As per the agreement, Abbott manufactures all dosage strengths of the authorized generic product and supplies to Watson.
Watson markets and distributes the product in the US and the companies will share profits based on sales of the product.
Other terms of the agreement have not been disclosed.
The product is indicated for the prevention of endometrial hyperplasia in non hysterectomized postmenopausal women who are receiving conjugated estrogen tablets and also indicated for use in secondary amenorrhea.
For the most recent twelve months ending 31 January 2012, Prometrium had sales of approximately $198m, according to IMS Health data.