<PAGE>

                                                                   EXHIBIT 10.12

                                                                  EXECUTION COPY

                           EXCLUSIVE LICENSE AGREEMENT

      THIS EXCLUSIVE LICENSE AGREEMENT (this "Agreement") is made effective the
19th day of May, 2003 ("Effective Date"), by and between ILEX Products, Inc., a
Delaware corporation having its principal place of business at 4545 Horizon Hill
Blvd., San Antonio, Texas 78229-2263 (hereinafter called "ILEX"), and Quatrx
Pharmaceuticals Company, a corporation organized and existing under the laws of
the State of Delaware having its principal place of business at 5430 Data Court,
Suite 300, Ann Arbor, Michigan 48108-8935 (hereinafter called "Licensee"). ILEX
and Licensee are each individually referred to herein as a "Party" and
collectively as the "Parties".

      WHEREAS, ILEX owns certain inventions that are described in the "Licensed
Patents" defined below, and ILEX is willing to grant a license to Licensee under
all of the Licensed Patents and Licensee desires a license under all of them;

      NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth below, the parties covenant and agree as follows:

SECTION 1. DEFINITIONS.

      "Affiliate" shall mean each and every business entity controlling,
controlled by or under common control with a Party. For purposes of this
definition, "control" shall mean ownership, directly or indirectly, of more than
fifty percent (50%) of the voting or income interest of the applicable business
entity.

      "Agreement" has the meaning set forth in the first paragraph.

      "Claim" has the meaning set forth in Section 9.1.

      "Confidential Information" has the meaning set forth in Section 7.1.

      "Disclosing Party" has the meaning set forth in Section 7.1.

      "Effective Date" shall mean the date first above written as the effective
date of this Agreement.

      "FDA" shall mean the United States Food and Drug Administration.

      "Field" shall mean the treatment of lipid disorders, atherosclerosis and
all other cardiovascular related diseases.

      "First Commercial Sale" shall mean the first sale of a Product to a third
party (other than an Affiliate or sublicensee) in a jurisdiction after
regulatory approval for such sale has been obtained from the appropriate
regulatory authorities in such jurisdiction.

      "ILEX LDL/Lp(a) and HDL/Apo E Research Platforms" shall mean all research
and development activities conducted by ILEX which relate to LDL, Lp(a), HDL,
and/or Apo E which involve compositions

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claimed and/or described in the Licensed Patents. For the avoidance of doubt,
compositions and uses claimed or for which claims are obtained in other patents
and/or patent applications owned or licensed to ILEX and/or its affiliates,
which are not part of the Licensed Patents (see Appendix A for list of "Excluded
Patents and Patent Applications"), shall not be included in the ILEX LDL/Lp(a)
and HDL/Apo E Research Platforms even if such compositions are disclosed as
having lipid lowering or similar activities (hereinafter "Excluded
Compound(s)").

      "Invention" has the meaning set forth in Section 8.1.

      "Inventor" has the meaning set forth in Section 8.1.

      "Lead Compound" shall mean a Licensed Compound which Licensee notifies
ILEX in writing, at any time during the first two (2) years after the Effective
Date for a Product decreasing LDL and Lp(a) in the Field and the first four (4)
years after the Effective Date for a Product to treat HDL and/or Apo E in the
Field, is one of Licensee's lead development candidates.

      "Licensed Compound" shall mean a chemical compound, the composition of
matter or use thereof is claimed in a Licensed Patent.

      "Licensed Patents" shall mean only the patent applications and patents
listed in Exhibit A, which is attached hereto and is incorporated herein by
reference, and any foreign counterparts thereof, and any continuations,
continuations-in-part, divisions, re-issues, additions, renewals and extensions
thereof, and any patents issuing therefrom, and all current and future patents
necessary to practice the foregoing, e.g. patents to Product metabolites, all to
the extent owned or licensed by ILEX or which ILEX has the right to license or
sublicense to Licensee.

      "Licensee" has the meaning set forth in the first paragraph.

      "Net Sales" shall mean, with respect to Product, the gross receipts from
sales in any country less deductions for: (i) transportation and insurance
charges; (ii) sales and excise taxes, tax, tariff, duty or any other
governmental charges (but excluding income, franchise and other similar taxes)
or duties paid; (iii) normal and customary trade, and quantity discounts and
rebates allowed; (iv) sales commissions actually paid to third parties; (v)
allowances actually made on account of rejection or return by customers; (vi)
credits, rebates, charge-back rebates, reimbursements or similar payments
actually granted or given to wholesalers and other distributors, buying groups,
health care insurance carriers, governmental agencies and other institutions;
(vii) payments or rebates actually paid in connection with state or federal
Medicare, Medicaid or similar programs. However, except where the sublicensee or
Affiliate is the final consumer of the Product, any sale to a sublicensee or
Affiliate shall be excluded from the computation of Net Sales, but any
subsequent sale by the sublicensee or Affiliate to a third party other than
another sublicensee or Affiliate shall be included in the computation of Net
Sales.

      "Party" or "Parties" has the meaning set forth in the first paragraph.

      "Product" shall mean any product discovered or developed for use in the
Field from the ILEX LDL/Lp(a) and HDL/Apo E research platforms conducted by ILEX
at any time prior to or during the term of this Agreement and disclosed in, or
covered by at least one Valid Claim of any patent listed in Exhibit A.

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      "Royalty Term" shall mean, with respect to a particular Product in any
country in the Territory, the period of time commencing on the First Commercial
Sale of such Product in such jurisdiction and ending upon the expiration of the
last to expire Licensed Patent containing a Valid Claim which would be infringed
by the manufacture, use, importation, offer for sale, or sale of such Product in
such country, provided that if the only such Valid Claim is a claim in a pending
patent application, then the Royalty Term shall end **** from the Effective
Date, unless after such **** period, Licensee has obtained, or otherwise enjoys
marketing exclusivity for the Product in question in the applicable jurisdiction
through non-patent related statutory means (hereinafter "Non-Patent Statutory
Exclusivity") such as orphan drug or new chemical entity status, in which case,
the Royalty term shall extend for the term of the Non-Patent Statutory
Exclusivity.

      "Technical Information" shall mean any and all know-how, trade secret and
other information of a technical nature relating to any Product or potential
Product, which is in the possession of ILEX as of the Effective Date, and which
is necessary or useful to Licensee in furtherance of the research, development,
manufacture or marketing of such Product or potential Product.

      "Territory" shall mean the world.

      "Valid Claim" shall mean a claim contained in a pending patent application
or in an issued patent, which claim has not expired and has not been held
unenforceable, unpatentable or invalid by an unappealable decision of a court or
other governmental agency of competent jurisdiction.

SECTION 2. GRANT.

      2.1. License. ILEX hereby grants to Licensee an exclusive (even as to
ILEX) license under the Licensed Patents and the Technical Information in the
Territory, with the right to grant sublicenses to make, have made, use, sell,
have sold, and export and import Products to the full extent necessary for the
research, development, commercialization and marketing of such Products in the
Field, and the right to use all existing and future data relating thereto owned
or controlled by ILEX. ILEX shall not develop or research any compound derived
from the ILEX LDL/Lp(a) and HDL/Apo E Research Platforms conducted by ILEX at
any time prior to or during the term of the Agreement for any indications,
except that ILEX may conduct research and development on a Licensed Compound
only for uses outside the Field if:

            2.1.1. Licensee has designated such Licensed Compound as a Lead
Compound and thereafter has ceased development of such Licensed Compound; or

            2.1.2. the research and development of such Licensed Compound is for
a method of administration that is not oral or transdermal and such Licensed
Compound is not a Lead Compound; or

            2.1.3. the research and development of such Licensed Compound is for
a method of administration of such Licensed Compound that is oral or transdermal
and such Licensed Compound is not a Lead Compound or a Reserved Compound. For
purposes of this Section 2.1.3, "Reserved Compounds" shall mean (a) up to four
Licensed Compounds which are not Lead Compounds, which have activity for
indications relating to LDL or Lp(a) and which are selected by Licensee at any
time prior to the second anniversary of the Effective Date and (b) up to four
Licensed Compounds which are not Lead Compounds

                                       3

<PAGE>

and are not included in Section 2.1.3 (a) above, which have activity for
indications relating to HDL or Apo E and which are selected by Licensee at any
time prior to the second anniversary after Licensee declares a Lead Compound for
HDL or Apo E.

In the event ILEX commences research or development outside the Field on a
Licensed Compound, and Licensee thereafter declares such Licensed Compound as a
Lead Compound or a Reserved Compound, then ILEX shall cease all research and
development work on such Licensed Compound. In the event ILEX commences research
and development of any Licensed Compounds as permitted herein, the parties shall
thereafter equally share the worldwide costs of filing, prosecution and
maintenance of all Licensed Patents containing Valid Claims covering such
Licensed Compound subject to Section 2.3.

ILEX shall use commercially reasonable efforts to restrict any third party
sublicensee of any compounds owned or controlled by ILEX from commercializing
such compounds in the Field. For the avoidance of doubt, the term "controlled
by" in the previous sentence shall mean the possession by ILEX with the right to
sublicense.

Within 90 days of the date hereof, ILEX shall deliver to Licensee, at ILEX's
cost, copies of all materials consisting of the Licensed Patents and Technical
Information and any other information, data or materials, whether or not in a
tangible medium, relating to or necessary for the research and/or development of
Products.

      2.2. Right of First Opportunity. In the event ILEX proceeds with research
and development permitted under this Section 2 and determines to grant rights to
any third party with regard to such Licensed Compounds, ILEX shall first provide
Licensee with written notice of such determination, along with a copy of all
data, information and reports relating to such Licensed Compound for use outside
the Field. If within **** days of receipt of such written notice, Licensee
notifies ILEX in writing of Licensee's interest in the licensing rights to such
Licensed Compound outside the Field, the Parties shall negotiate for **** days
exclusively and in good faith the terms of such license to such Licensed
Compound. In the event the parties fail to reach agreement on the license terms
in the aforesaid **** day period, ILEX shall be free to offer the same
opportunity to a third party without further obligation to Licensee, provided,
however, that ILEX, for a period of not longer than one year shall not grant to
any such third party a license to such Licensed Compound on terms which in
aggregate are more favorable than the Licensee indicated it would accept in the
foregoing **** day period.

      2.3. Maintenance of Licensed Patents. Subject to Section 2.1 and the terms
of this Section 2.3, ILEX shall prosecute and maintain in the Territory, using
outside patent counsel mutually agreed to, **** cost and expense, all patents
and patent applications set forth on Exhibit A, using professional and diligent
efforts. For purposes of the preceding sentence, the Parties agree that the law
firm of Fulbright and Jaworski is mutually agreeable as of the Effective Date,
provided that each Party retains the right to object to the use of such firm in
the event circumstances change. For patent costs and expenses incurred for
calendar year 2003 for Licensed Patents, the parties shall ****, provided,
however, that if Licensee returns to ILEX or otherwise loses its rights to a
Licensed Patent in one or more jurisdictions, then the parties shall **** only
for the period of time prior to such return or loss of rights. If Licensee
notifies ILEX in writing that it is no longer pursuing research or development
of one or more Licensed Compounds claimed in a Licensed Patent, but is pursuing
research or development of other Licensed Compounds claimed therein, and ILEX
desires to pursue research and development of such Licensed Compounds then the
parties shall thereafter **** the cost of filing, prosecution and

                                       4

<PAGE>
 maintenance of such Licensed Patent in all jurisdictions. Licensee shall have
the right to direct such prosecution and maintenance. In the event Licensee
determines not to prosecute a patent in any jurisdiction in the Territory,
Licensee shall notify ILEX in writing. *****************************************
****************** shall cease effective the date of such written notice. At
Licensee's option, Licensee shall have the right to assume responsibility for
the prosecution and maintenance of all patents and patent applications listed on
Exhibit A, including all corresponding foreign patents and patent applications
as Licensee shall deem necessary to file, prosecute and maintain.

SECTION 3. DEVELOPMENT; DATA SHARING.

      3.1. Development. Licensee shall be responsible for, and shall have sole
control over the research and development of the Products, including, without
limitation, the funding of such research and development. ILEX shall not incur
any research or development costs or otherwise conduct research and development
relating to Products, without the prior written consent of Licensee.

      3.2. Diligence. Licensee shall use reasonable commercial efforts to
develop for the earliest market introduction (subject to all required regulatory
approval) at least ****** indications and ****** indications, provided that
under no circumstances shall Licensee be obligated to use more than the level of
effort it used to develop any of its other products of equal market potential.
In particular, Licensee shall:

            a)    for a Product for ******:

                        i)    file an IND within **** of the Effective
                              Date;

                        ii)   complete Phase I clinical trials within ****
                              of acceptance of IND by FDA.

            b)    for a Product for ******, select a Lead Compound through a
                  reasonable experimental screening effort for full development
                  within **** of the Effective Date.

The time periods in subsections 3.2(a) and 3.2(b) shall be suspended to the
extent that Licensee's development efforts are delayed due to dosage
methodology, formulation, safety, efficacy, or regulatory issues or availability
of clinical supplies or recruitment of clinical sites or clinical patients.

      3.3. Reporting. Licensee shall provide to ILEX, on an annual basis within
30 days of each anniversary of the Effective Date, a written report summarizing
the current status and future plans for the development of Products.

      3.4. Services Agreement. In the event that Licensee determines that it
would be desirable to receive continued assistance from ILEX in the conduct of
research and development of the Products after the 90 day period set forth above
in Section 2.1, and provided that ILEX still owns or controls its operations in
Geneva (Switzerland), then Licensee and ILEX shall negotiate in good faith the
terms of a services agreement to cover such continued assistance. In the event
ILEX has not fulfilled its obligation to deliver the items described in Section
2.1 within the required 90 day period, then in addition to any other remedies
available to Licensee, ILEX shall provide such services sufficient to deliver
the items described in Section 2.1 at ILEX's expense.

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SECTION 4. CONSIDERATION.

      4.1. License Fee. Licensee agrees to pay to ILEX a non-refundable,
non-creditable license fee of $2,500,000, due within 5 business days of the
Effective Date.

      4.2. Milestones. Licensee shall make the following milestone payments to
ILEX within 30 days after the first achievement of each of the following
milestones for each Product being developed by Licensee for decreasing LDL and
Lp(a) within the Field:

<TABLE>
<CAPTION>
Milestone Event                                           Payment
<S>                                                       <C>
*******                                                   ****

*******                                                   The greater of $**** or *******
*******                                                   *******
                                                          *******

*******                                                   The greater of $**** or *******
*******                                                   *******
                                                          *******

*******                                                   The greater of $**** or *******
*******                                                   *******
*******                                                   *******

*******                                                   The greater of $**** or *******
*******                                                   *******
*******                                                   *******

*******                                                   The greater of $**** or *******
*******                                                   *******
*******                                                   *******
*******
*******

*******                                                   The greater of $**** or *******
*******                                                   *******
*******                                                   *******

*******                                                   The greater of $**** or *******
*******                                                   *******
                                                          *******

*******                                                   The greater of $**** or *******
*******                                                   *******
                                                          *******
</TABLE>

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<TABLE>
<S>                                                       <C>
********                                                  ********
********                                                  ********
                                                          ********
</TABLE>

Licensee to pay ILEX the following amounts upon the achievement of the following
milestones for each Product being developed by Licensee for increasing HDL
within the Field:

<TABLE>
<CAPTION>
Milestone Event                                           Payment
<S>                                                       <C>
********                                                  $****

********                                                  The greater of $**** or ********
********                                                  ********
                                                          ********

********                                                  The greater of $**** or ********
********                                                  ********
                                                          ********

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

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

********                                                  ********
********                                                  ********
                                                          ********
</TABLE>

Each milestone payment referred to in this Section 4 shall be made only once
with respect to each Product and Licensee shall not be required to pay milestone
payments for additional formulations of such Products which are developed or
commercialized. In the event Licensee ceases development of a Product for which
milestones payments have been made due to safety, efficacy, regulatory or
manufacturing reasons, and Licensee commences or continues development of a
Product for the same or similar indications as the discontinued Product, then
Licensee shall not be obligated to make any milestone payments to ILEX with
respect to such additional Product until such additional Product achieves
milestones which were not achieved by the discontinued Product.

                                       7

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      4.3. Royalty. Licensee shall pay to ILEX a royalty payment on sales of
each Product, as follows:

            4.3.1. With respect to Products approved for the treatment of LDL
and/or Lp(a),according to the following rates during the Royalty Term applicable
to the particular Product:

            ****% for such Net Sales by Licensee or its Affiliates up to and
            including $**** per year.

            ****% for such Net Sales by Licensee or its Affiliates in excess of
            $**** and less than $**** in each calendar year.

            ****% for such Net Sales by Licensee or its Affiliates of $****
            or more in each calendar year.

            ****% of all royalties on the sale of such Products received by
            Licensee from any third party granted a sublicense pursuant to
            Section 2.1.

            4.3.2. With respect to Products approved for the treatment of HDL
and/or Apo E, according to the following rates during the Royalty Term
applicable to the particular Product:

            ****% for such Net Sales by Licensee or its Affiliates up to and
            including $**** per year.

            ****% for such Net Sales by Licensee or its Affiliates in excess of
            $**** and less than $**** in each calendar year.

            ****% for such Net Sales by Licensee or its Affiliates of $****
            or more in each calendar year.

For sublicensee royalty, in the case of Product approved for the treatment of
HDL and/or Apo E, the royalty payment during the Royalty Term applicable to a
particular Product shall be:

            ****% of all royalties on the sale of such Products received by
            Licensee from any third party granted a sublicense pursuant to
            Section 2.1.

            4.3.3. The royalties calculated under Sections 4.3.1 and 4.3.2 shall
be due and payable without reduction for royalties that might be payable by
Licensee to third parties in respect of such sales, except that Licensee may
deduct, from any royalties owed thereunder for a particular Product:

                  (i) With regard to sales by Licensee, **** of royalties on
the sales of such Products payable by Licensee to third parties under licenses
to a patent that would be infringed by the making, using or selling of Products,
but for the grant of such license, provided however that Licensee may not
reduce, based on the foregoing deduction, the amount of royalties payable to
ILEX in respect of sales of such Product in a particular country by more than
****% of Net Sales; and

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<PAGE>

                  (ii) With regard to sales by sublicensees of Licensee, ****%
of all royalties on the sale of such Products received by Licensee from any
third party granted a sublicense pursuant to Section 2.1 if such sublicensee or
Licensee is obligated to pay a royalty to a third party under an issued patent
that, but for the grant of such license, the making, using or selling of
Products would infringe a patent owned or controlled by such third party.

      4.4. Accounting; Payments.

            4.4.1. Licensee shall keep and maintain complete books and records
containing an accurate accounting in sufficient detail of all data required to
enable verification of earned royalties and other payments due hereunder.

            4.4.2. Within 45 days after the end of each calendar quarter,
Licensee shall remit to ILEX a statement of Net Sales by Licensee and by its
sublicensees on account for such quarter, which statement shall be accompanied
by the payment due to ILEX pursuant to Section 4.3.

            4.4.3. ILEX may request that the financial statements of Licensee
and of its sublicensees relating to the sale of Products be audited annually by
a nationally recognized independent certified public accountant ("CPA")
reasonably acceptable to Licensee for the purpose of verifying the amount of
royalty payments due. Such examination of books and records of Licensee and its
sublicensees shall take place during regular business hours during the term of
this Agreement and for two (2) years after its termination, provided however,
that such an examination shall not take place more than once a year and shall
not cover records for more than the preceding three (3) years, and provided that
such accountant shall agree to keep confidential all the information obtained by
such accountant during such audit and shall report to ILEX only if the royalty
statements and payments are accurate, or if not accurate, only the amount of the
inaccuracy. If such accountant shall find an underpayment to ILEX, presentation
of a written statement substantiating the underpayment shall be provided to
Licensee. If Licensee is not in agreement with the findings of the accountant
selected by ILEX, then Licensee shall so notify ILEX in writing within 30 days
of receipt by Licensee of said findings, in which case the parties shall jointly
appoint, within a further period of 30 days, an independent certified public
accountant to validate, at Licensee's expense, ILEX's accountant's findings, and
the decision of said independent accountant shall be final. If said independent
accountant verifies that an underpayment has occurred, the amount due and
interest (accruing at the prevailing prime rate of interest for commercial loans
published in the Wall Street Journal, Eastern Edition, from the date payment was
due through the date of actual payment to ILEX) shall be paid to ILEX within
thirty (30) days and, if the amount of the underpayment is greater than ****% of
the required payment, then Licensee shall reimburse ILEX the out-of-pocket cost
for the CPA activities in the audit in question. If such accountants disagree,
then the parties shall be free to pursue any remedies available to them, subject
to the terms hereof, except that Licensee shall pay to ILEX the lowest amount
due as determined by either accountant, immediately.

            4.4.4. All payments due to ILEX under this Agreement shall be made
in United States dollars and shall be sent by Licensee to ILEX to the attention
of "CEO" at the address shown in Section 12.6. If Licensee receives Net Sales in
currency other than United States dollars, royalty payments due to ILEX on
account of Net Sales shall be converted into United States dollars at the
conversion rate for the foreign currency as published in the eastern edition of
The Wall Street Journal as of the last business day of the applicable calendar
quarter.

                                       9

<PAGE>

            4.4.5. Any income or other tax that Licensee hereunder, its
Affiliates or sublicensees are required by applicable law to withhold and pay on
behalf of ILEX hereunder with respect to the royalties payable under this
Agreement shall be deducted from said royalties prior to remittance to ILEX and
remitted to tax authorities; provided, however, that in regard to any tax so
deducted, the Licensee shall give or cause to be given to ILEX such assistance
as may reasonably be necessary to enable ILEX to claim exemption therefrom or
credit therefor, and in each case shall furnish ILEX proper evidence of the
taxes paid on its behalf.

            4.4.6. All sales of Products between any Party and any of its
Affiliates and sublicensees which are not final consumers shall be disregarded
for purposes of computing royalties under this Article 4, but in such instances
royalties shall be payable only upon sales to unlicensed third parties. Nothing
herein contained shall obligate any Party to pay the other Party more than one
royalty on any unit of any Product.

            4.4.7. Each Party shall, at the other Party's request, sign license
and/or royalty agreements directly with the other Party's Affiliates and
sublicensees in those situations where such agreements would not decrease the
amount of royalties which would be paid hereunder, net of withholding
obligations or otherwise impair ILEX's ability to seek recourse in the event of
breach. Such agreements shall contain the same language as contained herein with
appropriate changes in parties and territory. No such license and/or royalty
agreement will relieve Licensee of its obligations hereunder, and Licensee will
guarantee the obligations of its Affiliate or sublicensee in any such agreement.
Royalties received directly from one Party's Affiliates and sublicensees shall
be credited towards such Party's royalty obligations hereunder.

            4.4.8. The obligation to pay royalties under this Agreement shall be
waived and excused to the extent that statutes, laws, codes or governmental
regulations in a particular country prevent such royalty payments by the seller
of Products, provided that the Parties shall agree in good faith upon legally
permissible alternatives to royalty payments in order to make ILEX whole for
such waived or excused royalties. In each country where the local currency is
blocked and cannot be removed from the country, royalties accrued in that
country shall be paid to ILEX in the country in the local currency of the
country by deposit in a local bank designated by ILEX.

SECTION 5. REPRESENTATIONS AND WARRANTIES.

      5.1. ILEX represents and warrants that it is the owner or licensee of the
Licensed Patents or otherwise has the right to grant the licenses granted to
Licensee in this Agreement.

      5.2. ILEX through outside counsel mutually agreed to by the parties shall
prepare, file, prosecute and maintain patents and patent applications claiming
the inventions claimed in the Licensed Patents in jurisdictions requested by
Licensee, at Licensee's cost and expense. Licensee shall notify ILEX in writing
indicating those jurisdictions in which Licensee desires ILEX to make or
maintain such patents or patent applications, and ILEX shall thereafter make
and/or maintain such patents and patent applications.

                                       10

<PAGE>

      5.3 ILEX hereby represents that to the best of actual knowledge as of the
effective date of this Agreement, that the ****, **** and **** derivatives
described in U.S. Patent Application Serial Numbers **** and **** listed in
Exhibit A, and as exemplified by the compounds in Appendix B, are: (a) novel and
(b) do not infringe any third party patents.

      5.4. Each of the Parties hereby represents and warrants to the other Party
as follows:

            5.4.1. This Agreement is a legal and valid obligation binding upon
such Party and enforceable in accordance with its terms. The execution, delivery
and performance of this Agreement by such Party does not conflict with any
agreement, instrument or understanding, oral or written, to which it is a Party
or by which it is bound, nor violate any law or regulation of any court,
governmental body or administrative or other agency having jurisdiction over it.

            5.4.2. Such Party has not granted, and during the term of this
Agreement will not grant, any right to any third party relating to its
respective patents and know-how which would conflict with the rights granted to
the other Party hereunder.

            5.4.3. The Parties recognize that each may perform some or all of
its obligations under this Agreement through Affiliates. Each Party shall remain
responsible for, and hereby guarantees, the performance by its Affiliates and
shall cause its Affiliates to comply with the provisions of this Agreement in
connection with such performance. In the event of any dispute arising from the
performance by an Affiliate under this Agreement, the Party having such a
dispute may proceed directly against the other Party, without any obligation to
first proceed against the Affiliate.

SECTION 6. TERM AND TERMINATION.

      6.1. The term of this license shall begin on the Effective Date of this
Agreement and continue until this Agreement is terminated as provided herein.

      6.2. Licensee may terminate this Agreement at any time by giving at least
90 days written and unambiguous notice of such termination to ILEX. Such a
notice shall be accompanied by a statement of the reasons for termination.

      6.3. If Licensee at any time defaults in the timely payment of any monies
due to ILEX hereunder or ceases to carry out its business related to this
Agreement or becomes insolvent or commits any material breach of any other
material covenant herein contained (other than Licensee's obligations contained
in Section 7), and Licensee fails to remedy any such breach or default within 60
days after written notice thereof by ILEX, ILEX may, at its option, terminate
this Agreement as it applies to the Product and in the country with respect to
which such breach occurred by giving written notice of termination to Licensee.

      6.4. Upon the termination of this Agreement, Licensee shall remain
obligated to provide an accounting for and to pay milestone payments and
royalties earned up to the date of the termination and any minimum royalties
shall be prorated as of the date of termination by the number of days elapsed in
the applicable 12 month period.

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<PAGE>

      6.5. Waiver by either Party of a single breach or default, or a succession
of breaches or defaults, shall not deprive such Party of any right to terminate
this Agreement in the event of any subsequent breach or default.

      6.6 If the Agreement is terminated under Section 6.2 or 6.3 above,
Licensee shall promptly transfer to ILEX all Technical Information received from
ILEX in Licensee's possession relating to Products. Licensee shall promptly
transfer to ILEX ownership of any IND, NDA or other regulatory filing relating
to the development or marketing approval of any Product and any invention,
patent application and/or patent relating to Products which is included in the
Licensed Patents in the applicable country where Licensee's rights have been
terminated, if the License is terminated for cause under Section 6.3 above. ILEX
will pay to Licensee ****% of the revenue received from a third party licensee
or purchaser of the Product in question (capped at ****% of all Licensee's costs
incurred in creating and/or obtaining the same). Otherwise, if the termination
is by Licensee under Section 6.2, all of the above-noted transfers of ownership
shall be free-of-charge to ILEX.

SECTION 7. CONFIDENTIALITY.

      7.1. Except as specifically permitted hereunder or as required to
research, develop, manufacture or market Products or potential Products, each
Party hereby agrees to hold in confidence and not use on behalf of itself or
others, all data, samples, technical and economic information (including the
economic terms hereof), commercialization, clinical and research strategies and
know-how provided by the other Party (the "Disclosing Party") for a period of
five years from the date of disclosure and all data, results and information
developed pursuant to any services agreement under Section 3.4 hereof, and
solely owned by the other Party (collectively the "Confidential Information"),
except that the term "Confidential Information" shall not include:

                  (i) information that is or becomes part of the public domain
through no fault of the non-Disclosing Party or its Affiliates;

                  (ii) information that is obtained after the date hereof by the
non-Disclosing Party or one of its Affiliates from any third party which is
lawfully in possession of such Confidential Information and not in violation of
any contractual or legal obligation to the Disclosing Party with respect to such
Confidential Information;

                  (iii) information that is known to the non-Disclosing Party or
one or more of its Affiliates prior to disclosure by the Disclosing Party, as
evidenced by the non-Disclosing Party's written records; and

                  (iv) information that is necessary to be disclosed to any
governmental authorities or pursuant to any regulatory filings, provided that in
such case the non-Disclosing Party notifies the Disclosing Party reasonably in
advance of such disclosure and cooperates with the Disclosing Party to minimize
the scope or content of such disclosure.

      7.2. The Parties shall cooperate in the publication of the results of the
development, provided that Licensee shall have sole control over all such
publications. Neither Party shall issue any communications to the general public
regarding the contents of this Agreement without the prior written consent of
the other

                                       12

<PAGE>

Party (not to be unreasonably withheld), except to the extent required by any
law, rule or regulation, or advice of independent counsel, and in such event,
each Party shall use reasonable efforts to provide the other Party with a copy
of such communication at least 4 business days prior to release and shall in
good faith consider all comments or suggested edits made by other Party. With
regard to press releases relating to milestones achieved by the development of
Products, each Party shall use reasonable efforts to provide the other Party
with a copy of such press releases at least 4 business days prior to release and
shall in good faith consider all comments or suggested edits made by other
Party. Notwithstanding the forgoing, either Party may make any public written
disclosure it believes in good faith based upon the advice of counsel is
required by applicable law, rule or regulation or any listing or trading
agreement concerning its or its Affiliates publicly traded securities; provided,
however, that such written disclosure shall minimize to the extent possible the
financial information disclosed, and that at least 4 business days prior to
making such written disclosure, the disclosing Party shall provide to other
Party a copy of the materials proposed to be disclosed and provide the receiving
Party with an opportunity to promptly review the written disclosure. Failure by
either Party to meet to provide notice within the time periods set forth in this
Section shall not constitute a breach sufficient to permit termination of this
Agreement by the other Party, although such other Party shall retain the right
to pursue any other legal or equitable remedies available to it.

      7.3. The obligations of Section 7.1 shall survive the expiration or
termination of this Agreement for a period of 5 years.

SECTION 8. INTELLECTUAL PROPERTY RIGHTS.

      8.1. Inventorship of any invention that is developed, discovered or made
by a Party, solely or jointly with the other Party (as applicable, the
"Inventor") pursuant to work conducted under this Agreement (an "Invention")
shall be determined in accordance with United States laws of inventorship.
Subject only to the license rights granted under this Agreement, Licensee shall
own the entire right, title and interest in and to all Inventions resulting from
work conducted under this Agreement regardless of which Party's employees or
agents are Inventors thereof. Each Party shall promptly notify the other Party
if it determines that an Invention has been made. ILEX shall obtain from each of
its employees, contractors, representatives and agents a written obligation to
assign to ILEX all right, title and interest in and to all Inventions. ILEX
further agrees that it shall, and it hereby does, assign to Licensee all of
ILEX's right, title and interest in and to all Inventions which may arise out of
any service agreement under Section 3.4 or other work conducted pursuant to this
Agreement.

      8.2. With respect to any patent that claims any Invention which is owned
by or assigned to Licensee hereunder, Licensee shall have the right, at its
option and expense, to prepare, file and prosecute in its own name any patents
with respect to any such Invention and to maintain any patents issued thereon.
In connection with any such prosecution efforts, ILEX agrees to cooperate
reasonably with Licensee at the Licensee's expense in the preparation and
prosecution of all such patents and in the maintenance of any patents issued.
This obligation shall survive the expiration or termination of this Agreement.

      8.3. Licensee shall own all right, title and interest in and to all
information, data, records and reports arising out of or relating to the
research and/or development of Products carried out by Licensee or on Licensee's
behalf, subsequent to the Effective Date. ILEX shall take such action and
execute such documents as Licensee shall reasonably request in order to
effectuate such ownership rights of Licensee.

                                       13

<PAGE>

      8.4. Each of ILEX and Licensee shall promptly inform the other in writing
of any infringement of Licensed Patents by a third party in the Field of which
it has knowledge and shall provide the other with any available information
relating to such infringement. Licensee shall have the first right to prosecute
infringers at its own cost and expense and Licensee may for such purposes use
the name of ILEX as Party plaintiffs. ILEX shall reasonably cooperate with
Licensee, at Licensee's expense, in connection therewith.

      8.5. If within ninety (90) days after having been notified by Licensee of
any alleged infringement pursuant to Section 8.4, Licensee has been unsuccessful
in persuading the alleged infringer to desist and has not brought, and is not
diligently maintaining an infringement action or if Licensee notifies ILEX at
any time prior thereto of its intention not to bring suit against any alleged
infringer, then ILEX may, but shall not be obligated to, prosecute, at its own
expense, any infringement of the Licensed Patents in the Field, provided that
Licensee may, at Licensee's expense, participate in any such litigation to the
extent required to protect its rights.

      8.6. In the event that Licensee undertakes the enforcement and/or defense
of the Licensed Patents by litigation or settlement action, Licensee may
withhold royalties otherwise thereafter due ILEX hereunder to the extent of the
amount of its expenses, including reasonable attorney's fees in connection
therewith. Any recovery of damages by Licensee for any such suit shall be
applied first in satisfaction of any unreimbursed expenses and legal fees of
Licensee relating to the suit or settlement thereof, and next toward
reimbursement of ILEX for any royalties withheld and applied pursuant to this
Section. The balance thereafter remaining from such recovery shall be treated as
Net Sales to Licensee and Licensee shall pay a royalty to ILEX as though such
amount constituted Net Sales in the year of recovery for purposes of this
Agreement. No settlement, or consent judgment, or other voluntary final
disposition of the suit may be entered into without the consent of ILEX, which
consent shall not be unreasonably withheld or delayed.

      8.7. In the event that ILEX undertakes the enforcement and/or defense of
the Licensed Patents by litigation or settlement action, any recovery of damages
by ILEX shall be retained in full by ILEX. Provided Licensee is not in breach of
this Agreement and is current in reimbursing ILEX for all costs and expenses,
including reasonable attorney fees and legal costs, in connection with such
litigation or action, no settlement, or consent judgment, or other voluntary
final disposition of the suit, which may limit Licensee's rights hereunder may
be entered into without the consent of Licensee, which consent shall not be
unreasonably withheld or delayed.

      8.8. In the event any action in a court of competent jurisdiction alleging
invalidity, unenforceability, or non-infringement of any of the Licensed Patents
is brought against Licensee or ILEX, ILEX shall, within thirty (30) days after
commencement of such action, intervene and take over the sole defense of the
action at its own expense. ILEX is not aware of any patents or patent
applications which may be infringed by the sale of Products other than the
Licensed Patents.

      8.9. In any infringement suit that either Party may institute to enforce
the Licensed Patents or in any declaratory Judgment action alleging invalidity,
unenforceability or non-infringement of any Licensed Patents brought against
either Party, the other Party hereto agrees, at the request and expense of the
Party initiating or defending the suit or action, to operate in all reasonable
respects and to have its employees testify when requested and to make available
relevant records, papers, information samples, specimens, and the like.

                                       14

<PAGE>

SECTION 9. INDEMNIFICATION.

      9.1. Each Party hereby agrees to save, defend and hold the other Party and
its agents and employees harmless from and against any and all costs, expenses
(including reasonable attorneys' fees and amounts paid in settlement), damages
and liabilities claimed by a third party ("Claim") resulting directly or
indirectly from activities conducted by the indemnifying Party, its agents or
sublicensees, but only to the extent such Claim results from the negligence or
willful misconduct or breach of this Agreement by such Party or its employees
and agents and only to the extent such Claim does not also result from the
negligence or willful misconduct or breach of this Agreement by the Party
seeking indemnification or its agents or sublicensees.

      9.2. In the event that a Party is seeking indemnification under this
Section 9, it shall inform the other Party of a Claim as soon as reasonably
practicable after it receives notice of the Claim, shall permit the indemnifying
Party to assume direction and control of the defense of the Claim (including the
right to settle the Claim solely for monetary consideration), and shall
cooperate as requested in the defense and settlement of the Claim. The
indemnified Party shall not voluntarily make any payment or incur any expense in
connection with any claim or suit without the consent of the indemnifying Party,
provided that if the indemnifying Party does not assume direction and control of
the defense of the Claim, the indemnified Party may assume direction and control
of the defense of the Claim and, if successful, shall be reimbursed by the
indemnifying Party for reasonable costs, actually incurred, in connection with
such defense.

      9.3. The terms of this Section 9 shall survive the termination or
expiration of this Agreement.

SECTION 10. INSURANCE.

      10.1. Beginning on the Effective Date, Licensee shall, at its sole cost
and expense, procure and maintain comprehensive general liability insurance in
amounts not less than $2,000,000 per incident and $5,000,000 annual aggregate
and naming ILEX as additional insureds. Such comprehensive, general liability
insurance shall provide: (i) product liability coverage and (ii) broad form
contractual liability coverage for Licensee's indemnification of ILEX under
Section 9.1 of this Agreement. ILEX shall at all times procure and maintain
comprehensive general liability insurance in amounts not less than $2,000,000
per incident and $5,000,000 annual aggregate and naming Licensee as an
additional insureds. Such comprehensive, general liability insurance shall
provide: (i) product liability coverage and (ii) broad form contractual
liability coverage for ILEX's indemnification of Licensee under Section 9.1 of
this Agreement.

      10.2. Each party shall provide the other with written evidence of such
insurance upon request. Each party shall provide the other with written notice
at least forty-five (45) days prior to the cancellation, non-renewal, or
material change in such insurance; if a party does not obtain replacement
insurance providing comparable coverage within such forty-five (45) day period,
the other party shall have the right to terminate this Agreement effective at
the end of such forty-five (45) day period without notice or any additional
waiting periods.

      10.3. Each party shall maintain such comprehensive, general liability
insurance beyond the expiration or termination of this Agreement during: (i) the
period that any Licensed Product is being commercially distributed or sold
(other than for the purpose of obtaining regulatory approvals) by Licensee

                                       15

<PAGE>

or by an Affiliate or sublicensee of Licensee and (ii) a reasonable period after
the period referred above, but in no event less than fifteen (15) years.

SECTION 11. WARRANTY DISCLAIMER.

      11.1. EXCEPT AS EXPRESSLY PROVIDED HEREIN, NEITHER PARTY MAKES ANY EXPRESS
OR IMPLIED WARRANTY, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE WITH
RESPECT TO ANY PRODUCT AND HEREBY DISCLAIMS THE SAME.

      11.2. EXCEPT AS EXPRESSLY PROVIDED HEREIN, ILEX MAKES NO EXPRESS OR
IMPLIED WARRANTY THAT USE OR SALE OF ANY PRODUCT WILL NOT INFRINGE PATENTS OF
THIRD PARTIES AND HEREBY DISCLAIMS THE SAME.

SECTION 12. MISCELLANEOUS.

      12.1. Dispute Resolution.

            12.1.1. Informal Resolution Procedure. The Parties recognize that
disputes as to certain matters may from time to time arise during the term of
this Agreement which relate to either Party's rights and/or obligations. It is
the objective of the Parties to establish procedures to facilitate the
resolution of disputes arising under this Agreement in an expedient manner by
mutual cooperation and without resort to litigation, if possible. To accomplish
this objective, the Parties agree to follow the procedures set in this Section
12.1 if and when an issue or dispute arises under this Agreement.

            12.1.2. Chief Executive Discussion. In the event of any claim,
controversy, issue or dispute arising out of, or related to, this Agreement
which the parties are unable or unwilling to resolve on an informal basis
(collectively referred to hereafter as "Claim"), the aggrieved Party shall
submit written notice thereof to the other Party. If representatives of both
Parties, other than their respective chief executive officers, are unable to
resolve any such Claim arising within their authority within thirty (30) days
after receipt of written notice of same, either Party may, by written notice to
the other (the "Executive Referral Notice"), require that such Claim be referred
to the Parties' respective chief executive officers for attempted resolution by
good faith negotiations. Within thirty (30) days of the date of the Executive
Referral Notice, such chief executive officers shall meet at a mutually
agreeable time and place and shall use good faith efforts to attempt to resolve
such dispute or issue.

            12.1.3 Mediation. If such chief executive officers fail to resolve
such Claim within thirty (30) days of the date of the Executive Referral Notice,
then the matter shall be submitted to a mandatory one-day non-binding mediation
between the Parties in Chicago, Illinois before a mediator mutually-agreed to by
the Parties, which mediation shall take place within sixty (60) days of the date
of the Executive Referral Notice. If the Parties are unable to agree on the
identity of the mediator, the specific location or time of mediation, then the
Claim shall be deemed unresolved and the terms of Section 12.1.4 shall apply.

                                       16

<PAGE>

            12.1.4 Binding Arbitration. If the Claim is still not resolved sixty
(60) days after the date of the Executive Referral Notice, the Claim shall be
decided by arbitration before the American Arbitration Association in accordance
with the Commercial Arbitration Rules ("Rules") of the American Arbitration
Association, unless the Parties agree otherwise. This agreement to arbitrate
shall be specifically enforceable under the Federal Arbitration Act. Within
ninety (90) days of the date of the Executive Referral Notice, each Party shall
select an arbitrator and give written notice to the other Party of the identity
of such arbitrator. Within one hundred twenty (120) days of the date of the
Executive Referral Notice, the arbitrators shall select a neutral arbitrator.
The arbitration shall be conducted by such panel of three arbitrators selected
in accordance with this Agreement. In the event the two Party-selected
arbitrators are unable to agree on the identity of the third arbitrator, such
third arbitrator shall be a neutral arbitrator selected in accordance with the
Rules. The award rendered by the arbitrators shall be a "reasoned award",
including findings of fact and conclusions of law. Such award shall be final and
binding on all Parties, and judgment may be entered thereon in any court having
jurisdiction thereof, except that either Party shall be entitled to de novo
review of said award, including the findings of fact and conclusions of law, in
a court of competent jurisdiction in New York, New York. The arbitration shall
be held in New York, New York.

      12.2. Assignment.

            12.2.1. Affiliates. Either Party may assign any of its rights or
obligations under this Agreement in any country to any Affiliates; provided,
however, that such assignment shall not relieve the assigning Party of its
responsibilities for performance of its obligations under this Agreement, and
further provided that if a proposed assignment would have an adverse financial
impact upon the non-assigning Party (e.g., by reason of changed tax treatment of
payments due under this Agreement), such assignment shall be subject to the
other Party's prior written consent. ILEX agrees that it shall not assign any
Licensed Patents to a competitor of the Licensee in the Field without written
agreement of the Licensee, except such written consent is not required to the
same extent that Parties have the ability to assign rights and obligations
without written consent as set forth in Section 12.2.2.

            12.2.2. Merger, Acquisition Or Sale Of Assets. Subject to the terms
hereof, either Party may assign its rights or obligations under this Agreement
to a non-Affiliate only in connection with a merger or similar reorganization or
the sale of all or substantially all of its assets or the sale of all or
substantially all of its pharmaceutical and/or healthcare assets, or otherwise
without the prior written consent of the other Party. This Agreement shall
survive any such merger or reorganization of either Party with or into, or such
sale of assets to, another party and shall be fully enforceable against the
surviving, consolidated or reorganized entity of such merger, consolidation or
re-organization and no consent for such merger, reorganization or sale shall be
required hereunder; provided, that in the event of such merger, reorganization
or sale, no intellectual property rights of the acquiring corporation shall be
included in the technology licensed hereunder.

            12.2.3. Binding Upon Successors And Assigns. This Agreement shall be
binding upon and inure to the benefit of the successors and permitted assigns of
the Parties. Any assignment not in accordance with this Agreement shall be void
and the rights and obligations shall remain in the Party that attempted the void
assignment.

      12.3. Further Actions. Each Party agrees to execute, acknowledge and
deliver such further instruments, and to do all such other acts, as may be
necessary or appropriate in order to carry out the purposes and intent of this
Agreement.

                                       17

<PAGE>

      12.4. No Trademark Rights. Except as otherwise provided herein, no right,
express or implied, is granted by this Agreement to use in any manner the name
ILEX, Licensee or any other trade name or trademark of either Party or its
Affiliates in connection with the performance of this Agreement.

      12.5. Patent Marking. Licensee agrees to mark permanently and legibly all
Products manufactured and sold by it, its Affiliates and/or sublicensees under
this Agreement with the number of each issued patent applicable thereto.

      12.6. Notices. All notices hereunder shall be in writing and shall be
deemed given if delivered personally or by facsimile transmission (receipt
verified), telexed, mailed by registered or certified mail (return receipt
requested), postage prepaid, or sent by express courier service, to the Parties
at the following addresses (or at such other address for a Party as shall be
specified by like notice; provided, that notices of a change of address shall be
effective only upon receipt thereof).

      If to Licensee, addressed to:
            Quatrx Pharmaceuticals Company
            5430 Data Court, Suite 300
            Ann Arbor, MI 48108
            Attention: CEO
            Telephone: 734-913-0743
            Telecopy: 734-913-9900

      With a copy to:
            Brinza & Associates
            49697 Leyland
            Novi, MI 48374
            Attention: Jeffery M. Brinza, Esq.
            Telephone: 248-939-3927

      If to ILEX, addressed to:
            ILEX Products, Inc.
            4545 Horizon Hill Blvd.
            San Antonio, Texas 78229-22631550
            Attention: CEO
            Telephone: 210-949-8200
            Telecopy: 210-949-8210

      12.7. Limitation Of Liability. IN NO EVENT SHALL EITHER PARTY OR ITS
RESPECTIVE AFFILIATES AND PERMITTED SUBLICENSEES BE LIABLE FOR SPECIAL,
EXEMPLARY, CONSEQUENTIAL OR PUNITIVE DAMAGES, WHETHER IN CONTRACT, WARRANTY,
TORT, STRICT LIABILITY OR OTHERWISE, except to the extent such Party may be
required to indemnify the other Party from such damages claimed by third parties
under Article 9.

                                       18

<PAGE>

      12.8. Waiver. Except as specifically provided for herein, the waiver from
time to time by either of the Parties of any of their rights or their failure to
exercise any remedy shall not operate or be construed as a continuing waiver of
same or of any other of such Party's rights or remedies provided in this
Agreement.

      12.9. Severability. If any term, covenant or condition of this Agreement
or the application thereof to any Party or circumstance shall, to any extent, be
held to be invalid or unenforceable, then (i) the remainder of this Agreement,
or the application of such term, covenant or condition to the Parties or under
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby and each term, covenant or condition of this
Agreement shall be valid and be enforced to the fullest extent permitted by law;
and (ii) the Parties hereto covenant and agree to renegotiate any such term,
covenant or application thereof in good faith in order to provide a reasonably
acceptable alternative to the term, covenant or condition of this Agreement or
the application thereof that is invalid or unenforceable, it being the intent of
the Parties that the basic purposes of this Agreement are to be effectuated.

      12.10. Ambiguities. Ambiguities, if any, in this Agreement shall not be
construed against any Party, irrespective of which Party may be deemed to have
authored the ambiguous provision.

      12.11. Governing Law. This Agreement is made pursuant to and shall be
governed by and construed in accordance with the laws of the State of New York,
United States, without reference to conflicts of laws' rules or principles.

      12.12. Bankruptcy Provision. All rights and licenses granted by ILEX to
Licensee under or pursuant to this Agreement are, and shall otherwise be deemed
to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of
rights to "intellectual property" as defined in Section 101 of the Bankruptcy
Code. The Parties agree that Licensee, as exclusive licensee of such rights
under this Agreement, shall retain and may fully exercise all of its rights and
elections under the Bankruptcy Code. The Parties further agree that, in the
event of the commencement of a bankruptcy proceeding by or against ILEX under
the Bankruptcy Code, Licensee shall be entitled to a complete duplicate of (or
complete access to, as appropriate) any such intellectual property and all
embodiments of such intellectual property, and same, if not already in its
possession, shall be promptly delivered to Licensee (i) upon such commencement
of a bankruptcy proceeding, unless ILEX elects to continue to perform all of its
obligations under this Agreement; or (ii) if not delivered under (i) above, upon
rejection of this Agreement by or on behalf of ILEX.

      12.13. Headings. The Section headings contained herein are for the
purposes of convenience only and are not intended to define or limit the
contents of said Sections.

      12.14. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

      12.15. Entire Agreement. This Agreement and all exhibits attached hereto,
and all documents delivered concurrently herewith, set forth all the covenants,
promises, agreements, warranties, representations, conditions and understandings
between the Parties hereto with respect to the subject matter hereof and
supersede and terminate all prior agreements and understanding between the
Parties as to such subject matter. There are no covenants, promises, agreements,
warranties, representations, conditions or understandings, either oral or
written, between the Parties with respect to such subject matter

                                       19

<PAGE>

other than as set forth herein and therein. No subsequent alteration, amendment,
change or addition to this Agreement shall be binding upon the Parties hereto
unless reduced to writing and signed by the respective authorized officers of
the Parties. This Agreement shall not constitute an amendment of either of the
existing collaboration agreements between the Parties, each of which will
continue in full force and effect.

      12.16. Independent Contractors. Each Party acknowledges that neither it
nor any of its employees are employees of the other Party and that neither it
nor any of its employees are eligible to participate in any employee benefit
plans of the other Party. Each Party further acknowledges that neither it nor
any of its employees are eligible to participate in any such benefit plans even
if it is later determined that its or any of its employees' status during the
period of this Agreement was that of an employee of the other Party. In
addition, each Party hereby waives any claim that it may have under the terms of
any such benefit plans or under any law for participation in or benefits under
any of the other Party's benefit plans.

      12.17 Use Of Names. Neither Party shall use the name of the other Party in
relation to this transaction in any public announcement, press release or other
public document without the written consent of such other Party, which consent
shall not be unreasonably withheld or delayed; provided, however, that either
Party may use the name of the other Party in any document required to be filed
to obtain regulatory approval or to comply with applicable laws, rules or
regulations.

      12.18. Force Majeure. Neither Party shall lose any rights hereunder or be
liable to the other Party for damages or losses on account of failure of
performance by the defaulting Party if the failure is occasioned by government
action, war, fire, earthquake, explosion, flood, strike, lockout, embargo, act
of God, or any other similar or dissimilar cause beyond the control of the
defaulting Party, provided that the Party claiming force majeure has exerted all
reasonable efforts to avoid or remedy such force majeure. In the event, the
force majeure event persists for more than six (6) months, either Party shall
have the right to terminate this Agreement.

                                       20

<PAGE>


      IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
on the dates indicated below.

QUATRX PHARMACEUTICALS COMPANY                   ILEX PRODUCTS, INC.

By:  /s/ Robert L. Zerbe                         By:   /s/ Jeffrey H. Buchalter
    --------------------------                       ---------------------------
(Signature)                                          (Signature)

  Robert L. Zerbe                                    Jeffrey H. Buchalter
------------------------------                   -------------------------------
(Print Name)                                     (Print Name)

Title: CEO                                       Title: CEO

                                       21

<PAGE>

                                    EXHIBIT A
                                LICENSED PATENTS

SECTION 1: LDL/LP(a)

<TABLE>
<CAPTION>
JURISDICTION                        APPLICATION NO.; PATENT NO.
------------                        ---------------------------
<S>                                 <C>
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****

****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
****                                ****
</TABLE>

                                       22

<PAGE>

<TABLE>
<S>                                 <C>
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******

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

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

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

******                              ******
******                              ******
</TABLE>

                                       23

<PAGE>

                              SECTION 2: HDL/APO E

<TABLE>
<CAPTION>
JURISDICTION                        APPLICATION NO.; PATENT NO.
------------                        ---------------------------
<S>                                 <C>
******                              ******
******                              ******
******                              ******
******                              ******
******                              ******

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

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

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

******                              ******
</TABLE>

                                       24
<PAGE>

                                   APPENDIX A
                   (EXCLUDED PATENTS AND PATENT APPLICATIONS)

PHENOL SUBSTITUTED GEM DIPHOSPHONATE DERIVATIVES

<TABLE>
<CAPTION>
JURISDICTION         APPLICATION NO.                    PATENT NO
<S>                  <C>                                <C>
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
****                 ****                               ****
</TABLE>

BONE ANABOLIC COMPOUNDS

<TABLE>
<CAPTION>
JURISDICTION         APPLICATION NO.                    PATENT NO
<S>                  <C>                                <C>
****                 ****                               ****
</TABLE>

SUBSTITUTED PHOSPHONATES HAVING BONE ANABOLIC ACTIVITY

<TABLE>
<CAPTION>
JURISDICTION         APPLICATION NO.                    PATENT NO
<S>                  <C>                                <C>
****                 ****
</TABLE>

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<PAGE>

                                   APPENDIX B

                                [CHEMICAL BONDS]

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