Details of the settlement were not disclosed.
The resolution comes four months after Adam filed a lawsuit in U.S. District Court in the Northern District of Georgia asking the court to terminate its licensing agreement with Drkoop and to order that its information be pulled from the site.
Atlanta-based Adam also sought a court order barring Drkoop from reselling and packaging its information. Adam wanted an unspecified amount in damages.
Drkoop, which is fronted by former U.S. Surgeon General C. Everett Koop, subsequently voluntarily terminated the company's agreement with Adam.
At the time, Drkoop issued a statement saying only that it disagreed with the allegations.
Today, Drkoop chief executive Donald Hackett said in a statement that both companies have "made important strides in mending this relationship."
"We are pleased about putting this matter behind us," he said.
Under a licensing agreement between the two companies, Drkoop was allowed to use Adam's proprietary encyclopedia but only on specific, agreed upon Web sites, according to a previous report from Reuters.
Austin, Texas-based Drkoop, launched about a year ago, has partnerships with other Web sites, health portals, and television and radio outlets.
Shortly after the licensing lawsuit was filed, Drkoop ran into other legal troubles, this time with securities regulators. One director was charged with violating corporate insider trading rules, while other executives were charged with breaching federal security regulations that prohibit directors from selling company stock within six months of purchasing shares, the company confirmed at the time.
The troubles, however, haven't seemed to cool Drkoop's aspirations. Recently, the Web site announced plans to gain a wider audience for its medical news and information by tapping into the international market.