<PAGE>

                                                                   EXHIBIT 10.27

                     SETTLEMENT AGREEMENT AND MUTUAL RELEASE

          This Settlement Agreement and Mutual Release (this "Agreement") is
entered into as of January 22, 2003, by and among ICN Pharmaceuticals, Inc.
("ICN"), Ribapharm Inc. ("Ribapharm"), Johnson Y.N. Lau ("Lau"), Hans Thierstein
("Thierstein"), Kim Campbell ("Campbell"), Arnold H. Kroll ("Kroll"), John
Vierling ("Vierling"), Roberts A. Smith ("Smith"), Thomas Stankovich
("Stankovich"), Roger D. Loomis, Jr. ("Loomis") and Robert W. O'Leary
("O'Leary") (each individually, a "Party," and collectively, the "Parties").

          WHEREAS, ICN is the plaintiff and counterclaim-defendant; Ribapharm,
Lau, Thierstein, Campbell, Kroll and Vierling are the defendants and
counterclaim-plaintiffs; and O'Leary is an additional counterclaim-defendant in
a lawsuit filed in the Court of Chancery of the State of Delaware in and for New
Castle County, titled ICN Pharmaceuticals, Inc. v. Ribapharm Inc. et al., Civil
Action No. 20093-NC (the "Action"); Stankovich and Loomis are officers of
Ribapharm; and Smith is a director of Ribapharm;

          WHEREAS, the Parties desire to settle the Action in its entirety;

          WHEREAS, each of Lau, Thierstein, Campbell, Kroll and Vierling (each
individually, a "Director," and collectively, the "Directors") desires to resign
from their respective positions as members of the Board of Directors of
Ribapharm;

          WHEREAS, each of Lau, Stankovich and Loomis (each individually, an
"Executive," and collectively, the "Executives") desires to resign from their
employment with Ribapharm and terminate certain of the provisions of their
employment agreements entered into with Ribapharm, dated as of the effective
date of the initial public offering of Ribapharm, and as amended on May 17, 2002
(the "Employment Agreements"); and

          WHEREAS, a dispute exists among the Parties relating to, among other
things, certain actions relating to executive compensation matters that affect
the calculation of potential severance amounts payable pursuant to the
Employment Agreements.

          NOW, THEREFORE, in consideration of the mutual promises, covenants and
releases contained in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereby agree as follows:

     1.   Stipulation Dismissing Action. Each of the Parties to the Action is
concurrently herewith executing a Stipulation of Dismissal, in the form and
substance of Exhibit A attached hereto. Counsel for ICN shall file the
Stipulation of Dismissal with the Clerk of the Court within two (2) business
days of execution thereof.

<PAGE>

     2.   Release from ICN, Ribapharm, Smith and O'Leary.

          (a)   In consideration of this Agreement, each of ICN, Ribapharm,
Smith and O'Leary, together with their respective successors, assigns and heirs
(the "ICN and Ribapharm Releasors"), hereby releases and forever discharges each
of Lau, Thierstein, Campbell, Kroll, Vierling, Stankovich and Loomis, together
with their respective successors, assigns and heirs (the "Individual
Releasees"), of and from any and all claims, counterclaims, controversies,
demands, actions, causes of action, contracts, agreements, promises,
contribution, damages, judgments, executions and demands whatsoever, at law, in
equity, or otherwise, whether known or unknown, suspected or unsuspected,
asserted or unasserted, against the Individual Releasees, which the ICN and
Ribapharm Releasors ever had, now have or hereafter can, shall or may have, or
by reason of any matter, cause or thing whatsoever, from the beginning of the
world to the date of this Agreement, including but not limited to, the claims or
counterclaims that have been or could have been asserted by any Party in the
Action, provided, however, that the foregoing shall not be deemed to release
those items set forth in Section 4(c) hereof. The foregoing releases by
Ribapharm and the stipulation of dismissal of Ribapharm's claims against O'Leary
set forth in numbered paragraph 6 of Exhibit A hereto are ratified by ICN, the
holder of approximately 80.1% of the outstanding Ribapharm common stock.

          (b)   In consideration of this Agreement, each of the ICN and
Ribapharm Releasors hereby agrees not to foment, encourage or assist any third
parties or non-Parties in investigating or bringing any claims, causes of
actions, suits or other proceedings identical or similar to those that were
brought, or could have been brought, against the Individual Releasees in the
Action, or that are precluded by this Agreement. If any claims precluded by this
Agreement are brought by anyone, the ICN and Ribapharm Releasors shall cooperate
with the Individual Releasees in defense of such claims and shall not cooperate
with the persons or entities bringing such claims.

     3.   Release from Lau, Thierstein, Campbell, Kroll, Vierling, Stankovich
and Loomis.

          (a)   In consideration of this Agreement, each of Lau, Thierstein,
Campbell, Kroll, Vierling, Stankovich and Loomis, together with their respective
successors, assigns and heirs (the "Ribapharm Releasors"), as Director,
Executive or stockholder, hereby releases and forever discharges each of ICN,
Ribapharm, Smith and O'Leary, together with their successors, assigns and heirs
(the "ICN and Ribapharm Releasees"), of and from any and all claims,
counterclaims, controversies, demands, actions, causes of action, contracts,
agreements, promises, contribution, damages, judgments, executions and demands
whatsoever, at law, in equity, or otherwise, whether known or unknown, suspected
or unsuspected, asserted or unasserted, against the ICN and Ribapharm Releasees,
which the Ribapharm Releasors ever had, now have or hereafter can, shall or may
have, or by reason of

                                        2

<PAGE>

any matter, cause or thing whatsoever, from the beginning of the world to the
date of this Agreement, including but not limited to, the claims or
counterclaims which have been or could have been asserted by any Party in the
Action; provided, however, that the foregoing shall not be deemed to release
those items set forth in Section 5 hereof.

          (b)   In consideration of this Agreement, each of the Ribapharm
Releasors hereby agrees not to foment, encourage or assist any third parties or
non-Parties in investigating or bringing any claims, causes of actions, suits or
other proceedings identical or similar to those that were brought, or could have
been brought, against the ICN and Ribapharm Releasees in the Action, or that are
precluded by this Agreement. If any claims precluded by this Agreement are
brought by anyone, the Ribapharm Releasors shall cooperate with the ICN and
Ribapharm Releasees in defense of such claims and shall not cooperate with the
persons or entities bringing such claims.

     4.   Release Relating to Employment of the Executives.

          (a)   Each of the Executives hereby expressly waives any and all
rights under any applicable law with respect to claims that he does not know or
suspect to exist in his favor at the time of executing this release, even though
if known by him, such claims must have materially affected his settlement under
this Agreement.

          (b)   Each Executive shall have the right to execute a waiver in the
form and substance of Exhibit B attached hereto (the "ADEA Waiver"), wherein
each Executive may voluntarily and knowingly waive all rights to claims arising
under the Age Discrimination in Employment Act of 1967 in consideration for an
additional cash payment set forth in the ADEA Waiver.

          (c)   Notwithstanding anything contained herein to the contrary, ICN
and Ribapharm, as applicable, do not hereby release any claims against any of
the Executives arising out of, in connection with or based on (i) any of the
Surviving Employment Agreement Provisions (as defined in Section 10(b)); (ii)
each of the respective Proprietary Information and Inventions Agreements,
entered into by and between each of the Executives and Ribapharm, dated as of
April 15, 2002 (the "Proprietary Information Agreements"); (iii) any ADEA
Waiver, if executed and not revoked; (iv) each of the respective Indemnification
Agreements (as defined in Section 5(a) hereof); or (v) this Agreement. Ribapharm
and the Executives hereby acknowledge and represent that the terms and
provisions set forth in the Proprietary Information Agreements remain in full
force and effect as of the date hereof and the benefits, obligations and
covenants set forth therein extend to Ribapharm.

     5.   Exceptions to Release by the Directors and Executives.

          (a)   Nothing herein shall be deemed to release Ribapharm or ICN in
respect of (i) the Executives' rights under the Surviving Employment Agreement

                                        3

<PAGE>

Provisions, (ii) the Executives' and the Directors' rights under this Agreement
and the stock option agreements to which they are a party, including any stock
options with respect to either Ribapharm or ICN, (iii) the Indemnification
Agreements with Ribapharm, dated as of April 8, 2002, to which the Executives
and the Directors are respectively a party (the "Indemnification Agreements"),
(iv) any required payment under an ADEA Waiver, if executed and not revoked, (v)
the Executives' rights to any benefits or distribution under any employee
benefit plan maintained by ICN or Ribapharm that is a qualified plan within the
meaning of Section 401(a) of the Internal Revenue Code of 1986, as amended, in
which any of the Executives participates as of the date hereof or (vi) the
Executives' and their family members' rights under COBRA and HIPPA, if any.

          (b)   Nothing herein shall be deemed to release Ribapharm in respect
of the Executives' and the Directors' rights to indemnification from Ribapharm
that they may have under Ribapharm's Amended and Restated Certificate of
Incorporation and Amended and Restated By-laws to the extent permitted under
applicable Delaware law.

          (c)   Nothing herein shall be deemed to release Ribapharm in respect
of the Directors' rights under their options to acquire common stock of
Ribapharm and under the Director Fee Plan (as defined in Section 11 hereof).

     6.   No Admission.  Nothing contained in this Agreement, nor the fact that
the Parties have signed this Agreement, shall be considered an admission of any
kind whatsoever by any of the Parties or by any of the Parties' officers,
agents, partners, directors, representatives, employees, subsidiaries,
affiliates or assigns.

     7.   Representations and Warranties.

          (a)   Each of Ribapharm, Lau, Thierstein, Campbell, Kroll, Vierling,
Stankovich and Loomis hereby represents and warrants that it, he or she has
taken no action that (i) violates the Temporary Restraining Order To Preserve
Status Quo signed by the Court of Chancery of the State of Delaware in and for
New Castle County dated December 24, 2002 or (ii) breaches, or would result in
Ribapharm breaching, in any material respect, any existing agreement between ICN
and Ribapharm, other than non-payment of amounts that ICN asserts are due to it
under the Tax Sharing Agreement, dated as of April 8, 2002, by and between ICN
and Ribapharm and other than the failure to provide advance notice to ICN of the
Form 8-K, dated December 20, 2002.

          (b)   Each of the Executives hereby represents and warrants that each
has taken no action inconsistent with the Proprietary Information Agreements and
the Surviving Employment Agreement Provisions.

     8.   Waiver of Rights Under California Civil Code Section 1542 and Any
Similar Federal or State Statute. The Parties, and, to the extent applicable,
their

                                        4

<PAGE>

successors, assigns, officers, directors and employees, to the fullest extent
permitted by law, by entering into this Agreement and the releases contained
herein, hereby specifically waive whatever rights they may have under California
Civil Code Section 1542 and any similar federal or state statute that may be
applicable. Section 1542 provides as follows:

          A general release does not extend to claims which the creditor does
          not know or suspect to exist in his favor at the time of executing the
          release which if known by him must have materially affected his
          settlement with the debtor.

Accordingly, in consideration of the benefits described herein, notwithstanding
the discovery of facts or circumstances that are in addition to or different
from those that the Parties presently believe to be true, the Parties hereby
specifically waive the effect and provision of Section 1542 of the California
Civil Code and any similar federal or state statute, to the extent it may be
applicable.

     9.   Resignation of Ribapharm Directors and Officers. Concurrent with the
execution of this Agreement, each of (i) Lau, Thierstein, Campbell, Kroll and
Vierling shall resign (with immediate effectiveness) from the Board of Directors
of Ribapharm and any committee thereof, and any other position held with any of
Ribapharm, its subsidiaries or controlled or related entities, including any
position as an officer, director, trustee, manager or partner of any such
entity, and Ribapharm shall be deemed to have accepted such resignations; and
(ii) Stankovich and Loomis shall resign (with immediate effectiveness) as
officers of Ribapharm and any other position held with any of Ribapharm, its
subsidiaries or controlled or related entities, including any position as an
officer, director, trustee, manager or partner of any such entity, and Ribapharm
shall be deemed to have accepted such resignations. Each of Thierstein,
Campbell, Kroll and Vierling is concurrently herewith executing and delivering
to Ribapharm a resignation letter in the form and substance of Exhibit C
attached hereto. Each of Stankovich and Loomis is concurrently herewith
executing and delivering to Ribapharm a resignation letter in the form and
substance of Exhibit D attached hereto. Lau is concurrently herewith executing
and delivering to Ribapharm a resignation letter in the form and substance of
Exhibit E attached hereto.

     10.  Payment to Executives, Etc.

          (a)   Severance Payment. On the date hereof, Ribapharm shall pay to
each of the Executives the amount set forth as the Severance Payment and Accrued
Compensation (as defined in the Employment Agreements) as set forth for each
Executive in Exhibit F attached hereto (less any applicable withholding) in full
satisfaction of all such Executive's rights under Sections 9(b)(i) and (ii) of
his Employment Agreement, and ICN shall not oppose Ribapharm's making any such
payments.

                                        5

<PAGE>

          (b)   Status of Employment Agreements. Nothing herein shall affect the
continued effectiveness of the Employment Agreements, except that the Parties
hereby agree as follows: (i) any payment made pursuant to Section 10(a) hereof
shall be in full satisfaction of all such Executive's rights under Sections
9(b)(i) and (ii) of his Employment Agreement, (ii) each Executive shall be
entitled to receive continuation of benefits in accordance with the provisions
of Section 9(b)(iii) of the Employment Agreement commencing on the date hereof,
(iii) each Executive shall be entitled to the treatment of outstanding equity
based awards in accordance with the provisions of Section 9(b)(v) of the
Employment Agreement, including the provision addressing the restrictions on
exercisability of outstanding Ribapharm stock options as more fully described in
Section 10(c) hereof, (iv) no payment is due to any of the Executives under
Section 9(b)(iv) of the Employment Agreement, (v) the Executives shall be deemed
to have satisfied the notice requirement set forth in Section 8(c) of the
Employment Agreements and the date hereof shall constitute the "Termination
Date" under the Employment Agreements for all purposes and (vi) Sections 1
through 8 of the Employment Agreements, other than Section 4(b) thereof, shall
terminate on the date hereof (provided that the Executives shall be entitled to
reimbursement for which payment would be provided under Ribapharm's
reimbursement policy of any reasonable business expenses pursuant to Section 6
thereof for which reimbursement has been requested but not yet paid). The
provisions of the Employment Agreements, as modified pursuant to this Section
10(b), are hereinafter referred to as the "Surviving Employment Agreement
Provisions."

          (c)   Equity Awards. All of the equity based awards relating to the
stock of ICN, Ribapharm or any subsidiary or affiliate of either held by each
Executive on the date hereof (and the exercise price thereof) are set forth on
Exhibit F (the "Options"). As of the date hereof, all of the Options shall
become fully vested and shall remain vested and exercisable for the duration of
the original term of the Options, and shall remain governed under the terms and
conditions of the ICN Pharmaceuticals, Inc. Amended and Restated 1998 Stock
Option Plan (the "1998 ICN Plan") or the Ribapharm Inc. 2002 Stock Option Award
Plan (the "Ribapharm Plan"), as applicable, and any option agreement entered
into pursuant thereto; provided, however, that as set forth in the Employment
Agreement, notwithstanding vesting, any option granted under the Ribapharm Plan
shall not be exercisable prior to the earlier of (i) the Spin-Off (as defined in
the Employment Agreement) and (ii) September 30, 2003; provided, however, that
such restriction on exercisability shall lapse if, prior to September 30, 2003,
ICN abandons its plans to proceed with or complete the Spin-Off (as such
abandonment is described in Section 3.4 of the certain Affiliation and
Distribution Agreement, by and between ICN and Ribapharm).

     11.  Payment to Directors, Etc. For purposes of this Section 11, any
reference to a "Director" or "Directors" shall not include Lau. Pursuant to
Sections 5.10 and 6.5 of the Ribapharm Plan, any outstanding options to purchase
Ribapharm common stock held by a Director (the "Director Options") (all of which
Director

                                        6

<PAGE>

Options held by each Director on the date hereof are set forth on Exhibit G
attached hereto) shall become fully vested as of the date hereof, but shall
remain subject to limitations on exercisability set forth in the Ribapharm Plan,
and shall remain governed by the terms and conditions of the Ribapharm Plan and
any applicable stock option agreement. In accordance with the terms of the
Ribapharm Plan, such Director Options shall remain exercisable for a period of
six (6) months after the First Exercise Date (as defined in the Ribapharm Plan).
In addition, any currently accrued payments to Directors required to be made
under the Ribapharm Inc. 2002 Amended and Restated Nonemployee Director Retainer
Fee Plan (as filed with the Securities and Exchange Commission on November 14,
2002) (the "Director Fee Plan") that have not been made as of the date hereof
shall be made by Ribapharm on the date hereof. Such payments, as set forth in
Exhibit G hereto, shall be made in the form of cash or Ribapharm common stock as
elected by each respective Director pursuant to Section 5.1 of the Director Fee
Plan.

     12.  Return Of Ribapharm Property/Confidential Information. Each of the
Directors and the Executives hereby agrees that, as of the date hereof, each
will return to Ribapharm all Ribapharm documents (and all copies thereof), and
other Ribapharm property in his or her possession or control. Each of the
Directors and Executives hereby agrees not to use or disclose Ribapharm's
confidential or proprietary information. Each of the Directors and Executives
hereby agrees to comply with any obligations regarding the protection of
Ribapharm's proprietary and confidential information, assignment and disclosure
of inventions, and return of property that he or she may have undertaken
previously in agreements he or she has signed with Ribapharm.

     13.  Press Release.  Within one (1) business day of the execution of this

Agreement, ICN and Ribapharm shall jointly issue a press release in the form and
substance of Exhibit H attached hereto. None of the Parties shall make
any statements inconsistent with such press release.

     14.  Nondisparagement; Cooperation.

          (a)   Each Party shall not make, participate in the making of, or
encourage any other person to make, any statement, whether written or oral, that
criticizes, disparages or defames another Party or its officers, directors,
stockholders or agents. The Parties hereby further agree not to make any
negative statements, written or oral, relating to the employment with Ribapharm
or ICN of Lau, Stankovich and Loomis or the termination of such employment with
Ribapharm or ICN. Notwithstanding the foregoing, nothing in this Agreement shall
prohibit any person from making truthful statements when required by law or by
order of any court or other governmental agency, legislative body or other body
having jurisdiction to legally compel such statements, or as otherwise may be
required by law or legal process.

                                        7

<PAGE>

          (b)   Each of the Executives shall fully cooperate in any litigation
involving any third party in which Ribapharm or any of its affiliates may become
involved. Such cooperation shall include making the applicable Executive
reasonably available, upon the request of Ribapharm or its affiliate, for
depositions, court appearances and interviews by counsel to Ribapharm or its
affiliates, and such Executive shall be reimbursed for reasonable out-of-pocket
expenses incurred in connection therewith and paid for interviews at a
reasonable hourly rate to be determined in good faith by Ribapharm or its
affiliates and such Executive. An Executive cooperating in litigation pursuant
to Section 3(b) hereof at the request of ICN shall be reimbursed for reasonable
out-of-pocket expenses and paid for interviews in accordance with the terms of
this Section 14(b).

     15.  Costs, Expenses and Attorneys' Fees. Notwithstanding any provision to
the contrary in the Employment Agreements, each of the Parties hereby agrees to
pay its own costs, expenses and attorneys' fees in connection with this
Agreement and the Action; it being understood that the reasonable fees and
expenses of Sullivan & Cromwell LLP, Connelly Bove Lodge & Hutz LLP and Musick,
Peeler & Garrett LLP shall be paid by Ribapharm and not the Individual
Releasees.

     16.  Governing Law. This Agreement shall be governed, construed and
interpreted in accordance with the laws of the State of Delaware applicable to
agreements made and to be performed within the State of Delaware, without regard
to the State of Delaware's choice of law rules. In the event of any breach of
this Agreement, any non-breaching Party may seek such legal redress and remedies
as are available to it under the laws of the State of Delaware. Each Party
hereby consents to exclusive jurisdiction and venue in the Court of Chancery of
the State of Delaware in and for New Castle County for any action or proceeding
in which this Agreement is sought to be enforced or is otherwise at issue. Each
party further appoints its attorneys for receipt of service of process for any
action or proceeding in which this Agreement is sought to be enforced or is
otherwise at issue.

     17.  Headings.  The Section headings herein are for reference purposes only
and shall not affect in any way the meaning or interpretation of this Agreement,
nor are they deemed to be a part of this Agreement. Unless the context indicates
otherwise, references herein to Sections shall mean Sections of this Agreement.

     18.  Amendments/No Implied Waivers. This Agreement shall not be amended,
supplemented or modified without the written agreement of all of the Parties
hereto. No waiver of any provision of this Agreement shall be implied from any
course of dealing between the Parties hereto or from any failure by any Party to
assert its rights hereunder on any occasion or series of occasions.

     19.  Remedies. Each of the Parties hereby agrees that, in the event that a
Party does not perform its obligations hereunder in accordance with the specific
terms of this Agreement or otherwise breaches this Agreement, irreparable damage
will occur. Therefore, each Party shall be entitled to specific performance or

                                          8

<PAGE>

injunctive relief in order to enforce compliance of this Agreement by a
non-compliant Party. The Parties hereby further agree that the foregoing is not
intended in any way to limit the right of any Party to seek damages against such
non-compliant Party, or any other remedies (at law or in equity or otherwise) to
which it is entitled.

     20.  Advice of Counsel. In entering into this Agreement, each Party hereby
represents that it has relied upon the advice of its attorneys, who are
attorneys of its own choice, and that it has carefully read and understood the
terms of this Agreement, and that those terms are fully understood and
voluntarily accepted by it. Each Party has made such investigation of the facts
pertaining to this Agreement and all other matters as it deems necessary.

     21.  No Assignments. Each of the Parties by and through its authorized
agents and representatives, hereby represents and warrants that it has not
assigned any of, and is the sole owner of, all the claims, counterclaims,
controversies, demands, actions, causes of action, contracts, agreements,
promises, contribution, damages, judgments, executions and demands which are
intended to be released by the Parties pursuant to this Agreement and which are
in fact released pursuant to this Agreement.

     22. Sole and Entire Agreement. This Agreement and the Exhibits hereto
represent the sole and entire agreement among the Parties and supercede all
previous agreements relating to the subject matter hereof (other than the
existing agreements between ICN and Ribapharm, the Surviving Employment
Agreement Provisions, the Indemnification Agreements, the Ribapharm Plan, the
1998 ICN Plan, the Director Fee Plan, the Proprietary Information Agreements and
any ADEA Waiver, if executed and not revoked, which shall in all respects remain
in full force and effect and shall in no way be impacted by this Agreement),
whether oral or written, between or involving ICN, Ribapharm, Lau, Thierstein,
Campbell, Kroll, Vierling, Smith, Stankovich, Loomis and O'Leary, and their
successors and assigns. There are no promises, undertakings, representations or
warranties by the Parties relevant to the subject matter of this Agreement not
expressly set forth herein. Each Party hereby represents and warrants that the
execution, delivery and performance of this Agreement does not contravene any
other instrument, agreement, restriction, covenant, judgment or order to which
said Party is subject or bound.

     23.  Binding Authority.  Each individual executing this Agreement on behalf
of any Party hereby expressly represents and warrants that he or she has the
authority to do so and thereby binds the Party on behalf of whom he or she signs
this Agreement.

     24.  Successors and Assigns. All of the terms and provisions of this
Agreement shall be binding upon and shall inure to the benefit of the Parties
and their respective heirs, assigns and successors. Each Party shall cause its
respective officers, directors and employees to comply with the terms of this
Agreement. No
                                        9

<PAGE>

person not a party to, or a specified beneficiary of, this Agreement shall have
any rights hereunder, and all unspecified third-party beneficiary rights are
hereby negated.

     25.  Execution in Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall, for all purposes, be deemed an original and
all of such counterparts, taken together, shall constitute one and the same
agreement. The Parties hereby agree that a facsimile signature shall be deemed
to be an original signature.

                                       10

<PAGE>

          IN WITNESS WHEREOF the Parties have executed this Agreement by and
through the undersigned.

                                               ICN PHARMACEUTICALS, INC.

                                               By:
                                                  ------------------------------
                                               Name:
                                               Title:

STATE OF _____________ )
                          : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________; that he is ____________________________ of
ICN Pharmaceuticals the corporation described in and which executed the
foregoing Settlement Agreement and Mutual Release; and that he signed his name
by authority of the board of directors of said corporation.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               RIBAPHARM INC.

                                               By:
                                                  ------------------------------
                                               Name:
                                               Title:

STATE OF _____________ )
                         : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________; that he is ____________________________ of
Ribapharm Inc., the corporation described in and which executed the foregoing
Settlement Agreement and Mutual Release; and that he signed his name by
authority of the board of directors of said corporation.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               JOHNSON Y.N. LAU

                                               By:
                                                  ------------------------------
                                               Name:

STATE OF _____________ )
                          : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that he executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               HANS THIERSTEIN

                                               By:
                                                  ------------------------------
                                               Name:

STATE OF _____________ )
                         : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that he executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               KIM CAMPBELL

                                               By:
                                                  ------------------------------
                                               Name:

STATE OF _____________ )
                          : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that she executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               ARNOLD H. KROLL

                                               By:
                                                  ------------------------------
                                               Name:

STATE OF _____________ )
                          : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that he executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               JOHN VIERLING

                                               By:
                                                  ------------------------------
                                               Name:
                                               Title:

STATE OF _____________ )
                         : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that he executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               ROBERTS A. SMITH

                                               By:
                                                  ------------------------------
                                               Name:
                                               Title:

STATE OF _____________ )
                         : ss.:
COUNTY OF ____________ )

                  On January __, 2003, before me personally came
___________________ to me known, who by me being duly sworn, did depose and say
that he resides at ___________________________________ and that he executed the
foregoing Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               THOMAS STANKOVICH

                                               By:
                                                  ------------------------------
                                               Name:
                                               Title:

STATE OF _____________ )
                         : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that he executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               ROGER D. LOOMIS, Jr.

                                               By:
                                                  ------------------------------
                                               Name:
                                               Title:

STATE OF _____________ )
                          : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that he executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                               ROBERT W. O'LEARY

                                               By:
                                                  ------------------------------
                                               Name:

STATE OF _____________ )
                          : ss.:
COUNTY OF ____________ )

          On January __, 2003, before me personally came ___________________ to
me known, who by me being duly sworn, did depose and say that he resides at
___________________________________ and that he executed the foregoing
Settlement Agreement and Mutual Release.

                                    ----------------------------------------
                                                  Notary Public

<PAGE>

                                                                       Exhibit A

                IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

                          IN AND FOR NEW CASTLE COUNTY

- - - - - - - - - - - - - - - - - - - - - - - - - - -  - x
ICN PHARMACEUTICALS, INC.
                                                         :
                           Plaintiff and
                           Counterclaim-Defendant,       :

                  v.                                     :

RIBAPHARM INC., a Delaware Corporation,                  :
JOHNSON Y.N. LAU, HANS THIERSTEIN, KIM CAMPBELL,
ARNOLD H. KROLL, and JOHN VIERLING                       :

                           Defendants and                :
                           Counterclaimants,
                                                         :
                  v.                                     :
                                                         :     Civil Action
ROBERT O'LEARY,                                          :     No. 20093-NC
                                                         :
                           Additional Counterclaim-      :
                           Defendant.                    :
                                                         :
- - - - - - - - - - - - - - - - - - - - - - - - - - -    x

                        FORM OF STIPULATION OF DISMISSAL

          IT IS HEREBY STIPULATED AND AGREED, by and between the undersigned,
the attorneys of record for all parties to the above-entitled action, as
follows:

                                       A-1

<PAGE>

          1. The claims of ICN Pharmaceuticals, Inc. ("ICN") against Ribapharm
Inc. ("Ribapharm") are hereby discontinued without prejudice and without costs;


          2. The claims of ICN against Johnson Y.N. Lau, Hans Thierstein, Kim
Campbell, Arnold H. Kroll, and John Vierling (collectively the "Individual
Defendants") are hereby discontinued with prejudice and without costs;


          3. The motion of ICN for a mandatory preliminary injunction or in the
alternative summary judgment is hereby withdrawn without prejudice and without
costs;

          4. The counterclaims of Ribapharm against ICN are hereby discontinued
without prejudice and without costs;

          5. The counterclaims of the Individual Defendants against ICN are
hereby discontinued with prejudice and without costs.

          6. The counterclaims of Ribapharm and the Individual Defendants
against Robert O'Leary are hereby discontinued with prejudice and without costs.

Wilmington, Delaware
Dated: January 22, 2003

                                       A-2

<PAGE>

                                ------------------------------------------------
                                Anthony W. Clark
                                SKADDEN, ARPS, SLATE,
                                         MEAGHER &  FLOM LLP
                                One Rodney Square
                                P.O. Box 636
                                Wilmington, Delaware 19899
                                (302) 651-3000
                                Attorneys for Plaintiff and
                                Counterclaim-Defendant ICN Pharmaceuticals,
                                Inc. and Counterclaim-Defendant Robert O'Leary

                                ------------------------------------------------
                                Henry E. Gallagher, Jr.
                                Samuel D. Brickley II
                                Christos T. Adamopoulos
                                CONNOLLY BOVE LODGE
                                         & HUTZ LLP
                                1220 Market Street
                                P.O. Box 2207
                                Wilmington, Delaware 19899
                                (302) 658-9141
                                Attorneys for Defendants and Counterclaimants
                                Ribapharm Inc., Johnson Y.N. Lau, Hans
                                Thierstein, Kim Campbell, Arnold H. Kroll, and
                                John Vierling

                                       A-3

<PAGE>

                                                                       Exhibit B

                             [RIBAPHARM LETTERHEAD]

                                January 22, 2003

Ribapharm Inc.
Attn:  Secretary
3300 Hyland Avenue
Costa Mesa, CA  92626

Dear Sir:

          Reference is made to the Settlement Agreement and Mutual Release to be
entered into by and among, inter alia, you and Ribapharm Inc. (the "Company"),
dated as of the date hereof (the "Settlement Agreement"). Pursuant to the
Settlement Agreement, your employment with the Company shall terminate
immediately upon the execution of the Settlement Agreement. Capitalized terms
not defined in this letter (this "Letter") shall have the meanings set forth in
the Settlement Agreement.

          In consideration for payment by the Company of the cash amount set
forth in Schedule 1 hereto (the "Consideration"), you hereby knowingly and
voluntarily waive all rights or claims arising under the Age Discrimination in
Employment Act of 1967 ("ADEA"). This waiver is given in exchange for
consideration in addition to anything of value to which you would have been
entitled absent this Letter. Such waiver does not waive rights or claims that
may arise after the date of execution of this Letter. Pursuant to the
requirements set forth under ADEA, the Company hereby discloses that there are
no individuals in the same job classification that are not eligible for the
termination program.

          You hereby acknowledge that: (i) this Letter is written in a manner
calculated to be understood by you; (ii) you have been advised to consult with
an attorney before executing this Letter; (iii) you were given a period of
forty-five (45) days within which to consider this Letter; and (iv) to the
extent you execute this Letter before the expiration of the forty-five-day
period, you do so knowingly and voluntarily and only after consulting your
attorney.

          You shall have the right to cancel and revoke this Letter during a
period of seven (7) days following your execution of this Letter, and this
Letter shall not become effective, and no money shall be paid hereunder, until
the day after the expiration of such seven-day period (the "Effective Date").
The seven-day period of revocation shall commence upon the date of your
execution of this Letter. In order to revoke this Letter, you must deliver to
Ribapharm, prior to the expiration of said

                                       B-1

<PAGE>

seven-day period, a written notice of revocation. Upon such revocation, this
Letter shall be null and void and of no further force or effect.

          The Company shall furnish payment of the Consideration to you on the
Effective Date.

          Please sign below and return a copy of this Letter to the Company,
Attn: Secretary so as to acknowledge your receipt of this Letter and your
agreement to waive the rights contemplated herein.

                                                     Very truly yours,

                                                     RIBAPHARM INC.

                                                     -------------------------
                                                     Name:
                                                     Title:

I hereby acknowledge that I have reviewed and understand this Letter and the
waiver of rights contemplated hereby, and I knowingly and voluntarily waive such
rights after consultation with my attorney.

-------------------------
Name

-------------------------
Signature

-------------------------
Date

                                       B-2

<PAGE>

                                                                      Schedule 1

NAME                AGE    CONSIDERATION

Johnson Y.N. Lau     42   $     50,000.00

Thomas Stankovich    42   $     50,000.00

Roger D. Loomis      54   $     50,000.00

                                       B-3

<PAGE>

                                                                       Exhibit C

                                                  January 22, 2003

Ribapharm Inc.
Attn:  Secretary
3300 Hyland Avenue
Costa Mesa, CA  92626

Dear Sir:

          Effective immediately, I hereby resign from my position as a member of
the board of directors of Ribapharm Inc. (the "Company") and any committee
thereof, and any other position I hold with any of the Company, its subsidiaries
or controlled or related entities, including any position as an officer,
director, trustee, manager or partner of any such entity.

                                                   Very truly yours,

                                       C-1

<PAGE>

                                                                       Exhibit D

                                                  January 22, 2003

Ribapharm Inc.
Attn:  Secretary
3300 Hyland Avenue
Costa Mesa, CA  92626

Dear Sir:

          Effective immediately, I hereby resign from my employment with
Ribapharm Inc. (the "Company"), from my position as an executive officer of the
Company and any other position I hold with any of the Company, its subsidiaries
or controlled or related entities, including any position as an officer,
director, trustee, manager or partner of any such entity.

                                                  Very truly yours,

                                       D-1

<PAGE>

                                                                       Exhibit E

                                                  January 22, 2003

Ribapharm Inc.
Attn:  Secretary
3300 Hyland Avenue
Costa Mesa, CA  92626

Dear Sir:

          Effective immediately, I hereby resign from my employment with
Ribapharm Inc. (the "Company"), from my position as an executive officer of the
Company, a member of the board of directors of the Company and any other
position I hold with any of the Company, its subsidiaries or controlled or
related entities, including any position as an officer, director, trustee,
manager or partner of any such entity.

                                                  Very truly yours,

                                       E-1

<PAGE>

                                                                       Exhibit F

                               SEVERANCE PAYMENTS

<TABLE>
<CAPTION>
EXECUTIVE          SEVERANCE PAYMENT     ACCRUED COMPENSATION      TOTAL CASH PAYMENT
---------------    ------------------    --------------------    --------------------
<S>                <C>                   <C>                     <C>
Lau                $    2,519,500.00     $          76,535.00    $       2,596,035.00
---------------    ------------------    --------------------    --------------------
Stankovich         $    1,081,000.00     $          34,775.00    $       1,115,775.00
---------------    ------------------     -------------------    --------------------
Loomis             $    1,195,000.00     $          35,440.00    $       1,230,440.00
</TABLE>

                                   RNA OPTIONS

<TABLE>
<CAPTION>
                          NUMBER OF SHARES OF RIBAPHARM COMMON                          EXERCISE
EXECUTIVE                   STOCK UNDERLYING OPTIONS GRANTED       GRANT DATES          PRICES
----------------------   --------------------------------------    ---------------   -----------
<S>                                                 <C>            <C>                <C>
Lau                                                 1,200,000      04/11/02           $    10.00
                                                      259,300      12/04/02           $     5.60
----------------------   --------------------------------------    ---------------   -----------
Stankovich                                            350,000      04/11/02           $    10.00
                                                       71,700      12/04/02           $     5.60
----------------------   --------------------------------------    ---------------   -----------
Loomis                                                350,000      04/11/02           $    10.00
                                                       99,000      12/04/02           $     5.60
</TABLE>

                                   ICN OPTIONS

<TABLE>
<CAPTION>
                          NUMBER OF SHARES OF RIBAPHARM COMMON                         EXERCISE
EXECUTIVE                   STOCK UNDERLYING OPTIONS GRANTED       GRANT DATES          PRICES
----------------------   --------------------------------------    ---------------   ------------
<S>                                                    <C>         <C>                <C>
Lau                                                    19,044      2/24/00            $   21.0000
                                                        4,629      3/22/01            $   21.6000
----------------------   --------------------------------------    ---------------   ------------
Stankovich                                              7,500      4/15/96            $   14.7500
                                                       13,950      4/25/97            $   13.6667
                                                        7,500      1/1/98             $   32.6667
                                                       30,000      5/1/98             $   45.2500
                                                        9,153      1/19/01            $   23.4375
                                                        5,748      3/22/01            $   21.6000
                                                        3,691      4/28/94            $    9.5315
----------------------   --------------------------------------    ---------------   ------------
Loomis                                                 15,364      11/16/01           $   26.0300
</TABLE>

                                       F-1

<PAGE>

                                                                       Exhibit G

Set forth below are the cash or stock consideration and options to purchase
shares of common stock, par value, $.01 per share, of Ribapharm Inc.
("Ribapharm") to which each non-employee director is entitled:

<TABLE>
<CAPTION>
Name                       Cash Payment to        Payment to Director       Number of Shares of     Grant Date      Exercise
                           Director to be         of Ribapharm Common        Ribapharm Common                         Price
                           Made on the Date        Stock in Lieu of          Stock Underlying
                               Hereof             Cash to be Made on          Options Granted
                                                    the Date Hereof
<S>                                    <C>                       <C>                    <C>         <C>   <C>      <C>
-----------------------   -----------------    ----------------------    -----------------------   ------------   -------------
Kim Campbell                           0                         0                      15,000      04/11/02       $     10.00
-----------------------   -----------------    ----------------------    -----------------------   ------------   -------------
Arnold H. Kroll                        0                         0                      15,000      04/11/02       $     10.00
-----------------------   -----------------    ----------------------    -----------------------   ------------   -------------
John Vierling                          0                         0                      15,000      04/11/02       $     10.00
-----------------------   -----------------    ----------------------    -----------------------   ------------   -------------
Hans Thierstein                        0                         0                      15,000      04/11/02       $     10.00
</TABLE>

                                       G-1

<PAGE>

                                                                       Exhibit H

                              Form of Press Release

               ICN AND RIBAPHARM ANNOUNCE SETTLEMENT OF LITIGATION

                        RIBAPHARM ANNOUNCES RESIGNATIONS

          Costa Mesa, CA, January 22, 2003 -- ICN Pharmaceuticals (NYSE: ICN)
and Ribapharm Inc. (NYSE: RNA) announced today that they have settled
outstanding litigation involving ICN, Ribapharm and certain of their officers
and directors. ICN owns approximately 80.1% of the outstanding Ribapharm shares.

          Ribapharm also announced that Chairman and Chief Executive Officer
Johnson Y.N. Lau, M.D. has resigned as an officer and director of Ribapharm, and
that board members Kim Campbell, Arnold Kroll, Hans Thierstein and John Vierling
have also resigned as directors. Ribapharm's Chief Financial Officer, Thomas
Stankovich, and General Counsel, Roger Loomis, have resigned their positions.
All of the resignations are effective immediately.

          Dr. Lau stated that he and the other resigning officers and directors
had determined to resign in order to let Ribapharm move on following recent
differences with ICN.

          ICN Chairman and Chief Executive Officer, Robert W. O'Leary, thanked
the departing Ribapharm directors and officers for ending the uncertainty
regarding Ribapharm's leadership.

          "We recognize and appreciate the valuable contributions made by the
management and board during this critical period in the company's history," said
Mr. O'Leary. "I wish them every success as they pursue new opportunities going
forward."

          "In addition, I want to thank the dedicated staff of scientists for
continuing their important work on key scientific development activities and
other employees of both ICN and Ribapharm for remaining focused on their
responsibilities over the past few weeks," Mr. O'Leary concluded.

ABOUT ICN

          ICN is an innovative, research-based global pharmaceutical company
that manufactures, markets and distributes a broad range of prescription and
non-prescription pharmaceuticals under the ICN brand name. Its research and new
product development focuses on innovative treatments for dermatology, infectious
diseases and cancer.

ABOUT RIBAPHARM

<PAGE>

          Ribapharm is a biopharmaceutical company that seeks to discover,
develop, acquire and commercialise innovative products for the treatment of
significant unmet medical needs, principally in the antiviral and anticancer
areas.

THE SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995. This press release contains forward-looking statements that involve risks
and uncertainties, including but not limited to, projections of future sales,
operating income, returns on invested assets, regulatory approval processes,
success of the company's strategic repositioning initiatives and the ability of
management to execute them, success of the company's ongoing inventory reduction
program and other cost-cutting measures, and other risks detailed from time to
time in the company's Securities and Exchange Commission filings.

                                       ###
                                        2