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                                                       EXHIBIT 10.1
 

                       [DuPont Merck Letterhead]


June 3, 1998



John E. Bagalay, Ph.D.
President & CEO
Cytogen Corporation
600 College Road East
Princeton, NJ 08540-5308

Dear John:

This Letter Agreement ("Agreement") is intended to confirm our
mutual agreement (i) to terminate the License Agreement dated
December 20, 1994, as amended on March 29, 1996 (collectively,
the "License Agreement") under which the parties collaborated on
the research, development, manufacture, marketing and sale of
Quadramet, and (ii) to enter into an interim arrangement wherein
DuPont Merck would continue to make Quadramet available in the
marketplace while seeking a third party to acquire rights to
Quadramet.  It is understood that this letter is a statement of
agreement, binding on the parties, and not merely a statement of
understanding.  Towards this, the parties agree as follows:

1.   General Principles.  The parties intend to dissolve the
relationship created by the License Agreement and to transfer all
rights granted therein to a third party or back to Cytogen.  The
parties further intend to release each other from any and all
duties, obligations, payments and the like due now or in the
future under the terms of the License Agreement.  The License
Agreement is hereby terminated in its entirety.  As of the date
first shown above, all rights, duties, payments and obligations,
except those relating to confidentiality, relating to the License
Agreement are extinguished.  Henceforth, no reference shall be
made to the License Agreement.  Instead, all aspects of the
parties relationship with respect to Quadramet shall be governed
by this Agreement.

2.   Appointment.

     (a)  Cytogen hereby appoints DuPont Merck, for the term of
this Agreement, as a manufacturer and distributor of Quadramet. 
Pursuant to this appointment, DuPont Merck will manufacture, sell
and distribute, but not promote or detail, Quadramet to
physicians and patients requesting it.  DuPont Merck will
invoice, ship, record sales and set the price of Quadramet during
the term hereof.  As consideration for this appointment, DuPont
Merck will pay Cytogen an amount equal to fifty percent (50%) of
net sales of Quadramet.  Within fifteen (15) days following the
end of each month, DuPont Merck will provide Cytogen with a
report of that month's sales of Quadramet, so that Cytogen can
report the revenue.  DuPont Merck will include with said report
the payment due for such month.

     (b)  Cytogen hereby appoints DuPont Merck its exclusive
agent to identify and negotiate with third parties capable of and
interested in acquiring rights to Quadramet.  Promptly after the
date first shown above, DuPont Merck will contact selected third
parties and negotiate on Cytogen's behalf for the terms and
conditions of a license agreement for Quadramet.  Such agreement
will include a grant by Cytogen to the selected third party under
Cytogen's intellectual property (including, patents, know-how and
trademarks) to make, have made, use and sell Quadramet.  [CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED]


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DuPont Merck will not be a party to the contemplated agreement,
rather the parties will be Cytogen and the third party.  DuPont
Merck shall not be liable for, nor shall it in anyway be
responsible for the performance of any third party acquiring
rights to Quadramet.  DuPont Merck's efforts under this Section
2(b) shall continue until expiration of this agreement of this
Agreement, and shall cease thereafter.  In no event shall DuPont
Merck be liable to Cytogen under any theory whatsoever if DuPont
Merck is not successful in identifying and/or concluding
negotiations with any third party.

3.   Payments.

     (a)  Within five (5) days of the date first shown above,
DuPont Merck shall advance Cytogen $3.8MM [CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED].  While this amount is not refundable
(provided Cytogen otherwise complies with the terms and
conditions of this Agreement), [CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED].

     (b)  In the event DuPont Merck receives the upfront payment
contemplated under Section 2(b), then DuPont Merck will pay
Cytogen any amount it is due in excess of the amount advanced
under Section 3(a).  [CONFIDENTIAL TREATMENT HAS BEEN REQUESTED].

4.   Subsequent Manufacture.   The parties anticipate that DuPont
Merck will continue manufacturing Quadramet for a period of two
(2) years from the date first shown above.  In furtherance of
this, the parties shall enter into a separate written agreement
for the manufacture and supply of Quadramet, on terms and
conditions that shall be negotiated by the parties in good faith.

5.   Release.

     (a)  DuPont Merck, for itself and on behalf of its officers,
directors, employees, agents, assigns, predecessors, successors-in-interest, 
subsidiaries, and affiliates, hereby releases, remises and discharges 
Cytogen and its officers, directors, employees, agents, assigns, 
predecessors, successors-in-interest, subsidiaries, and of and from 
all debts, payables, receivables, demands, causes of action, suits, 
accounts, covenants, contracts, agreements, damages, and any and all 
claims, demands, and liabilities involving the development, production, 
manufacture, sale or marketing of Quadramet, both in law and in equity, which
DuPont Merck now has or ever has had against Cytogen, whether
known or unknown, from the beginning of the world to this date,
including without limitation all claims involving the
development, production, or marketing of Quadramet under the
License Agreement and/or which were or could have been asserted
in Cytogen Corporation v. The DuPont Merck Pharmaceutical
Company, C.A. No. (NJ), but excluding the obligations of Cytogen
under this Agreement, and any and all existing confidentiality
agreements which shall remain in force and effect from the date
of this release pursuant to their terms.

     (b)  Cytogen, for itself and on behalf of its officers,
directors, employees, agents, assigns, predecessors, 
successors-in-interest, subsidiaries, and affiliates, hereby releases,
remises and discharges DuPont Merck and its officers, directors,
employees, agents, assigns, predecessors, successors-in-interest,


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subsidiaries, and of and from all debts, payables, receivables,
demands, causes of action, suits, accounts, covenants, contracts,
agreements, damages, and any and all claims, demands, and
liabilities involving the development, production, manufacture,
sale or marketing of Quadramet, both in law and in equity, which
Cytogen now has or ever has had against DuPont Merck, whether
known or unknown, from the beginning of the world to this date,
including without limitation all claims under the License
Agreement and/or which were or could have been asserted in
Cytogen Corporation v. The DuPont Merck Pharmaceutical, C.A. No.
(NJ), but excluding the obligations of DuPont Merck under this
Agreement, and any and all existing confidentiality agreements
which shall remain in force and effect from the date of this
release pursuant to their terms.

6.   Assignment.  DuPont Merck may assign this Agreement without
approval to DuPont Pharmaceuticals Company.

7.   Governing Law.  This Agreement shall be governed by and
interpreted under the laws of the State of Delaware and the
Delaware courts, without regard to conflict of laws.

8.   Term.  This Agreement shall be effective as of the date
first shown above and shall continue for a term of [CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED] thereafter or the execution of a 
definitive agreement between Cytogen and a third party for Quadramet,
whichever is shorter.  Upon expiration of this Agreement all
rights and obligations of the parties created hereby will end. 
Thereafter, Cytogen shall be solely responsible for all
activities relating to Quadramet.

If the foregoing is in accordance with your understanding, please
indicate your agreement by signing in the space provided in the
enclosed copy of this letter and promptly return it to us.



Very truly yours,

THE DUPONT MERCK PHARMACEUTICAL COMPANY


By: /s/ Richard Dolighan                                   
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Accepted and Agreed:

Cytogen Corp.


By: /s/ John E. Bagalay, Jr.                                
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