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                                                                    EXHIBIT 10.2

                          REGISTRATION RIGHTS AGREEMENT

                  This Registration Rights Agreement (this "Agreement") is made
and entered into as of February 24, 2004, by and among SCOLR, Inc., a Delaware
corporation (the "Company"), and the investors signatory hereto (each a
"Purchaser" and collectively, the "Purchasers").

                  This Agreement is made pursuant to the Securities Purchase
Agreement, dated as of the date hereof among the Company and the Purchasers (the
"Purchase Agreement").

                  The Company and the Purchasers hereby agree as follows:

         1.       Definitions. Capitalized terms used and not otherwise defined
herein that are defined in the Purchase Agreement shall have the meanings given
such terms in the Purchase Agreement. As used in this Agreement, the following
terms shall have the following meanings:

                  "Effectiveness Date" means, with respect to the Registration
         Statement required to be filed hereunder, the earlier of (a) the 60th
         calendar day following the date of the Purchase Agreement (120th
         calendar day following the Closing Date in the event of a "full review"
         of the Registration Statement by the Commission), and (b) the fifth
         Trading Day following the date on which the Company is notified by the
         Commission that the Registration Statement will not be reviewed or is
         no longer subject to further review and comments.

                  "Effectiveness Period" shall have the meaning set forth in
         Section 2(a).

                  "Filing Date" means, with respect to the Registration
         Statement required to be filed hereunder, the 30th calendar day
         following the Closing Date.

                  "Holder" or "Holders" means the holder or holders, as the case
         may be, from time to time of Registrable Securities.

                  "Indemnified Party" shall have the meaning set forth in
         Section 5(c).

                  "Indemnifying Party" shall have the meaning set forth in
         Section 5(c).

                  "Losses" shall have the meaning set forth in Section 5(a).

                  "Proceeding" means an action, claim, suit, investigation or
         proceeding (including, without limitation, an investigation or partial
         proceeding, such as a deposition), whether commenced or threatened.

                  "Prospectus" means the prospectus included in the Registration
         Statement (including, without limitation, a prospectus that includes
         any information previously omitted from a prospectus filed as part of
         an effective registration statement in reliance upon Rule 430A
         promulgated under the Securities Act), as amended or supplemented by

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         any prospectus supplement, with respect to the terms of the offering of
         any portion of the Registrable Securities covered by the Registration
         Statement, and all other amendments and supplements to the Prospectus,
         including post-effective amendments, and all material incorporated by
         reference or deemed to be incorporated by reference in such Prospectus.

                  "Registrable Securities" means all of the Shares and the
         Warrant Shares, together with any shares of Common Stock issued or
         issuable upon any stock split, dividend or other distribution,
         recapitalization or similar event with respect to the foregoing.

                  "Registration Statement" means the registration statements
         required to be filed hereunder, including (in each case) the
         Prospectus, amendments and supplements to the registration statement or
         Prospectus, including pre- and post-effective amendments, all exhibits
         thereto, and all material incorporated by reference or deemed to be
         incorporated by reference in the registration statement.

                  "Rule 415" means Rule 415 promulgated by the Commission
         pursuant to the Securities Act, as such Rule may be amended from time
         to time, or any similar rule or regulation hereafter adopted by the
         Commission having substantially the same effect as such Rule.

                  "Rule 424" means Rule 424 promulgated by the Commission
         pursuant to the Securities Act, as such Rule may be amended from time
         to time, or any similar rule or regulation hereafter adopted by the
         Commission having substantially the same effect as such Rule.

                  "Securities Act" means the Securities Act of 1933, as amended.

         2.       Registration.

                  (a)      On or prior to the Filing Date, the Company shall
         prepare and file with the Commission the Registration Statement
         covering the resale of all of the Registrable Securities for an
         offering to be made on a continuous basis pursuant to Rule 415. The
         Registration Statement required hereunder shall be on Form S-3 (except
         if the Company is not then eligible to register for resale the
         Registrable Securities on Form S-3, in which case the Registration
         shall be on another appropriate form in accordance herewith). The
         Registration Statement required hereunder shall contain (except if
         otherwise directed by the Holders) the "Plan of Distribution" attached
         hereto as Annex A. The Company shall use its commercially reasonable
         efforts to cause the Registration Statement to be declared effective
         under the Securities Act as promptly as possible after the filing
         thereof, but in any event not later than the Effectiveness Date, and
         shall use its commercially reasonable efforts to keep the Registration
         Statement continuously effective under the Securities Act until the
         date when all Registrable Securities covered by the Registration
         Statement (a) have been sold pursuant to the Registration Statement or
         an exemption from the registration requirements of the Securities Act
         or (b) may be sold without volume restrictions pursuant to Rule 144(k)
         as determined by the counsel to the Company pursuant to a written
         opinion letter to such effect, addressed and acceptable to the
         Company's transfer agent and the affected Holders (the "Effectiveness
         Period").

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                  (b)      If: (i) a Registration Statement is not filed on or
         prior to its Filing Date (if the Company files a Registration Statement
         without affording the Holder the opportunity to review and comment on
         the same as required by Section 3(a), the Company shall not be deemed
         to have satisfied this clause (i)); or (ii) the Company fails to file
         with the Commission a request for acceleration in accordance with Rule
         461 promulgated under the Securities Act, within five Trading Days of
         the date that the Company is notified (orally or in writing, whichever
         is earlier) by the Commission that a Registration Statement will not be
         "reviewed," or not subject to further review, or (iii) prior to the
         date when such Registration Statement is first declared effective by
         the Commission, the Company fails to file a pre-effective amendment and
         otherwise respond in writing to comments made by the Commission in
         respect of such Registration Statement within ten Trading Days after
         the receipt of comments by or notice from the Commission that such
         amendment is required in order for a Registration Statement to be
         declared effective, or (iv) a Registration Statement filed or required
         to be filed hereunder is not declared effective by the Commission on or
         before the Effectiveness Date, or (v) after a Registration Statement is
         first declared effective by the Commission, it ceases for any reason to
         remain continuously effective as to all Registrable Securities for
         which it is required to be effective, or the Holders are not permitted
         to utilize the Prospectus therein to resell such Registrable
         Securities, for in any such cases ten Trading Days (which need not be
         consecutive days) in the aggregate during any 12-month period (any such
         failure or breach being referred to as an "Event," and for purposes of
         clause (i) or (iv) the date on which such Event occurs, or for purposes
         of clause (ii) the date on which such five Trading Day period is
         exceeded, or for purposes of clauses (iii) the date which such ten
         Trading Day period is exceeded, or for purposes of clause (v) the date
         on which such ten Trading Day period is exceeded being referred to as
         "Event Date"), then in addition to any other rights the Holders may
         have hereunder or under applicable law: (x) on each such Event Date the
         Company shall pay to each Holder an amount in cash, as partial
         liquidated damages and not as a penalty, equal to 2.0% of the aggregate
         purchase price paid by such Holder pursuant to the Purchase Agreement
         for any Registrable Securities then held by such Holder; and (y) on
         each monthly anniversary of each such Event Date (if the applicable
         Event shall not have been cured by such date) until the applicable
         Event is cured, the Company shall pay to each Holder an amount in cash,
         as partial liquidated damages and not as a penalty, equal to 2.0% of
         the aggregate purchase price paid by such Holder pursuant to the
         Purchase Agreement for any Registrable Securities then held by such
         Holder. If the Company fails to pay any partial liquidated damages
         pursuant to this Section in full within seven days after the date
         payable, the Company will pay interest thereon at a rate of 18% per
         annum (or such lesser maximum amount that is permitted to be paid by
         applicable law) to the Holder, accruing daily from the date such
         partial liquidated damages are due until such amounts, plus all such
         interest thereon, are paid in full.

                  (c)      If during the Effectiveness Period, the number of
         Registrable Securities at any time exceeds 100% of the number of shares
         of Common Stock then registered in a Registration Statement, then the
         Company shall file as soon as reasonably practicable but in any case
         prior to the 30th day following the date such number is exceeded, an
         additional Registration Statement covering the resale of by the Holders
         of not less than all of such Registrable Securities and the Company
         shall use commercially reasonable

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         efforts to cause such Registration Statement to be declared effective
         as soon as reasonably practicable thereafter.

         3.       Registration Procedures

                  In connection with the Company's registration obligations
hereunder, the Company shall:

                  (a)      Not less than three Trading Days prior to the filing
         of the Registration Statement or any related Prospectus or any
         amendment or supplement thereto, the Company shall, (i) furnish to the
         Holders copies of all such documents proposed to be filed (including
         documents incorporated or deemed incorporated by reference to the
         extent requested by such Person) which documents will be subject to the
         review of such Holders, and (ii) cause its officers and directors,
         counsel and independent certified public accountants to respond to such
         inquiries as shall be necessary, in the reasonable opinion of
         respective counsel to conduct a reasonable investigation within the
         meaning of the Securities Act. The Company shall not file the
         Registration Statement or any such Prospectus or any amendments or
         supplements thereto to which the Holders of a majority of the
         Registrable Securities shall reasonably object in good faith on the
         advice of counsel to a Holder.

                  (b)      (i) Prepare and file with the Commission such
         amendments, including post-effective amendments, to the Registration
         Statement and the Prospectus used in connection therewith as may be
         necessary to keep the Registration Statement continuously effective as
         to the applicable Registrable Securities for the Effectiveness Period
         and prepare and file with the Commission such additional Registration
         Statements in order to register for resale under the Securities Act all
         of the Registrable Securities; (ii) cause the related Prospectus to be
         amended or supplemented by any required Prospectus supplement, and as
         so supplemented or amended to be filed pursuant to Rule 424; (iii)
         respond as promptly as reasonably possible, and in any event within ten
         Trading Days, to any comments received from the Commission with respect
         to the Registration Statement or any amendment thereto and, as promptly
         as reasonably possible, upon request, provide the Holders true and
         complete copies of all correspondence from and to the Commission
         relating to the Registration Statement; and (iv) comply in all material
         respects with the provisions of the Securities Act and the Exchange Act
         with respect to the disposition of all Registrable Securities covered
         by the Registration Statement during the applicable period in
         accordance with the intended methods of disposition by the Holders
         thereof set forth in the Registration Statement as so amended or in
         such Prospectus as so supplemented.

                  (c)      Notify the Holders of Registrable Securities to be
         sold as promptly as reasonably possible (and, in the case of (i)(A)
         below, not less than two Trading Days prior to such filing) and (if
         requested by any such Person) confirm such notice in writing promptly
         following the day (i)(A) when a Prospectus or any Prospectus supplement
         or post-effective amendment to the Registration Statement is proposed
         to be filed; (B) when the Commission notifies the Company whether there
         will be a "review" of the Registration Statement and whenever the
         Commission comments in writing on the

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         Registration Statement (the Company shall upon request provide true and
         complete copies thereof and all written responses thereto to each of
         the Holders); and (C) with respect to the Registration Statement or any
         post-effective amendment, when the same has become effective; (ii) of
         any request by the Commission or any other Federal or state
         governmental authority during the period of effectiveness of the
         Registration Statement for amendments or supplements to the
         Registration Statement or Prospectus or for additional information;
         (iii) of the issuance by the Commission or any other federal or state
         governmental authority of any stop order suspending the effectiveness
         of the Registration Statement covering any or all of the Registrable
         Securities or the initiation of any Proceedings for that purpose; (iv)
         of the receipt by the Company of any notification with respect to the
         suspension of the qualification or exemption from qualification of any
         of the Registrable Securities for sale in any jurisdiction, or the
         initiation or threatening of any Proceeding for such purpose; and (v)
         of the occurrence of any event or passage of time that makes the
         financial statements included in the Registration Statement ineligible
         for inclusion therein or any statement made in the Registration
         Statement or Prospectus or any document incorporated or deemed to be
         incorporated therein by reference untrue in any material respect or
         that requires any revisions to the Registration Statement, Prospectus
         or other documents so that, in the case of the Registration Statement
         or the Prospectus, as the case may be, it will not contain any untrue
         statement of a material fact or omit to state any material fact
         required to be stated therein or necessary to make the statements
         therein, in light of the circumstances under which they were made, not
         misleading.

                  (d)      Use its commercially reasonable efforts to avoid the
         issuance of, or, if issued, obtain the withdrawal of (i) any order
         suspending the effectiveness of the Registration Statement, or (ii) any
         suspension of the qualification (or exemption from qualification) of
         any of the Registrable Securities for sale in any jurisdiction, at the
         earliest practicable moment.

                  (e)      Furnish to each Holder, without charge, at least one
         conformed copy of the Registration Statement and each amendment
         thereto, including financial statements and schedules, all documents
         incorporated or deemed to be incorporated therein by reference to the
         extent requested by such Person, and all exhibits to the extent
         requested by such Person (including those previously furnished or
         incorporated by reference) promptly after the filing of such documents
         with the Commission.

                  (f)      Promptly deliver to each Holder, without charge, as
         many copies of the Prospectus or Prospectuses (including each form of
         prospectus) and each amendment or supplement thereto as such Persons
         may reasonably request in connection with resales by the Holder of
         Registrable Securities. The Company hereby consents to the use of such
         Prospectus and each amendment or supplement thereto by each of the
         selling Holders in connection with the offering and sale of the
         Registrable Securities covered by such Prospectus and any amendment or
         supplement thereto, except after the giving on any notice pursuant to
         Section 3(c).

                  (g)      Prior to any resale of Registrable Securities by a
         Holder, use its commercially reasonable efforts to register or qualify
         or cooperate with the selling

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         Holders in connection with the registration or qualification (or
         exemption from the Registration or qualification) of such Registrable
         Securities for the resale by the Holder under the securities or Blue
         Sky laws of such jurisdictions within the United States as any Holder
         reasonably requests in writing, to keep the Registration or
         qualification (or exemption therefrom) effective during the
         Effectiveness Period and to do any and all other acts or things
         reasonably necessary to enable the disposition in such jurisdictions of
         the Registrable Securities covered by the Registration Statement;
         provided, that the Company shall not be required to qualify generally
         to do business in any jurisdiction where it is not then so qualified,
         subject the Company to any material tax in any such jurisdiction where
         it is not then so subject or file a general consent to service of
         process in any such jurisdiction.

                  (h)      If requested by the Holders, cooperate with the
         Holders to facilitate the timely preparation and delivery of
         certificates representing Registrable Securities to be delivered to a
         transferee pursuant to the Registration Statement, which certificates
         shall be free, to the extent permitted by the Purchase Agreement, of
         all restrictive legends, and to enable such Registrable Securities to
         be in such denominations and registered in such names as any such
         Holders may request.

                  (i)      Upon the occurrence of any event contemplated by
         Section 3(c)(v), as promptly as reasonably possible, prepare a
         supplement or amendment, including a post-effective amendment, to the
         Registration Statement or a supplement to the related Prospectus or any
         document incorporated or deemed to be incorporated therein by
         reference, and file any other required document so that, as thereafter
         delivered, neither the Registration Statement nor such Prospectus will
         contain an untrue statement of a material fact or omit to state a
         material fact required to be stated therein or necessary to make the
         statements therein, in light of the circumstances under which they were
         made, not misleading. If the Company notifies the Holders in accordance
         with clauses (ii) through (v) of Section 3(c) above to suspend the use
         of any Prospectus until the requisite changes to such Prospectus have
         been made, then the Holders shall suspend use of such Prospectus. The
         Company will use its best efforts to ensure that the use of the
         Prospectus may be resumed as promptly as is practicable. The Company
         shall be entitled to exercise its right under this Section 3(i) to
         suspend the availability of a Registration Statement and Prospectus,
         subject to the payment of liquidated damages pursuant to Section 2(b),
         for a period not to exceed 60 days (which need not be consecutive days)
         in any 12 month period.

                  (j)      Comply with all applicable rules and regulations of
         the Commission.

                  (k)      The Company may require each selling Holder to
         furnish to the Company a certified statement as to the number of shares
         of Common Stock beneficially owned by such Holder and, if required by
         the Commission, the person thereof that has voting and dispositive
         control over the Shares. During any periods that the Company is unable
         to meet its obligations hereunder with respect to the registration of
         the Registrable Securities solely because any Holder fails to furnish
         such information within three Trading Days of the Company's request,
         any liquidated damages that are accruing at such time as to such Holder
         only shall be tolled and any Event that may otherwise occur solely

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         because of such delay shall be suspended as to such Holder only, until
         such information is delivered to the Company.

         4.       Registration Expenses. All fees and expenses incident to the
performance of or compliance with this Agreement by the Company shall be borne
by the Company whether or not any Registrable Securities are sold pursuant to
the Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with the Trading Market on which the Common Stock is then
listed for trading, and (B) in compliance with applicable state securities or
Blue Sky laws), (ii) printing expenses (including, without limitation, expenses
of printing certificates for Registrable Securities and of printing prospectuses
if the printing of prospectuses is reasonably requested by the holders of a
majority of the Registrable Securities included in the Registration Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, (v) Securities Act liability insurance, if the Company
so desires such insurance, and (vi) fees and expenses of all other Persons
retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement. In addition, the Company shall be responsible
for all of its internal expenses incurred in connection with the consummation of
the transactions contemplated by this Agreement (including, without limitation,
all salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder. The Company shall not be responsible
for any Holder's brokerage commissions or other underwriting discount paid by
any Holder in connection with the sale of any Registrable Securities.

         5.       Indemnification

                  (a)      Indemnification by the Company. The Company shall,
         notwithstanding any termination of this Agreement, indemnify and hold
         harmless each Holder, the officers, directors, agents and employees of
         each of them, each Person who controls any such Holder (within the
         meaning of Section 15 of the Securities Act or Section 20 of the
         Exchange Act) and the officers, directors, agents and employees of each
         such controlling Person, to the fullest extent permitted by applicable
         law, from and against any and all losses, claims, damages, liabilities,
         costs (including, without limitation, reasonable attorneys' fees) and
         expenses (collectively, "Losses"), as incurred, to the extent arising
         out of or relating to any untrue or alleged untrue statement of a
         material fact contained in the Registration Statement, any Prospectus
         or any form of prospectus or in any amendment or supplement thereto or
         in any preliminary prospectus, or arising out of or relating to any
         omission or alleged omission of a material fact required to be stated
         therein or necessary to make the statements therein (in the case of any
         Prospectus or form of prospectus or supplement thereto, in light of the
         circumstances under which they were made) not misleading, except to the
         extent, but only to the extent, that (1) such untrue statements or
         omissions are based solely upon information regarding such Holder
         furnished in writing to the Company by such Holder expressly for use
         therein, or to the extent that such information relates to such Holder
         or such Holder's proposed method of distribution of Registrable
         Securities and was reviewed and expressly approved in writing by such
         Holder expressly for use in the Registration Statement, such Prospectus
         or such

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         form of Prospectus or in any amendment or supplement thereto (it being
         understood that the Holder has approved Annex A hereto for this
         purpose) or (2) in the case of an occurrence of an event of the type
         specified in Section 3(c)(ii)-(v), the use by such Holder of an
         outdated or defective Prospectus after the Company has notified such
         Holder in writing that the Prospectus is outdated or defective and
         prior to the receipt by such Holder of the Advice contemplated in
         Section 6(d). The Company shall notify the Holders promptly of the
         institution, threat or assertion of any Proceeding of which the Company
         is aware in connection with the transactions contemplated by this
         Agreement.

                  (b)      Indemnification by Holders. Each Holder shall,
         severally and not jointly, indemnify and hold harmless the Company, its
         directors, officers, agents and employees, each Person who controls the
         Company (within the meaning of Section 15 of the Securities Act and
         Section 20 of the Exchange Act), and the directors, officers, agents or
         employees of such controlling Persons, to the fullest extent permitted
         by applicable law, from and against all Losses, as incurred, to the
         extent arising out of or based upon: (x) such Holder's failure to
         comply with the prospectus delivery requirements of the Securities Act
         or (y) any untrue or alleged untrue statement of a material fact
         contained in any Registration Statement, any Prospectus, or any form of
         prospectus, or in any amendment or supplement thereto or in any
         preliminary prospectus, or arising out of or relating to any omission
         or alleged omission of a material fact required to be stated therein or
         necessary to make the statements therein not misleading (i) to the
         extent, but only to the extent, that such untrue statement or omission
         is contained in any information so furnished in writing by such Holder
         to the Company specifically for inclusion in the Registration Statement
         or such Prospectus or (ii) to the extent that (1) such untrue
         statements or omissions are based solely upon information regarding
         such Holder furnished in writing to the Company by such Holder
         expressly for use therein, or to the extent that such information
         relates to such Holder or such Holder's proposed method of distribution
         of Registrable Securities and was reviewed and expressly approved in
         writing by such Holder expressly for use in the Registration Statement
         (it being understood that the Holder has approved Annex A hereto for
         this purpose), such Prospectus or such form of Prospectus or in any
         amendment or supplement thereto or (2) in the case of an occurrence of
         an event of the type specified in Section 3(c)(ii)-(v), the use by such
         Holder of an outdated or defective Prospectus after the Company has
         notified such Holder in writing that the Prospectus is outdated or
         defective and prior to the receipt by such Holder of the Advice
         contemplated in Section 6(d). In no event shall the liability of any
         selling Holder hereunder be greater in amount than the dollar amount of
         the net proceeds received by such Holder upon the sale of the
         Registrable Securities giving rise to such indemnification obligation.

                  (c)      Conduct of Indemnification Proceedings. If any
         Proceeding shall be brought or asserted against any Person entitled to
         indemnity hereunder (an "Indemnified Party"), such Indemnified Party
         shall promptly notify the Person from whom indemnity is sought (the
         "Indemnifying Party") in writing, and the Indemnifying Party shall have
         the right to assume the defense thereof, including the employment of
         counsel reasonably satisfactory to the Indemnified Party and the
         payment of all fees and expenses incurred in connection with defense
         thereof; provided, that the failure of any Indemnified Party to give
         such notice shall not relieve the Indemnifying Party of its obligations
         or liabilities

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         pursuant to this Agreement, except (and only) to the extent that it
         shall be finally determined by a court of competent jurisdiction (which
         determination is not subject to appeal or further review) that such
         failure shall have prejudiced the Indemnifying Party.

                  An Indemnified Party shall have the right to employ separate
         counsel in any such Proceeding and to participate in the defense
         thereof, but the fees and expenses of such counsel shall be at the
         expense of such Indemnified Party or Parties unless: (1) the
         Indemnifying Party has agreed in writing to pay such fees and expenses;
         (2) the Indemnifying Party shall have failed promptly to assume the
         defense of such Proceeding and to employ counsel reasonably
         satisfactory to such Indemnified Party in any such Proceeding; or (3)
         the named parties to any such Proceeding (including any impleaded
         parties) include both such Indemnified Party and the Indemnifying
         Party, and such Indemnified Party shall have been advised by counsel
         that a conflict of interest is likely to exist if the same counsel were
         to represent such Indemnified Party and the Indemnifying Party (in
         which case, if such Indemnified Party notifies the Indemnifying Party
         in writing that it elects to employ separate counsel at the expense of
         the Indemnifying Party, the Indemnifying Party shall not have the right
         to assume the defense thereof and the reasonable fees and expenses of
         one separate counsel shall be at the expense of the Indemnifying
         Party). The Indemnifying Party shall not be liable for any settlement
         of any such Proceeding effected without its written consent, which
         consent shall not be unreasonably withheld. No Indemnifying Party
         shall, without the prior written consent of the Indemnified Party,
         effect any settlement of any pending Proceeding in respect of which any
         Indemnified Party is a party, unless such settlement includes an
         unconditional release of such Indemnified Party from all liability on
         claims that are the subject matter of such Proceeding.

                  All reasonable fees and expenses of the Indemnified Party
         (including reasonable fees and expenses to the extent incurred in
         connection with investigating or preparing to defend such Proceeding in
         a manner not inconsistent with this Section) shall be paid to the
         Indemnified Party, as incurred, within ten Trading Days of written
         notice thereof to the Indemnifying Party; provided, that the
         Indemnified Party shall promptly reimburse the Indemnifying Party for
         that portion of such fees and expenses applicable to such actions for
         which such Indemnified Party is not entitled to indemnification
         hereunder, determined based upon the relative faults of the parties.

                  (d)      Contribution. If a claim for indemnification under
         Section 5(a) or 5(b) is unavailable to an Indemnified Party (by reason
         of public policy or otherwise), then each Indemnifying Party, in lieu
         of indemnifying such Indemnified Party, shall contribute to the amount
         paid or payable by such Indemnified Party as a result of such Losses,
         in such proportion as is appropriate to reflect the relative fault of
         the Indemnifying Party and Indemnified Party in connection with the
         actions, statements or omissions that resulted in such Losses as well
         as any other relevant equitable considerations. The relative fault of
         such Indemnifying Party and Indemnified Party shall be determined by
         reference to, among other things, whether any action in question,
         including any untrue or alleged untrue statement of a material fact or
         omission or alleged omission of a material fact, has been taken or made
         by, or relates to information supplied by, such Indemnifying Party or
         Indemnified Party, and the parties' relative intent, knowledge, access
         to information and

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         opportunity to correct or prevent such action, statement or omission.
         The amount paid or payable by a party as a result of any Losses shall
         be deemed to include, subject to the limitations set forth in Section
         5(c), any reasonable attorneys' or other reasonable fees or expenses
         incurred by such party in connection with any Proceeding to the extent
         such party would have been indemnified for such fees or expenses if the
         indemnification provided for in this Section was available to such
         party in accordance with its terms.

                  The parties hereto agree that it would not be just and
         equitable if contribution pursuant to this Section 5(d) were determined
         by pro rata allocation or by any other method of allocation that does
         not take into account the equitable considerations referred to in the
         immediately preceding paragraph. Notwithstanding the provisions of this
         Section 5(d), no Holder shall be required to contribute, in the
         aggregate, any amount in excess of the amount by which the proceeds
         actually received by such Holder from the sale of the Registrable
         Securities subject to the Proceeding exceeds the amount of any damages
         that such Holder has otherwise been required to pay by reason of such
         untrue or alleged untrue statement or omission or alleged omission,
         except in the case of fraud by such Holder. The indemnity and
         contribution agreements contained in this Section are in addition to
         any liability that the Indemnifying Parties may have to the Indemnified
         Parties.

         6.       Miscellaneous

                  (a)      Remedies. In the event of a breach by the Company or
         by a Holder, of any of their obligations under this Agreement, each
         Holder or the Company, as the case may be, in addition to being
         entitled to exercise all rights granted by law and under this
         Agreement, including recovery of damages, will be entitled to specific
         performance of its rights under this Agreement. The Company and each
         Holder agree that monetary damages would not provide adequate
         compensation for any losses incurred by reason of a breach by it of any
         of the provisions of this Agreement and hereby further agrees that, in
         the event of any action for specific performance in respect of such
         breach, it shall waive the defense that a remedy at law would be
         adequate.

                  (b)      No Piggyback on Registrations. Except as set forth
         Schedule 6(b), neither the Company nor any of its security holders
         (other than the Holders in such capacity pursuant hereto) may include
         securities of the Company in a Registration Statement other than the
         Registrable Securities, and the Company shall not after the date hereof
         enter into any agreement providing any such right to any of its
         security holders. Except as set forth in the SEC Reports and as set
         forth in this subsection, no Person has any right to cause the Company
         to effect the registration under the Securities Act of any securities
         of the Company. The Company shall not file any other registration
         statement until after the Effective Date.

                  (c)      Compliance. Each Holder covenants and agrees that it
         will comply with the prospectus delivery requirements of the Securities
         Act as applicable to it in connection with sales of Registrable
         Securities pursuant to the Registration Statement.

                                       10

<PAGE>

                  (d)      Discontinued Disposition. Each Holder agrees by its
         acquisition of such Registrable Securities that, upon receipt of a
         notice from the Company of the occurrence of any event of the kind
         described in Section 3(c), such Holder will forthwith discontinue
         disposition of such Registrable Securities under the Registration
         Statement until such Holder's receipt of the copies of the supplemented
         Prospectus and/or amended Registration Statement or until it is advised
         in writing (the "Advice") by the Company that the use of the applicable
         Prospectus may be resumed, and, in either case, has received copies of
         any additional or supplemental filings that are incorporated or deemed
         to be incorporated by reference in such Prospectus or Registration
         Statement. The Company will use its best efforts to ensure that the use
         of the Prospectus may be resumed as promptly as it practicable. The
         Company agrees and acknowledges that any periods during which the
         Holder is required to discontinue the disposition of the Registrable
         Securities hereunder shall be subject to the provisions of Section
         2(b).

                  (e)      Piggy-Back Registrations. If at any time during the
         Effectiveness Period there is not an effective Registration Statement
         covering all of the Registrable Securities and the Company shall
         determine to prepare and file with the Commission a registration
         statement relating to an offering for its own account or the account of
         others under the Securities Act of any of its equity securities, other
         than on Form S-4 or Form S-8 (each as promulgated under the Securities
         Act) or their then equivalents relating to equity securities to be
         issued solely in connection with any acquisition of any entity or
         business or equity securities issuable in connection with the stock
         option or other employee benefit plans, then the Company shall send to
         each Holder a written notice of such determination and, if within
         fifteen days after the date of such notice, any such Holder shall so
         request in writing, the Company shall include in such registration
         statement all or any part of such Registrable Securities such Holder
         requests to be registered, subject to customary underwriter cutbacks
         applicable to all holders of registration rights.

                  (f)      Amendments and Waivers. The provisions of this
         Agreement, including the provisions of this sentence, may not be
         amended, modified or supplemented, and waivers or consents to
         departures from the provisions hereof may not be given, unless the same
         shall be in writing and signed by the Company and each Holder of the
         then outstanding Registrable Securities.

                  (g)      Notices. Any and all notices or other communications
         or deliveries required or permitted to be provided hereunder shall be
         made in accordance with the provisions of the Purchase Agreement.

                  (h)      Successors and Assigns. This Agreement shall inure to
         the benefit of and be binding upon the successors and permitted assigns
         of each of the parties and shall inure to the benefit of each Holder.
         Each Holder may assign their respective rights hereunder in the manner
         and to the Persons as permitted under the Purchase Agreement.

                  (i)      Execution and Counterparts. This Agreement may be
         executed in any number of counterparts, each of which when so executed
         shall be deemed to be an original and, all of which taken together
         shall constitute one and the same Agreement. In the event that any
         signature is delivered by facsimile transmission, such signature shall

                                       11

<PAGE>

         create a valid binding obligation of the party executing (or on whose
         behalf such signature is executed) the same with the same force and
         effect as if such facsimile signature were the original thereof.

                  (j)      Governing Law. All questions concerning the
         construction, validity, enforcement and interpretation of this
         Agreement shall be determined with the provisions of the Purchase
         Agreement.

                  (k)      Cumulative Remedies. The remedies provided herein are
         cumulative and not exclusive of any remedies provided by law.

                  (l)      Severability. If any term, provision, covenant or
         restriction of this Agreement is held by a court of competent
         jurisdiction to be invalid, illegal, void or unenforceable, the
         remainder of the terms, provisions, covenants and restrictions set
         forth herein shall remain in full force and effect and shall in no way
         be affected, impaired or invalidated, and the parties hereto shall use
         their commercially reasonable efforts to find and employ an alternative
         means to achieve the same or substantially the same result as that
         contemplated by such term, provision, covenant or restriction. It is
         hereby stipulated and declared to be the intention of the parties that
         they would have executed the remaining terms, provisions, covenants and
         restrictions without including any of such that may be hereafter
         declared invalid, illegal, void or unenforceable.

                  (m)      Headings. The headings in this Agreement are for
         convenience of reference only and shall not limit or otherwise affect
         the meaning hereof.

                  (n)      Independent Nature of Purchasers' Obligations and
         Rights. The obligations of each Purchaser hereunder is several and not
         joint with the obligations of any other Purchaser hereunder, and no
         Purchaser shall be responsible in any way for the performance of the
         obligations of any other Purchaser hereunder. Nothing contained herein
         or in any other agreement or document delivered at any closing, and no
         action taken by any Purchaser pursuant hereto or thereto, shall be
         deemed to constitute the Purchasers as a partnership, an association, a
         joint venture or any other kind of entity, or create a presumption that
         the Purchasers are in any way acting in concert with respect to such
         obligations or the transactions contemplated by this Agreement. Each
         Purchaser shall be entitled to protect and enforce its rights,
         including without limitation the rights arising out of this Agreement,
         and it shall not be necessary for any other Purchaser to be joined as
         an additional party in any proceeding for such purpose.

                            *************************

                                       12

<PAGE>

                  IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.

                                            SCOLR, INC.

                                            By: /s/ Daniel O. Wilds
                                                --------------------------------
                                                Name: Daniel O. Wilds
                                                Title: President and CEO

                     [PURCHASERS' SIGNATURE PAGES TO FOLLOW]

                                       13

<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Alexandra Global Master Fund Ltd.
Signature of Authorized Signatory of Investing entity: /s/ Vadim Iosilevich
                                                       --------------------
Name of Authorized Signatory: Vadim Iosilevich for Alexandra Investment
Management, LLC
Title of Authorized Signatory: Principal

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Atlas Equity I, Ltd.
Signature of Authorized Signatory of Investing entity: /s/ Dmitry Balyasny
                                                       -------------------
Name of Authorized Signatory:  Dmitry Balyasny
Title of Authorized Signatory: Managing Member of Balyasny Asset Management,
L.P., Manager of Atlas Equity I, Ltd.

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Cranshire Capital, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Mitchell Kopin
                                                       ------------------
Name of Authorized Signatory: Mitchell Kopin
Title of Authorized Signatory: President - Downsview Capital, The General
Partner

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Elliott Associates, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Elliot Greenberg
                                                       --------------------
Name of Authorized Signatory: Elliot Greenberg, Vice President
Title of Authorized Signatory: By: Elliott Capital Advisors, L.P., as general
partner
                                By: Braxton Associates, Inc., as general partner

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Elliott International, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Elliot Greenberg
                                                       --------------------
Name of Authorized Signatory: Elliot Greenberg, Vice President
Title of Authorized Signatory: By: Elliott International Capital Advisors Inc.
as attorney-in-fact

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Omicron Master Trust
Signature of Authorized Signatory of Investing entity: /s/ Bruce Bernstein
                                                       -------------------
Name of Authorized Signatory: Bruce Bernstein
Title of Authorized Signatory: Managing Partner

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Portside Growth and Opportunity Fund
Signature of Authorized Signatory of Investing entity: /s/ Jeff Smith
                                                       --------------
Name of Authorized Signatory: Jeff Smith
Title of Authorized Signatory: Authorized Signatory

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: RHP Master Fund, Ltd.
Signature of Authorized Signatory of Investing entity: /s/ Keith S. Marlowe
                                                       --------------------
Name of Authorized Signatory: Keith S. Marlowe, Director
Title of Authorized Signatory: By: Rock Hill Investment Management, L.P.
                                    By: RHP General Partner, LLC

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: SF Capital Partners Ltd.
Signature of Authorized Signatory of Investing entity: /s/ Brian Davidson
                                                       ------------------
Name of Authorized Signatory: Brian Davidson
Title of Authorized Signatory: Authorized Signatory

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Slava Volman
Signature of Authorized Signatory of Investing entity: /s/ Slava Volman
                                                       ----------------
Name of Authorized Signatory: Slava Volman
Title of Authorized Signatory: Individual

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Spectra Capital Management, LLC
Signature of Authorized Signatory of Investing entity: /s/ Gregory I. Porges
                                                       ---------------------
Name of Authorized Signatory: Gregory I. Porges
Title of Authorized Signatory: Sole Member

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: SRG Capital, Inc.
Signature of Authorized Signatory of Investing entity: /s/ Andrew Turchin
                                                       ------------------
Name of Authorized Signatory: Andrew Turchin
Title of Authorized Signatory: Chief Financial Officer

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Topaz Partners
Signature of Authorized Signatory of Investing entity: /s/ Herbert J. Marks
                                                       --------------------
Name of Authorized Signatory: Herbert J. Marks
Title of Authorized Signatory: Managing Director

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Dolphin Offshore Partners, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Peter E. Salas
                                                       ------------------
Name of Authorized Signatory: Peter E. Salas
Title of Authorized Signatory: General Partner

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Interdynamic Fund Biomed Tech
Signature of Authorized Signatory of Investing entity: /s/ Norman Schleifer
                                                       --------------------
Name of Authorized Signatory: Norman Schleifer
Title of Authorized Signatory: Chief Financial Officer

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: J. Michael Reisert, Inc.
Signature of Authorized Signatory of Investing entity: /s/ J. Michael Reisert
                                                       ----------------------
Name of Authorized Signatory: J. Michael Reisert
Title of Authorized Signatory: President

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Meadowbrook Opportunity Fund LLC
Signature of Authorized Signatory of Investing entity: /s/ Michael Ragins
                                                       ------------------
Name of Authorized Signatory: Michael Ragins
Title of Authorized Signatory: Manager

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Merlin Biomed II, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Norman Schleifer
                                                       --------------------
Name of Authorized Signatory: Norman Schleifer
Title of Authorized Signatory: Chief Financial Officer

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Merlin Biomed International, Ltd.
Signature of Authorized Signatory of Investing entity: /s/ Norman Schleifer
                                                       --------------------
Name of Authorized Signatory: Norman Schleifer
Title of Authorized Signatory: Chief Financial Officer

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Merlin Biomed Longterm Appreciation Fund, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Norman Schleifer
                                                       --------------------
Name of Authorized Signatory: Norman Schleifer
Title of Authorized Signatory: Chief Financial Officer

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Merlin Biomed Offshore Master Fund, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Norman Schleifer
                                                       --------------------
Name of Authorized Signatory: Norman Schleifer
Title of Authorized Signatory: Chief Financial Officer

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Merlin Biomed, L.P.
Signature of Authorized Signatory of Investing entity: /s/ Norman Schleifer
                                                       --------------------
Name of Authorized Signatory: Norman Schleifer
Title of Authorized Signatory: Chief Financial Officer

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Michael Taglich
Signature of Authorized Signatory of Investing entity: /s/ Michael Taglich
                                                       -------------------
Name of Authorized Signatory:
                             -----------------------
Title of Authorized Signatory:
                              -----------------------

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Robert F. Taglich
Signature of Authorized Signatory of Investing entity: /s/ Robert F. Taglich
                                                       ---------------------
Name of Authorized Signatory:
                             -----------------------
Title of Authorized Signatory:
                              -----------------------

                           [SIGNATURE PAGES CONTINUE]
<PAGE>
                     [PURCHASER'S SIGNATURE PAGE TO DDD RRA]

Name of Investing Entity: Tag Kent Partners
Signature of Authorized Signatory of Investing entity: /s/ Michael Taglich
                                                       -------------------
Name of Authorized Signatory: Michael Taglich
Title of Authorized Signatory: General Partner

                           [SIGNATURE PAGES CONTINUE]


<PAGE>

                                     ANNEX A

                              Plan of Distribution

         The Selling Stockholders (the "Selling Stockholders") of the common
stock ("Common Stock") of SCOLR, Inc., a Delaware corporation (the "Company")
and any of their pledgees, assignees and successors-in-interest may, from time
to time, sell any or all of their shares of Common Stock on any stock exchange,
market or trading facility on which the shares are traded or in private
transactions. These sales may be at fixed or negotiated prices. The Selling
Stockholders may use any one or more of the following methods when selling
shares:

                  -        ordinary brokerage transactions and transactions in
                           which the broker-dealer solicits purchasers;

                  -        block trades in which the broker-dealer will attempt
                           to sell the shares as agent but may position and
                           resell a portion of the block as principal to
                           facilitate the transaction;

                  -        purchases by a broker-dealer as principal and resale
                           by the broker-dealer for its account;

                  -        an exchange distribution in accordance with the rules
                           of the applicable exchange;

                  -        privately negotiated transactions;

                  -        settlement of short sales;

                  -        broker-dealers may agree with the Selling
                           Stockholders to sell a specified number of such
                           shares at a stipulated price per share;

                  -        a combination of any such methods of sale;

                  -        through the writing or settlement of options or other
                           hedging transactions, whether through an options
                           exchange or otherwise; or

                  -        any other method permitted pursuant to applicable
                           law.

         The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available, rather
than under this prospectus.

         Broker-dealers engaged by the Selling Stockholders may arrange for
other brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Stockholders (or, if any broker-dealer
acts as agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. Each Selling Stockholder does not expect these commissions and
discounts relating to its sales of shares to exceed what is customary in the
types of transactions involved.

                                       i

<PAGE>

         In connection with the sale of our common stock or interests therein,
the Selling Stockholders may enter into hedging transactions with broker-dealers
or other financial institutions, which may in turn engage in short sales of the
common stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of our common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).

         The Selling Stockholders and any broker-dealers or agents that are
involved in selling the shares may be deemed to be "underwriters" within the
meaning of the Securities Act in connection with such sales. In such event, any
commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act. Each Selling Stockholder has
informed the Company that it does not have any agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock.

         The Company is required to pay certain fees and expenses incurred by
the Company incident to the registration of the shares. The Company has agreed
to indemnify the Selling Stockholders against certain losses, claims, damages
and liabilities, including liabilities under the Securities Act.

         Because Selling Stockholders may be deemed to be "underwriters" within
the meaning of the Securities Act, they will be subject to the prospectus
delivery requirements of the Securities Act. In addition, any securities covered
by this prospectus which qualify for sale pursuant to Rule 144 under the
Securities Act may be sold under Rule 144 rather than under this prospectus.
Each Selling Stockholder has advised us that they have not entered into any
agreements, understandings or arrangements with any underwriter or broker-dealer
regarding the sale of the resale shares. There is no underwriter or coordinating
broker acting in connection with the proposed sale of the resale shares by the
Selling Stockholders.

         We agreed to keep this prospectus effective until the earlier of (i)
the date on which the shares may be resold by the Selling Stockholders without
registration and without regard to any volume limitations by reason of Rule
144(e) under the Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold pursuant to the prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The resale shares will be
sold only through registered or licensed brokers or dealers if required under
applicable state securities laws. In addition, in certain states, the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.

         Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the resale shares may not simultaneously
engage in market making activities with respect to our common stock for a period
of two business days prior to the commencement

                                       ii

<PAGE>

of the distribution. In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases and
sales of shares of our common stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of the sale.

                                      iii