DIAZ & ALTSCHUL
       CAPITAL, LLC

                                                                   Exhibit 10.70

                                                        July 1, 1998

ImClone Systems Incorporated
180 Varick Street
New York, New York 10014

Attention: Dr. Harlan Waksal

Dear Sir:

                              Engagement Agreement

      This  letter  agreement  (this  "Agreement")  confirms  the  understanding
between  ImClone  Systems   Incorporated,   a  Delaware  corporation  (with  its
affiliates collectively,  the "Company"),  and Diaz & Altschul Capital, LLC (the
"Financial  Advisor"),  pursuant to which the Company has retained the Financial
Advisor  to  render  certain  financial  advisory  services  to the  Company  in
connection with a currently contemplated  transaction,  on the terms and subject
to the conditions set forth herein,  in connection with the matters  referred to
herein.

      1. Retention.  The Company hereby retains the Financial  Advisor to assist
the Company in analyzing,  structuring,  negotiating, and effecting the proposed
Transaction on the terms and conditions of this  Agreement.  If requested by the
Company,  the Financial Advisor will render an opinion, as to whether or not the
Transaction is fair, from a financial point of view, to the  stockholders of the
Company. If an opinion is requested,  the Company and the Financial Advisor will
enter into a separate agreement  containing customary terms and conditions to be
mutually  agreed  upon.  The  parties  acknowledge  that such an opinion  may be
requested  from a third party.  In addition,  the parties  acknowledge  that the
Financial Advisor might retain Hambrecht & Quist Incorporated  ("H&Q") to assist
the  Financial  Advisor  in  rendering  its  services  under this  Agreement  in
connection  with  the  Transaction.  In  connection  with  such  retention,  the
Financial  Advisor shall be solely  responsible for any compensation  payable to
H&Q in connection with the Transaction

      2. Transaction.  As used in this Agreement,  the term "Transaction"  means
the  currently  contemplated  purchase  directly  from the  Company  or from the
Company's shareholders of not less than 20% of the Company's common stock ($.001
par value) (the "Common Stock") outstanding after the Transaction, or securities
convertible  into not less that 20% of the  Company's  Common Stock  outstanding
after the Transaction.  The parties acknowledge that the Transaction is separate
and  apart  from  subsequent  purchases  that  may  occur  making  up  a  larger
transaction.

                 745 FIFTH AVENUE SUITE 3001 NEW YORK, NY 10151
                      PHONE 212.751.1011 FAX 212.751.5757

                                   MEMBER-NASD

<PAGE>


      3.  Compensation.  As compensation  for the Financial  Advisor's  services
hereunder, the Company agrees to pay the Financial Advisor the following fees:

      (a)   a retainer fee of $35,000 per month (the  "Retainer  Fee"),  payable
            monthly in advance,  commencing on July 1, 1998 and terminating upon
            the earlier of the closing of the  Transaction  or the date that the
            Company notifies the Financial  Advisor that it no longer intends to
            pursue the Transaction which amount shall be creditable  against the
            Transaction Fee set forth in (b) below, and

      (b)   a fee (the  "Transaction  Fee")  equal to .75% of the  consideration
            paid in the Transaction

      4. Expenses.  Whether or not any  Transaction is agreed to or consummated,
the Company agrees to reimburse the Financial Advisor, upon request from time to
time, for its reasonable  out-of-pocket expenses,  including the reasonable fees
and expenses of its legal counsel and any agents or experts that may be retained
by the Financial  Advisor,  incurred in connection  with the services  performed
hereunder  and  the  other  advisory  and  capital   raising   assignments   and
transactions for which the Financial  Advisor has performed  financial  advisory
services to the Company;  provided however, that such reimbursable expenses will
not exceed in the aggregate $35,000 without the consent of the Company.

      5. Termination or Resignation.  Subject to Section 8 hereof, the Financial
Advisor  shall have the right at any time during the term of this  Agreement  to
resign on ten days' prior written notice and the Company shall have the right at
any time during the term of this Agreement to terminate the Financial  Advisor's
services under this Agreement for any reason on ten days' prior written  notice.
If the Company  terminates  the Financial  Advisor's  services  hereunder at any
time, with respect to the consummation of the Transaction within 12 months after
such termination,  the Financial Advisor shall be entitled to receive all of the
amounts  payable  pursuant  to  Section 3 hereof as if the  Financial  Advisor's
services had not been terminated.

      6.  Indemnity.  As the Financial  Advisor shall be acting on behalf of the
Company,  the Company  agrees to indemnify the  Financial  Advisor and the other
Indemnified  Persons as set forth in  Schedule 1 hereto,  which is  incorporated
herein and made a part hereof.

      7.  Representations and Warranties of Company.  The Company represents and
warrants as follows:  

      (a) This  Agreement  has been duly  authorized  and validly  executed  and
delivered by the Company and constitutes a legal, valid and binding agreement of
the Company enforceable against the Company in accordance with its terms.

      (b) Any  information  provided to the Financial  Advisor by the Company in
connection with the Transaction,  or any document  distributed by the Company to
its  stockholders  or filed by the  Company  with the  Securities  and  Exchange
Commission  or any other  federal,  


                                       2
<PAGE>

state,  local or foreign government or any agency or department thereof will not
contain  any untrue  statements  of a material  fact or omit to state  therein a
material  fact  necessary  to make  the  statements  therein,  in  light  of the
circumstances under which they were made, not misleading.

      8. Further Covenants of the Company. The Company agrees as follows:

      (a) The Company  agrees  that,  except as  otherwise  required by law, any
reference to the Financial  Advisor or any affiliate of the Financial Advisor in
any  document,  or any other release or  communication  to any party outside the
Company,  is subject to the Financial  Advisor's prior approval (which shall not
be unreasonably  withheld),  which shall be given or  subsequently  confirmed in
writing.  Except as otherwise  required by law, if the Financial Advisor resigns
its appointment or is terminated prior to the dissemination of any such document
or other  release or  communication,  no reference  shall be made therein to the
Financial Advisor without the Financial Advisor's prior written permission; and

      (b) In connection with the Financial Advisor's activities  hereunder,  the
Company agrees to furnish the Financial Advisor with all information  concerning
the Company that the Financial  Advisor  reasonably deems appropriate and agrees
to provide  the  Financial  Advisor  with  appropriate  access to the  Company's
accountants,   counsel,   consultants   and   other   appropriate   agents   and
representatives.  The Company  acknowledges  that the Financial Advisor may rely
upon the  completeness  and accuracy of information  and data furnished to it by
the Company's officers, directors, employees, agents and representatives without
independent  verification  of such  information  and data or an appraisal of the
Company's assets.

      9.   Confidentiality.   The  parties  have  executed  the  Confidentiality
Agreement  dated as of April 21, 1998  appearing as Schedule 2 hereto,  which is
incorporated herein and made a part hereof.

      10.  Survival of Certain  Provisions;  Succession.  The  compensation  and
expense  provisions  contained  in  Sections 3 and 4 (subject to Section 5), the
termination and resignation provisions contained in Section 5, the indemnity and
contribution   agreements   contained   in  Section  6  and   Schedule   1,  the
confidentiality   provisions   contained  in  Section  9  and  Schedule  2,  the
representations  and warranties of the Company contained in Section 7, Section 8
and  this  Section  10 shall  remain  operative  and in full  force  and  effect
regardless  of (a) any  investigation  made  by or on  behalf  of the  Financial
Advisor  or by or on behalf  of any  affiliate  of the  Financial  Advisor,  any
Indemnified Person (as defined in Schedule 1 hereto),  or any person controlling
any of them, (b)  consummation  of the  Transaction,  or (c) any  termination or
expiration of this  Agreement or the  Financial  Advisor's  services  under this
Agreement or resignation of the Financial  Advisor,  and this Agreement shall be
binding upon, and shall inure to the benefit of, any successors,  assigns, heirs
and  personal  representatives  of  the  Company,  the  Financial  Advisor,  the
Indemnified Persons and any such person.

      11.  Notices.  Notice  given  pursuant  to any of the  provisions  of this
Agreement  shall be in writing  and shall be mailed or  delivered  (which  shall
include telephone line facsimile 


                                       3
<PAGE>

transmission)  to the Company at the address set forth on the first page of this
Agreement or at the following telephone line facsimile transmission number (212)
645-2054,  as the case may be, and to the Financial Advisor at 745 Fifth Avenue,
Suite  3001,  New York,  New York  10151,  or at the  following  telephone  line
facsimile  line  transmission  number:  (212)  751-5757,  as the case may be, in
either case with a copy to Law  Offices of Brian W Pusch,  Penthouse  Suite,  29
West  57th  Street,   New  York,  New  York  10019   (telephone  line  facsimile
transmission  number (212)  980-7055).  Any such notice shall be effective  upon
receipt.

      12. Construction.  This Agreement incorporates the entire understanding of
the parties and supersedes all previous  agreements  with respect to the subject
matter hereof and shall be governed by, and construed in  accordance  with,  the
laws of the State of New York as applied to contracts made and performed  wholly
in the State of New York, without regard to principles of conflict of laws.

      13.  Severability.  Any determination that any provision of this Agreement
may  be,  or is,  unenforceable  shall  not  affect  the  enforceability  of the
remainder of this Agreement.

      14. Headings. The section headings in this Agreement have been inserted as
a matter of  convenience  for  reference  and are not an effective  part of this
Agreement.

      15.  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 instrument.

      16. Third Party Beneficiaries.  This Agreement has been and is made solely
for the benefit of the Company,  the Financial Advisor and the other Indemnified
Persons  referred  to in Section 6 hereof and their  respective  successors  and
permitted assigns,  and no other person shall acquire or have any right under or
by virtue of this Agreement.

      17. Succession; Assignment. This Agreement shall be binding upon and inure
to the benefit of the Company,  the Financial Advisor,  the Indemnified  Persons
and  their  respective   successors,   permitted  assigns,  heirs  and  personal
representatives.  No party may  assign  its  rights or  obligations  under  this
Agreement  without  the  prior  written  consent  of the  other  party  to  this
Agreement.

      l8. Advertisements.  The Company agrees that the Financial Advisor and the
Company  each  shall  have the  right to place  advertisements  after  the final
closing of the Transaction in financial and other newspapers and journals at its
own expense  describing  its services to the Company  hereunder.  The  Financial
Advisor shall afford the Company a reasonable  opportunity to review the text of
any such  advertisement  before it is placed  and will not  include  in any such
advertisement any statements to which the Company reasonably objects.


                                       4
<PAGE>

      If the foregoing terms  correctly set forth our agreement,  please confirm
this by signing and returning the duplicate copy of this letter.  Thereupon this
letter, as signed in counterpart,  shall constitute our agreement on the subject
matter herein.

                                             DIAZ & ALTSCHUL CAPITAL, LLP

                                             By: /s/ Reinaldo M. Diaz
                                             -----------------------------------
                                             Name: Reinaldo M. Diaz
                                             Authorized Signatory

Confirmed and Agreed to as of the 
date first set forth above:

IMCLONE SYSTEMS INCORPORATED

By: /s/ Dr. Harlan Waksal
----------------------------------------
Name: Dr. Harlan Waksal,
Title: Executive Vice President & Chief Operating Officer


                                       5
<PAGE>

                                                                      SCHEDULE 1

      This Schedule 1 is a part of and is incorporated  into that certain letter
agreement,  dated as of July 1, 1998 (the  "Agreement"),  by and between ImClone
Systems Incorporated,  a Delaware corporation (with its affiliates collectively,
the "Company"),  and Diaz & Altschul  Capital,  LLC (the  "Financial  Advisor").
Capitalized  terms  used  herein  and  not  otherwise  defined  shall  have  the
respective meanings provided in the Agreement.

      The Company  agrees to indemnify and hold harmless the Financial  Advisor,
its affiliates,  its agents,  including  without  limitation,  Hambrecht & Quist
Incorporated,  and each person controlling of any of them (within the meaning of
Section  15 of the  Securities  Act),  and the  respective  members,  directors,
officers,  agents and employees of the Financial Advisor,  its affiliates,  such
agents and each such  controlling  person (the  Financial  Advisor and each such
entity or person, an "Indemnified Person") from and against any losses,  claims,
damages, judgments,  assessments, costs and other liabilities (collectively, the
"Liabilities"),  and shall  reimburse each  Indemnified  Person (subject to such
Indemnified  Person agreeing to repay such amounts if they are not indemnifiable
hereunder) for all fees and expenses (including the reasonable fees and expenses
of one  counsel  for all  Indemnified  Persons,  except as  otherwise  expressly
provided  herein)  (collectively,  the  "Expenses,")  as they are incurred by an
Indemnified Person in investigating, preparing, pursuing or defending any claim,
action, proceeding or investigation and whether or not any Indemnified Person is
a party  (collectively,  the "Actions"),  (i) caused by, or arising out of or in
connection  with, any untrue statement or alleged untrue statement of a material
fact contained in any document distributed by the Company to its stockholders or
distributed by any other party to the  Transaction to its  stockholders or filed
by the  Company  or any such  other  party  with  the  Securities  and  Exchange
Commission or any other federal,  state,  local or foreign  governmental  or any
agency or  department  thereof (the  "Documents")  or by any omission or alleged
omission  to state  therein a material  fact  necessary  to make the  statements
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading  (other than untrue  statements or alleged  untrue  statements in, or
omissions or alleged  omissions  from,  information  relating to an  Indemnified
Person furnished in writing by or on behalf of such Indemnified Person expressly
for use in any Documents) or (ii) otherwise arising out of or in connection with
advice or services rendered or to be rendered by any Indemnified Person pursuant
to the  Agreement,  the  transactions  contemplated  thereby or any  Indemnified
Person's  actions or inactions in connection  with any such advice,  services or
transactions;  provided, however, that, the Company shall not be responsible for
any  Liabilities or Expenses of any  Indemnified  Person pursuant to this clause
(ii) that  result  from such  Indemnified  Person's  negligence,  bad faith,  or
willful misconduct in connection with any of the advice,  actions,  inactions or
services   referred  to  above.  The  Company  also  agrees  to  reimburse  each
Indemnified  Person (subject to such  Indemnified  Person agreeing to repay such
amounts  if they are  determined  by  final  judgement  of a court of  competent
jurisdiction  not to be  indemnifiable  hereunder)  for all Expenses as they are
incurred in connection with enforcing such Indemnified Person's rights under the
Agreement, which includes this Schedule 1.

      Upon  receipt  by an  Indemnified  Person  of  actual  notice of an Action
against such  Indemnified  Person with respect to which  indemnity may be sought
under the Agreement,  such Indemnified  Person shall promptly notify the Company
in writing; provided that failure by any


                                      (i)

<PAGE>

Indemnified  Person so to notify the Company  shall not relieve the Company from
any  liability  which the  Company  may have on  account  of this  indemnity  or
otherwise to such  Indemnified  Person,  except to the extent the Company  shall
have been materially prejudiced by such failure.

      The Company  shall,  if requested  by the  Financial  Advisor,  assume the
defense of any such  Action  including  the  employment  of  counsel  reasonably
satisfactory to the Financial  Advisor.  Any  Indemnified  Person shall have the
right to employ  separate  counsel  in any such  action and  participate  in the
defense  thereof,  but the fees and  expenses  of such  counsel  shall be at the
expense of such Indemnified  Person unless:  (i) the Company has failed promptly
to assume the defense and employ  counsel or (ii) the named  parties to any such
Action (including any impleaded parties) include such Indemnified Person and the
Company,  and such Indemnified  Person shall have been advised in the reasonable
opinion of counsel  that there are one or more legal  defenses  available  to it
which are  different  from or in addition  to those  available  to the  Company;
provided that the Company shall not in such event be  responsible  hereunder for
the  fees  and  expenses  of more  than one  firm of  separate  counsel  for all
Indemnified  Persons  in  connection  with any  Action or  related  Actions,  in
addition  to any  local  counsel.  The  Company  shall  not be  liable  for  any
settlement of any Action  effected  without its written consent (which shall not
be unreasonably withheld). In addition, the Company shall not, without the prior
written consent of the Financial Advisor,  settle,  compromise or consent to the
entry  of any  judgment  in or  otherwise  seek  to  terminate  any  pending  or
threatened  Action in respect of which  indemnification  or contribution  may be
sought  hereunder  (whether or not such  Indemnified  Person is a party thereto)
unless  such  settlement,   compromise,   consent  or  termination  includes  an
unconditional  release of each Indemnified  Person from all Liabilities  arising
out of  such  Action.  The  indemnification  required  hereby  shall  be made by
periodic  payments of the amount thereof during the course of the  investigation
or defense,  as such expense,  loss,  damage or liability is incurred and is due
and payable.

      In the event that the foregoing indemnity is unavailable to an Indemnified
Person other than in accordance with the Agreement, the Company shall contribute
to the  Liabilities and Expenses paid or payable by such  Indemnified  Person in
such  proportion as is appropriate  to reflect (i) the relative  benefits to the
Company, on the one hand, and to the Financial Advisor and any other Indemnified
Person, on the other hand, of the matters  contemplated by the Agreement or (ii)
if the allocation provided by the immediately  preceding clause is not permitted
by applicable  law, not only such relative  benefits but also the relative fault
of the  Company,  on the one  hand,  and the  Financial  Advisor  and any  other
Indemnified  Person,  on the other hand,  in  connection  with the matters as to
which  such  Liabilities  or  Expenses  relate,  as well as any  other  relevant
equitable considerations; provided that in no event shall the Company contribute
less than the amount  necessary to ensure that all Indemnified  Persons,  in the
aggregate,  are not liable for any  Liabilities  and  Expenses  in excess of the
amount of fees  actually  received  by the  Financial  Advisor  pursuant  to the
Agreement. For purposes of this paragraph, the relative benefits to the Company,
on the one hand, and to the Financial  Advisor on the other hand, of the matters
contemplated  by the Agreement  shall be deemed to be in the same  proportion as
(a)  the  total  value  paid  or  contemplated  to be  paid  to or  received  or
contemplated  to be received by the Company in the  transaction or  transactions
that are within the scope of the Agreement,  whether 


                                      (ii)

<PAGE>

or not any such  transaction is  consummated,  bears to (b) the fees paid to the
Financial Advisor under the Agreement.

      The  Company  also  agrees  that no  Indemnified  Person  shall  have  any
liability (whether direct or indirect,  in contract or tort or otherwise) to the
Company for or in connection with advice or services rendered by any Indemnified
Person pursuant to the Agreement,  the transactions  contemplated thereby or any
Indemnified  Person's  actions or inactions in connection  with any such advice,
service or  transactions  except  that the  Financial  Advisor may be liable for
Liabilities (and related Expenses) of the Company from such Indemnified Person's
gross  negligence,  bad faith or willful  misconduct in connection with any such
advice, actions, inactions or services.

      The reimbursement,  indemnity and contribution  obligations of the Company
set forth  herein shall apply in any  modification  of the  Agreement  and shall
remain  in full  force  and  effect  regardless  of any  termination  of, or the
completion of any Indemnified Person's services under or in connection with, the
Agreement.


                                     (iii)

<PAGE>

                                                                      Schedule 2

                            CONFIDENTIALITY AGREEMENT

      ImClone Systems Incorporated, having a place of business at 180 Varick
Street, New York, New York 10014 (hereinafter called "ImClone"), and Diaz and
Altschul Capital, LLC, having a place of business at 745 Fifth Avenue, New York,
New York, 10151 (hereinafter called "Diaz and Altschul") expect to discuss
ImClone scientific and business information in connection with representation by
Diaz and Altschul of ImClone (hereinafter called "Technology"). For such a
discussion to take place, information that may be proprietary may be disclosed
by ImClone to Diaz and Altschul. For the purpose of enabling ImClone and Diaz
and Altschul (hereinafter, collectively, "the Parties") to hold the discussion
described above, Diaz and Altschul agrees to receive, and ImClone agrees to
disclose, proprietary information on the following terms and conditions:

      1. For the purpose hereof, the term "Proprietary Information" shall mean
all information relating to Technology that is identified by ImClone as being
confidential, and that is disclosed to Diaz and Altschul by ImClone. Proprietary
Information includes, but is not limited to, information relating to science,
finance, business, intellectual property, and law. Proprietary Information does
not include information that (i) is in the public domain at the time of
disclosure; (ii) is in the possession of Diaz and Altschul prior to the time of
disclosure from sources unconnected with ImClone, as evidenced by written
records; (iii) after disclosure, enters the public domain through no act or
omission of Diaz and Altschul; (iv) after disclosure, is received by Diaz and
Altschul from a third party, unless the third party is not entitled to transfer
the information to Diaz and Altschul; (v) that Diaz and Altschul is required to
disclose by applicable law, rule or regulation, provided that in such case Diaz
and Altschul shall provide ImClone with reasonable notice to allow ImClone to
contest such stated requirement.

      2. Diaz and Altschul shall treat each item of Proprietary Information as
confidential for a period of three (3) years from the date of receipt of each
item, and shall not use such Proprietary Information for any purpose other than
that described above. To treat as confidential shall mean that Diaz and Altschul
will not disclose Proprietary Information to any third party without the prior
written consent of ImClone, and will take the same precautions to prevent the
unauthorized disclosure of Proprietary


<PAGE>

Information to third parties that it takes to prevent the unauthorized
disclosure of its own confidential information.

      3. Diaz and Altschul shall restrict the communication of Proprietary
Information to its employees and representatives who need to know to the extent
necessary for the purpose hereof.

      4. Each authorized employee or representative to whom any Proprietary
Information is communicated or given shall be informed that the information is
confidential and proprietary and shall agree not to disclose or give the
information to others.

      5. Each authorized employee or representative to whom any Proprietary
Information is communicated or given shall agree not to use any of said
information except for the purpose of permitting Diaz and Altschul and ImClone
to enter into the discussion contemplated hereunder.

      6. Notwithstanding the foregoing, nothing contained in this agreement
shall be construed as creating an express or implied license to practice
Proprietary Information.

      7. This Confidentiality Agreement shall be interpreted in accordance with
the laws of the State of New York.

      8. This Agreement is intended by the Parties hereto as the final
expression of their understanding and is the complete and exclusive statement of
the terms hereof notwithstanding any oral representations or statements to the
contrary heretofore made. This Agreement contains all of the representations and
under-standings between the Parties hereto. No modifications of this Agreement
or waiver of the terms and conditions hereof shall be binding upon either party
unless approved in writing by an authorized representative of both Parties or
shall be effected by the acknowledgment of acceptance of any forms containing
other or different terms and conditions whether or not signed by an authorized
representative of one of the Parties. No modification or release shall be
effective unless in writing signed by the Parties.


<PAGE>

      IN WITNESS WHEREOF, the Parties hereto have caused this instrument to be
executed by their duly authorized officers.

IMCLONE SYSTEMS INCORPORATED

By: /s/ John B. Landes
-------------------------------------
Print: John B. Landes
Title: Vice President
       General Counsel
Date:

DIAZ AND ALTSCHUL CAPITAL, LLC
By: /s/ Reinaldo M. Diaz
-------------------------------------
Print: Reinaldo M. Diaz
Title:
Date: 4/21/98

AGREE\D&A.CDA


<PAGE>

DIAZ & ALTSCHUL
       CAPITAL, LLC

                                                        As of September 30, 1998

ImClone Systems Incorporated
180 Varick Street
New York, New York 10014

Attention: Dr. Harlan Waksal

Dear Sir:

      RE: Engagement Agreement Amendment

      We refer to the engagement agreement (the "Engagement  Agreement"),  dated
July 1, 1998,  between ImClone Systems  Incorporated  (the "Company") and Diaz &
Altschul  Capital,  LLC (the  "Financial  Advisor").  The  Engagement  Agreement
contemplated  a  transaction  involving a purchase  directly from the Company or
from the Company's  shareholders  of not less than 20% of the  Company's  common
stock ($.001 par value) (the "Common Stock")  outstanding after the Transaction,
as defined in the Engagement Agreement,  or securities convertible into not less
that 20% of the Company's Common Stock  outstanding  after the  Transaction,  as
defined  in  the  Engagement  Agreement.  Subsequent  to  the  execution  of the
Engagement  Agreement,  the  parties  have  determined  to broaden  the types of
business  arrangements under consideration.  This Engagement Agreement amendment
(the "Engagement  Agreement  Amendment")  shall confirm our understanding of the
modification of the Engagement  Agreement  between the Company and the Financial
Advisor.

      Licensing  Agreement.  The defined term  Transaction is hereby modified to
include  the  term  Licensing  Agreement,   which  is  defined  as  a  corporate
collaboration  and development  agreement between the Company and a partner (the
"Partner") that contemplates all, or any of, the following:

      (a) the grant of a license to the  Partner in certain  territories  of the
Company's  intellectual  property  covering  the product  candidate  C225 Cancer
Therapeutic ("C225"),

      (b) certain  payments to the Company,  either through cash payments or the
purchase of the Company's  Common Stock,  upon the  completion of certain events
related to the clinical development of C225,

                 745 FIFTH AVENUE SUITE 3001 NEW YORK, NY 10151
                      PHONE 212.751.1011 FAX 212.751.5757

                                   MEMBER-NASD

<PAGE>

      (c) an agreement for the Company to exclusively supply C225 to the Partner
for use in clinical studies and commercial sales, if any,

      (d) a royalty  payable to the  Company  from the  Partner  based on future
sales of C225, if any, or

      (e) an agreement  that the Partner  shall provide a guarantee of a line of
credit to the Company for a new manufacturing facility or a direct loan from the
Partner to the Company for such manufacturing facility.

      Compensation.  In addition to the compensation  provided in the Engagement
Agreement,  the Financial Advisor shall be entitled to compensation for services
in  connection  with a  Transaction  involving  a Licensing  Agreement  equal to
$200,000 (the "Licensing  Agreement Fee"). The Licensing  Agreement Fee shall be
payable $50,000 upon execution of this  Agreement,  and $50,000 on each of April
1, 1999, July 1, 1999 and October 1, 1999.

      The Retainer Fee under Section 3(a) of the  Engagement  Agreement has been
paid through  December 31, 1998. The parties  acknowledge  that the Retainer Fee
shall be suspended  until such time as the Company gives  written  notice to the
Financial Advisor that it is to be reinstated.

      If this letter  correctly sets forth the Company's  understanding,  please
sign a copy of this  letter in the  space  provided  below and  return it to the
Financial Advisor,  whereupon this letter shall become a binding agreement under
the laws of the State of New York and the Engagement  Agreement shall be amended
hereby.  Except as amended hereby, the Engagement Agreement shall remain in full
force and effect.

                                                 DIAZ & ALTSCHUL CAPITAL, LLP

                                                 By: /s/ Arthur G. Altschul, Jr.
                                                 -------------------------------
                                                 Name: Arthur G. Altschul, Jr.
                                                 Authorized Signatory

Confirmed and Agreed to as of the 
date first set forth above:

IMCLONE SYSTEMS INCORPORATED

By: /s/ John B. Landes
----------------------------------
John B. Landes, Vice President, Business Development
and General Counsel


                                       2