Vaccine developer Avant Immunotherapeutics Inc. said Wednesday that GlaxoSmithKline PLC has paid royalties on its sales of Rotarix rotavirus vaccine in Australia and certain European countries at the lower of two rates established under the companies' 1997 license agreement.

Avant said Glaxo decided to pay the lower royalty rate _ which is 70 percent of the full rate _ because it claims Rotarix is not covered by the patents it licensed from Avant in Australia and these certain European countries.

Avant said it is evaluating various options to counter Glaxo's claims.

"Although we have sold the bulk of Avant's royalties from sales of Rotarix to Paul Royalty Fund II, and only retain a residual interest, we are of course disappointed in this news. We are determined to take all available steps to enforce our rights under our license agreement with GSK, both regarding the recent sales in Australia and Europe and future sales in the other countries in which we hold patents," said Una S. Ryan, Avant president and CEO.

In May 2005, Avant sold a stake in the royalties to Paul Royalty Fund II for up to $61 million, and to date, has received $50 million. Avant said it doesn't believe the $50 million already paid and the potential $11 million in additional milestone payments are affected by Glaxo's action.

However, Avant said that if it's unable to reverse Glaxo's decision to pay the lower rate, the value of Avant's residual interest in Rotarix royalties will be impacted.

Avant shares fell 12 cents, or 8.5 percent, to $1.30 in morning trading on the Nasdaq. Over the past year, shares have traded between $1.23 and $2.82.