<PAGE>
EXHIBIT 10.41

                       ASSIGNMENT AND AMENDMENT AGREEMENT



         THIS  ASSIGNMENT  AND  AMENDMENT  AGREEMENT,  dated as of March 7, 2003
(this  "Agreement"),  by and among SWISS FEDERAL INSTITUTE OF TECHNOLOGY (ETHZ),
having  an  address  at  Raemistrasse  101,  CH-8092  Zurich,   Switzerland  and
UNIVERSITY  OF  ZURICH,  having an address at  Raemistrasse  91 CH-8006  Zurich,
Switzerland (collectively,  "Universities"),  PHAIRSON MEDICAL LIMITED, a United
Kingdom  company  ("Phairson"),  and LIFE  MEDICAL  SCIENCES,  INC.,  a Delaware
corporation  ("LMS").  References  to  Universities,  Phairson and LMS hereunder
shall include each of their respective agents, nominees, designees,  successors,
assigns, heirs or other successors-in-interest.  All representations, warranties
and covenants of the Universities hereunder shall be joint and several.

                              W I T N E S S E T H:
                              -------------------

         WHEREAS,  Phairson has agreed to sell LMS all of its assets  related to
its polymer-based technology business,  pursuant to an Asset Purchase Agreement,
dated as of the date hereof, by and between  Phairson,  an affiliate of Phairson
and LMS (the "Asset Purchase Agreement");

         WHEREAS,  among  the  assets  to be sold to LMS  pursuant  to the Asset
Purchase Agreement are all of Phairson's rights under the contract,  dated as of
March 1, 1999,  between  Phairson and  Universities,  as amended  pursuant to an
amendment effective June 1, 1999 (the "Development Agreement");

         WHEREAS,  Universities  agree  to the  assignment  of  the  Development
Agreement and the amendment  thereof,  all subject to and in accordance with the
provisions of this Agreement.

         NOW  THEREFORE,  in  consideration  of  the  premises  and  the  mutual
covenants  contained  herein  and other  good and  valuable  consideration,  the
receipt and  sufficiency  of which are hereby  acknowledged,  the parties hereto
hereby agree as follows:

1. CONSENT BY  UNIVERSITIES  TO  ASSIGNMENT.  Subject to the  provisions of this
Agreement,  and in order to induce  the other  parties  hereto to enter into the
Asset  Purchase  Agreement  and  to  consummate  the  transactions  contemplated
thereby,  Universities  hereby  consent  to the  assignment  of the  Development
Agreement from Phairson to LMS effective as of the closing of the Asset Purchase
Agreement (which date shall not be later than March 15, 2003, the "Closing") and
agree that,  notwithstanding  any provision of the Development  Agreement to the
contrary,  Phairson  shall  not be  liable  for  obligations  arising  under the
Development Agreement from and after the Closing.

2.  ASSIGNMENT  AND  ASSUMPTION OF  DEVELOPMENT  AGREEMENT.  Effective as of the
Closing, (i) Phairson hereby sells, assigns, conveys and transfers to LMS all of
Phairson's right, title and interest in, to and arising under or relating to the
Development Agreement and all intellectual property and other rights of Phairson
obtained or arising thereunder,  but excluding the Patent Rights (which shall be
<PAGE>

transferred  to LMS  pursuant  to  separate  instrument(s))  and (ii) LMS hereby
assumes  and  shall  be  solely  responsible  for  all  of the  obligations  and
liabilities of Phairson  arising under the Development  Agreement from and after
such date.

3.  AMENDMENT  OF  DEVELOPMENT  AGREEMENT.  LMS  and  Universities  agree  that,
effective  as of the  Closing,  the  Development  Agreement  shall be amended as
follows:

     (a)  to change all references  therein from  "Phairson" to "LMS"; to change
          all references  therein from  "Foundation" to  "Universities";  and to
          change all references therein from "ETH Zurich Institute of Biomedical
          Engineering...ETH" to "Swiss Federal Institute of Technology (ETHZ)".

     (b)  to  substitute  the LMS address and contact  information  set forth in
          Section 10 hereof  for the  address  and  contact  information  of the
          Phairson  technical  and  administrative  representatives  in  Article
          IV-Designated  Representatives  of the Development  Agreement,  and to
          further add the other  provisions  of Section 10 hereof  (exclusive of
          the contact  information)  to the provisions of Article  IV-Designated
          Representatives  of the  Development  Agreement and to substitute  the
          Universities'  address and contact information set forth in Section 10
          hereof for the  address  and  contact  information  of the  Foundation
          technical and administrative  representatives in Article IV-Designated
          Representatives of the Development Agreement

     (c)  to substitute the following for Section 4 of Article VI:

                  "4. (a)  Universities  hereby grant  Contractor  an exclusive,
                  worldwide, perpetual license under their Proprietary Rights in
                  the Technology, without limitation or restriction as to use or
                  field of use (the  "License").  The License includes the right
                  to  sublicense.   With  respect  to  sublicenses   granted  by
                  Contractor,  Contractor  shall promptly  provide  Universities
                  with a copy of each sublicense  issued; and collect payment of
                  all payments due, directly or indirectly, to Universities from
                  Sublicensees  and  summarize  and  deliver  all  reports  due,
                  directly or indirectly,  to  Universities  from  Sublicensees.
                  Universities  reserve the right to use  Proprietary  Rights in
                  the Technology  solely for internal  educational  and research
                  purposes.

                   In consideration  for the License,  Contractor  agrees to pay
                  Universities,  in the  aggregate,  one tenth of one percent of
                  any and all Net Sales and Sublicense Fees actually received by
                  it.  If,  prior  to  receipt  by  Contractor  of Net  Sales or
                  Sublicense  Fees,  Contractor fails to perform any Development
                  Work with respect to the  Technology for a period of two years
                  or more,  Universities shall have the right to enter into good
                  faith  negotiations  with  Contractor to terminate the License
                  and develop the Technology.

                           (b) For the purposes of this  section,  the following
terms shall have the following meanings:


                                       2
<PAGE>

                           `Development  Work' means any  technical  or business
                  activity relating to the development,  manufacture,  marketing
                  or  commercialization  of a Product or  Products or efforts to
                  secure intellectual property rights with respect thereto.

                           `Products'   means   products    incorporating    the
                  Technology.

                           `Proprietary Rights' means patent rights, copyrights,
                  mask work rights,  trademark  rights,  trade secret rights and
                  any and all other intellectual property or similar rights.

                           `Net  Sales' of a party means all  revenues  actually
                  received  by that party or its  affiliate(s)  with  respect to
                  sale of  Products  in any and all  countries  in which a valid
                  patent  included  in  the  licensed  Proprietary  Rights  then
                  exists,   less  any  allowances  for  returns,   shipping  and
                  insurance costs, discounts and promotional allowances,  sales,
                  use,  value-added  and  similar  taxes and duties and  similar
                  governmental assessments.

                           `Sublicense  Fees' means any and all revenue received
                  by Contractor  in respect of  sublicenses  of the  Proprietary
                  Rights  licensed  under this  Agreement.  For the avoidance of
                  doubt,  as used in the foregoing  sentence the term  "revenue"
                  includes the value,  as determined  in accordance  with United
                  States    generally    acceptable    accounting    principles,
                  attributable to property,  if any, other than cash received by
                  Contractor in respect of sublicenses of the Proprietary Rights
                  under this Agreement."

                           `Technology'    means    inventions,    improvements,
                  discoveries,  know-how  and the like  made or  conceived  as a
                  result of or in connection  with the sponsored work under this
                  Agreement.

     (d)  Beginning  January 1, 2004 and ending on the date of first  commercial
          sale of a Product,  Contractor  shall  submit to  Universities  annual
          progress reports covering Contractor's (and Sublicensee's)  activities
          to develop and test all  Products  and obtain  governmental  approvals
          necessary for marketing the same. Such reports shall include a summary
          of work completed;  summary of work in progress;  current  schedule of
          anticipated  events or milestones and market plans for introduction of
          Products.  Contractor  shall  also  report  to  Universities,  in  its
          immediately  subsequent  progress report, the date of first commercial
          sale of a  Product.  After  the  first  commercial  sale of a  Product
          anywhere  in  the  world,  Contractor  shall  submit  to  Universities
          annually  royalty  reports on or before each February 28. Each royalty
          report shall cover  Contractor's  (and  Sublicensee's)  most  recently
          completed  calendar  year and shall  show (i) the gross  sales and Net
          Sales  during  the  most  recently  completed  calendar  year  and the
          royalties,  in U.S.  Dollars,  payable with respect thereto;  (ii) the
          number  of each  type of  Product  sold;  (iii)  sublicense  fees  and
          royalties received during the most recently completed calendar year in
          US dollars,  payable  with  respect  thereto;  (iv) the method used to
          calculate the  royalties;  and (v) the exchange rates used. If no sale
          of Products has been made and no sublicense  revenue has been received
          by Contractor during any reporting period, Contractor shall so report.


                                       3
<PAGE>

     (e)  All fees and royalties due Universities shall be paid in United States
          dollars and all checks  shall be made  payable to "The  University  of
          Zurich",  referencing "Unitectra Technology Transfer UZ-04/201".  When
          Products  are sold in  currencies  other than United  States  dollars,
          Contractor shall first determine the earned royalty in the currency of
          the country in which  Products  were sold and then  convert the amount
          into equivalent United States funds, using the exchange rate quoted in
          the Wall Street  Journal on the last  business  day of the  applicable
          reporting  period.  Royalties shall accrue when Products are invoiced,
          or if not invoiced,  when delivered to a third party. Contractor shall
          pay earned royalties on or before February 28. Each such payment shall
          be for earned  royalties  accrued  within  Contractor's  most recently
          completed calendar year.  Royalties earned on sales occurring or under
          sublicense granted pursuant to this Agreement in any country shall not
          be reduced by Contractor for any taxes, fees, or other charges imposed
          by the  government  of such country on the payment of royalty  income,
          except  that  all  payments  made  by  Contractor  in  fulfillment  of
          Universities' tax liability in any particular  country may be credited
          against earned  royalties or fees due  Universities  for that country.
          Contractor  shall pay all bank charges  resulting from the transfer of
          such royalty payments. In the event royalty,  reimbursement and/or fee
          payments are not received by Universities  when due,  Contractor shall
          pay to  Universities  interest  charges at a rate of ten percent (10%)
          per year.  Such interest shall be calculated from the date payment was
          due until actually received by Universities.

     (f)  To  substitute  the following for Section 3 of Article VI.

          At its  sole  discretion  and  expense,  Contractor  shall  diligently
          prosecute and maintain the patent applications and patents relating to
          Proprietary  Rights  using  counsel of its choice.  Contractor  or its
          counsel shall, upon request,  provide  Universities with copies of all
          relevant documentation relating to such prosecution including, but not
          limited to, draft patent  applications,  office  actions and responses
          thereto,  and appropriate  correspondence with counsel and agents. All
          patents and patent  applications  relating to Proprietary Rights shall
          be assigned jointly to Contractor and Universities (ie. "Swiss Federal
          Institute of Technology(ETHZ)" and "University of Zurich"). Contractor
          shall, at its sole  discretion and expense,  apply for an extension of
          the term of any  patent in Patent  Rights if  appropriate.  Contractor
          shall  prepare all documents for such  application,  and  Universities
          shall execute such documents and take any other  additional  action as
          Contractor reasonably requests in connection therewith.

     (g)  The  license  granted is  provided  "AS IS" and  without  WARRANTY  OF
          MERCHANTABILITY or WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE or any
          other   warranty,   express   or   implied.   UNIVERSITIES   make   no
          representation   or  warranty  that  the  Product(s)  or  the  use  of


                                       4
<PAGE>

          Proprietary Rights or Technology will not infringe any other patent or
          other proprietary  rights.  Contractor shall indemnify,  hold harmless
          and defend UNIVERSITIES,  its officers,  employees, and agents and the
          Inventors of the patents and patent applications in Proprietary Rights
          and their employers (collectively,  the "Indemnified Parties") against
          any and all claims,  suits, losses,  damage,  costs, fees and expenses
          resulting  from or  arising  out of any  theory of  product  liability
          relating to the Product(s).  Notwithstanding the foregoing, Contractor
          shall have no obligation  pursuant to this  paragraph  with respect to
          any claim  resulting  from or arising out of any negligent or wrongful
          action or inaction of any of the Indemnified Parties or which has been
          settled  by  an  Indemnified   Party  without  the  prior  consent  of
          Contractor  (which  consent  shall  not  be  unreasonably   withheld).
          Contractor  shall have the right to direct  the  defense of any action
          brought  against an  Indemnified  Party with respect to the subject of
          indemnity  contained herein,  and to retain counsel of its choosing in
          connection  therewith  (subject  to  the  reasonable  approval  of the
          Indemnified Parties).

All other provisions of the Development Agreement shall remain in full force and
effect.

4. REPRESENTATIONS AND WARRANTIES OF UNIVERSITIES. Universities hereby represent
and warrant to LMS and Phairson, as of the date hereof, that: (i) this Agreement
has been duly  authorized  by  Universities,  and the  execution,  delivery  and
performance  of this  Agreement  by  Universities  and the  consummation  of the
transactions  contemplated hereby do not and will not constitute a breach of any
agreement to which it is a party or violate any provision of any law to which it
is subject;  (ii) no consent of any person or governmental entity is required in
connection  with the execution or delivery of this Agreement by  Universities or
the consummation by Universities of the transactions  contemplated hereby; (iii)
there are no actions, suits, proceedings, orders, grievance proceeding or claims
pending or, to Universities' knowledge,  threatened against them relating to the
Development  Agreement  or this  Agreement,  or the subject  matter  thereof and
hereof;  (iv) there is no default, or event which with the passage of time would
constitute a default, under the Development Agreement by either Universities or,
to Universities'  knowledge,  by Phairson;  (v)  Universities  have delivered to
Phairson  complete written  disclosures with respect to all Inventions under the
Development  Agreement and  Universities  acknowledge that all of the Inventions
were  conceived  and/or made  jointly by  Universities  and  Phairson  (vi) upon
consummation of the transactions  contemplated by this Agreement,  there will be
no amounts owed Universities by Phairson or Phairson by Universities;  and (vii)
the  Development  Agreement,  a true and  complete  copy of which is attached as
Exhibit A hereto,  has not been amended other than the amendment  effective June
1, 1999 (a form of which is included as part of Exhibit A), is in full force and
effect and is enforceable in accordance with its terms,  and, upon  consummation
of the transactions  contemplated by this Agreement, will be enforceable against
Universities by LMS in accordance with its terms (as amended hereby); and (viii)
the Universities have no objection to the Contract dated 1 December 1998 between
Phairson and Professor J. A. Hubbell.

5.  REPRESENTATIONS  AND WARRANTIES OF PHAIRSON.  Phairson hereby represents and
warrants  to  Universities  and  LMS,  as of the  date  hereof,  that:  (i) this
Agreement has been duly authorized by Phairson, and the execution,  delivery and


                                       5
<PAGE>

performance  of  this  Agreement  by  Phairson  and  the   consummation  of  the
transactions  contemplated hereby do not and will not constitute a breach of the
organizational  or  constituent  documents of Phairson or any agreement to which
Phairson is a party or violate any  provision of any law to which it is subject;
(ii) no consent of any person or  governmental  entity is required in connection
with the execution or delivery of this Agreement by Phairson or the consummation
by Phairson of the transactions contemplated hereby; (iii) there are no actions,
suits,  proceedings,  orders,  grievance  proceeding  or claims  pending  or, to
Phairson's  knowledge,   threatened  against  it  relating  to  the  Development
Agreement or this  Agreement,  or the subject  matter  thereof and hereof;  (iv)
there is no default,  or event which with the passage of time would constitute a
default,  under the Development  Agreement by either Phairson,  or to Phairson's
knowledge,   by  Universities;   (v)  upon   consummation  of  the  transactions
contemplated  by this Agreement,  there will be no amounts owed  Universities by
Phairson or Phairson by Universities; and (vi) the Development Agreement, a true
and complete copy of which is attached as Exhibit A hereto, has not been amended
other than the amendment  effective June 1, 1999 (a form of which is included as
part of Exhibit A) and, upon  consummation of the  transactions  contemplated by
this  Agreement,  will be  enforceable  by  each  party  against  the  other  in
accordance with its terms (as amended hereby).

6.  REPRESENTATIONS AND WARRANTIES OF LMS. LMS hereby represents and warrants to
Universities and Phairson,  as of the date hereof,  that: (i) this Agreement has
been duly authorized by LMS, and the execution, delivery and performance of this
Agreement by LMS and the consummation of the transactions contemplated hereby do
not and will not  constitute a breach of the  Certificate  of  Incorporation  or
By-laws of LMS or any agreement to which LMS is a party or violate any provision
of any law to which it is subject; (ii) no consent of any person or governmental
entity  is  required  in  connection  with the  execution  or  delivery  of this
Agreement by LMS or the  consummation  by LMS of the  transactions  contemplated
hereby; and (iii) there are no actions, suits,  proceedings,  orders,  grievance
proceeding  or claims  pending  or to LMS'  knowledge,  threatened  against,  it
relating to this Agreement or the subject matter hereof and (iv) the Development
Agreement will be enforceable against LMS by Universities in accordance with its
terms (as amended hereby).

7.  ACKNOWLEDGMENT  AND AFFIRMATION.  The Swiss Federal  Institute of Technology
(ETHZ) ("ETHZ") and the University of Zurich ("UNIZH")  hereby  acknowledge that
the Development Agreement incorrectly listed an entity referred to as "Institute
of  Biomedical  Engineering,  ETH  Zurich and  University  of Zurich" as a party
instead  of ETHZ and  UNIZH  and that the  correct  parties  to the  Development
Agreement have always been Phairson  Medical Limited,  ETHZ and UNIZH.  ETHZ and
UNIZH  affirm  that the rights  and  obligations  of  "Institute  of  Biomedical
Engineering,  ETH Zurich and  University  of Zurich"  are, and have always been,
therights and  obligations  of, and have been and will be performed by, ETHZ and
UNIZH.


8. FURTHER  ASSURANCES.  The parties  hereto agree to timely  execute such other
agreements,   assignments,  consents,  waivers  or  other  documents  reasonably
necessary to further give effect to or evidence the agreements hereunder.


                                       6
<PAGE>

9. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to the
benefit of Universities and LMS and their respective successors and assigns.

10.  GOVERNING LAW. This Agreement shall be deemed to be a contract entered into
pursuant  to the  laws  Switzerland  and  shall  in all  respects  be  governed,
construed, applied and enforced in accordance with the laws Switzerland (without
reference to its rules as to conflicts of law).  Exclusive place of jurisdiction
shall be Zurich, Switzerland.

11.  NOTICES.  All  notices  and other  communications  hereunder  and under the
Development Agreement shall be in writing and shall be deemed given if delivered
personally  or upon  sending a copy  thereof  by first  class or  express  mail,
postage prepaid, or by telegram (with messenger service specified), or reputable
overnight courier services, charges prepaid, to such party's address (or to such
party's telecopier):


         If to Universities, to:

                  University of Zurich
                  Unitectra Technology Transfer [UZ-04/201]
                  Mohrlistrasse 23
                  CH-8006 Zurich
                  Switzerland

                  Telephone: +41 1 634 44 01
                  Facsimile: +41 1 634 44 09

                  Attention:        Mr. Urs Dommann
                  (Mr.  Urs  Dommann  is  Administrative   Representative,   see
                  Development  Agreement for contact  information  for Technical
                  Representative)

         If to Phairson, to:

                  Phairson Medical Limited
                  Russell Bedford House, City Forum
                  250 City road
                  London, United Kingdom
                  EC1V 2QQ
                  Telephone:  +44 (0) 207 253 5573
                  Facsimile:  +44 (0) 207 253 5512


         If to LMS, to:

                  Life Medical Sciences, Inc.
                  PO Box 219
                  Little Silver, New Jersey 07739
                  Telephone/Facsimile: (732) 728-1769
                  Email: RPHICKEY@AOL.COM

                  Attention:  Robert P. Hickey, President

                                       7
<PAGE>

or to such other person or address as any of the foregoing  may have  designated
for that purpose by notice to the others.

12.  MISCELLANEOUS.  This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and may not be modified in any
manner or terminated  except by an instrument in writing executed by the parties
hereto.  Nothing in this Agreement shall constitute a waiver of, expansion of or
limitation  upon any of  Phairson's  or LMS'  rights  and  remedies  as  between
themselves  under  the Asset  Purchase  Agreement  and,  in the case of any such
conflict  between the terms of the Asset Purchase  Agreement and this Agreement,
the Asset Purchase Agreement shall control.  If any term,  covenant or condition
of this  Agreement  is held  to be  invalid,  illegal  or  unenforceable  in any
respect,  this  Agreement  shall  be  construed  without  such  provision.  This
Agreement may be executed in several  counterparts,  each of which  counterparts
shall  be  deemed  an  original  instrument  and  all of  which  together  shall
constitute a single  Agreement.  Whenever the context may require,  any pronouns
used herein shall include the corresponding masculine, feminine or neuter forms,
and the singular  form of nouns and pronouns  shall  include the plural and vice
versa.



                  [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]


                                       8
<PAGE>



     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be
duly executed as of the date first set forth above.


                         SWISS  FEDERAL  INSTITUTE  OF  TECHNOLOGY
                         UNIVERSITY  OF  ZURICH


                         By:_____________________________
                         Name:  Jeffrey  Hubbell
                         Title: Professor,  Director  IBT

                         By:_____________________________
                         Name:  Alexander  Borbely
                         Title: Professor,  Vice  President  Research
                                University  of  Zurich


                         By:_____________________________
                         Name:  Ueli  Suter
                         Title: Professor,  Vice  President  Research
                                ETHZ



                         PHAIRSON  MEDICAL  LIMITED


                         By:_____________________________
                         Name:
                         Title:



                         LIFE  MEDICAL  SCIENCES,  INC.


                         By:_____________________________
                         Name:
                         Title:



                                       9
<PAGE>




                                    EXHIBIT A
                             (Development Agreement)

                                       10
<PAGE>
   CONTRACT

                                     Between

                            PHAIRSON MEDICAL LIMITED

                                       and

    INSTITUTE OF BIOMEDICAL ENGINEERING, ETH ZURICH AND UNIVERSITY OF ZURICH

THIS  AGREEMENT,  having  an  Effective  Date of  March  1st 1999 is made by and
between Phairson Medical  Limited,  a corporation  having its principal place of
business  at  602  The  Chambers,   Chelsea  Harbour,  London,  SW10  OXF,  U.K.
(hereinafter  referred  to as  "CONTRACTOR")  and the ETH  Zurich  Institute  of
Biomedical Engineering, an academic laboratory located at Moussonstrasse 18, ETH
and University of Zurich, CH-8044 Zurich,  Switzerland  (hereinafter referred to
as "FOUNDATION").

WITNESSETH:

WHEREAS,  CONTRACTOR has identified and related  specific tasks  described under
ARTICLE I; and

WHEREAS, FOUNDATION is available and qualified to perform such tasks.

NOW  THEREFORE,  in  consideration  of the  promises  and the mutual  covenant's
contained herein, the parties agree as follows:

ARTICLE I - Scene of Work and Performance

     FOUNDATION  agrees to USE ITS BEST EFFORTS to perform the work  outlined in
     ATTACHMENT 1.

     FOUNDATION undertakes to report to CONTRACTOR at the dates set out below:

     FOUNDATION reporting dates:

     Date: May 1st 1999
     Date: July 1st 1999
     Date: September 1st 1999
     Date: November 1st 1999
     Date: January 1st 2000
     Date: March 1st 2000

     ARTICLE II - Period of Performance

     The  period of  performance  shall  commence  on  Effective  Date and shall
terminate on March 1st 2000 unless  extended by written mutual  agreement of the
parties hereto or terminated in accordance  with the provisions of Article XIII.
FOUNDATION shall notify CONTRACTOR, as soon as possible, of my reason that might
contribute to its failure to perform,  within the specified  performance period,
even if such reason is beyond its control and without fault or negligence of the
FOUNDATION.

     ARTICLE III - Consideration, Records and Billing Instructions

     1.   FOUNDATION shall be reimbursed by CONTRACTOR for all costs incurred in
          connection  with the Scope of Work in the amount of (SFr  158,000 ). A
          total  budget is presented  below,  with a  distribution  between cost
          categories shown approximately:

          Salary: see attached
          Expendable supplies: see attached
          NMR, see attached
          Etc.

     2.   Payments shall be made to FOUNDATION by CONTRACTOR  upon  presentation
          of invoices in accordance with the following schedule:

Date:  March 1st, 1999     SFr 39,500
Date:  June 1st, 1999      SFr 39,500
Date:  September 1st, 1999 SFr 39,500
Date:  December 1st, 1999  SFr 39,500

<PAGE>

     3.   Payment of any  additional  amounts must be agreed upon by  CONTRACTOR
          and  FOUNDATION  if the  Research  Project  is  extended  in  scope or
          duration.

     Whenever a payment becomes 60 days past due,  FOUNDATION reserves the right
to stop work  until  payment is  received.  Wire  payments  shall be made to the
following account:

                    BANK DETAILS NEEDED FOR WIRE INSTRUCTION

ARTICLE IV - Designated Representatives

<TABLE>
<CAPTION>
<S>                                              <C>
     1.   Technical Representative

          For CONTRACTOR:                        For FOUNDATION:
     Name: Didier Cowling                        Name: Prof. Jeffrey Hubbell
     Address: 602 The Chambers                   Address: Institute for Biomedical Engineering
              Chelsea Harbour                             ETH and University of Zurich
              London SW10 OXF                             Moussonstrasse 18
              U.K.                                        CH-8044
                                                          Switzerland

     Telephone: +44 171 349 3100                 Telephone: +41 1 632 4575
     Fax: +44 171 349 3101                       Fax: +41 1 632 1214
     Email: didier.cowling@phairson.com          Email: hubbell@biomed.mat.ethz.ch

2.    Administrative Representative

          For CONTRACTOR:                        For FOUNDATION:
     Name: Patrick Banks                         Name: Dr. Ulrich Steiner
     Address: 602 The Chambers                   Address: Office of the Vice President for Research
              Chelsea Harbour                             Technology Licensing
              London SW10 OXF                             ETH Zentrum
              U.K.                                        Ramistrasse 101, HG E 49
                                                          CH-8092
                                                          Switzerland

     Telephone: +44 171 349 3100                 Telephone: +41 1 632 2082
     Fax: +44 171 349 3101                       Fax: 41 1 632 1184
     Email: patrick.banks@phairson.com
</TABLE>

ARTICLE V - Reports

     FOUNDATION  will submit in a timely manner those  reports  described in the
Scope of Work  (Article I). Such reports shall be in the format agreed to by the
Designated Technical Representatives.

ARTICLE VI - Patents and Inventions

     1.   All  rights  and  title  to  all   inventions,   improvements   and/or
discoveries,  including  software,  know-how,  patent and other  intellectual or
industrial  property  conceived and/or made by one or more employees or students
of  FOUNDATION  in  the  performance  of  the  agreement,  shall  belong  to the
FOUNDATION.

          All  rights  and  title  to  all   inventions,   improvements   and/or
discoveries,  including  software,  know-how,  patent and other  intellectual or
industrial  property  conceived  and/or made jointly by one or more employees or
students  of  FOUNDATION  and  one  or  more  employees  of  CONTRACTOR  in  the
performance  of the  agreement,  shall  belong  jointly  to the  FOUNDATION  and
CONTRACTOR.

     2.   FOUNDATION  shall  promptly  notify   CONTRACTOR  of  any  inventions,
improvements,  discoveries,  software and the like conceived  and/or made during
the  performance  of  this  agreement  (hereafter   "Inventions").   Disclosures
submitted by FOUNDATION to CONTRACTOR shall be identified as confidential.

<PAGE>

     3. The filing,  prosecution  and  maintenance  of patent  applications  and
patents  covering  Inventions shall be carried out by the CONTRACTOR at its sole
discretion and expense.  In the event the CONTRACTOR elects not to apply for any
such patents,  the  foundation  shall have the option,  at its sole expense,  to
apply for the patents.  The CONTRACTOR  shall confirm its intention not to apply
for any such patents in writing.  FOUNDATION and CONTRACTOR  shall co-operate in
the filing, prosecution and maintenance of inventions.

     4. At the sole discretion of the CONTRACTOR,  the FOUNDATION  shall license
all rights to inventions,  improvements and/or discoveries,  including software,
know-how,  patent and other  intellectual or industrial  property resulting from
the sponsored work to the CONTRACTOR or to a party designated by the CONTRACTOR.
The license will be world-wide and exclusive. CONTRACTOR will pay FOUNDATION one
tenth of one percent of revenues received from third parties for sub-licences or
of any direct product sales for products  developed  subject to the license.  If
CONTRACTOR does not carry out any development work on any particular application
of said inventions, improvements and/or discoveries resulting from the sponsored
work for a period of two years or more,  FOUNDATION will have the right to enter
into good faith  negotiations  with  CONTRACTOR  to  license  and  develop  said
inventions, improvements and/or discoveries.

ARTICLE VII- Proprietary or Confidential Information

     Should  proprietary or  confidential  information or materials be exchanged
under this agreement,  each party agrees,  absent any special  provisions to the
contrary, to:

     1.   use its best efforts to receive and maintain in confidence any and all
          confidential or proprietary  information or materials delivered by one
          party hereto to the other party;

     2.   use confidential  information or proprietary  materials solely for the
          purpose  or  purposes  for  which  it was  disclosed  and for no other
          purpose whatsoever;

     3.   disclose confidential information and share proprietary materials with
          its employees, officers, agents, and representatives only on a need to
          know basis;

     4.   identify in writing all  confidential  or  proprietary  information or
          materials  as such at the  time of  disclosure  or  within  60 days of
          disclosure in the case of oral communication;

     5.   not release  confidential  or proprietary  information or materials to
          any third parties; and

     6.   dispose  of or  return  proprietary  or  confidential  information  or
          materials to the disclosing party when requested or upon expiration or
          termination of this contract. The period of protection of confidential
          information shall be 5 years from the effective date of this contract.

     Confidential information does not include any information which

     1.   is already  in the public  domain or which  becomes  available  to the
          public through no breach of confidentiality by the recipient;

     2.   was, as between  recipient  and  discloser,  lawfully  in  recipient's
          possession  on a  non-confidential  basis  prior to  receipt  from the
          discloser;

     3.   is received by recipient  independently  on a  non-confidential  basis
          from a third party free to lawfully  disclose such  information to the
          recipient; or

     4.   is independently developed by recipient without use of the discloser's
          confidential information:

The release of  confidential  information by the receiving  party to satisfy the
requirements  of  federal,  state or local  laws  shall  not be a breach of this
agreement.

ARTICLE VIII- Publication

     Subject to the  limitations of ARTICLES VI and VII,  FOUNDATION  shall have
the right to publish any  information or material  resulting from the conduct of
the Scope of Work.  FOUNDATION  shall furnish the CONTRACTOR  with a copy of any
proposed publication 30 days in advance of the proposed  submission.  CONTRACTOR
may request  FOUNDATION to delay  publication for a maximum of an additional 120
days in Order to pursue a patent on any Invention described in the manuscript.

<PAGE>

ARTICLE IX - Changes and Modifications

     Any changes to this  contract  must be made in writing and must be executed
by both  parties to indicate  acceptance  of the  modification.  Any change that
might  impact cost,  price,  or delivery  must be agreed to in writing  prior to
initiation of any work associated with the proposed change.

ARTICLE X- Assignment and Subcontracts

     Neither  performance,  nor payment,  involving the whole or any part of the
research  effort  described  under  Article  I may be  assigned,  subcontracted,
transferred,  or  otherwise  given or imposed on any other  party by  FOUNDATION
without the prior written consent of the CONTRACTOR.

ARTICLE XI - Mutual Responsibilities

     1.   Each  party  will  comply  with  all  applicable   governmental  laws,
          ordinances, rules and regulations in the performance of this contract.

     2.   Without  affecting or limiting any other  provisions of this contract,
          it is agreed each party's  obligation  under Article VII shall survive
          the expiration of this contract.

     3.   Each party to this  contract is an  independent  contractor  with each
          party solely  responsible for its own business  expenses and employees
          including   but  not  limited  to  salaries,   benefits,   insurances,
          withholding,  and worker  compensation and taxes.  Employees of either
          party shall not be deemed agents,  employees or representatives of the
          other party.

     4.   In the execution to this contract, the person whose signatures are set
          forth  are  duly  authorized  to  execute  the  contract  and bind the
          parties.

ARTICLE XII- Use of Names

     CONTRACTOR  shall not use the name of FOUNDATION and  FOUNDATION  shall not
use the name of CONTRACTOR in any news release, advertising or other publication
without the express  written  permission  from the other party.  Such permission
shall not be unreasonably withheld.

ARTICLE XIII - Termination

     Either party may terminate this contract at any time if:

     1.   The  other  party  materially  breaches  the  terms of this  contract;
          provided that the  non-breaching  party shall have given the breaching
          party written notice of such breach and the breaching party shall have
          failed to cure the same within 30 days after receipt of such notice.

     2.   There is the loss or departure of key personnel that would  jeopardize
          both the quality  and time of  performance  or would make  performance
          impractical with respect to the budget contemplated for this contract,
          and a mutually acceptable replacement cannot be found.

     3.   performance  of any part of this  contract by a party is  prevented or
          delayed  by  reason  of  Force  Majoure  and  cannot  be  overcome  by
          reasonable diligence to the satisfaction of the other party; or

     4.   The other party  ceases,  discontinues  or  indefinitely  suspends its
          business  activities related to the services to be provided under this
          contract,  or the other party  voluntarily or involuntarily  files for
          bankruptcy.

In the  event of  termination,  immediate  notice  shall  be given by the  party
requesting  termination  which should  specify both the reason and the effective
date of termination.

This  Agreement  may be  terminated  by the  CONTRACTOR  by  written  notice  to
FOUNDATION  to that  effect if, at any stage  after  expiration  of an initial 3
month  period from the  commencement  date,  and after a review of the  Research
which shall have been  completed as at that date, in the  reasonable  opinion of
CONTRACTOR  it is decided  that  continuation  of the  research is not likely to
produce  results that will be of sufficient  commercial  interest to CONTRACTOR.

Upon any  termination  except for breach of contract by  CONTRACTOR,  FOUNDATION
shall  deliver  to  CONTRACTOR  in  the  state  they  exist  as of the  date  of
termination,  all work, product,  materials,  including confidential information
and property  belonging to CONTRACTOR.  CONTRACTOR  shall,  within 30 days after
termination,  pay  FOUNDATION  all  payments  due as of the  effective  date  of
termination.

     For the avoidance of doubt, Article VI and VII shall survive termination.

<PAGE>

ARTICLE XIV - Applicable Law

     This contract shall be governed by the laws of Switzerland and the place of
jurisdiction shall be Zurich.

ARTICLE XIV - Entire Agreement

     This contract is intended by the parties as a final  written  expression of
their agreement and supersedes and replaces any prior oral or written agreement.
Any terms or conditions inconsistent with or in addition to terms and conditions
herein contained shall be void and of no effect unless specifically agreed to in
writing and signed by both parties.

     IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  their  authorized
officials to execute this Subcontract as of the date(s) set forth below:

     CONTRACTOR                                  FOUNDATION

     /s/ Richard Franklin                        /s/  Jeffrey J A Hubbell

     Dr Richard Franklin
     CEO

Date 23 February 1999                            Date 26 Feb 1999

                                                 agreed, Zurich, March 2, 1999

                                                 /s/ Albert Waldvogel

                                                 Prof. Dr. Albert Waldvogel
                                                 Vice President for Research

<PAGE>

                        AMENDMENT TO RESEARCH AGREEMENT

Effective June 1, 1999 (the "Amendment Effective Date"), Institute of Biomedical
Engineering,  ETH Zurich and University of Zurich with offices at Moussonstrasse
18, CH-8044  Zurich,  Switzerland  ("Foundation")  and Phairson  Medical Ltd., a
corporation  organized  under  the  laws of  England,  with  offices  at 602 The
Chambers, Chelsea Harbour, London SW10 OXF ("Contractor") agree as follows:

ARTICLE I - BACKGROUND

SECTION  1.1  Foundation  and  Contractor  are  parties  to a  certain  Research
Agreement (the  "Agreement") made effective March 1, 1999 under which Foundation
and Contractor have entered into a research agreement (as defined therein).

SECTION 1.2 The parties desire to amend the Research Agreement to change the
dates Contractor pays to Foundation all costs incurred in connection with the
scope of work.

SECTION 1.3 Initially - and fully - capitalized terms shall have the same
meaning as in the Research Agreement.

ARTICLE II - AMENDMENT AND AGREEMENT

SECTION 2.1 Amendment to Article III, subsection 2 of the Research Agreement.
Article III, subsection 2 of the Research Agreement is hereby amended by
changing the dates of payment and replacing them with the following:

Article III, subsection 2. Payment shall be made to Foundation by Contractor
upon presentation of invoices in accordance with the following schedule:

Date: April 1st, 1999        SFr 39,500
Date: July 1st, 1999         SFr 39,500
Date: October 1st, 1999      SFr 39,500
Date: January 1st, 1999      SFr 39,500

SECTION 2.2 Continued Effect. The Research Agreement shall continue in force and
effect unchanged, except as specifically set forth in this document.

<PAGE>

IN WITNESS  WHEREOF,  the parties have each caused a duly authorized  officer to
sign this Amendment  Agreement on the date(s)  indicated  below, to be effective
the Amendment Effective Date.

Phairson Medical Ltd.                       Institute of Biomedical Engineering,
                                            ETH Zurich and University of Zurich
By:                                         By:
   _________________________________           _________________________________
   Dr. Richard Franklin                        Prof. Dr. Albert Waldvogel
   Chief Executive                             Vice President of Research

Date:                                       Date:
     _________________________________           _______________________________




<PAGE>