ROYAL BANK


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R.W. SMITH                           ROYAL BANK OF CANADA
Senior Manager                       Multinational Accounts, Quebec Headquarters
                                     1 Place Ville-Marie, 8th  Floor, West Wing
                                     P.O. Box 6001
                                     Montreal, Quebec H3C 3A9
July 12, 1999
                                     Tel:  (514) 874-2815
                                     Fax:  (514) 874-5315

Mr. Lawrence J. Hineline
Vice President - Finance,
C/O NORTH AMERICAN VACCINE INC.
10150 Old Columbia Road
Columbia, MD
21046-2358

Dear Larry:

SUBJECT:  OFFER TO FINANCE

Further to our recent discussions, we are pleased to offer you financing subject
to the following terms and conditions:

BORROWER:               North  American  Vaccine Inc., a  corporation  organised
                        under the laws of Canada. ("the Borrower")

LENDERS:                Royal Bank of Canada (the "Lender").

PURPOSE:                Bridge capital market debt or equity issue.

CREDIT FACILITY:        Up  to  a maximum of  US$6,000,000  committed  revolving
                        operating loan (the "Operating Loan").

AVAILABILITY:           Available  by  way  of US Base Rate loans  ("US  Loans")
                        and/or Libor loans ("LIBOR").

INTEREST RATES:         US Base Rate + 265bp
                        Libor + 265bp

                        The  expression  "US Base Rate" means the annual rate of
                        interest  announced by the Bank from time to time as its
                        reference rate then in effect for  determining  interest
                        rates on U.S. dollar  commercial  loans made by the Bank
                        in Canada.


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INTEREST RATES:  (cont'd)
                        The  Borrower  shall pay  outstanding  accrued  interest
                        monthly on the date fixed by the Bank. Interest shall be
                        calculated  on  the  daily  principal   balance  at  the
                        aforementioned annual interest rates based on the actual
                        number of  calendar  days  elapsed  during the period in
                        which interest is calculated, divided by 365. The annual
                        rates  of  interest,   which  correspond  to  the  rates
                        calculated  as  aforesaid,  are the rates so  determined
                        multiplied  by the  actual  number of days in a calendar
                        year and divided by 365.  Outstanding  interest  payable
                        bears interest at the rate of interest applicable to the
                        relative  loan and is payable on demand.  Interest on US
                        Loans shall be payable monthly in arrears.

                        Interest  periods  for  LIBOR  Loans  shall  be,  at the
                        Borrower's option, one, two or three months. Interest on
                        LIBOR Loans shall be payable on the last business day of
                        the  applicable  interest  period for such loans and, if
                        earlier, the 90th day following the commencement of such
                        interest  period.  LIBOR  Loans must be for a minimum of
                        $US500,000  and in whole  multiples of  $US100,000.  Two
                        business  days  prior  to  drawdown  or  rollover,   the
                        Borrower  shall  advice the Bank of the next  applicable
                        LIBOR interest period.

REPAYMENT:              December 31, 1999.

MANDATORY
REPAYMENT:              100%  of  any debt or equity  issue above  $US21,000,000
                        to be applied  as a  permanent  reduction  of the Credit
                        Facility.

SECURITY:               Guarantee  and  Postponement of  Claims for $US6,000,000
                        from  Biochem  Pharma Inc. and Biochem  Pharma  Holdings
                        Inc. in favour of the Borrower.

DOCUMENTATION:          Letter  loan  agreement signed by the Borrower,  Biochem
                        Pharma Inc. and Biochem Pharma Holdings Inc..

CONDITIONS
PRECEDENT:              The  obligation  of  the  Bank  to  make  available  the
                        Borrowings to the Borrower is subject to and conditional
                        upon:

                        a)    Satisfactory   credit   documentation    including
                              receipt  of  all  necessary  closing  certificates
                              required by the Lender,  including  legal  opinion
                              and security documentation.

                        b)    Satisfactory review of Y2K issue.


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COVENANTS:              The Borrower covenants with the Bank as follows:

                        a)    The  Borrower   will  deliver  to  the  Bank  such
                              financial  and other  information  as the Bank may
                              reasonably require, including:

                              (i)  Audited  annual  financial  statements of the
                                   Borrower   within  90  days  of  its   fiscal
                                   year-end;

                              (ii) Annual budget of the Borrower  within 90 days
                                   of its fiscal year-end;

                              (iii)A monthly  in-house  financial  statement  of
                                   the Borrower within 30 days of month-end.

                        b)    The  Borrower  will  promptly  pay,  when due, all
                              income and other taxes payable.

                        c)    The Borrower agrees to remit, as prescribed  under
                              the  Income Tax Act  (Canada),  the  Taxation  Act
                              (Quebec)   and   any   other   applicable   fiscal
                              legislation,  all deductions and withholdings made
                              by the  Borrower,  as they  fall due and to notify
                              the Bank immediately upon failure to do so.

                        d)    The  Borrower   shall  maintain  of  an  insurance
                              program consistent with industry practice.

                        e)    The Borrower shall not declare or pay dividends on
                              the  common or  preferred  shares  of its  capital
                              without the prior written approval of the Bank.

PROVISIONS REGARDING
THE ENVIRONMENT:
                        a)    The Borrower  declares to the Bank that as of date
                              hereof:

                              -    it   fully   complies   with    environmental
                                   protection  laws,  regulations,   bylaws  and
                                   other requirements applicable to its property
                                   and activities;

                              -    it has obtained the environmental  protection
                                   certificates,       approvals,       permits,
                                   authorisations  and orders  required  for the
                                   use of its  property and for carrying out its
                                   activities, if applicable;


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"NORTH AMERICAN VACCINE INC. - JULY 12, 1999"                                 /4

PROVISIONS REGARDING
THE ENVIRONMENT:  (cont'd)

                              -    no  notice,  demand,  ordinance,  lawsuit  or
                                   complaint  was brought  against it concerning
                                   environmental protection;

                              -    to its  knowledge,  there is no  circumstance
                                   which may give rise to the  revocation of the
                                   aforesaid certificates,  approvals,  permits,
                                   authorisations  and orders or to the issue of
                                   a  notice,  demand,  ordinance,   lawsuit  or
                                   complaint as aforesaid, except for those that
                                   it fully disclosed to the Bank in writing.

                        b)    The  Borrower  shall  comply  strictly  and in all
                              respects with the  requirements  of  environmental
                              protection  laws,  regulations,  bylaws  and other
                              requirements   applicable   to  its  property  and
                              activities  and shall notify the Bank  immediately
                              in the event of any  release or  discovery  of any
                              contaminant   upon,  under,  over  or  within  its
                              property or any  contiguous  real  property or any
                              real property on or near which a contaminant could
                              reasonably be  anticipated to be released that may
                              affect its property and  activities.  The Borrower
                              shall  promptly  forward to the Bank copies of all
                              notices,   permits,   orders,   demands  or  other
                              documents  and  reports  in  connection  with  any
                              release or the presence of any  contaminant or any
                              matters relating to environmental  protection laws
                              or  otherwise  as they  affect  its  property  and
                              activities.

                        c)    The Borrower  shall provide the Bank,  upon demand
                              and  at  the  Borrower's  expense,  with  all  the
                              information  that the Bank may reasonably  require
                              regarding  the  environmental   situation  of  the
                              Borrower,   notably   concerning   the  Borrower's
                              activities,  moveable and immovable property,  and
                              all  contiguous  property  to its  properties,  if
                              applicable,   including  an  environmental   audit
                              report  prepared by an  environmental  engineering
                              firm acceptable to the Bank. It will be reasonable
                              for the  Bank to  periodically  request  from  the
                              Borrower  a   confirmation   that  the  statements
                              regarding  the  environment  contained  herein are
                              still  true  and  that  as of  the  date  of  such
                              confirmation, no event occurred that may affect in
                              any way its  property  and  activities  insofar as
                              environmental protection is concerned.


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PROVISIONS REGARDING
THE ENVIRONMENT:   (cont'd)

                        d)    The  Borrower  shall allow the Bank and its agents
                              access  to  its  property  or to  any  information
                              regarding its property or activities to enable the
                              Bank  to  assess  the  risk  that  the  Borrower's
                              environmental situation represents to the Bank, to
                              anticipate  its  effect  or  to  take   corrective
                              action.


                        e)    The  Borrower  shall  indemnify  and hold the Bank
                              harmless  against  and  from  any and all  claims,
                              suits,  actions,  damages,  costs,  judgements  or
                              other  expenses  sustained or incurred by the Bank
                              either in the exercise of the rights  conferred on
                              the Bank  herein,  or as  beneficiary  of security
                              against the property of the Borrower, or under any
                              other   circumstance   relating  to  environmental
                              protection  affecting the Borrower's  property and
                              activities.

                        All  above  covenants  shall  remain  in  force  for the
                        benefit of the Bank  regardless of the date advances are
                        made or security taken.

INDEMNITY:              If, in the  opinion  of the  Bank,  the Bank is now or
                        becomes subject to, or if there is a change in:

                        a)    any  reserve or similar  requirement  against  the
                              assets of the Bank,  deposits made with or for the
                              account of, credit extended by, or any acquisition
                              of funds for the extension of credit by, the Bank;

                        b)    any reserve or similar requirement with respect to
                              all or any part of the credit used by the Borrower
                              hereunder  or any  unused  portion  of the  credit
                              facilities;

                        c)    taxation,   or  the  basis  of  taxation,  of  any
                              payments  due to the Bank  hereunder  (except  for
                              taxes on the overall net income of the Bank);

                        d)    any requirement relating to capital adequacy; or

                        e)    any other  condition  prescribed  by law or by the
                              interpretation thereof by competent authority,  or
                              any other  condition,  whether  or not  having the
                              force of law,  with which  financial  institutions
                              carrying   on  business  in  Canada  are  or  were
                              generally complying;


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"NORTH AMERICAN VACCINE INC. - JULY 12, 1999"                                 /6

INDEMNITY:  (cont'd)
                              which in  the  sole   determination  of the  Bank,
                              causes:

                              (i)   an  additional  cost  with  respect  to  the
                                    credit facilities,

                              (ii)  a   reduction   in  the   revenues   derived
                                    therefrom, or

                              (iii) a   reduction   in  the   effective   return
                                    hereunder  or on  the  Bank's  capital  to a
                                    level  below  that which the Bank could have
                                    otherwise  achieved  (using  any  reasonable
                                    averaging and attribution method),

                        then, in any such event,  the Borrower  shall pay to the
                        Bank,  on demand,  the amount  which the Bank  considers
                        sufficient to compensate that additional cost, reduction
                        in  revenues,  or  reduction  in rate of return.  Absent
                        manifest error, the amount established by the Bank shall
                        be conclusive.

EVENTS OF DEFAULT:      Without  limiting   its  right  to  demand  at  any time
                        payment  of sums which are  payable on demand,  the Bank
                        may, to the extent  permitted by and in compliance  with
                        applicable law,  immediately  terminate the right of the
                        Borrower  to make  further  borrowings  under the credit
                        facilities,  and  demand  immediate  payment of all sums
                        owing  thereunder,   including  accrued  interest,   and
                        realise on all or any portion of the security granted in
                        its favor,  upon the  occurrence of any of the following
                        events:

                        a)    failure  by  the  Borrower  to pay the  principal,
                              interest or any other amount when due;

                        b)    failure by the  Borrower to observe or satisfy any
                              covenant, condition or provision in this agreement
                              or in any other agreement with the Bank, or in any
                              security  document  established  in  favor  of the
                              Bank;

                        c)    if   the   Borrower  becomes  insolvent,  files  a
                              notice  of  intention  to make a  proposal  to its
                              creditors under the BANKRUPTCY AND INSOLVENCY ACT,
                              is declared  bankrupt,  makes an assignment of its
                              property  for the  benefit  of its  creditors,  or
                              makes  a bulk  sale  of  any  part  of its  assets
                              without the prior consent of the Bank;


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"NORTH AMERICAN VACCINE INC. - JULY 12, 1999"                                 /7

EVENTS OF DEFAULT:  (cont'd)

                        d)    if any step is taken with  respect to a compromise
                              or arrangement with the creditors of the Borrower,
                              or to have the Borrower declared bankrupt or wound
                              up, or if a receiver is appointed  with respect to
                              any part of the property encumbered by security in
                              favor of the Bank,  or if any  encumbrances  takes
                              possession of any part of the Borrower's assets;

                        e)    if in the opinion of the Bank, there occurs:

                              (i)   a material  adverse change in the Borrower's
                                    financial condition;

                              (ii)  an  unacceptable  change in the ownership of
                                    the capital stock of the Borrower;

                              (iii) the Borrower is subject to legal proceedings
                                    detrimental to its affairs;

                        f)    the  breach  of  any  law,  regulation,  bylaw  or
                              requirement    whether    federal,     provincial,
                              municipal,  or otherwise,  concerning pollution of
                              the  environment,   toxic   materials,   or  other
                              environmental   hazards,   or  public  health  and
                              safety,  affecting any of the Borrower's  property
                              or activities.

                        g)    change of ownership  whereby  Biochem  Pharma Inc.
                              ceases  to own at  least  30%  of the  issued  and
                              outstanding voting shares of the Borrower.

EVIDENCE OF
INDEBTEDNESS:           The Bank  shall  open  and  maintain  at  the  Branch of
                        Account  accounts and records  evidencing the Borrowings
                        made  available  to the  Borrower by the Bank under this
                        agreement. The Bank shall record the principal amount of
                        such  Borrowings,  the payment of principal and interest
                        on account of the loans,  and all other amounts becoming
                        due to the Bank under this agreement.

                        The  Bank's  accounts  and  records  constitute,  in the
                        absence of manifest  error,  prima facie evidence of the
                        indebtedness  of the  Borrower  to the Bank  pursuant to
                        this agreement.


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"NORTH AMERICAN VACCINE INC. - JULY 12, 1999"                                 /8

EVIDENCE OF
INDEBTEDNESS:  (cont'd)
                        The  Borrower   authorises   and  directs  the  Bank  to
                        automatically debit, by mechanical, electronic or manual
                        means,  any bank account of the Borrower for all amounts
                        payable under this agreement,  including but not limited
                        to,  the  repayment  of  principal  and the  payment  of
                        interest,  fees and all  charges for the keeping of such
                        bank accounts.


FEES AND EXPENSES:      The  Borrower  will pay all  reasonable  out  of  pocket
                        fees and  expenses  of the  Lender  in  connection  with
                        consummation of the Agreement.

GOVERNING LAW:          This agreement  shall  be  governed by the laws in force
                        in the province of Quebec.

This Offer to  Finance  will be open for  acceptance  up to and  including  July
30,1999 after which time it will be null and void.

We trust the foregoing is satisfactory to you and request that you indicate your
acceptance by signing and returning the duplicate of this letter.

Yours truly,

ROYAL BANK OF CANADA



/s/ Rod Smith
----------------------------------

Read and accepted on this 15th day of July 1999.
                          ----
NORTH AMERICAN VACCINE INC.


By:    /s/ Lawrence J. Hineline
       -----------------------------
Name:  Lawrence J. Hineline
Title: Vice President - Finance


By:    /s/ Daniel J. Abdun-Nabi
       -----------------------------
Name:  Daniel J. Abdun-Nabi
Title: Sr. Vice President


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"NORTH AMERICAN VACCINE INC. - JULY 12, 1999"                                 /9

Acknowledged on this 14th day of July 1999.
                     ----

BIOCHEM PHARMA INC.


By:    /s/ Frederick J. Andrew
       -----------------------------
Name:  Frederick J. Andrew
Title: Chief Financial Officer


By:    /s/ Francois Legault
       -----------------------------
Name:  Francois Legault
Title: Executive V.P. Corporate Development and Investments


BIOCHEM PHARMA HOLDINGS INC.


By:    /s/ Frederick J. Andrew
       ----------------------------
Name:  Frederick J. Andrew
Title: Treasurer



By:    /s/ Francois Legault
       ----------------------------
Name:  Francois Legault
Title: Vice President