Exhibit 10.2

LICENSE AGREEMENT

This License Agreement is entered into and made effective as of July 28, 1997,
by and among SciClone Pharmaceuticals, Inc., a California corporation, and
SciClone Pharmaceuticals International, Ltd., a Cayman corporation (collectively
“Licensee”), and Edward T. Wei, an individual (“Licensor”), with respect to the
facts set forth below.

RECITALS

A. Licensee is engaged in development of medical products which may be able to
utilize the Licensed Technology (defined below).

B. By assignment, Licensor is the owner of, and Licensor has the exclusive right
to grant a license to, the Licensed Technology, except those patents or
applications issued or filed in Russia Licensor has furnished to Licensee copies
of the assignment documents for the Licensed Technology, consisting of an
Assignment and an Acknowledgment from the Russian Inventors (defined below) and
an assignment from Verta Ltd. and Cytokin Ltd., each a Russian company
(collectively the “Russian Companies”), who were the employers of the Russian
Inventors.

C. Licensor desires to grant to Licensee, and Licensee wishes to acquire, an
exclusive worldwide (excluding Russia) license to the Licensed Technology,
subject to the terms and conditions set forth herein. The Licensed Technology is
also known as the “Bestim” Technology.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants and conditions set
forth herein, Licensor and Licensee hereby agree as follows:

1. Definitions. Capitalized terms shall have the meaning set forth below.

1.1. Affiliate. The term “Affiliate” shall mean any entity which directly or
indirectly controls, is controlled by or is under common control with a party.
The term “control” as used herein means the possession of the power to direct or
cause the direction of the management and the policies of an entity, or person,
whether through the ownership of a majority of the outstanding voting securities
or by contract or otherwise.

1.2. Combination Product. The term “Combination Product” shall have the meaning
as defined in Section 4.3.1 below.

1.3. Component Product. The term “Component Product” shall have the meaning as
defined in Section 4.4.1 below.

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1.4. Composition of Matter Patent Claims. The term “Composition of Matter Patent
Claims” shall mean those certain patent claims which constitute composition of
matter claims (other than method of use claims) within the Licensed Patents
which are eventually allowed by the applicable governmental patent office, from
and after the date when a valid patent issues for said claims, if at all. If a
valid patent so issues in one or more countries but not in other countries, then
the Net Sales realized from each such issuing country shall be treated as Net
Sales realized from Composition of Matter Patent Claims.

1.5. Confidential Information. The term “Confidential Information” shall mean
any and all proprietary or confidential information of Licensor or Licensee
which may be exchanged between the parties at any time and from time to time in
connection with this Agreement. Information shall not be considered confidential
to the extent that it:

a. is publicly disclosed through no fault of any party hereto, either before or
after it becomes known to the receiving party; or

b. was known to the receiving party prior to the date of disclosure, which
knowledge was acquired independently and not from the other party hereto (or
such party’s employees or agents); or

c. is subsequently disclosed to the receiving party in good faith by a third
party who has a right to make such disclosure; or

d. has been published by a third party as a matter of right; or

e. is developed or acquired totally independent from and with any benefit from
any confidential information received from the disclosing party.

1.6. Effective Date. The term “Effective Date” shall mean when all of the.
following documents have been executed by all of the parties thereto: (i) this
Agreement, (ii) the Inventors’ Acknowledgment of Assignment, (iii) the Russian
Companies’ Acknowledgment of Assignment, and (iv) the Research Funding
Agreement.

1.7. Inventors’ Acknowledgment of Assignment. The term “Inventors’
Acknowledgment of Assignment” shall mean the document by that name approved by
SciClone.

1.8. Licensed Patents. The term “Licensed Patents” shall mean the patent rights
described on Exhibit A attached hereto, plus all patents issued based on
divisionals, continuations, continuations-in-part, reissues, re-examinations and
extensions of the patent rights described in paragraph 1 of Exhibit A, together
with all corresponding foreign patents, except for those issuing in Russia, and
together with all related pending patent applications and inventor’s
certificates, and together with all patents and patent applications covering
improvements to the inventions described in the foregoing, filed or issued in
any country, except in Russia.

1.9. Licensed Product. The term “Licensed Product(s)” shall mean any product or
process which cannot be developed, manufactured, used or sold (i) without
infringing on the valid issued claims of the Licensed Patents, or (ii) without
utilizing the Licensed Technology.

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1.10. Licensed Technology. The term “Licensed Technology” shall mean the
Licensed Patents, plus all improvements thereto developed by Licensor, the
Russian Companies or the Russian Inventors (defined below), and all data,
studies, know-how, technology, confidential information and other intellectual
property rights belonging to Licensor, the Russian Companies or the Russian
Inventors, which relate to the Licensed Patents or are conceived or reduced to
practice by one or more of such parties during the term of the Research Funding
Agreement.

1.11. Licensed Territory. The term “Licensed Territory” shall mean worldwide,
except for Russia.

1.12. Method of Use Patent Claims. The term “Method of Use Patent Claims” shall
mean those certain patent claims within the Licensed Patents which are
eventually allowed by the applicable governmental patent office, from and after
the date when a valid patent issues for said claims, if at all. If a valid
patent so issues in one or more countries but not in other countries, then the
Net Sales realized from each such issuing country shall be treated as Net Sales
realized from Method of Use Patent Claims.

1.13. Net Sales. The term “Net Sales” shall mean the gross amount received by
Licensee, or its Affiliates and sublicensees, or any of them, on sales to first
customers of Licensed Products for therapeutic use after deducting (i) discounts
actually given, (ii) credits for claims, allowances, retroactive price
reductions or returned goods, (iii) transportation and insurance costs and
(iv) sales taxes, value added taxes or other governmental charges paid in
connection with sales of Licensed Products (but excluding what is commonly known
as income taxes). For purposes of determining Net Sales, a sale shall be deemed
to have occurred when a Licensed Product is shipped for delivery and payment has
been received for said shipment. Sales of Licensed Products by Licensee or its
Affiliates or a sublicensee thereof to any Affiliate or sublicensee which is a
reseller thereof shall not be considered in the computation of Net Sales, and
only the subsequent sales of such Licensed Products by Affiliates or
sublicensees to unrelated parties shall be deemed Net Sales hereunder. Sales of
Licensed Products for research purposes, or for the purpose of conducting
clinical trials necessary or desirable in connection with securing regulatory
approval of any Licensed Product in the Licensed Territory, shall not be
considered in the computation of Net Sales. In the event that a Licensed Product
is a Combination Product, then the Net Sales from said Licensed
Product/Combination Product shall be determined in accordance with the formula
set forth in Section 4.3 below. In the event that a Licensed Product is a
Component Product, then the Net Sales from said Licensed Product/Component
Product shall be determined in accordance with the formula set forth in
Section 4.4 below.

1.14. PTO. The term “PTO” shall mean the United States Patent and Trademark
Office.

1.15. Research Funding Agreement. The term “Research Funding Agreement” shall
mean the document by that name, as signed by all of the parties thereto,
including Licensee, Licensor and the Russian Companies, a signed copy of which
has been furnished to Licensee.

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1.16. Russian Inventors. The term “Russian Inventors” shall mean the following
named individuals, who were co-inventors or participants for the conception and
development of the Licensed Technology:

Alexander A. Kolobov

Andrey S. Simbirtsev

Sergey V. Kulikov

Alexey N. Prusakov

Natalia M. Kalinina

Natalia V. Pigareva

Alexander U. Kotov

Vladimir M. Shpen

Oleg A. Kaurov

Sergey A. Ketlinsky

1.17. Russian Companies’ Acknowledgment of Assignment. The term “Russian
Companies’ Acknowledgment of Assignment” shall mean the document by that name,
as signed by the Russian Companies, a signed copy of which has been furnished to
Licensee.

1.18. Russia. The term “Russia” shall mean the geographical territory now known
as the country of Russia.

1.19. Specified Countries. The term “Specified Countries” shall mean:

Australia

Belgium

Canada

Denmark

France

Germany

Japan

Netherlands

Sweden

Switzerland

United Kingdom

United States of America

2. License Grants.

Licensor hereby grants to Licensee an exclusive license in the Licensed
Territory to utilize the Licensed Technology, to use, make, have made, sell,
offer to sell, import and export all products and/or processes and/or services,
with the full right to grant sublicenses, subject to the terms of this
Agreement.

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3. License Fee, Licensor’s Past Patent Costs and Milestone Payments.

3.1. License Fee and Licensor’s Past Patent Costs. Within ten (10) business days
after the Effective Date, Licensee shall pay to Licensor a license fee of
$47,500, plus $10,000 for reimbursement of Licensor’s past patent costs.

3.2. Milestone Payments.

3.2.1. Within ten (10) business days after Licensee files its first New Drug
Application (“NDA”) seeking regulatory approval for a Licensed Product in one of
the Specified Countries, Licensee shall pay to Licensor a milestone payment of
$100,000 in cash. It is understood and agreed that Licensee shall only be
obligated to make one $100,000 payment to Licensor pursuant to this paragraph
regardless as to the number of NDAs filed by Licensee for Licensed Product(s) in
one or more of the Specified Countries. It is further understood and agreed that
Licensee shall not be obligated to make any payment to Licensor pursuant to this
paragraph upon an NDA filing by Licensee in any Country not included in the list
of Specified Countries.

3.2.2. Within ten (10) business days after Licensee receives its first
governmental regulatory approval to commercially market and sell a Licensed
Product in one of the Specified Countries, Licensee shall pay to Licensor a
milestone payment of $300,000 in cash. It is understood and agreed that Licensee
shall only be obligated to make one $300,000 payment to Licensor pursuant to
this paragraph regardless as to the number of governmental approvals obtained by
Licensee to commercially market and sell Licensed Product(s) in one or more of
the Specified Countries. It is further understood and agreed that Licensee shall
not be obligated to make any payment to Licensor pursuant to this paragraph upon
Licensee receiving governmental regulatory approval to commercially market and
sell a Licensed Product in any Country not included in the list of Specified
Countries.

4. Royalties.

4.1. Percentage Royalty As additional consideration for the exclusive license
granted pursuant to Section 2 hereof, Licensee shall pay to Licensor a royalty
on a country-by-country basis, based upon the Net Sales of Licensed Products
sold in each country, as follows:

4.1.1. Composition of Matter Patent Claims. For the Net Sales realized by
Licensee (or its Affiliates) from a particular country in which there are
validly issued patent rights for the Composition of Matter Patent Claims,
Licensee shall pay a royalty of four percent (4%) of said Net Sales, payable for
the life of said applicable patent.

4.1.2. Method of Use Patent Claims. For the Net Sales realized by Licensee (or
its Affiliates) from a particular country in which there are validly issued
patent rights for the Method of Use Patent Claims, but not for Composition of
Matter Patent Claims, Licensee shall pay a royalty of three percent (3%) of said
Net Sales, payable for the life of said applicable patent. If both Sections
4.1.1 and 4.1.2 are applicable to the same Net Sales (i.e., validly issued
patent rights are for both Composition of Matter Patent Claims and Method of Use
Patent Claims), then Licensee shall pay the four percent (4%) royalty (and not
4% plus 3%).

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4.1.3. Other Licensed Technology. For the Net Sales realized by Licensee (or its
Affiliates) from a particular country in which there are no validly issued
patent rights for the Composition of Matter Patent Claims or the Method of Use
Claims, Licensee shall pay a royalty of two percent (2%) of said Net Sales,
payable up through the fifth anniversary of the first commercial sale of a
Licensed Product in any country. For avoidance of doubt and for an example, if
the first such sale occurs in the year 2000 in one country, then Licensee’s
royalty obligation will cease in all countries five years later (in 2005) since
there is no patent protection.

4.1.4. Competitive Compositions. In the event that the Russian Companies or
Licensor develop or acquire a composition or compound which is competitive with
the Licensed Product, and the exclusive rights to said competitive composition
or compound have not been granted to Licensee, then the royalty rates specified
in Sections 4.1.1, 4.1.2 and 4.1.3 shall be reduced to two percent (2%), one and
one-half percent (1.5%) and one percent (1%) of Net Sales, respectively.

4.2. Sublicensee Payments. In the case of Net Sales realized by a sublicensee of
Licensee, instead of Licensee or a sublicensee paying the royalties to Licensor
based upon the provisions in Sections 4.1, Licensee shall pay to Licensor an
amount equal to twenty-five percent (25%) of the cash actually received by
Licensee from the sublicensee on account of the sublicensee’s Net Sales or on
account of the sublicense agreement, including payments made by the sublicensee
to Licensee in the nature of running royalties, license fees and milestone
payments (“Included Sublicensee Payments”), but excluding payments made by the
sublicensee to Licensee to purchase Licensee’s stock or to fund a specific
research and/or development project (“Excluded Sublicensee Payments”).

4.3. Combination Product.

4.3.1. Definition of Combination Product. As used herein, the term “Combination
Product” shall mean a Licensed Product which cannot be manufactured, used or
sold without (i) infringing the Licensed Patents, and also (ii) infringing one
or more patents held by Licensee or a third party (referred to herein as “other
patent rights”).

4.3.2. Net Sales of Combination Product. The Net Sales of a Combination Product
shall be based upon the proportional value of the contribution of the Licensed
Patents, as compared with the aggregate value of all patent rights used for the
Combination Product and determined in accordance with the following formula:

 

  X =    A    × C       B      , where

X = the Net Sales attributable to the portion of the Combination Product which
is attributable to the Licensed Patents, on which Net Sales Licensee shall pay
the royalty rate set forth in Section 4.1; and

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A = the value of the contribution of the Licensed Patents (as compared to the
value of the contributions of the other patent rights) used in the Combination
Product; and

B = The aggregate value of all patent rights used for the Combination Product,
consisting of both the Licensed Patents and all other patent rights used in the
Combination Product; and

C = the Net Sales for the Combination Product.

The values described above shall be determined by the parties hereto in good
faith. In the absence of agreement as to said values, the values shall be
determined by arbitration in accordance with the provisions of Section 12.2
hereof.

4.4. Component Product.

4.4.1. Definition of Component Product. As used herein, the term “Component
Product” shall mean a Licensed Product which is a distinct component of a larger
product which contains multiple components (including, as an example of
additional components, proprietary methods sold or licensed with the Component
Product).

4.4.2. Net Sales of Component Product. The Net Sales of a Component Product
shall be based upon the proportional value of the cost to manufacture the
Component Product (or the sale price of the Component Product if it is sold
separately), as compared with the aggregate value of all components of the
aggregate larger product (including methods sold or licensed with the Component
Product and the Component Product) and determined in accordance with the
following formula:

 

  X =    A    × C       B      , where

X = the Net Sales attributable to the Component Product, on which Licensee is
obligated to pay the royalty rate set forth in Section 4.1; and

A = the value of the Component Product, based upon cost to manufacture the
Component Product, or the sales price of the Component Product if it is sold
separately; and

B = The value of the aggregate larger product, with all components (including
methods sold or licensed with the Component Product, and the Component Product),
based upon the same criteria as used for A above; and

C = the Net Sales for the aggregate larger product.

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The values described above shall be determined by the parties in good faith. In
the absence of agreement as to said values, the values shall be determined by
arbitration in accordance with the provisions of Section 12.2 hereof.

4.5. Quarterly Payments.

4.5.1. Sales by Licensee. With regard to Net Sales made by Licensee or its
Affiliates, royalties shall be payable by Licensee quarterly, within ninety
(90) days after the end of each calendar quarter, based upon Net Sales of
Licensed Products during such preceding calendar quarter, commencing with the
calendar quarter in which the first commercial sale of any Licensed Product is
made.

4.5.2. Sales by Sublicensees. With regard to cash actually received by Licensee
from sublicensees of Licensee or its Affiliates, based upon Net Sales made by
said sublicensees, amounts owed to Licensor shall be payable by Licensee
quarterly, within one hundred twenty (120) days after the end of each calendar
quarter, based upon Included Sublicensee Payments actually received by Licensee
from sublicensee during such preceding calendar quarter, commencing with the
calendar quarter in which Licensee actually receives Included Sublicensee
Payments.

4.6. Duration of Royalty Obligations. The royalty obligations of Licensee as to
each Licensed Product shall terminate on a country-by-country basis as follows:
(i) with respect to royalties payable pursuant to Section 4.1.1 or 4.1.2 hereof,
termination shall occur concurrently with the expiration of the last to expire
of the Composition of Matter Patent Claims and Method of Use Patent Claims
licensed hereunder utilized by or in such Licensed Product in each such country,
or (ii) with respect to royalties payable pursuant to Section 4.1.3 hereof,
termination shall occur as specified in Section 4.1.3 herein, if applicable.
Notwithstanding any other provision of this Agreement, in the event that, based
upon a challenge by a party other than Licensee, its Affiliates or sublicensees,
the existing favorable claims of the Licensed Patents are held to be invalid by
the PTO or other applicable foreign governmental authority or any competent
court of law, this Agreement shall remain in effect, unless otherwise terminated
by Licensee, and Licensee shall thereafter have no further obligation to pay any
royalties hereunder.

4.7. Reports. Licensee shall furnish to Licensor at the same time as each
royalty payment is made by Licensee, a written report of Net Sales of Licensed
Products (or, in the case of Included Sublicensee Payments, the aggregate amount
of such payments) and the royalty due and payable thereon, including a
description of any offsets or credits deducted therefrom, on a
product-by-product and country-by-country basis, for the calendar quarter upon
which such royalty payment is based.

4.8. Records. Licensee shall keep, and cause its Affiliates and sublicensees to
keep, complete records and accounts of all sales of Licensed Products in
sufficient detail to enable the royalties payable on Net Sales of each Licensed
Product and Included Sublicensee Payments to be determined. Licensor shall have
the right to appoint an independent certified public accounting firm approved by
Licensee, which approval shall not be unreasonably withheld, to audit, upon
delivery of advance written notice and during normal business hours without
interruption of normal business operations, the records of Licensee, its
Affiliates and sublicensees as necessary to verify the royalties payable
pursuant to this Agreement. Licensee or its Affiliates shall pay to

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Licensor an amount equal to any additional royalties to which Licensor is
entitled as disclosed by the audit. Such audit shall be at Licensor’s expense.
Licensor may exercise its right of audit hereunder no more frequently than once
in any calendar year. The accounting firm shall disclose to Licensor only such
information as is necessary to verify the accuracy of the royalty payments
required hereunder, and all such information shall be treated as Confidential
Information by Licensor. Licensee, its Affiliates and sublicensees shall
preserve and maintain all records required for audit for a period of three
(3) years after the calendar quarter to which the record applies.

4.9. Foreign Taxes. Any tax required to be withheld by Licensee or its
Affiliates under the laws of any foreign country for the account of Licensor
shall be paid by Licensee or its Affiliates for and on behalf of Licensor to the
appropriate governmental authority and deducted from any royalties payable by
Licensee hereunder.

5. Sublicense Rights. Licensee shall have the sole and exclusive right to grant
sublicenses to any party with respect to the rights conferred upon Licensee
under this Agreement, provided, however, that any such sublicense shall be
subject in all respects to all of the provisions contained in this Agreement.
Licensee shall pay Licensor, or cause its sublicensees to pay Licensor, amounts
owed by Licensee to Licensor on account of Included Sublicensee Payments as
specified in Section 4.2 hereof.

6. Obligations Related to Commercialization.

6.1. Commercial Development Obligation. In order to maintain Licensee’s
exclusive license rights granted hereunder in force, Licensee, its Affiliates or
sublicensees shall use reasonable efforts to develop the Licensed Technology
into a commercially viable Licensed Product, as promptly as is reasonably and
commercially feasible, and thereafter to produce and sell reasonable quantities
of the Licensed Product. Licensee shall keep Licensor generally informed as to
Licensee’s, its Affiliates’ or sublicensees’ progress in such development,
production and sale.

6.2. Governmental Approvals and Marketing of Licensed Products. Licensee shall
have sole authority for, and shall be responsible for, obtaining all necessary
governmental approvals for the development, production, distribution, sale and
use of any Licensed Product, at Licensee’s expense. Licensee shall have sole
responsibility for any warning labels, packaging and instructions as to the use
of Licensed Products and for the quality control for any Licensed Product.

6.3. Product Liability Indemnity. Licensee hereby agrees to indemnify, defend
and hold harmless Licensor from and against any liability or expense arising
from any product liability claim asserted by any party as to any Licensed
Product made or sold by Licensee or its Affiliates and sublicensees, other than
any claim which arises due to a breach by Licensor, any Russian Inventor or the
Russian Companies of any covenant, warranty or representation made to Licensee.

7. Representations and Warranties. Licensor hereby represents and warrants that
(i) he is the rightful and sole owner of exclusive worldwide rights (except
those patents and applications issued or filed in Russia) to the Licensed
Technology, (ii) the Licensed Technology is not subject to any lien, license,
assignment (other than an assignment to Licensor), security interest or other
encumbrances, (iii) he has made full disclosure to Licensee of all
communications with respect to

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the Licensed Technology with the PTO and any foreign patent agencies, (iv) he
has the power and authority to enter into this Agreement and grant the license
provided for hereunder, and (v) he has no knowledge that the Licensed Technology
infringes any patents or other intellectual property rights of third parties, or
that any third party is in any way infringing the Licensed Technology covered by
this Agreement.

8. Patent Matters.

8.1. Patent Prosecution and Maintenance. From and after the date of this
Agreement, the provisions of this Section 8.1 shall control the prosecution and
maintenance of the Licensed Patents in the Licensed Territory. Licensee shall
direct and control (i) the preparation, filing and prosecution of all domestic
and foreign patent applications in the Licensed Territory relating to Licensed
Technology (including any interferences and foreign oppositions); and (ii) the
maintenance of any patents issuing therefrom. Licensee shall select the patent
attorney, and the fees and expenses incurred by Licensee with respect to
services performed by such patent counsel and any filing or other fees shall be
paid by Licensee. Licensor, the Russian Companies and Russian Inventors shall
assist Licensee and patent counsel employed or retained by Licensee as necessary
to accomplish the patent processes described hereunder and in the Research
Funding Agreement. Licensor, the Russian Inventors and the Russian Companies
shall sign all documents which are reasonably necessary to enable Licensee to
prosecute and maintain all patent matters. Licensor shall use diligent efforts
to obtain the cooperation and participation of the Russian Companies and the
Russian Inventors when reasonably necessary or appropriate for the presentation
or maintenance of the Licensed Products. Licensee shall use good faith and due
diligence in determining which foreign countries, in addition to the United
States, in which to file for and maintain patent rights, depending on the
commercial benefits Licensee can reasonably anticipate in each country. In as
much as Licensee is paying all patent costs, the ultimate decision as to all
patent prosecution and maintenance matters shall be made by Licensee.

8.2. Information to Licensor. Licensee shall keep Licensor informed with regard
to the patent applications, re-examination and maintenance processes. Licensee
shall deliver to Licensor copies of all material patent applications,
amendments, related correspondence, and other related matters. Licensor shall
keep Licensee informed with regard to the Russian patent applications,
re-examinations and maintenance process with respect to the Licensed Technology.
Licensor shall deliver to Licensee English translations of copies of all
material patent applications, related correspondence, and other related matters
with respect to the Licensed Technology. Licensee shall pay reasonable expenses
for translation of such materials, provided, however, that such expenses are
pre-approved by Licensee in writing.

8.3. Patent Costs. The parties hereto agree that the exclusive license granted
hereunder is in part in consideration for Licensee’s payment of past and future
patent costs and expenses as described herein. Licensee shall pay for all
expenses incurred by Licensee pursuant to Sections 8.1 and 8.2 hereof. Licensee
shall not pay for any patent costs paid or incurred by Licensor or the Russian
Inventors or the Russian Companies, other than as specified in Section 3.1
hereof.

8.4. Ownership. The Licensed Patents and the patent applications filed and the
patents obtained pursuant to Section 8.1 hereof shall be owned by Licensor, and
included in Licensed Technology and the exclusive license granted in this
Agreement.

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8.5. Infringement Actions.

8.5.1. Prosecution and Defense of Infringements. Licensee shall have the right
but not the obligation to prosecute any and all infringements of any Licensed
Patent and to defend all charges of infringement arising as a result of the
exercise by Licensee, its Affiliates or sublicensees of the rights granted in
this Agreement. Licensee may enter into settlements, stipulated judgments or
other arrangements respecting such infringement, at its own expense. Licensor
shall permit any action to be brought in his name if required by law, and
Licensee shall hold Licensor harmless from any costs, expenses of liability
respecting all such infringements or charges of infringement, except such
infringements as shall result from any breach of covenant, warranty or
representation made by Licensor herein. Licensor agrees to provide, or use
diligent effort to obtain from the Russian Inventors and Russian Companies, all
necessary assistance of a technical nature which Licensee may require in any
litigation arising with respect to the Licensed Technology. In the event
Licensee elects not to prosecute any infringement, Licensee shall notify
Licensor in writing promptly and Licensor shall have the right to prosecute such
infringement on his own behalf. If Licensee elects to prosecute an infringement,
then Licensor shall not be entitled to do so.

8.5.2. Allocation of Recovery. Any damages or other recovery from an
infringement action undertaken by Licensee pursuant to Section 8.5.1 shall be
retained by Licensee as its exclusive property; but any such recovery, net of
Licensee’s costs of litigation, shall be treated as “Net Sales” and Licensee
shall pay a royalty thereon pursuant to Section 4.1 above. If Licensee elects to
not prosecute an infringement, and Licensor does prosecute said infringement,
then Licensor shall retain any recovery received from said prosecution.

9. Interests in Intellectual Property Rights.

9.1. Preservation of Title. Licensor shall retain full ownership and title to
Licensed Technology, and any other patents licensed under this Agreement and
shall use his reasonable best efforts to preserve and maintain such full
ownership and title.

9.2. Ownership of Improvements and Additional Intellectual Property.

9.2.1. Developed by Licensee. Any improvements to Licensed Technology conceived,
developed or reduced to practice by Licensee, its Affiliates or sublicensees or
their employees shall remain the sole and exclusive property of such party, and
shall not be included in Licensed Technology under this Agreement.

9.2.2. License Grant Back. Licensee hereby grants to Licensor an exclusive
license in Russia to utilize Licensee’s, its Affiliates’ or sublicensees’
improvements to Licensed Technology, to use, make, have made, sell or offer to
sell all products and/or processes and/or services, with full right to grant
sublicenses, subject to Licensor paying to Licensee a royalty on Net Sales which
utilize said improvements, at the same royalty rates as specified in Section 4
hereof. All other terms of this Agreement which are applicable to Licensee shall
be applicable to Licensor, as a licensee to use the improvements in Russia with
respect to this section 9.2.2, specifically including items in Sections 4, 5, 6,
8 (in Russia), 11 and 12.

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9.2.3. Developed by Licensor or the Russian Companies. Any improvements to the
Licensed Technology conceived, developed or reduced to practice by Licensor
during the term of this Agreement, or by the Russian Companies during the term
of the Research Funding Agreement, shall be included in Licensed Technology and
subject to the exclusive license granted hereunder. Examples of such anticipated
improvements, include without limitation: (i) novel methods of synthesis,
formulation or delivery of Bestim and related analogs, (ii) therapeutic use
applications which cover indications not previously covered in patents, and
(iii) new composition of matter claims for Bestim analogs.

10. Confidentiality and Publication.

10.1. Treatment of Confidential Information. The parties hereto and the Russian
Companies agree that during the term of this Agreement, and for a period of five
(5) years after this Agreement terminates, a party receiving Confidential
Information of the other party will, excepting only to the extent needed in
connection with the performance of this Agreement or the other agreements
referenced herein, (i) maintain in confidence such Confidential Information,
(ii) not disclose such Confidential Information to any third party without prior
written consent of the other party and (iii) not use such Confidential
Information for any purpose except those permitted by this Agreement.

10.2. Publications. In order to protect the rights granted to Licensee
hereunder, Licensor and the Russian Companies shall submit to Licensee copies of
proposed publications of Licensor or the Russian Companies which contain subject
matter relating to intellectual property licensed hereunder, and shall afford
Licensee thirty (30) days to review such proposed publications. Upon timely
written request by Licensee, Licensor shall delay any such publication to
facilitate the preparation and filing of a patent application, which delay shall
not exceed thirty (30) days from the date Licensee requests such delay.

11. Term and Termination.

11.1. Term. The term of this Agreement and the license granted hereunder shall
commence on the Effective Date and continue until expiration of the last patent
included within the Licensed Patents, unless sooner terminated pursuant to this
Section 11.

11.2. Termination Without Cause. This Agreement may be terminated by Licensee
for any reason, at Licensee’s sole discretion, upon delivery to Licensor of
sixty (60) days’ prior written notice of termination.

11.3. Termination Upon Default. Upon the failure of a party to perform any
obligation required of it or him to be performed hereunder, and the failure to
cure within sixty (60) days after receipt of written notice from the other party
specifying in reasonable detail the nature of such default, the non-defaulting
party may deliver to the defaulting party written notice of intent to terminate,
such termination to be effective upon the date set forth in such notice.

Such termination rights shall be in addition to and not in substitution for any
other remedies that may be available to the non-defaulting party. Termination
pursuant to this Section 11.3 shall not relieve the defaulting party from
liability and damages to the other party for breach of this Agreement. Waiver by
either party of a single default or a succession of defaults shall not deprive
such party of any right to terminate this Agreement arising by reason of any
subsequent default.

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11.4. Bankruptcy or Insolvency. The parties agree that the rights and licenses
granted under Section 2 of this Agreement, and any intellectual property
conceived or reduced to practice during the course of the Research Funding
Agreement, are and shall be deemed to be, for purposes of Section 365 (a) of the
U.S. Bankruptcy Code, licenses or rights to “intellectual property” as defined
under Section 101 of the U.S. Bankruptcy Code. The parties agree that Licensee,
as a licensee of such rights under this Agreement, shall retain and may fully
exercise all of its rights and elections under the U.S. Bankruptcy Code. The
parties further agree that in the event of the bankruptcy or insolvency of
Licensee, this Agreement and the rights granted to Licensee hereunder may be
transferred by Licensee or any trustee appointed for the estate of Licensee,
provided such transferee shall agree in writing to comply with all of the terms
and conditions set forth herein and to cure any financial defaults by Licensee.
In the event of the bankruptcy or insolvency of Licensee or Licensor, this
Agreement shall remain in full force and effect.

11.5. Rights Upon Expiration. Neither party shall have any further rights or
obligations upon the regularly scheduled expiration of this Agreement other than
the obligation of Licensee to make any and all reports and payments for the
final quarter period. Provided, however, that upon such expiration, each party
shall be required to continue to abide by its confidentiality obligations as
described in Section 10, and Licensee shall continue to abide by its obligation
to indemnify Licensor as described in Section 6.3 for products sold prior to the
termination.

11.6. Rights Upon Termination. Notwithstanding any other provision of this
Agreement, upon any termination of this Agreement prior to the regularly
scheduled expiration date of this Agreement, the license granted hereunder shall
terminate. Except as otherwise provided in Section 11.7 of this Agreement with
respect to work-in-progress, upon such termination, Licensee shall have no
further right to develop, manufacture or sell any Licensed Products, or to
otherwise use any Licensed Technology. Any such termination shall not relieve
either party from any obligations accrued to the date of such termination. Upon
such termination, each party shall be required to abide by its nondisclosure
obligations as described in Section 10.1, and, provided termination was not
initiated by Licensee due to Licensor’s breach hereunder, Licensee shall
continue to abide by its obligations to indemnify Licensor as described in
Section 6.3 for products sold prior to the termination.

11.7. Work-in-Progress. Upon any early termination of this Agreement and the
license granted hereunder, Licensee shall be entitled to finish any
work-in-progress and to sell any completed inventory of Licensed Products which
remain on hand as of the date of termination, so long as Licensee pays to
Licensor the royalties applicable to such sales in accordance with the terms and
conditions as set forth in this Agreement.

12. General Provisions.

12.1. Independent Contractors. The relationship between Licensor and Licensee is
that of independent contractors. Licensor and Licensee are not joint venturers,
partners, principal and agent, master and servant, employer or employee, and
have no other relationship other than independent contracting parties. Licensor
and Licensee shall have no power to bind or obligate each other in any manner,
other than as is expressly set forth in this Agreement.

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12.2. Arbitration. Any matter or disagreement arising under this Agreement shall
be submitted for decision to a panel of three neutral arbitrators with expertise
in the subject matter to be arbitrated. One arbitrator shall be selected by each
party and the two arbitrators so selected shall select the third arbitrator. The
arbitration shall be conducted in accordance with the Rules of the American
Arbitration Association. The decision and award rendered by the arbitrators
shall be final and binding. Judgment upon the award may be entered in any court
having jurisdiction thereof. Any arbitration shall be held in Santa Clara
County, California, or such other place as may be mutually agreed upon in
writing by the parties.

12.3. Entire Agreement; Modification. This Agreement sets forth the entire
agreement and understanding between the parties as to the subject matter hereof.
There shall be no amendments or modifications to this Agreement, except by a
written document which is signed by both parties. The parties acknowledge that
they are also parties to related agreements entitled (i) Research Funding
Agreement, (ii) Russian Companies’ Acknowledgment, and (iii) Consulting
Agreement.

12.4. Headings. The headings of the several sections are inserted for
convenience of reference and are not intended to be a part of or affect the
meaning or interpretation of this Agreement.

12.5. Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of California, without regard to conflict
of laws rules.

12.6. Severability. If any one or more of the provisions of this Agreement is
held to be invalid or unenforceable by a court of competent jurisdiction, it
shall be considered severed from this Agreement and shall not serve to
invalidate the remaining provisions thereof. The parties shall make a good faith
effort to replace any invalid or unenforceable provision with a valid and
enforceable provision such that the objectives contemplated by them when
entering this Agreement may be realized.

12.7. No Waiver. Any delay in enforcing a party’s rights under this Agreement or
any waiver as to a particular default or other matter shall not constitute a
waiver of such party’s rights to the future enforcement of its rights under this
Agreement, excepting only as to an express written and signed waiver as to a
particular matter for a particular period of time.

12.8. Notices. Any notices required by this Agreement shall be in writing, shall
refer to this Agreement and shall be sent by registered or certified mail,
postage prepaid, or by facsimile, telex or cable, charges prepaid, or by
overnight courier, charges prepaid to the addresses set forth below unless
subsequently changed by written notice to the other party:

 

For Licensee:   

SciClone Pharmaceuticals, Inc.

901 Mariner’s Island Blvd.

San Mateo, CA 94404

Attention: Alfred Rudolf, M.D.

Fax No.: (415) 358-3469

For Licensor:   

Edward T. Wei

480 Grizzly Peak Blvd.

Berkeley, CA 94708

Fax No.: 510-524-9040

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Notice shall be deemed delivered upon the earlier of (i) when received,
(ii) three (3) days after deposit into the mail, or (iii) the date notice is
sent via facsimile, telex or cable, (iv) the day immediately following delivery
to overnight courier (except Sunday and holidays).

12.9. Binding Upon Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of any successors in interest and assigns of Licensor
and Licensee. Neither this Agreement nor any interest hereunder is assignable in
part or in whole without the prior written consent of the other, which consent
shall not be unreasonably withheld; provided, however, that Licensee may assign
this Agreement without Licensor’s consent (i) to any of its Affiliates, or
(ii) to any successor to Licensee by merger or consideration, or to the acquiror
of all or substantially all of the business unit to which this Agreement
relates, in each case, any such successor or assignee shall expressly assume in
writing the performance of all the terms and conditions of this Agreement to be
performed by the assigning party.

12.10. Interpretation of Agreement. Each of the parties hereto has reviewed the
terms of this Agreement with such party’s counsel. Therefore, notwithstanding
Section 1654 of the California Civil Code, the terms of the Agreement shall not
be interpreted against either party in the event of any uncertainty with regard
to the language in this Agreement.

12.11. Counterparts This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same Agreement. Signatures may be transmitted by facsimile.

IN WITNESS WHEREOF, the parties have executed this Agreement by their duly
authorized representatives as of the date set forth above.

 

LICENSOR:     LICENSEE:     SCICLONE PHARMACEUTICALS, INC.

/s/ Edward T. Wei, Ph.D.

    By:  

/s/ D.R. Sellers

Edward T. Wei, Ph.D.         SCICLONE PHARMACEUTICALS INTERNATIONAL LTD.     By:
 

/s/ Mark A. Culhane

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EXHIBIT A

Licensed Technology and Licensed Patents

 

1. All the inventions, patent applications, patent rights, know-how and
technology which are described in the following pending patent applications:

U.S. Application Serial No. 08/634,718, filed April 18, 1996

PCT Application No. PCT/US 96/17913, filed November 13, 1996

The Inventors are:

Alexander A. Kolobov

Andrey S. Simbirtsev

Sergey V. Kulikov

Alexey N. Prusakov

Natalia M. Kalinina

Natalia V. Pigareva

Alexander U. Kotov

Vladimir M. Shpen

Oleg A. Kaurov

Sergey A Ketlinsky

 

2. All patents issued based on divisionals, continuations,
continuations-in-part, reissues, re-examinations and extensions of the patent
rights described in paragraph 1 above, together with all corresponding foreign
patents, except for those issued in Russia, and together with all related
pending patent applications and inventor’s certificates, and together with all
patents and patent applications covering improvements to the inventions
described in the foregoing, filed or issued in any country except in Russia.

 

3. All future patent applications and patents filed and issued in individual
countries as a result of “going national” under the PCT Application identified
in paragraph 1 above.