Mayne Pharma shares have soared 19 per cent to a near five-month high after the pharmaceutical company inked an exclusive long-term deal to sell a new contraceptive drug in the United States.

The ASX-listed drugs manufacturer announced on Wednesday it had signed a 20-year supply and licence agreement with Belgium-based Mithra Pharmaceuticals to commercialise a "next generation" contraceptive pill.

Seeking a bigger slice of an American market deemed to be worth $US5.4 billion, Mayne Pharma will pay up to $US295 million ($A440 million) in cash and shares if net sales of the drug exceed $US2.25 billion ($A3.36 billion).

Read Next Shares in the South Australian company had spiked 18.87 per cent to 63 cents on the ASX by 1120 AEST.

The drug E4/DRSP, which contains 15mg estetrol (E4) and 3mg drospirenone, could lead to improved patient outcomes among America's 10 million women who use short-acting hormonal contraceptives.

It was tested on 3,725 women during the third stage of clinical studies, producing positive top-line results.

Mithra has developed a method to produce E4, a native estrogen created by the human foetal liver during pregnancy, at scale through a plant-based process after more than 20 years of research and development.

The new pill is expected to be rolled out in first half of 2021, subject to US regulatory approval, in what would be a historic feat.

"If approved, estetrol (E4) will be the first native estrogen approved in a contraceptive product in the US and the first new estrogen introduced in the US in approximately 50 years," Mayne chief executive Scott Richards said.

Mr Richards expects E4/DRSP to be a "foundation asset" in women's health for years to come.

"Women's health is a core therapeutic area for the company and this deal enables Mayne Pharma to accelerate and extend its position in this specialty," he said.

It also strengthens ties between Mayne and Mithra, as they simultaneously target approval for a generic contraceptive ring next year.