<PAGE> 1

                   ----------------------------------

                   COLLABORATION and OPTION AGREEMENT

                                IL-1 BETA 

                   ----------------------------------


This Agreement is entered this 30th day of October, 1998 (the "Effective 
Date") into by and between :


        CISTRON BIOTECHNOLOGY, INC., a corporation  organized and existing 
        under the laws of the State of Delaware, having its principal place
        of business at 10, Bloomfield Avenue, Pine Brook, New Jersey 07058,
        USA

	(hereinafter referred to as "CISTRON")

and

        PASTEUR MERIEUX Serums & Vaccins - a Pasteur Merieux Connaught
        Company, a societe anonyme organized and existing under the laws of
        the French Republic, having its registered head office at 58, avenue
        Leclerc, 69007, Lyon, France, 

	(hereinafter referred to as "PMC")

                                
                                WITNESSETH
                                ----------


WHEREAS, CISTRON has developed intellectual property, including inventions 
which are the subject matter of patents and patent applications and  secret 
and substantial know-how, relating to a cytokine called Interleukin 1 beta 
("IL-1b" or the "FACTOR") used as an immuno-adjuvant ;

WHEREAS, PMC wishes to obtain from CISTRON an option for a license to use 
CISTRON' inventions relating to the FACTOR for use as an adjuvant in human 
vaccines, and CISTRON is shalling to grant such license option to PMC, 
subject to the terms of and conditioned upon this Agreement ;

WHEREAS, CISTRON and PMC also want to collaborate in order to identify and 
discover vaccine antigens suitable for combination with the FACTOR as an 
adjuvant, to be used as either mucosal or parenteral preparations for the 
prevention or treatment and/or cure of infectious diseases and cancers, 
which shall be used by PMC to evaluate potential vaccine products for use 
in humans, thus expanding the intellectual property portfolio with respect 
to the use of the FACTOR as an immuno-adjuvant.


NOW, THEREFORE, in consideration of the respective representations and 
covenants of each of the Parties as set forth below, CISTRON and PMC, 
intending to be legally bound, agree as
follows :


ARTICLE I - DEFINITIONS AND INTERPRETATION
------------------------------------------

1.1.	Definitions : For the purposes of this Agreement the following words 
and phrases shall have the following meanings :

                                   -1-
<PAGE>2

        (a) "Affiliate" means, with respect to any Person, (i) any other 
            Person of which the securities or other ownership interests 
            representing fifty per cent (50 %) or more of the equity or fifty 
            per cent (50 %) or more of the ordinary voting power or fifty per 
            cent (50 %) or more of the general partnership interest are, at 
            the time such determination is being made, owned, Controlled or 
            held, directly or indirectly, by such Person (a "Subsidiary"), or 
            (ii) any other Person which, at the time such determination is 
            being made, is Controlling or under common Control with, such 
            Person. As used herein, the term "Control", whether used as a 
            noun or verb, refers to the possession, directly or indirectly, 
            of the power to direct, or cause the direction of, the management 
            or policies of a Person, whether through the ownership of voting 
            securities, by contract or otherwise.

        (b) "Agreement" means this agreement, all amendments and supplements 
            to this Agreement and all schedules to this Agreement, including 
            the following :

            Schedule A -    OPTIONED PATENTS
            Exhibit 1 -     RESEARCH PROGRAM
            Exhibit 2 -     LICENSE AGREEMENT

        (c) "Biological Materials" shall mean any biological materials 
            including but not limited to structural genes, genetic sequences, 
            promoters, enhancers, probes, linkage probes, vectors, hosts, 
            plasmids, peptides, polypeptides, transformed cell lines, 
            transgenic animals, proteins, biological modifiers, antigens, 
            reagents, hybridomas, antibodies, toxins, lectins, enzymes, 
            lipids, hormones, viruses, cells or parts of cells, cell lines, 
            fragments of any of the foregoing and any other biologically 
            active material or compound, whether or not occurring naturally 
            or howsoever derived, modified, conjugated, cross-linked, 
            immobilized, reduced, purified or produces, whether by 
            recombinant DNA techniques and/or otherwise.

        (d) "Calendar Quarter" means any of the three-month periods beginning 
            January 1, April 1, July 1 and October 1 in any year.

        (e) "CISTRON Improvement" means Improvements which are conceived 
            during the term of this Agreement solely or jointly by employees 
            or contractors acting on behalf of CISTRON or its Affiliates, to 
            the extent that CISTRON has now or hereafter shall have the right 
            to grant licenses, immunities or other rights thereon.
        
        (f) "CISTRON Technology" means the OPTIONED PATENTS, the OPTIONED 
            KNOW-HOW and the CISTRON  Improvements, and shall include 
            CISTRON's share in any JOINT INVENTIONS and Joint Patent Rights.

        (g) "Confidential Information" has the meaning ascribed to it in 
            Section 4.1. of this Agreement.

        (h) "Event of Force Majeure" has the meaning ascribed to it in 
            Article 4.4. of this Agreement.

        (i) "FACTOR" means the cytokine (a protein) called Interleukin 1 
            beta, or IL-1b, as described in the OPTIONED PATENTS, and any 
            derivatives thereof, and is intended to refer to both the protein 
            itself and the gene encoding thereto.

        (j) "Field of Preventative Vaccines" means the field comprised of 
            bio-pharmaceutical products for the prevention through active 
            immunization against infectious diseases and/or cancers in 
            humans.

        (k) "Field of Therapeutic Vaccines" means the field comprised of bio-
            pharmaceutical products for the immunotherapy through active 
            immunization against infectious diseases and/or cancers in 
            humans.
                                      -2-
<PAGE>3

        (l) "Field of Use" means either the Field of the Therapeutic Vaccines 
            or the Field of the Preventative Vacines or both.

        (m) "Improvements" means all patentable  and non-patentable 
            inventions, discoveries, technology and information of any type 
            whatsoever, including without limitation Biological Materials, 
            methods, processes, technical information, knowledge, experience 
            and know-how which utilize, incorporate, derive from, or are 
            based on CISTRON Technology or could not be conceived, developed 
            or reduced to practice but for the use of the CISTRON Technology. 

        (n) "JOINT INVENTIONS" and "Joint Patent Rights" have the meaning 
            ascribed to it in Section 3.7 hereof.

        (o) "License Issue Fee" is defined in Section 2.2.3 hereof.

        (p) "OPTIONED KNOW-HOW" means any and all technical information, 
            discoveries, improvements, processes, formulae, data, 
            engineering, technical and shop drawings, inventions, Biological 
            Materials, shop-rights, know-how and trade secrets which is 
            useful or necessary to make, have made, use or sell the FACTOR 
            and/or PRODUCTS or to practice under the OPTIONED PATENTS in the 
            Field of Use, which have been, or hereafter are, either developed 
            reduced to practice by CISTRON or its Affiliates, or the rights 
            to which in the Field of Use have been acquired by CISTRON or its 
            Affiliates and to which CISTRON or its Affiliates have a 
            transferable interest.

        (q) "OPTIONED PATENTS" means :

            (i)   any existing patents and patent applications listed in 
                  Schedule A to this Agreement ;

            (ii)  any future patents issued from any patent applications 
                  referred to in Paragraph 1.(p).(i) above and any future 
                  patents issued from a patent application filed in any country 
                  in the Territory which corresponds to a patent or patent 
                  application identified in Paragraph 1.(p).(i) above ;

            (iii) any reissues, confirmations, renewals, extensions, 
                  counterparts, divisions, continuations, continuations-in-
                  part, supplemental protection certificates or utility models
                  issued, assigned or licensed to CISTRON or its Affiliates of
                  or relating to the patents or patent applications identified
                  in Paragraph 1.(p).(i) and (ii) above 

            (iv)  any future patents and patent applications covering CISTRON 
                  Improvements, solely or jointly owned by CISTRON or its 
                  Affiliates, or licensed by CISTRON or its Affiliates with the
                  right to sublicense any JOINT INVENTIONS or Joint Patent 
                  Rights. 

        (r) "Notice of Dispute" has the meaning ascribed to it in Section 
            4.7.4.(a) of this Agreement.

        (s) "Option" and "Option Period" are defined in Article 2 hereof.

        (t) "Parties" means PMC and CISTRON, and "Party" means any one of 
            them.

        (u) "Person" means an individual, corporation, partnership, trust, 
            business trust, association, joint stock company, pool, 
            syndicate, sole proprietorship, unincorporated organization, 
            governmental authority or any other form of entity not 
            specifically listed herein.

        (v) "PMC Improvement" means Improvements which are conceived during 
            the term of this Agreement solely or jointly by employees or 
            contractors acting on behalf of PMC

                                  -3-
<PAGE>4
            or its Affiliates, to the extent that PMC has now or hereafter
            shall have the right to grant licenses, immunities or other
            rights thereon.
        
        (w) "PRODUCTS" means any and all vaccines or other bio-pharmaceutical 
            products intended for use in the Field of Preventative Vaccines 
            or the Field of Therapeutic Vaccines which (i) incorporate the 
            FACTOR as an adjuvant or (ii) more generally utilize any or are 
            based on any CISTRON Technology.

        (x) "Selected Field of Use" is defined in Section 2.2.3 hereof.

        (y) "Third-Party" means any Person other than PMC, CISTRON and their 
            respective Affiliates.

        (z) "Valid Patent Claim" means a claim of an issued and unexpired 
            patent or patent application included in OPTIONED PATENTS which 
            has not been held permanently revoked, unenforceable or invalid 
            by a decision of a court or other governmental agency of 
            competent jurisdiction, unappealable or unappealed within the 
            time allowed for appeal, and which has not been admitted to be 
            invalid or unenforceable through reissue or disclaimer or 
            otherwise. If there should be two or more decisions within the 
            same country which are conflicting with respect to the invalidity 
            of the same claim, the decision of the highest tribunal shall 
            thereafter control. However, should the tribunals be of equal 
            authority, then the decision or decisions holding the claim valid 
            shall prevail where the conflicting decisions are equal in number 
            and the majority of decisions shall prevail where the conflicting 
            decisions are not equal in number.
        

1.2.    Certain Rules of Interpretation in this Agreement and the Schedules:

        (a) An accounting term not otherwise defined has the meaning assigned 
            to it by, and every accounting matter shall be determined in 
            accordance with, generally accepted accounting principles in the 
            United States of America;

        (b) Unless otherwise specified, all references to monetary amounts 
            are to United States dollars currency (US$);

        (c) The descriptive headings of Articles and Sections are inserted 
            solely for convenience of reference and are not intended as 
            complete or accurate descriptions of the content of such Articles 
            or Sections ;

        (d) The use of words in the singular or plural, or with a particular 
            gender, shall not limit the scope or exclude the application of 
            any provision of this Agreement to such Person or Persons or 
            circumstances as the context otherwise permits ;

        (e) Whenever a provision of this Agreement requires an approval or 
            consent by a Party to this Agreement and notification of such 
            approval or consent is not delivered within the applicable time 
            limit, then, unless otherwise specified, the Party whose approval 
            or consent is required shall be conclusively deemed to have 
            withheld its approval or consent ;

        (f) Unless otherwise specified, time periods within or following 
            which any payment is to be made or act is to be done shall be 
            calculated by excluding the day on which the period commences and 
            including the day on which the period ends and by extending the 
            period to the next business day following if the last day of the 
            period is not a business day in the jurisdiction of the Party to 
            make such payment or do such act ; and 

        (g) Whenever any payment is to be made or action to be taken under 
            this Agreement is required to be made or taken on a day other than
            a business day, such payment shall be made or action taken on the
            next business day following such day in the jurisdiction of the
            Party to make such payment or do such act.

                                   -4-
<PAGE>5

ARTICLE 2 - OPTION
------------------

2.1.	Research License to PMC
        -----------------------

        Subject to the provisions of this Agreement, CISTRON hereby grants to
        PMC and its Affiliates, and PMC hereby accepts, for the term provided
        for in section 2.2.2. hereof  (the "Option Period"), the right to use
        CISTRON Technology solely for the purpose of conducting research &
        development activities (including pre-clinical and clinical studies)
        in the Field of Use relating to the FACTOR and PRODUCTS and evaluating
        PMC's interest in exercising the Option. PMC shall communicate to
        CISTRON an outline of the research work that PMC intends to conduct
        during the Option Period and shall keep CISTRON informed of its
        progress throughout such term in accordance with Section 3.2 hereof.

        CISTRON agrees that promptly following the execution of this Agreement,
        it shall make available to PMC and/or a designated PMC Affiliate such
        OPTIONED KNOW-HOW (including, but not limited to, non-published patent
        applications) and such quantities of research grade FACTOR as
        reasonably necessary to enable PMC to conduct its own research &
        development activities during the Option Period and to evaluate its
        interest in exercising the Option; provided, however, that CISTRON
        shall not be obligated to provide PMC with more than One Hundred
        milligrams (100 mg) of research grade FACTOR per Calendar Quarter.
        PMC hereby covenants to CISTRON that PMC shall not use research grade
        FACTOR supplied to it by CISTRON hereunder for the purpose of clinical
        trials or any similar experiments in humans. PMC shall be responsible
        for manufacturing or having manufactured clinical grade FACTOR, provided
        that PMC shall consult with CISTRON in this respect and shall exert
        commercially reasonable efforts in organizing such manufacturing so
        that there is sufficient supply of FACTOR for use by CISTRON for the
        needs of the Research Program and other CISTRON needs in addition to
        PMC's needs. CISTRON shall indicate to PMC its best estimates of the
        quantities of FACTOR that it may need during the Option Period.

        Certain research & development activities to be performed during the
        Option Period shall be conducted on a collaborative basis by PMC and
        CISTRON in accordance with and subject to the terms & conditions set
        forth in Article 3.

2.2.	Option
        ------

2.2.1.	Grant of the Option.
        --------------------

        Subject to the provisions of this Agreement, CISTRON hereby grants to 
        PMC, and PMC hereby accepts, an exclusive option (the "Option") to 
        enter into a license under terms and conditions set forth in the 
        License Agreement herewith attached as Exhibit 2. Without limiting the
        generality of the foregoing, CISTRON covenants that during the Option
        Period, neither CISTRON nor its Affiliates shall grant to any Third-
        Party any right, license or privilege to use CISTRON Technology in the
        Field of Use. PMC may exercise the Option at any time on or before the
        expiration of the Option Period in accordance with Section 2.2.3 
        hereinafter.


2.2.2.	Option Period.
        --------------

        The Option Period shall commence on the Effective Date and shall 
        continue for a period of three (3) years thereafter, unless otherwise 
        terminates in accordance with its terms.

                                     -5-
<PAGE>6

2.2.3.	Exercise of the Option.
        -----------------------
        PMC may exercise the Option at any time during the Option Period but 
        in any case no later than the date upon which the Option Period shall 
        expire by (i) providing written notice to CISTRON not less than thirty
        (30) days prior to the expiration of the Option Period specifying the 
        Selected Field(s) of Use and (ii) by paying to CISTRON a non-
        refundable, non-creditable license issue fee of Three Million and Five
        Hundred Thousand US Dollars (3,500,000.- US$) per Selected Field of 
        Use (the "License Issue Fee"), provided, however, that the License 
        Issue Fee with respect to the Field of Preventative Vaccines shall be
        paid at the latest by October 31, 2001 if such field is selected by 
        PMC, and the License Issue Fee with respect to the Field of 
        Therapeutic Vaccines shall be paid  not later than  January 30, 2002, 
        if such field is selected by PMC. For the purpose of this Agreement, 
        "Selected Field of Use" shall mean the field in which PMC may choose 
        to exercise its option right and therefore obtain the LICENSE, which 
        may be comprised of the Field of the Preventative Vaccines, or the 
        Field of the Therapeutic Vaccines, or both.


2.2.4.	Effect of Failure to Exercise Option.
        -------------------------------------

        Without prejudice to the last paragraph of this Section 2.2.4., in the
        event PMC fails to properly and timely exercise the Option in the 
        Field of Use, PMC shall be deemed to have forfeited all its rights 
        hereunder, and it shall promptly return to CISTRON all CISTRON 
        Technology and all embodiments of such technology.

        Without prejudice to the last paragraph of this Section 2.2.4., in the
        event PMC fails to properly and timely exercise the Option in either 
        the Field of Preventative Vaccines or the Field of Therapeutic 
        Vaccines, then PMC shall be deemed to have forfeited its rights 
        hereunder to the extent such rights pertain to the non-selected field 
        and it shall promptly return to CISTRON all CISTRON Technology and all 
        embodiments of such technology.

        In both cases, PMC and CISTRON shall remain joint owners of JOINT 
        INVENTIONS under the terms and conditions of Section 3.7 hereof.

2.2.5.	Actions to be Taken upon Option Exercise.
        -----------------------------------------

        In the event that PMC exercises the Option in a Field of Use, it shall
        send to CISTRON along with the notice provided for in Section 2.2.3. 
        hereof, two original counterparts of the License Agreement herewith 
        attached as Exhibit 2, ready for execution, adjusted to reflect the 
        Selected Field of Use if required. PMC shall also join a term sheet 
        describing proposed terms and conditions for the continued 
        commercialization of JOINT INVENTIONS by CISTRON outside the Selected 
        Field of Use.


ARTICLE 3 - RESEARCH COLLABORATION.
-----------------------------------

3.1.	Object.
        -------

        Pursuant to a mutually agreed upon research program attached hereto as
        Exhibit 1 (the "Research Program"), CISTRON agrees to conduct 
        research works described therein and PMC agrees to support and fund 
        such Research Program in accordance with the terms and conditions set 
        forth here below.


3.2.	Oversight of the Research Program.
        ----------------------------------

        The Parties shall meet as they deem fit and in any event not less 
        than once a year during the term of the Research Program, at such 
        dates and times as agreed to by the Parties. Face to face meetings 
        shall normally take place at CISTRON's premises or such other place 
        as may be mutually agreed upon. Meetings may be held by 
        telecommunication means. At such meetings, CISTRON shall present  the 
        status of performance by CISTRON under the Research Program and 
        purposes and conditions of any collaboration with a Third-Party that

                                   -6-
<PAGE>7

        CISTRON may intend to enter into in connection with the Research 
        Program and the Parties shall jointly evaluate the results thereof 
        and set priorities therefor in accordance with CISTRON's 
        recommendations. PMC shall have the right to comment on CISTRON's 
        recommendations, and CISTRON shall give due consideration to such 
        PMC's comments, but CISTRON shall have the final decision on any 
        matters relating to the performance of the Research Program. 
        Similarly, during the above-mentioned meetings, PMC shall present the 
        status of performance by PMC under its own research program, and the 
        Parties shall jointly evaluate the results thereof and set priorities 
        therefor in accordance with PMC's recommendations. CISTRON shall have 
        the right to comment on PMC's recommendations, and PMC shall give due 
        consideration to such CISTRON's comments, but PMC shall have the 
        final decision on any matters relating to the performance of PMC 
        research in the Field of Use. The Parties shall prepare written 
        minutes of each meeting and a written record of all decisions whether 
        made at a formal meeting or not. Such minutes shall incorporate semi-
        annual research reports prepared by CISTRON and semi-annual reports 
        prepared by PMC.


3.3.	Conduct of Research Program. 
        ----------------------------
        
3.3.1.	Good Laboratory Practice. The Research Program shall be conducted 
        by CISTRON at CISTRON's laboratories and/or at Third-Party research 
        laboratories contracted by CISTRON.  CISTRON shall use all reasonable 
        efforts to complete research works in accordance with the said 
        Program. Any research work performed by CISTRON pursuant hereto shall 
        be in compliance with current Good Laboratory Practices (cGLP) as 
        applicable in the United States of America.

3.3.2.	Laboratory Notebooks. CISTRON shall cause its employees, agents 
        and subcontractors to maintain laboratory notebooks. Such laboratory 
        notebooks shall set forth such work in detail, including a clear 
        description of the purposes for which the work has been undertaken 
        and the results expected ; sufficient details, diagrams, plans, 
        sketches and identification of materials (including Biological 
        Materials) used, formulations and operating conditions under which 
        the work was conducted as may be necessary to understand and 
        reproduce the work conducted ; identification of any intermediate or 
        final results achieved ; and if such laboratory notebooks contain any 
        interpretations of data, they shall also describe the rough data upon 
        which such interpretations have been based. CISTRON shall further 
        cause its employees, agents and  subcontractors maintaining such 
        laboratory notebooks to have their work corroborated periodically, 
        which corroboration shall include at least personal witnessing of the 
        notebooks indicating that the witness has read and understood the 
        material on the page witnessed on the date that he or she signed it.


3.4.	Financial conditions.
        ---------------------

3.4.1.	Support commitment. In consideration of the work performed by 
        CISTRON pursuant to and in accordance with the Research Program, PMC 
        shall pay to CISTRON during the Research Program  Three Hundred 
        Thousand United States dollars  (300,000.- US$) per year for three 
        (3) years.  Such payments shall be non-refundable, guaranteed and not 
        contingent upon any research milestones.


3.4.2.	Payments Schedule. Support payments shall be made by PMC to 
        CISTRON in twelve (12) quarterly payments of Seventy Five Thousand 
        United States dollars (75,000- US$)  in advance with the first 
        payment to be made within fifteen (15) days of the Effective Date of 
        this Agreement, and the other payments payable on the first day of 
        each of the subsequent Calendar Quarters. 

                                   -7-
<PAGE>8

3.4.3.	No Conflict With Research Program. CISTRON agrees that the  funds 
        provided by PMC hereunder shall be applied to the Research Program 
        and to Field of Use-related research and may not, without PMC prior 
        written approval, be used in support of any r research at CISTRON 
        which would not be closely related to the Field of Use, the FACTOR or 
        PRODUCTS.


3.4.4.	Title to Equipment. CISTRON shall retain title to any equipment 
        purchased with funds provided by PMC under this Agreement, if such 
        purchase is mutually agreed upon  to support  the Research Program.
        

3.5.	Term of the Research Program.
        The term of the Research Program shall be three (3) years as from the 
        Effective Date.


3.6.	Confidentiality.
        In order to facilitate the Research Program, either Party may disclose
        confidential or proprietary information owned or controlled by it to 
        the other. It is hereby understood and agreed that such information 
        shall be deemed "Confidential Information" as defined in Article 4.1. 
        and treated as such.


3.7.	JOINT INVENTIONS.
        -----------------

3.7.1	Inventions Arising During Option Period.  All right, title and 
        interest in and to any technology or invention, whether or not 
        patentable, and any patent applications and patents based thereof, 
        made or conceived by or on behalf of either Party during the Option 
        Period which are (i) CISTRON Improvements, (ii) PMC Improvements or 
        (iii) inventions made jointly by CISTRON employees and PMC employees 
        in the course of the Research Program, shall be deemed to be joint 
        inventions ("Joint Inventions") and shall be jointly owned by the 
        Parties on an equal basis.  In the event that CISTRON wishes to 
        commercialize any Joint Invention which does not infringe on any 
        CISTRON Technology (i) outside the Fields of Use at any time, or 
        (ii) within either Field of Use following the expiration of the 
        Option Period (assuming PMC has declined to exercise the PMC Option 
        in respect of such Field of Use), CISTRON agrees to pay a royalty to 
        PMC, on the terms provided below.  In the event that PMC wishes to 
        commercialize any Joint Invention (i) outside the Fields of Use at 
        any time, or (ii) within either Field of Use following the 
        expiration of the Option Period (assuming PMC has declined to 
        exercise the PMC Option in respect of such Field of Use), PMC agrees 
        to pay a royalty to CISTRON, on the terms provided below.  In the 
        event that PMC wishes to commercialize any Joint Invention which 
        does infringe on any CISTRON Technology, it shall only do so under a 
        license from CISTRON.

3.7.2.	Inventions Arising Subsequent to Option Period.  Each of the 
        Parties hereto shall have the rights set forth below in respect of 
        any and all inventions, whether or not patentable, made by either 
        Party following expiration of the Option Period:  (a) in the event 
        that PMC has made an invention, PMC shall own all right, title and 
        interest in and to such invention and shall be free to use such 
        invention as it sees fit, provided it does not infringe upon any 
        CISTRON Technology under which PMC does not have a license (provided 
        this shall not limit PMC's obligations under that certain license 
        agreement between the Parties), and (b) in the event that CISTRON 
        has made an invention which is derived from or based upon any Joint 
        Invention, CISTRON will own all right, title and interest in and to 
        such invention, and (i) if PMC has not exercised the PMC Option, 
        CISTRON shall be free to use such invention as it sees fit, and 
        shall pay a royalty to PMC on sales of products using such invention 
        on the terms provided below, and (ii) if PMC has exercised the PMC 
        Option in respect of either or both Fields of Use, the rights to 
        such invention shall be automatically included in the

                                  -8-
<PAGE>9

        LICENSE AGREEMENT and licensed thereunder to PMC in the applicable
        Field(s) of Use, and CISTRON shall be free to use such invention as
        it sees fit outside the applicable Field(s) of Use, and shall pay a
        royalty to PMC on sales of products using such invention, on the terms 
        provided below.

3.7.3	Determination of Royalties.  In determining the royalty payable 
        to the other Party, in the event a royalty is to be paid pursuant to 
        subparagraph 3.7.1 or 3.7.2 hereof, the Parties agree to negotiate 
        in good faith a reasonable royalty which reflects the value of the 
        Joint Invention in relation to all other technology and proprietary 
        rights included in such product and, in the case of subparagraph 
        3.7.2 hereof only, the importance of the Joint Invention to the 
        discovery of the subsequent invention by a Party.  

3.7.4	As to any JOINT INVENTIONS made by the Parties during the term of 
        this Agreement, CISTRON shall have the first right to file patent 
        applications with respect to such inventions in the name of both 
        Parties. CISTRON may elect not to file and if it does so, PMC 
        shall have the right to file the patent application. Any patents 
        and patent applications covering a JOINT INVENTION are referred 
        to herein as "Joint Patent Rights". In any case, the filing Party 
        shall give the non-filing Party an opportunity to review the text 
        of the application before filing, shall consult with the non-
        filing Party with respect thereto and shall supply the non-filing 
        Party with a copy of the applications as filed, together with 
        notice of its filing date and serial number and fifty percent 
        (50%) of the out-of-pocket costs and expenses of the filing Party 
        shall be reimbursed by the other Party. Both Parties shall keep 
        the other advised of the status of actual and prospective patent 
        application filings and upon request, provide advanced copies of 
        any documents related to such filings and thereafter to the 
        prosecution and maintenance of all patent applications and 
        patents pertaining to Joint Patent Rights.


3.8	Commercialization of Inventions.
        --------------------------------

	CISTRON and PMC each hereby represents that all employees and other
        Persons acting on its behalf in performing its obligations under 
        this Agreement shall be obligated under a binding written 
        agreement to assign to it, or as it shall direct, all 
        Improvements conceived or reduced to practice by such employees 
        or other Persons during the term of this Agreement.


3.8.1	Patent Prosecution and Maintenance.
        -----------------------------------

	OPTIONED PATENTS. CISTRON shall be responsible for and shall control 
        the preparation, filing, prosecution, grant and maintenance of all 
        OPTIONED PATENTS. CISTRON shall prepare, file, prosecute and maintain 
        such OPTIONED PATENTS in good faith consistent with its customary 
        patent policy and its reasonable business judgement, and shall 
        consider in good faith the interests of PMC in so doing.

	Costs. With respect to all filings hereunder, the filing Party shall 
        be responsible for payment of all costs and expenses related to such 
        filings, prosecution and maintenance, unless relieved of same 
        pursuant to Section 3.8.2 hereinafter, and except for jointly owned 
        patents, for which fifty percent (50%) of all such costs and expenses 
        shall be reimbursed to the filing Party by the other Party.


3.8.2	Option to Prosecute and Maintain Patents.
        -----------------------------------------

        CISTRON shall give notice to PMC of any intention to cease prosecution
        and/or maintenance, or not to proceed with an extension, of OPTIONED 
        PATENTS and, in such case, shall permit PMC, at PMC's sole 
        discretion, to continue prosecution or maintenance or proceed with 
        the extension at its own expenses. If PMC elects to continue 
        prosecution or maintenance or to proceed with the extension, CISTRON 
        shall execute such documents and perform such acts at PMC's expense 
        as may be reasonably necessary to effect an

                                     -9-
<PAGE>10

        assignment of such OPTIONED PATENTS to PMC in a timely manner, and
        more generally to permit PMC to continue such prosecution and
        maintenance or to proceed with the extension. Any patents and patent
        applications so assigned shall not be considered as OPTIONED PATENTS
        as of the date of such assignment. No royalties shall be payable by
        PMC on sales of PRODUCTS covered only by a Valid Patent Claim of a
        OPTIONED PATENT which has been assigned to PMC pursuant to this
        Section 3.8.


3.8.3	Interference, Opposition, Reexamination and Reissue.
        ----------------------------------------------------

        (i)   The Parties shall use their respective best efforts to within
              ten (10) days of learning of any interference, opposition, 
              reexamination or reissue event, inform the other Party of any 
              request for, or filing or declaration thereof relating to
              OPTIONED PATENTS.  The Parties shall thereafter consult and
              cooperate fully to determine the course of action with respect
              to any such proceeding. Both Parties shall have the right to
              review and comment on any submission to be made in connection
              with any such proceeding.

        (ii)  CISTRON shall not institute any reexamination or reissue 
              proceeding relating to OPTIONED PATENTS without having first 
              consulted PMC.

        (iii) In connection with any interference, opposition, reissue or 
              reexamination proceeding relating to OPTIONED PATENTS, the
              Parties shall cooperate fully and shall provide each other
              with any information or assistance that either Party may
              reasonably request. CISTRON shall keep PMC informed of
              developments in any such action or proceeding, including,
              to the extent permissible, the status of any settlement
              negotiations and the terms of any offer related thereto.

        (iv)  CISTRON shall bear the expense of any interference, opposition,
              reexamination or reissue proceeding relating to OPTIONED
              PATENTS.


3.8.4	Enforcement and Defense. 
        ------------------------

        (i)   Each Party shall give the other notice of either (a) any 
              infringement of OPTIONED PATENTS, or (b) any misappropriation
              or misuse of OPTIONED KNOW-HOW that has come to its attention.
              The Parties shall thereafter consult and cooperate fully to
              determine a course of action, including but not limited to the
              commencement of legal action by either or both Parties to
              terminate any infringement of OPTIONED PATENTS or any
              misappropriation or misuse of OPTIONED KNOW-HOW.

        (ii)  In the event that OPTIONED PATENTS are infringed by any Third-
              Party with respect to a PRODUCT in the Field of Use, CISTRON,
              upon notice to PMC, shall have the first right, but not the
              obligation, to institute and prosecute any action or proceeding
              under OPTIONED PATENTS with respect to such infringement, by
              counsel of its choice, or to control the defense of any
              declaratory judgment action arising from such infringement or
              from the misappropriation or misuse of OPTIONED KNOW-HOW, at its
              own expense and in the name of both Parties. CISTRON shall not
              settle, compromise or take any action in such litigation which
              diminish, limit or inhibit the scope, validity or enforceability
              of OPTIONED PATENTS without the express permission of PMC.
              CISTRON shall keep PMC advised of the progress of such
              proceedings.

        (iii) In the event that a Third-Party is infringing any OPTIONED 
              PATENTS with respect to a PRODUCT in the Field of Use and CISTRON
              does not elect to institute an action, PMC, upon notice to 
              CISTRON, shall have the right, but not the obligation, to 
              institute and prosecute any action or proceeding under OPTIONED 
              PATENTS with respect to such infringement, by counsel of its 
              choice, or to control the defense of any declaratory judgment 
              action arising from such infringement or from the
              misappropriation or misuse of OPTIONED KNOW-HOW, at its own
              expense and in the name of both Parties. PMC shall not settle,
              compromise or take any action in such litigation which diminish,
              limit or
                                  -10-
<PAGE>11

              inhibit the scope, validity or enforceability of OPTIONED
              PATENTS without the prior approval of CISTRON, which
              shall not be unreasonably withheld.

        (iv)  With respect to any action to terminate any infringement of 
              OPTIONED PATENTS or any misappropriation or misuse of OPTIONED 
              KNOW-HOW, the Parties shall cooperate fully and shall provide
              each other with any information and assistance that either Party
              may reasonably request. In particular, either Party shall execute
              such documents necessary for the other Party to initiate and
              prosecute the action or proceeding and cause its Affiliates and
              Sublicensees to execute all such documents, if required. In the
              event that either Party is unable to initiate or prosecute an
              action solely in its own name, the other Party shall then join
              such action voluntarily. Each Party shall keep the other
              informed of the development of any action or proceeding
              including, to the extent permissible by law, the status of any
              settlement negotiations and the terms of any offer related
              thereto.

        (v)   Any recovery obtained by either or both Parties in connection 
              with or as a result of any action or proceeding contemplated by
              this Section 3.8, whether by settlement or otherwise, shall be 
              allocated in order as follows:

              (a) The Party which initiated and prosecuted the action shall
                  recoup all of its costs and expenses incurred in connection 
                  with the action (provided that if PMC was the initiating
                  Party and that the action proceeds were not sufficient for
                  PMC to recoup all its costs and expenses, then PMC shall be
                  allowed to deduct the balance of its unrecovered costs and
                  expenses from royalties payable to CISTRON under Article 3
                  hereof) ;

              (b) The other Party shall then, to the extent possible, recover 
                  its costs and expenses incurred in connection with the
                  action; and

              (c) The amounts of any recovery remaining shall then be 
                  allocated between the Parties with PMC receiving all amounts
                  in respect of damages in the Field of Use and CISTRON
                  receiving all amounts in respect of damages out of the Field
                  of Use, except that any amounts recovered in connection with
                  infringement actions relating to jointly-owned patents shall
                  be equally shared between the Parties.

        (vi)  CISTRON shall inform PMC of any certification regarding any 
              OPTIONED PATENTS it has received pursuant to 21 United States
              Code 355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV), or any similar
              provision in other countries, and shall provide PMC with a copy
              of such certification within five (5) days of receipt. Both
              Parties rights with respect to the initiation and prosecution of
              any legal action as a result of such certification or any
              recovery obtained as a result of such legal action shall be as
              defined in paragraphs (a) to (c) of this Section 3.8.4(v).


3.8.5	Notice of Patent Events.
        ------------------------

	CISTRON shall promptly give notice to the other Party of the grant, 
        lapse, revocation, surrender or invalidation of any OPTIONED PATENTS.


3.8.6	Patent Term Restoration.
        ------------------------

        CISTRON shall notify PMC of (a) the issuance of each U.S. patent
        included within the OPTIONED PATENTS, giving the date of issue and
        patent number for each such patent, and (b) each notice pertaining to
        any patent included within the OPTIONED PATENTS which it receives as
        patent owner pursuant to the United Sates Drug Price Competition and 
        Patent Term Restoration Act of 1984 (hereinafter called the "Act"), 
        including notices pursuant

                                  -11-
<PAGE>12

        to 101 and 103 of the Act from Persons who have filed a biological
        license application ("BLA") or an abbreviated new drug application
        ("ANDA"), whichever is applicable. Such notices shall be given 
        promptly, but in any event within five (5) calendar days of each such 
        patent's date of issue or receipt of each such notice pursuant to the 
        A
ct, whichever is applicable. CISTRON shall notify PMC of each filing 
        for patent term restoration under the Act, any allegations of failure 
        to show due diligence and all awards of patent term restoration 
        (extensions) with respect to the OPTIONED PATENTS.

	Likewise, CISTRON or PMC, as the case may be, shall inform the other
        Party of patent extensions and periods of data exclusivity in the rest
        of the world regarding any PRODUCTS and more generally the Parties
        shall diligently cooperate with respect to any procedures for patent
        and period of data exclusivity extensions, such as but not limited to 
        Supplementary Protection Certificates, the above-mentioned Patent 
        Term Restoration and corresponding GATT regulations.



ARTICLE 4 - GENERAL PROVISIONS
------------------------------

4.1.	Confidentiality
        ---------------

	(a) -	General
                -------

                Except as expressly set forth in this Section 4.1., each Party
                shall cause its respective Affiliates, officers, directors, 
                employees, agents and subcontractors (collectively, 
                "Representatives") to keep confidential any and all technical,
                commercial, scientific and other data, processes, documents or
                other information (whether in oral or written form) or physical
                object (including, without limitation, Biological Materials, 
                intellectual property, marketing data, agreements between any 
                Party and a  Third-Party, license applications, and business 
                plans and projections of any Party) acquired from the other
                Party (the "Other Party"), its Affiliates or its
                Representatives prior to or after the date of this Agreement
                and which relates (in the case of a Party) to the Other Party
                or any of its Affiliates or their respective businesses
                ("Confidential Information"), and each Party shall not disclose
                directly or indirectly, and shall cause its Representatives not
                to disclose directly or indirectly, any Confidential
                Information to anyone outside such Person, such Affiliates and
                their respective Representatives, except that the foregoing
                restriction shall not apply to any information disclosed
                hereunder to any Party, if such Person (the "Receiving Person")
                can demonstrate that such Confidential Information:

                (i)   is or hereafter becomes generally available to the trade
                      or public other than by reason of any breach or default
                      by the Receiving Person, any of its Affiliates or any
                      Representative of the foregoing with respect to a
                      confidentiality obligation under this Agreement;

                (ii)  was already known to the Receiving Person or such
                      Affiliate or Representative;

                (iii) is disclosed to the Receiving Person or such Affiliate
                      or Representative by a Third-Party who has the right to
                      disclose such information;

                (iv)  based on such Person's good faith judgement with the
                      advice of counsel, is otherwise required to be disclosed
                      in compliance with applicable legal requirements to a
                      public authority such as, without limitation, the US
                      Food & Drug Administration (FDA), the European Medicine
                      Evaluation Agency (EMEA), the French Agence du Medicament
                      or any comparable authority of any country having
                      jurisdiction. 

		Whenever the Receiving Person becomes aware of any state of
                facts which would or might result in disclosure of Confidential
                Information pursuant to subparagraph (iv)

                                  -12-
<PAGE>13
                above with the exception of the case here below referred to
                in Section 4.1.(g) in fine, it shall, if possible, promptly
                notify the Person making disclosure (the "Disclosing Person")
                prior to any such disclosure so that the Disclosing Person may
                seek a protective order or other appropriate remedy and/or
                waive compliance with the provisions of this Agreement.

		In any event, if the Receiving Person is unable to promptly 
                notify the Disclosing Person or if such protective order or
                other remedy is not obtained, or if the Disclosing Person
                waives compliance with the provisions of this Agreement, the
                Receiving Person shall furnish only that portion of the
                information which it is advised by counsel is legally required
                and shall exercise reasonable efforts to obtain assurance that
                confidential treatment shall be accorded the Confidential
                Information.

                Each Party shall be entitled, in addition to any other right or
                remedy it may have, at law or in equity, to an injunction, 
                without the posting of any bond or other security except as 
                required by the relevant laws, enjoining or restraining the
                other Party from any violation or threatened violation of this
                Section 4.1.

	(b) -	Use of Confidential Information
                -------------------------------

                Each Party agrees that no Confidential Information shall:

                (i)   be used in its own business except as necessary to the 
                      fulfilment of the rights and obligations of such Party
                      under this Agreement;

                (ii)  be assigned, licensed, sublicensed, marketed, transferred
                      or loaned, directly or indirectly to any Third-Party
                      other than a Representative or an Affiliate
                      Representative of such Party, except as necessary to the
                      fulfilment of the rights and obligations of the Parties
                      under this Agreement;

                (iii) be used or exploited by such Party or any of its
                      Affiliates or their Representatives for its or their
                      respective benefit or the benefit of any other
                      relationships with customers of such Party and its
                      Affiliates.

                Without limiting the generality of the foregoing, each Party 
                agrees that, it shall not (and shall not permit any of its 
                Affiliates) at any time use any Confidential Information in
                the conduct of its business without the prior written consent
                of the Other Party. 

                The obligations set forth in this Section 4.1. shall extend to
                copies, if any, of Confidential Information made by any 
                Representatives referred to in paragraph (a) and to documents 
                prepared by such Persons which embody or contain Confidential 
                Information.

	(c) -	Protection of Confidential Information
                --------------------------------------

		Each Party shall deal with Confidential Information so as to 
                protect it from disclosure with a degree of care not less than
                that used by it in dealing with its own information intended
                to remain exclusively within its knowledge and shall take
                reasonable steps to minimise the risk of disclosure of
                Confidential Information which shall include, without
                limitation, ensuring that only its Affiliates and its and
                their Representatives who have a bona fide "need to know" such
                Confidential Information for purposes permitted or contemplated
                by this Agreement shall have access thereto. Each Party, shall
                notify all of its Representatives who have access to
                Confidential Information of its confidentiality and the care
                therefor required, and shall obtain from any Affiliate or any
                agent or subcontractor who is a Representative that is
                permitted access to such Confidential Information in accordance
                with this Section 4.1. an agreement of confidentiality
                incorporating the restrictions set forth herein.

                                   -13-
<PAGE>14

	(d) -	Survival of Obligations
                -----------------------

                The obligations set forth in this Section 4.1. shall survive
                the termination of this Agreement for a period of five (5)
                years.

	(e) -	Return of Confidential Information
                ----------------------------------

                Within thirty (30) days after the termination of this
                Agreement, the  Receiving Person shall (and shall cause its
                Affiliates' Representatives and its Affiliates to) return to
                the Disclosing Person or destroy all related documents and
                tangible items (including but not limited to unused Biological
                Materials) then in its possession which it has received from
                the Disclosing Person or any Affiliate or Representative
                thereof pertaining, referring or relating to the Disclosing
                Person's Confidential Information, as well as all copies,
                summaries, records, descriptions, modifications, and
                duplications that it, or any of its Affiliates or
                Representatives, has made from the documents or tangible items
                received from the Disclosing Person or any Affiliate or
                Representative thereof; provided, however, that the Receiving
                Person may retain one copy of each document in its legal files
                solely to permit the Receiving Person to continue to comply
                with its obligations hereunder and, in addition, may upon
                notice to the Disclosing Person, retain in its legal files
                or in the office of outside legal counsel one copy of any
                document solely for use in any pending legal proceeding to
                which such document relates.

        (f) -   Publications
                ------------

		Each Party shall have the right to publish or present the
                results of the Research Program or of any research related
                to the Field of Use and announce scientific progress of the
                Research Program, provided such publication, presentation or
                announcement (and any revisions thereof, a "Publication") is
                submitted to the other Party at least sixty (60) days prior
                to submitting it to any Third-Party (including any editing
                Person). The other Party shall have sixty (60) days after
                receipt of the draft Publication to review and comment on
                such draft. Upon notice within such sixty (60) day period by
                the other Party that such Party reasonably believes the
                Publication would amount to the public disclosure of a
                patentable  JOINT INVENTION upon which a patent application
                should be filed prior to any such disclosure, submission of
                the concerned Publication to Third Parties shall be delayed
                for a ninety (90) day period from the date of said notice, or
                for such longer period which may appear necessary for
                appropriately drafting and filing a patent application covering
                such invention. In addition, each Party shall duly take into
                account comments made by the other Party on any Publication and
                shall accept to have employees or others acting on behalf of
                the other Party be mentioned as co-authors on any Publication
                describing results to which such Persons shall have
                contributed.  The terms of this paragraph may be modified from
                time to time in accordance with the Sponsored Research
                Agreement with Duke University dated September 1, 1998.

	(g) -	Press Releases  and other Disclosures to Third Parties.
                --------------

                Neither CISTRON nor PMC shall, without the prior written
                consent of the other, issue any press release or make any other
                public announcement or furnish any statement to any Person
                (other than either Party's respective Affiliates) concerning
                the existence of this Agreement and the transactions
                contemplated by this Agreement, except for (i) general
                statements referring to the existence of this Agreement,
                specifying  its nature (Research Collaboration and License
                Option), the Field of Use and identity  of the Parties but no
                other details, (ii) disclosures made in compliance with
                Section 4.1.(a) hereof, (iii) attorneys, consultants, and
                accountants retained to represent them in connection with the
                transactions contemplated hereby or as may be reasonably
                necessary to either Party's bankers, investors, attorneys or
                other professional advisers in connection with a merger or
                acquisition, provided such advisors are bound by
                confidentiality obligations essentially identical to those
                provided for herein, and (iv) occasional, brief comments by
                the respective executive officers of both Parties consistent
                with such guidelines for public statements as may be mutually
                agreed by the Parties made in connection with routine
                interviews with analysts or members of

                                   -14-
<PAGE>15
                the financial press. In addition, either Party (after
                consultation with counsel) in its own right may make such
                further announcements and disclosures, if any, as may be
                required by applicable security laws and regulations (such as,
                without limitation, regulations of the US Securities &
                Exchange Commission (SEC) or the French Commission des
                Operations de Bourse (COB), or any equivalent authority of any
                country having jurisdiction), in which case the Party making
                the announcement or disclosure shall use its best efforts to
                give advance notice to, and discuss such announcement or
                disclosure with, the other Party and such other Party's
                attorneys.

4.2.	Term and termination.
        ---------------------

4.2.1.	Expiration.
        -----------

	This Agreement shall terminate on the third (3rd) anniversary of the 
        Effective Date.


4.2.2.	Termination for Cause.
        ----------------------

        (i)  Either Party may terminate this Agreement, at its option, upon
             or after the breach of any material provision of the Agreement
             by the other Party, if such breaching Party has not cured such 
             breach within ninety (90) days after written notice thereof from 
             the other Party.

        (ii) Subject to any applicable bankruptcy law of public order, PMC or 
             CISTRON may terminate this Agreement upon written notice to the 
             other Party if the other Party makes a general assignment for 
             the benefit of creditors, is the subject of proceedings in 
             voluntary or involuntary bankruptcy or has a receiver or trustee 
             appointed for substantially all of its property ; provided that 
             in the case of an involuntary bankruptcy proceeding such right 
             to terminate shall only become effective if the other Party 
             consents thereto or such proceeding is not dismissed within 
             ninety (90) days after the filing thereof.
 

4.2.4.	Effect of Expiration and Termination.
        -------------------------------------

	Expiration or termination of the Agreement shall not relieve the 
        Parties of any obligation accruing prior to such expiration or 
        termination. The provisions of Sections 2.2.4, 2.2.5, 3.6, 3.7, 3.8, 
        4.3, 4.4, 4.7.1, 4.7.2, 4.7.4 and 4.7.6 to 4.7.9 included, and 
        Articles 1 and 4, shall survive the expiration or termination of the 
        Agreement for their own term or for so long as such provisions have 
        to remain operative so as to give full effect to the intent of the 
        Parties with respect thereto.


4.3.	Indemnity.
        ----------

4.3.1.	Direct Indemnity.
        -----------------

4.3.1.1. Each Party shall indemnify and hold harmless the other Party, its 
        Affiliates, and their respective directors, officers, shareholders, 
        agents, consultants and employees from and against all Third-Party 
        claims, demands, liabilities, damages (including damages directly or 
        indirectly suffered by the other Party and/or its Affiliates and 
        their respective directors, officers, shareholders, agents, 
        consultants and employees) and expenses, including attorneys' fees 
        and costs (collectively, the "Liabilities") arising out of the breach 
        of any material provision of this Agreement by the indemnifying Party 
        or caused by an intentional act or omission of the indemnifying 
        Party.

                                   -15-
<PAGE>16

4.3.1.2. PMC shall defend, indemnify and hold harmless CISTRON, its
        Affiliates, and their respective directors, officers, shareholders, 
        agents, consultants and employees, from and against all Liabilities 
        suffered or incurred arising out of any Third-Party claims in 
        connection with the manufacture, design, testing, possession, 
        distribution, use, sale or other disposition by or through PMC, its 
        Affiliates or Sublicensees of any PRODUCTS, except in each case to 
        the extent such Liabilities resulted from the gross negligence, 
        recklessness or intentional acts or omissions by CISTRON.

4.3.2.	Procedure.
        ----------

	A Party (the "Indemnitee") that intends to claim indemnification
        under this Section 4.3. shall promptly notify the other Party (the 
        "Indemnitor") of any Liability or action in respect of which the 
        Indemnitee intends to claim such indemnification, and the Indemnitor 
        shall have the right to participate in, and, to the extent the 
        Indemnitor so desires, jointly with any other Indemnitor similarly 
        noticed, to assume the defense thereof with counsel selected by the 
        Indemnitor ; provided, however, that the Indemnitee shall have the 
        right to retain its own counsel, with the fees and expenses to be 
        paid by the Indemnitor, if representation of such Indemnitee by the 
        counsel retained by the Indemnitor would be inappropriate due to 
        actual or potential differing interests between such Indemnitee and 
        any other Party represented by such counsel in such proceedings. 

	The indemnity obligations under this Section 4.3. shall not apply to 
        amounts paid in settlement of any loss, claim, damage, liability or 
        action if such settlement is effected without the consent of the 
        Indemnitor, which consent shall not be withheld unreasonably. The 
        failure to deliver notice to the Indemnitor within a reasonable time 
        after the commencement of any such action, if prejudicial to its 
        ability to defend such action, shall relieve such Indemnitor of any 
        liability to the Indemnitee under this Section 4.3. The Indemnitee, 
        its Affiliates, employees and agents, shall cooperate fully with the 
        Indemnitor and its legal representatives in the investigation of any 
        action, claim or liability covered by this indemnification.


4.4.	Force Majeure.
        --------------

        No Party (or any of its Affiliates) shall be held liable or 
        responsible to the other Party (or any of its Affiliates) nor be 
        deemed to have defaulted under or breached the Agreement for failure 
        or delay in fulfilling or performing any term of the Agreement when 
        such failure or delay is caused by or results from causes beyond the 
        reasonable control of the affected Party (or any of its Affiliates) 
        including but not limited to fire, floods, embargoes, war, acts of 
        war (whether war be declared or not), insurrections, riots, civil 
        commotions, strikes, lockouts or other labor disturbances, acts of 
        God or acts, omissions or delays in acting by any governmental 
        authority or the other Party (collectively, "Events of Force 
        Majeure") ; provided, however, that the affected Party (i) shall 
        immediately notify the other Party of the occurrence of any such 
        Event of Force Majeure and (ii) shall exert all reasonable efforts to 
        eliminate, cure or overcome any such Event of Force Majeure and to 
        resume performance of its covenants with all possible speed ; and 
        provided, further, that nothing contained herein shall require any 
        Party to settle on terms unsatisfactory to such Party any strike, 
        lockout or other labor difficulty, any investigation or proceeding by 
        any governmental authority or any litigation by any Third-Party. 
        Notwithstanding the foregoing, to the extent that an Event of Force 
        Majeure continues for a period in excess of six (6) months, the 
        affected Party shall promptly notify in writing the other Party of 
        such Event of Force Majeure and within four (4) months of the other 
        Party's receipt of such notice, the Parties agree to negotiate in 
        good faith either (i) to resolve the Event of Force Majeure, if 
        possible, (ii) to extend by mutual agreement the time period to 
        resolve, eliminate, cure or overcome such Event of Force Majeure, 
        (iii) to amend this Agreement to the extent reasonably possible, or 
        (iv) to terminate this Agreement.

                                   -16-
<PAGE>17

4.5.	Assignment.
        -----------

        This Agreement in its entirety may not be assigned or otherwise 
        transferred, nor, except as expressly provided hereunder, may any 
        right or obligations pertaining to the Field of Use hereunder be 
        assigned or transferred to any Third-Party by either Party without the
        consent of the other Party ; provided, however, that either Party may,
        without such consent, assign this Agreement and its rights and 
        obligations hereunder to any of its Affiliates or in connection with 
        the transfer or sale of all or substantially all of its business, or 
        in the event of its merger or consolidation or change in control or 
        similar transaction. Any permitted assignee shall assume all 
        obligations of its assignor under this Agreement. Without limiting the
        generality of the foregoing, without the prior written consent of PMC,
        CISTRON shall not under any circumstances assign or transfer any 
        CISTRON Technology in the Field of Use unless (i) all of the rights 
        and obligations of CISTRON under this Agreement are assigned to the 
        same transferee(s) concurrently therewith, and (ii) such transferee(s) 
        expressly assume(s) in writing the performance of all terms and 
        conditions of this Agreement to be performed by CISTRON and such 
        assignment shall not relieved the assignor of any of its obligations 
        under this Agreement. Each Party acknowledges that the other Party 
        would suffer irreparable injury in the event of any breach of this 
        Article 4.5. that therefore the remedy at law for any breach or 
        threatened breach hereof by any Party shall be inadequate. 
        Accordingly, upon a breach or threatened breach hereof by any Party, 
        the other Party shall, in addition and without prejudice to any other 
        rights and remedies it may have, be entitled as a matter of right, 
        without proof of actual damages, to seek specific performance hereof 
        and to such other injunctive or equitable relief to enforce, or 
        prevent any violations (whether anticipatory, continuing or future) 
        hereof.


4.6.	Severability.
        -------------

        Each Party hereby agrees that it does not intend to violate any public
        policy, statutory or common laws, rules, regulations, treaty or 
        decision of any government agency or executive body thereof of any 
        country or community or association of countries. Should one or more 
        provisions of this Agreement be or become invalid, the Parties hereto 
        shall substitute, by mutual consent, valid provisions for such invalid
        provisions which valid provisions in their economic effect are 
        sufficiently similar to the invalid provisions that it can be 
        reasonably assumed that the Parties would have entered into this 
        Agreement with such provisions. In case such provisions cannot be 
        agreed upon, the invalidity of one or several provisions of this 
        Agreement shall not affect the validity of this Agreement as a whole, 
        unless the invalid provisions are of such essential importance to this
        Agreement that it is to be reasonably assumed that the Parties would 
        not have entered into this Agreement without the invalid provisions.


4.7.	Miscellaneous.
        --------------

4.7.1.	Notices.
        --------

	Any consent, notice or report required or permitted to be given or
        made under this Agreement by one of the Parties hereto to the other
        shall be in writing, delivered Personally or by facsimile (and
        promptly confirmed by Personal delivery, first class air mail or
        courier), first class air mail or courier, postage prepaid (where
        applicable), addressed to such other Party at its address indicated
        below, or to such other address as the addressee shall have last
        furnished in writing to the addressor and (except as otherwise
        provided in this Agreement) shall be effective upon receipt by the
        addressee.


        If to CISTRON :

        Cistron Biotechnology, Inc.
        101 Bloomfield Avenue
        Pine Brook, NJ  07058

                                   -17-
<PAGE>18

        Attention:  Chairman 
        Telecopier: (973) 575-4854
							
        with a copy to:

        Seth I. Truwit, Esq.
        Epstein Becker & Green, PC
        250 Park Avenue
        New York, NY  10177
        Telephone:  (212) 351-4709
        Telecopier:  (212) 661-0989


        If to PMC :

        Pasteur Merieux Serums & Vaccins, S.A.
        58, avenue Leclerc
        69007 Lyon, France
        Attention:  Senior Vice President, Legal and Corporate Affairs
        Telecopier:  011 33 4 72 73 77 84

        Pasteur Merieux Connaught - USA 
        Route 611
        Swiftwater, PA  18370
        Attention:  Vice President, Business Development
        Telecopier:  (717) 839-4600

        and

        Akin, Gump, Strauss, Hauer & Feld, LLP
        590 Madison Avenue
        New York, New York 10022
        Attention:  L. Kevin O'Mara, Jr., Esq.
        Telephone:  (212) 872-1021
        Telecopier:  (212) 872-1002


4.7.2.	Applicable Law.
        ---------------

	The Agreement shall be governed by and construed in accordance with 
        the laws of State of New-York., without regard to the conflict of law
        principles thereof.


4.7.3.	Representations, warranties and covenants.
        ------------------------------------------

4.7.3.1. Representations and Warranties of PMC.
         --------------------------------------

        (a) PMC is a Societe Anonyme duly organized and existing under the 
            laws of France, with the corporate power to own, lease and operate
            its properties and to carry on its business as now conducted.

        (b) PMC has all necessary corporate power and authority to enter into 
            this Agreement and to consummate the transactions contemplated 
            hereby.

        (c) The execution, delivery and performance of this Agreement by PMC 
            does not conflict with or contravene the statuts of PMC nor shall 
            the execution, delivery or performance of this Agreement conflict 
            with or result in a breach of, or entitle any Party thereto to 
            terminate, any material agreement or instrument to which PMC is a 
            Party, or by which any of its assets or properties is bound.

                                   -18-
<PAGE>19

        (d) This Agreement has been duly authorized, executed and delivered 
            by PMC and constitutes a legal, valid and binding agreement of 
            PMC, enforceable against PMC in accordance with its terms, except 
            as enforceability may be limited by bankruptcy, insolvency, 
            moratorium, reorganization or other similar laws affecting 
            creditors' rights generally.


4.7.3.2. Representations, Warranties and Covenants of CISTRON.
         -----------------------------------------------------

        (a) CISTRON is a corporation duly incorporated and validly existing 
            as a corporation in good standing under the laws of the State of 
            Delaware with the corporate power to own, lease and operate its 
            properties and to carry on its business as now conducted.

        (b) CISTRON has all necessary corporate power and authority to enter 
            into this Agreement and to consummate the transactions 
            contemplated hereby.

        (c) The execution, delivery and performance of this Agreement by 
            CISTRON does not conflict with or contravene its certificate of 
            incorporation or by-laws, nor shall the execution, delivery or 
            performance of this Agreement conflict with or result in a breach 
            of, or entitle any Party thereto to terminate, any material 
            agreement or instrument to which CISTRON is a Party, or by which 
            any of its assets or properties is bound.
        
        (d) This Agreement has been duly authorized, executed and delivered 
            by CISTRON and constitutes a legal, valid and binding agreement of
            CISTRON, enforceable against CISTRON in accordance with its terms,
            except as enforceability may be limited by bankruptcy, insolvency,
            moratorium, reorganization or other similar laws affecting 
            creditors' rights generally.

        (e) All OPTIONED PATENTS listed on Schedule A as amended from time to 
            time, but for the purpose of this Section 4.7.3.2 and for such 
            purpose only excluding any Joint Patent Rights, have been 
            registered in, filed in or issued by the appropriate patent 
            offices of each jurisdiction as indicated on such Schedule A, and 
            in each case is currently in effect and all maintenance fees and 
            renewals thereof have been duly made with respect thereto. CISTRON
            owns or has full and exclusive rights to use and exploit under 
            licenses (and to license or sublicense) all its rights under such 
            OPTIONED PATENTS and the OPTIONED KNOW-HOW. Except as set forth on
            Schedule 4.7.3(e) hereto, there have been no material claims made 
            against CISTRON asserting the invalidity or non-enforceability of,
            or with respect to such OPTIONED PATENTS , the misuse of such 
            OPTIONED PATENTS or the OPTIONED KNOW-HOW, nor is CISTRON aware 
            that any such claims exist.  Except as set forth on Schedule 
            4.7.3(e) hereto, CISTRON has not received a notice of conflict of 
            such OPTIONED PATENTS or the OPTIONED KNOW-HOW with the asserted 
            rights of others, or otherwise challenging its rights to use any 
            of such OPTIONED PATENTS, or the OPTIONED KNOW-HOW. 
        

            None of the rights of CISTRON under the OPTIONED PATENTS or 
            OPTIONED KNOW-HOW shall be adversely affected by the execution, 
            delivery or performance of this Agreement, or the consummation of 
            the transaction contemplated herein. EXCEPT AS OTHERWISE EXPRESSLY
            SET FORTH IN THIS SECTION, NEITHER PARTY MAKES ANY REPRESENTATION
            OR EXTENDS ANY WARRANTIES OF ANY KIND EITHER EXPRESS OR IMPLIED, 
            INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, 
            FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, OR VALIDITY OF 
            ANY PATENT RIGHTS ISSUED OR PENDING.
        
                                    -19-
<PAGE>20

4.7.4.	Dispute Resolution.
        -------------------

	The Parties agree that if any dispute or disagreement arises between 
        PMC on the one hand and CISTRON on the other in respect of this 
        Agreement, they shall follow the following procedure in an attempt to 
        resolve the dispute or disagreement.

        (a) The Party claiming that such a dispute exists shall give notice 
            in writing ("Notice of Dispute") to the other Party of the nature 
            of the dispute;

        (b) Within twenty eight (28) business days of receipt of a Notice of 
            Dispute, a nominee or nominees of PMC and a nominee or nominees 
            of CISTRON shall meet in Person and exchange written summaries 
            reflecting, in reasonable detail, the nature and extent of the 
            dispute, and at this meeting they shall use their reasonable 
            endeavours to resolve the dispute ;
        
        (c) If, within a further period of twenty eight (28) business days, 
            the dispute has not been resolved or if, for any reason, the 
            required meeting has not been held, then the Parties agree that 
            any dispute shall be referred to an arbitrator appointed by 
            agreement of CISTRON and PMC or, if no such agreement is reached 
            within sixty (60) business days after a Party commences the 
            arbitration, then by a panel of three arbitrators, with each of 
            PMC and CISTRON to select one arbitrator and those two 
            arbitrators to select the third. If all three arbitrators have 
            not been selected within sixty (60) business days after a Party 
            commences the arbitration, then the Parties agree to abide by the 
            selection of the remaining arbitrator to be named by a 
            representative of the International Chamber of Commerce. 

            The Parties agree that the Rules of the International Chamber of 
            Commerce shall govern such arbitration and that any decision of 
            the arbitrators shall be final and binding and shall be 
            enforceable in any court of competent jurisdiction worldwide 
            (regardless of whether one of the Parties fails or refuses to 
            participate in the arbitration). The Parties agree that all 
            arbitrations shall be conducted in the English language and that 
            the exclusive venue of all arbitrations shall be in Zurich, 
            Switzerland. The Party determined by the arbitrators to be the 
            Party substantially prevailing in the arbitration shall be 
            entitled to recover its legal and consultants' fees and other 
            costs reasonably incurred in connection with the arbitration (as 
            determined by the arbitrators) ; and

        (d) in the event of a dispute regarding any payments owing under this 
            Agreement, all undisputed amounts shall be paid promptly when due 
            and the balance, if any, promptly after resolution of the 
            dispute.


4.7.5.	Entire Agreement.
        -----------------

	This Agreement contains the entire understanding of the Parties with 
        respect to the subject matter hereof. All express or implied 
        agreements and understandings, either oral or written, heretofore 
        made, including but not limited to Option Agreements to the extent, 
        but only to the extent, they are inconsistent with any provisions of 
        this Agreement (in which case the relevant provision of this 
        Agreement shall prevail) are expressly superseded by this Agreement. 
        This Agreement may be amended, or any term hereof modified, only by a 
        written instrument duly executed by both Parties hereto.


4.7.6.	Independent Contractors.
        ------------------------

	CISTRON and PMC each acknowledge that they shall be independent 
        contractors and that the relationship between the two Parties shall 
        not constitute a partnership, joint venture or agency. Neither 
        CISTRON nor PMC shall have the authority to make any statements, 
        representations or commitments of any kind, or to take any action, 
        which shall be binding on the other Party, without the prior consent 
        of the other Party to do so.

                                   -20-
<PAGE>21

4.7.7.	Affiliates.
        -----------

	Each Party shall cause its respective Affiliates to comply fully with 
        the provisions of this Agreement to the extent such provisions 
        specifically relate to, or are intended to specifically relate to, 
        such Affiliates, as though such Affiliates were expressly named as 
        joint obligors hereunder.


4.7.8.	Waiver.
        -------

	The waiver by either Party hereto of any right hereunder or the 
        failure to perform or of a breach by the other Party shall not be 
        deemed a waiver of any other right hereunder or of any other breach 
        or failure by said other Party whether of a similar nature or 
        otherwise.


4.7.9.	No Implied License.
        -------------------

	Nothing in this Agreement shall be deemed to constitute, by
        implication or otherwise, the grant by PMC to CISTRON, or by CISTRON 
        to PMC, of any license to, or interest in, or other rights under any 
        patent, patent application, proprietary know-how, trade secrets or 
        other intellectual property rights owned or possessed by PMC or 
        CISTRON, whichever is applicable, except as expressly provided for 
        herein.


4.7.10.	Counterparts.
        -------------

	This Agreement may be executed in two or more counterparts, each of 
        which shall be deemed an original, but all of which together shall 
        constitute one and the same instrument.


                                 -21-
<PAGE>22

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date 
first set forth above.


For CISTRON BIOTECHNOLOGY, INC. 

 
By :  /s/BRUCE C. GALTON
     -------------------
Name : BRUCE C. GALTON
Title : Chairman of the Board and
        Chief Executive Officer


For PASTEUR MERIEUX Serums & Vaccins S.A.




By : /s/DAVID J. WILLIAMS
     --------------------
Name : DAVID J. WILLIAMS
Title : President and
        Chief Operating Officer

-----------------------
                                 -22-
<PAGE>23

                        EXHIBIT-2
                        ---------

Confidential treatment has been requested for portions of the exhibit. The 
copy filed herewith omits the information subject to the confidentiality 
request.  Omissions are designated as ["xxxxx"].  The portions omitted have 
been filed separately with the Securities and Exhange Commission pursuant 
to such request for confidential information.

                     --------------------------------------

                             LICENSE AGREEMENT

                                 IL-1 BETA

                     --------------------------------------

This Agreement is entered this 30th day of October, 1998 (the "Effective 
Date") into by and between :

       CISTRON BIOTECHNOLOGY, INC., a corporation organized and existing under
       the laws of the State of Delaware, having its principal place of 
       business at 10, Bloomfield Avenue, Pine Brook, New Jersey 07058, USA

       (hereinafter referred to as "CISTRON")

and
---
       PASTEUR MERIEUX Serums & Vaccins - a Pasteur Merieux Connaught Company
       -, a societe anonyme organized and existing under the laws of the
       French Republic, having its registered head office at 58, avenue
       Leclerc, 69007, Lyon, France, 

       (hereinafter referred to as "PMC")

                                WITNESSETH
                                ----------

WHEREAS, CISTRON has developed intellectual property, including inventions 
which are the subject matter of patents and patent applications and secret 
and substantial know-how, relating to a cytokine called Interleukin 1 beta 
("IL-1b" or the "FACTOR") used as an immunoadjuvant ;

WHEREAS, PMC and CISTRON are parties to the Collaboration & Option 
Agreement dated October 30th, 1998, under which PMC has exercised its option 
to obtain from CISTRON a license in order to have the right to use CISTRON' 
inventions relating to the FACTOR for use as an adjuvant in human vaccines, 
and CISTRON has agreed to grant such licenses to PMC, subject to the terms 
of and conditioned upon this Agreement ;


NOW, THEREFORE, in consideration of the respective representations and 
covenants of each of the Parties as set forth below, CISTRON and PMC, 
intending to be legally bound, agree as
follows :
                                 -23-
<PAGE>24

ARTICLE I - DEFINITIONS AND INTERPRETATION
------------------------------------------

1.1.	Definitions : For the purposes of this Agreement the following words 
        and phrases shall have the following meanings :

        (a)     "Affiliate" means, with respect to any Person, (i) any other 
                Person of which the securities or other ownership interests 
                representing fifty per cent (50 %) or more of the equity or 
                fifty per cent (50 %) or more of the ordinary voting power or 
                fifty per cent (50 %) or more of the general partnership
                interest are, at the time such determination is being made,
                owned, Controlled or held, directly or indirectly, by such
                Person (a "Subsidiary"), or (ii) any other Person which, at
                the time such determination is being made, is Controlling or
                under common Control with, such Person. As used herein, the
                term "Control", whether used as a noun or verb, refers to the
                possession, directly or indirectly, of the power to direct, or
                cause the direction of, the management or policies of a
                Person, whether through the ownership of voting securities,
                by contract or otherwise.

        (b)     "Agreement" means this agreement, all amendments and
                supplements to this Agreement and all schedules to this
                Agreement, including the following :

                Schedule A -    LICENSED PATENTS.
                ----------
                Exhibit 1  -    Tax Form re. French Withholding Tax.
                ---------
        (c)     "Biological Materials" shall mean any biological materials 
                including but not limited to structural genes, genetic 
                sequences, promoters, enhancers, probes, linkage probes, 
                vectors, hosts, plasmids, peptides, polypeptides, transformed 
                cell lines, transgenic animals, proteins, biological modifiers,
                antigens, reagents, hybridomas, antibodies, toxins, lectins, 
                enzymes, lipids, hormones, viruses, cells or parts of cells, 
                cell lines, fragments of any of the foregoing and any other 
                biologically active material or compound, whether or not 
                occurring naturally or howsoever derived, modified, conjugated,
                cross-linked, immobilized, reduced, purified or produces, 
                whether by recombinant DNA techniques and/or otherwise.

        (d)     "Calendar Quarter" means any of the three-month periods 
                beginning January 1, April 1, July 1 and October 1 in any year.

        (e)     "CISTRON Improvements" means Improvements which are conceived 
                during the term of this Agreement solely or jointly by 
                employees and/or contractors (other than PMC) acting on behalf
                of CISTRON or its Affiliates, to the extent that CISTRON has 
                now or hereafter shall have the right to grant licenses, 
                immunities or other rights thereon.

        (f)     "CISTRON Technology" means the LICENSED PATENTS, the LICENSED 
                KNOW-HOW and the CISTRON  Improvements, and shall include 
                CISTRON's interest in any Joint Inventions as such latter term
                is defined under the Collaboration & Option Agreement and under
                this Agreement .

        (g)     "Collaboration & Option Agreement" means the Collaboration & 
                Option Agreement signed by the Parties hereto on October 30th,
                1998.

        (h)     "Confidential Information" has the meaning ascribed to it in 
                Section 8.1. of this Agreement.

                                   -24-
<PAGE>25

        (i)     "Event of Force Majeure" has the meaning ascribed to it in 
                Article 8.4. of this Agreement.

        (j)     "FACTOR" means the cytokine (a protein) called Interleukin 1 
                beta, or IL-1b, as described in the LICENSED PATENTS, and any 
                derivatives thereof, and is intended to refer to both the 
                protein itself and the gene encoding thereto.

        [OPTIONAL : will depend on how Option is exercised.

        (k)     "Field of Preventative Vaccines" means the field comprised of 
                bio-pharmaceutical products for the prevention through active 
                immunization against infectious diseases and/or cancers in 
                humans.

        (l)     "Field of Therapeutic Vaccines" means the field comprised of 
                bio-pharmaceutical products for the immunotherapy through 
                active immunization against infectious diseases and/or cancers 
                in humans.

        (m)     "Field of Use" means either the Field of the Therapeutic 
                Vaccines or the Field of the Preventative Vacines or both.]

        (n)     "First Commercial Sale" means, in each country of the 
                Territory, the first sale of a PRODUCT by PMC, its Affiliates 
                or Sublicensees, to Third-Parties, in each case for use or 
                consumption of such PRODUCT in such country by the general 
                public.

        (o)     "Improvements" means all patentable and non-patentable 
                inventions, discoveries, technology and information of any type
                whatsoever, including without limitation Biological Materials,
                methods, processes, technical information, knowledge, 
                experience and know-how which are made during the term of this
                Agreement and which utilize, incorporate, are derived from or 
                are based on, CISTRON Technology, or could not be conceived, 
                developed or reduced to practice but for the use of the CISTRON
                Technology.

        (oo)    "Joint Inventions" have the meaning ascribed to them in Section
                7.2. hereof.

        (p)     "LICENSE" has the meaning ascribed to it in Section 2.1.1. of 
                this Agreement.


        (q)     "LICENSED KNOW-HOW" means any and all technical information, 
                discoveries, improvements, processes, formulae, data, 
                engineering, technical and shop drawings, inventions, 
                Biological Materials, shop-rights, know-how and trade secrets 
                which is useful or necessary to make, have made, use or sell 
                the FACTOR and/or PRODUCTS or to practice under the LICENSED 
                PATENTS in the Field of Use, which have been, or hereafter are,
                either developed by CISTRON or its Affiliates, or the rights to
                which in the Field of Use have been acquired by CISTRON or its
                Affiliates and to which CISTRON or its Affiliates have a 
                transferable interest. LICENSED KNOW-HOW expressly includes any
                and all technology developed in the Field of Use by the Parties
                pursuant to and in accordance with the Collaboration & Option 
                Agreement and which constitutes Joint Inventions as such term 
                is defined in such agreement.

        (r)     "LICENSED PATENTS" means :

                (i)   any existing patents and patent applications listed in
                      Schedule A to this Agreement, including any Joint Patent
                      Rights as such term is defined in the Collaboration & 
                      Option Agreement ;

                (ii)  any future patents issued from any patent applications 
                      referred to in Paragraph 1.(r).(i) above and any future 
                      patents issued from a patent application filed in any 
                      country in the Territory which corresponds to a patent or
                      patent application identified in Paragraph 1.(r).(i)
                      above;
                                   -25-
<PAGE>26

                (iii) any reissues, confirmations, renewals, extensions, 
                      counterparts, divisions, continuations, continuations-in-
                      part, supplemental protection certificates or utility 
                      models issued, assigned or licensed to CISTRON or its 
                      Affiliates of or relating to the patents or patent 
                      applications identified in Paragraph 1.(r).(i) and (ii) 
                      above ;

                (iv)  any future patents and patent applications covering
                      CISTRON Improvements, solely or jointly owned by CISTRON
                      or its Affiliates, or licensed by CISTRON or its
                      Affiliates with the right to sublicense, and CISTRON's
                      interest in any Joint Inventions.

        (rr)    "Net Sales" shall mean gross invoice price of PRODUCTS sold by
                PMC, its Affiliates and Sublicensees to the first Third-Party 
                (including unaffiliated Third-Party distributors, except in the
                circumstances referred to in Section 6.3 hereof, and provided 
                further that where a distributor is an Affiliate, but not a 
                Subsidiary of PMC, such distributor shall be deemed a Third-
                Party for the purpose of calculating Net Sales hereunder) less,
                to the extent actually incurred or allowed and if not already 
                deducted in the amount invoiced : 

                (i)   normal or customary trade and/or quantity discounts, 
                      credits, allowances, rebates, returns (including, but not
                      limited to, wholesaler and retailer returns) ;

                (ii)  retroactive price reductions ;

                (iii) excise taxes, other consumption taxes, customs duties and
                      compulsory payments made to governmental authorities ;

                (iv)  sales commissions that are actually paid to Third-Party 
                      distributors and selling agents ; and

                (v)   transportation, transit and insurance for transportation
                      each to the extent separately invoiced and paid by PMC.

        (s)     "Notice of Dispute" has the meaning ascribed to it in Section 
                8.8.4.(a) of this Agreement.

        (t)     "Parties" means PMC and CISTRON, and "Party" means any one of 
                them.

        (u)     "Person" means an individual, corporation, partnership, trust,
                business trust, association, joint stock company, pool, 
                syndicate, sole proprietorship, unincorporated organization, 
                governmental authority or any other form of entity not 
                specifically listed herein.

        (v)     "Phase III" means the first large scale safety and efficacy 
                clinical trial relating to a PRODUCT.

        (w)     "PMC Improvements" means Improvements which are conceived 
                during the term of this Agreement solely or jointly by 
                employees and/or contractors (other than CISTRON) acting on 
                behalf of PMC or its Affiliates, to the extent that PMC has now
                or hereafter shall have the right to grant licenses, immunities
                or other rights thereon.

        (ww)    "PRODUCTS" means any and all vaccines or other bio-
                pharmaceutical products intended for use [in the Field of 
                Preventative Vaccines or the Field of Therapeutic Vaccines or 
                both - OPTIONAL : will depend on how Option is exercised]  
                which (i) incorporate the FACTOR as an adjuvant or (ii) more 
                generally utilize any or are based on any CISTRON Technology.

                                   -26-
<PAGE>27

        (x)     "Royalty Term" means, with respect to each PRODUCT in each 
                country in the Territory, the period of time equal to the 
                longer of (a) fifteen (15) years from the date of First 
                Commercial Sale of such PRODUCT in such country or (b) the term
                for which a Valid Patent Claim in such country remains in 
                effect and, but for a license granted by this Agreement, would
                be infringed by the manufacture, use or sale of such PRODUCT in
                the Field of Use in such country.

        (xx)    "Sublicensee" means any Person acting pursuant to a sublicense
                granted to it by PMC under the terms of this Agreement.

        (y)     "Territory" means all countries in the world.
        
        (yy)    "Third-Party" means any Person other than PMC, CISTRON and 
                their respective Affiliates.

        (z)     "Valid Patent Claim" means a claim of an issued and unexpired 
                patent or patent application included in LICENSED PATENTS which
                has not been held permanently revoked, unenforceable or invalid
                by a decision of a court or other governmental agency of 
                competent jurisdiction, unappealable or unappealed within the 
                time allowed for appeal, and which has not been admitted to be
                invalid or unenforceable through reissue or disclaimer or 
                otherwise. If there should be two or more decisions within the
                same country which are conflicting with respect to the 
                invalidity of the same claim, the decision of the highest 
                tribunal shall thereafter control. However, should the 
                tribunals be of equal authority, then the decision or decisions
                holding the claim valid shall prevail where the conflicting 
                decisions are equal in number and the majority of decisions 
                shall prevail where the conflicting decisions are not equal in
                number.


1.2.    Certain Rules of Interpretation in this Agreement and the Schedules:
        --------------------------------------------------------------------

        (a)     An accounting term not otherwise defined has the meaning 
                assigned to it by, and every accounting matter will be 
                determined in accordance with, generally accepted accounting 
                principles in the United States of America ;

        (b)     Unless otherwise specified, all references to monetary amounts
                are to United States dollars currency (US$) ;

        (c)     The descriptive headings of Articles and Sections are inserted
                solely for convenience of reference and are not intended as 
                complete or accurate descriptions of the content of such 
                Articles or Sections ;

        (d)     The use of words in the singular or plural, or with a 
                particular gender, shall not limit the scope or exclude the 
                application of any provision of this Agreement to such Person 
                or Persons or circumstances as the context otherwise permits ;

        (e)     Whenever a provision of this Agreement requires an approval or
                consent by a Party to this Agreement and notification of such 
                approval or consent is not delivered within the applicable time
                limit, then, unless otherwise specified, the Party whose 
                approval or consent is required shall be conclusively deemed to
                have withheld its approval or consent ;

        (f)     Unless otherwise specified, time periods within or following 
                which any payment is to be made or act is to be done shall be 
                calculated by excluding the day on which the period commences 
                and including the day on which the period ends and by extending
                the period to the next business day following if the last day 
                of the period is not a business day in the jurisdiction of the
                Party to make such payment or do such act ; and 

                                   -27-
<PAGE>28

        (g)     Whenever any payment is to be made or action to be taken under
                this Agreement is required to be made or taken on a day other 
                than a business day, such payment shall be made or action taken 
                on the next business day following such day in the jurisdiction 
                of the Party to make such payment or do such act.


ARTICLE 2 - LICENSE.
--------------------

2.1.	Grant.
        ------

        Subject to and conditioned upon the provisions of this Agreement,
        CISTRON hereby grants to PMC, and PMC hereby accepts, a license
        (the "LICENSE") in the Territory to make, have made, use and sell 
        PRODUCTS and FACTOR under the LICENSED PATENTS in the Field of Use 
        and by using LICENSED KNOW-HOW, CISTRON Improvements and Joint 
        Inventions in the Field of Use.

2.2.	Exclusivity
        -----------

        (i)   Subject to and conditioned upon the provisions of this
              Agreement, the LICENSE granted pursuant to this Article II
              shall be exclusive (exclusive even as to CISTRON and CISTRON
              Affiliates) to PMC in the Field of Use. Without limiting the
              generality of the foregoing, CISTRON covenants that during the
              term of this Agreement, neither CISTRON nor its Affiliates shall
              grant to any other Person any right , license or privilege to
              make, have made, use or sell PRODUCTS or to otherwise exploit
              CISTRON Technology (including for the manufacturing of the
              FACTOR) and Joint Inventions in connection with such PRODUCTS in
              the Field of Use.

        (ii)  For greater certainty, CISTRON has and retains all rights in 
              and to the CISTRON Technology outside the Field of Use and PMC
              has no rights in the CISTRON Technology outside the Field of Use.


2.3.	PMC 's Rights to Sublicense 
        ---------------------------

        (i)   PMC shall have the right, with CISTRON's prior written consent
              (which consent shall not be unreasonably withheld), to 
              sublicense in the Field of Use to Third-Parties all or any 
              portion of the rights to LICENSED PATENTS and LICENSED  KNOW-
              HOW and CISTRON Improvements granted to PMC pursuant to this 
              Agreement under the LICENSE. No permitted Sublicensee pursuant 
              hereto shall have the right to grant further sublicenses to any 
              Third-Party.

        (ii)  PMC shall have the right, without obtaining the further consent 
              of CISTRON, to sublicense in the Field of Use all or any 
              portion of the rights to the LICENSED PATENTS, the LICENSED 
              KNOW-HOW and CISTRON Improvements granted to it pursuant to 
              this Agreement under the LICENSE (i) to any of its Affiliates, 
              and (ii) to any Person in any country of the Territory if 
              required to do so by any governmental authority having 
              jurisdiction in such country. No permitted Sublicensee pursuant 
              hereto shall have the right to grant further sublicenses to any 
              Third-Party.

        (iii) PMC agrees that all sublicenses granted by PMC hereunder 
              shall expressly bind Sublicensees to the terms of Article 8.1.,
              "Confidentiality" and to all other relevant provisions of this 
              Agreement. In the event PMC grants sublicenses, PMC shall still 
              be under the obligation to pay Milestone Payments to CISTRON as 
              provided for in
                                 -28-
<PAGE>29

              Section 4.6. hereof, and PMC shall pay royalties to CISTRON as
              if Net Sales of the Sublicensees were Net Sales of PMC and
              CISTRON shall be expressly made a Third-Party beneficiary
              thereof. PMC shall be responsible for the performance by any
              sub-PMC of all such terms, conditions and obligations. In
              addition PMC shall pay to CISTRON Twenty Five percent (25%) of
              any incremental consideration that PMC may receive from any
              Third-Party Sublicensee such as but not limited to license
              issue fees and milestone payments.

        (iv)  Any sublicenses granted by PMC shall include a requirement that 
              the Sublicensee maintains records and permit inspection on 
              terms essentially identical to Sections 5.1. and 5.2 hereof. At 
              CISTRON's request, PMC shall arrange for an independent 
              certified public accountant selected by CISTRON to inspect the 
              records of Sublicensees for the purpose of verifying royalties 
              due to CISTRON and shall cause such accountant to report the 
              results thereof to CISTRON.

        (v)   Any sublicenses granted by PMC shall provide for the 
              termination of the sublicense, or, if the Sublicensee is a 
              Third-Party, at the option of such Sublicensee, the conversion 
              to a license directly between such Sublicensee and CISTRON, 
              upon termination of this Agreement under Article 8.2. (other 
              than expiration under Section 8.2.1 or a termination by PMC 
              further to a breach by CISTRON pursuant to Section 8.2.3). Such 
              conversion shall be subject to CISTRON's approval and 
              contingent upon acceptance by the Sublicensee of the remaining 
              provisions of this Agreement.

        (vi)  PMC shall notify CISTRON of each sublicense granted to Third-
              Parties and shall provide CISTRON with the name and address of 
              each Sublicensee and a description of the PRODUCTS and 
              territory covered by each sublicenses.


2.4.	Sublicenses to PMC.
        -------------------

	To the extent LICENSED PATENTS have been, or shall be, licensed by 
        CISTRON from a Third-Party under an agreement with such Third-Party 
        (a "Third-Party License"), PMC understands and agrees as follows :

	(i)-	The rights sub-licensed to PMC by CISTRON are subject to the 
                terms and conditions, restrictions, limitations and obligations
                of the relevant Third-Party License ;

	(ii)-	PMC shall comply with the terms and conditions, 
                restrictions, limitations and obligations of such Third-Party 
                License(s) to the extent PMC has been permitted to review such
                terms, conditions, restrictions, limitations and obligations. 
                CISTRON shall give PMC, upon request, a reasonable opportunity
                to review the same except to the extent that confidentiality 
                obligations towards Third-Parties may prevent CISTRON from
                doing so. In any event, CISTRON shall act reasonably in
                advising PMC of the scope of PMC's obligations pursuant to any
                relevant Third-Party License.

2.5.    Licenses to CISTRON.
        --------------------

        In the event that CISTRON wishes to commercialize any PMC 
        Improvements outside the Field of Use at any time during the term of 
        this Agreement, CISTRON shall so notify PMC and the Parties agree to 
        then negotiate in good faith the terms and conditions of a license 
        to be granted by PMC to CISTRON covering such PMC Improvements, 
        including a reasonable royalty which shall reflect the value of the 
        PMC Improvements in relation to all other

                                -29-
<PAGE>30

        technology and proprietary rights included in the product and/or
        process that CISTRON wishes to commercialize.


2.5	Subcontracting.
        ---------------

	Notwithstanding anything herein provided for to the contrary, PMC 
        shall be allowed to (i) sub-contract in whole or in part PRODUCTS 
        development to Third-Parties such as, without limitation, clinical 
        research organizations, (ii) appoint sales agents and distributors 
        to market and distribute PRODUCTS and (iii) sub-contract 
        manufacturing of PRODUCTS and FACTOR with Third-Parties or with 
        PMC's Affiliates.
       
2.6.    Procedures for Provision of Know-How.
        -------------------------------------

2.6.1.	Disclosure of Technology.
        -------------------------

        From time to time during the term of this Agreement, CISTRON shall 
        disclose or cause its Affiliates to disclose to PMC such CISTRON 
        Technology as may be reasonably necessary to enable PMC to develop, 
        manufacture and commercialize PRODUCTS in the Field of Use on the 
        terms and subject to the conditions of this Agreement. In addition, 
        during the term of this Agreement, CISTRON shall, upon PMC's 
        reasonable request and with adequate notice to CISTRON, make 
        available to PMC at PMC's or its Affiliates' manufacturing 
        facilities or the facility of a Third-Party manufacturer who shall 
        have contracted with PMC to manufacture PRODUCTS, CISTRON's or 
        CISTRON Affiliate's Personnel to provide technical assistance to 
        PMC's Personnel, or PMC Affiliates' Personnel or Third-Party 
        manufacturer's Personnel. PMC shall pay or have paid by its 
        concerned Affiliates all expenses incurred by CISTRON or its 
        Affiliates in connection with such technical assistance.


2.6.2.	Communication among Parties.
        ----------------------------

	Each of PMC and CISTRON shall appoint (a) specific individual(s) who 
        shall be available and shall act as (a) liaison Person(s) to 
        facilitate the day-to-day communications among the Parties. The 
        names and addresses of the liaison Persons who shall act on behalf 
        of each of the Parties shall be provided by each of the Parties to 
        the other immediately following the execution of this Agreement. 
        Each of PMC and CISTRON agrees to notify the other in accordance 
        with the terms of Section 8.8.1. of this Agreement in the event of a 
        change in liaison Person.


2.6.3.	Identification of Know-How.
        ---------------------------

	The Parties agree that all information and Biological Materials 
        comprised in the LICENSED KNOW-HOW to be transferred to PMC pursuant 
        to this Agreement shall be so transferred in the case of written 
        information, by memoranda bearing the mention "Confidential", and, 
        in the case of Biological Materials, by clearly marked and numbered 
        containers. PMC shall designate an individual who shall be 
        responsible for receiving information and Materials

                                  -30-
<PAGE>31

        from CISTRON and/or its Affiliates and the Parties agree that such
        information and Materials shall in all cases (except where the Parties
        agree otherwise) be sent solely to the attention of such individual.
        Upon receipt of information and/or Biological Materials, the designated
        individual shall, on behalf of PMC, send an acknowledgement to 
        CISTRON and/or its Affiliates confirming receipt of information 
        and/or Biological Materials. The Parties agree that they shall in 
        good faith work together to establish and maintain a system to 
        record the transmission of information and/or materials under this 
        Agreement and make all commercially reasonable efforts to ensure 
        such system is followed.


2.6.4.	Confidentiality.
        ----------------

	All information transferred pursuant to this Agreement shall be 
        deemed to be "Confidential Information" in accordance with Section 
        8.1 hereof.


ARTICLE 3 - DEVELOPMENT AND COMMERCIALIZATION.
----------------------------------------------

3.1.	Development and Commercialization Efforts.
        ------------------------------------------

	PMC (i) shall use commercially reasonable efforts to diligently 
        conduct such preclinical and clinical trials that are necessary or 
        desirable to obtain all regulatory approvals to develop and 
        commercialize such PRODUCTS, (ii) shall diligently develop and 
        obtain necessary approval to market such PRODUCTS (including, as the 
        case may be, pricing approval), and (iii) shall commence marketing 
        and market such PRODUCTS in each country in which PMC has received 
        all applicable regulatory approvals therefor. PMC shall comply with 
        all applicable good laboratory, clinical and manufacturing practices 
        in the development and commercialization of such PRODUCTS, and shall 
        cause its Affiliates and subcontractors to do the same. PMC shall be 
        solely responsible for funding all costs of the development and 
        commercialization of each such PRODUCTS.

	PMC and CISTRON agree to negotiate in good faith PRODUCT development 
        milestones within ninety (90) days following execution of this 
        Agreement.


3.2.	Development and Commercialization Reports.
        ------------------------------------------

	During the term of this Agreement, PMC shall keep CISTRON reasonably 
        informed as to the progress of the development of PRODUCTS by 
        notifying CISTRON of completion of each significant step. All 
        information disclosed by PMC pursuant to this Section 3.2 shall be 
        subject to Article 8 hereof.

	PMC shall send to CISTRON at the latest before the end of the first 
        Calendar Quarter of each year during the term of this Agreement a 
        report describing in sufficient details all development and 
        commercialization efforts made by PMC pursuant hereto during the 
        preceding year.
                                   -31-
<PAGE>32

ARTICLE 4 - ROYALTIES AND MILESTONES.
-------------------------------------

4.1.	Earned Royalties.
        -----------------

	During the Royalty Term, PMC shall pay to CISTRON a royalty of 
        ["xxxxx"] of Net Sales of PRODUCTS ; provided, however, that  the 
        royalty shall be reduced to ["xxxxx"] of Net Sales of PRODUCTS in 
        countries where there is no Valid Patent Claim and there is a 
        competitor of PMC using a formulation or formulations of the same 
        antigen(s) than PMC with an IL-1b.

4.2.	Third-Party Royalties.
        ----------------------

	If PMC, its Affiliates or Sublicensees is required to pay royalties 
        to any Third-Party in order to make, have made, use or sell a 
        PRODUCT in a country, then the royalty set-forth in Section 6.1 
        hereof for such PRODUCT in such country shall be reduced by fifty 
        percent (50%) of the amount paid by PMC to such Third-Parties ; 
        provided, however, that in no event the rate of the royalty payable 
        by PMC to CISTRON pursuant hereto shall be less than ["xxxxx"] of 
        Net Sales of such PRODUCT in such country.

4.3.	Single Royalty : Non-Royalty Sales.
        -----------------------------------

	In no event shall more than one royalty be payable under Sections 
        4.1. and 4.2. with respect to a particular unit of PRODUCTS. No 
        royalty shall be payable under this Article 6 with respect to sales 
        of PRODUCTS among PMC and its Subsidiaries, or among Sublicensees 
        and their Affiliates, or among PMC and its Sublicensees, but a 
        royalty shall be due upon the subsequent sale of the PRODUCTS to a 
        Third-Party. No royalty shall be payable for (i) PRODUCTS used in 
        clinical trials, or (ii) PRODUCTS used by PMC, its Affiliates or 
        Sublicensees, for research, (iii) customary quantities of PRODUCTS 
        distributed as free samples or (iv) reasonable quantities of 
        PRODUCTS disposed by PMC as donations to Third-Parties (such as 
        humanitarian and charitable organizations).

4.4.	Royalties for Sale of Bulk Products.
        ------------------------------------

	In those cases where PMC, its Subsidiaries or Sublicensees sell 
        PRODUCTS in bulk to a Third-Party, the royalty due to CISTRON 
        hereunder shall be calculated on the Net Sales of bulk PRODUCTS to 
        said Third-Party.
        
4.5.	Compulsory Licenses.
        --------------------

	If a compulsory license is granted with respect to a PRODUCT in any 
        country in the Territory with a royalty rate lower than the royalty 
        rates provided within this Article 4, then the rate of the royalty 
        to be paid on Net Sales in that country under Article 4 shall be 
        reduced to the rate paid by the compulsory licensee.


4.6.	Milestone Payments.
        -------------------
	As additional consideration for the LICENSE, rights and privileges 
        granted to it hereunder, PMC shall pay to CISTRON the following 
        milestone payments within thirty (30) days of the occurrence of each 
        event set forth below, whether such events are achieved by PMC, its 
        Affiliates or Sublicensees :

        [OPTIONAL : will depend on how Option is exercised.



---------------------------------------------------------------------------
Confidential treatment has been requested for portions of this page of this 
exhibit.  The copy filed herewith omits the information subject to the 
confidentiality request.  Omissions are designated as ["xxxxx"].  The 
portions omitted have been filed separately with the Securities and 
Exchange Commission pursuant to such request for confidential information.
---------------------------------------------------------------------------

                                    -32-
<PAGE>33

        a)      Upon commencement of the first Phase III clinical trial with
                respect to each of the first  (1st) and second (2nd) PRODUCT 
                belonging to the Field of Preventative Vaccines (provided such
                field is included in the Selected Field of Use), ["xxxxx"] for
                each;

        (b)     Upon receipt of the product registration in [either] the United
                States of America [or the European Union] with respect to each
                of the first (1st) and the second (2nd) PRODUCT belonging to
                the Field of Preventative Vaccines, ["xxxxx"] for each ;

        (c)     Upon commencement of the first Phase III clinical trial with 
                respect to each the first (1st) and the second (2nd) PRODUCT 
                belonging to the Field of Therapeutic Vaccines (provided such 
                field is included in the Selected Field of Use), ["xxxxx"] for
                each ;

        (d)     Upon receipt of the product registration in [either] the United
                States of America [or European Union] with respect to each of
                the first (1st) and the second (2nd) PRODUCT belonging to the
                Field Therapeutic Vaccines, ["xxxxx"] for each.]


ARTICLE 5 - ROYALTY REPORTS AND ACCOUNTING.
-------------------------------------------

5.1.	Reports, Exchange Rates.
        ------------------------

	During the term of this Agreement following the First Commercial 
        Sale, PMC shall furnish to CISTRON, with respect to each Calendar 
        Quarter, a written report showing in reasonably specific detail, on 
        a country-by-country basis, (a) the gross sales of PRODUCTS sold by 
        PMC, its Affiliates and its Sublicensees in the Territory during the 
        corresponding Calendar Quarter and the calculation of Net Sales from 
        such gross sales ; (b) the royalties payable in United States 
        dollars, if any, which shall have accrued hereunder based upon Net 
        Sales of PRODUCTS ; (c) the withholding taxes, if any, required by 
        law to be deducted in respect of such royalties ; (d) the date of 
        the First Commercial Sale of PRODUCTS having occurred in each 
        country in the Territory during the corresponding Calendar Quarter  
        and (e) the exchange rates used in determining the royalty amount 
        expressed in United States dollars.

	With respect to sales (if any) of PRODUCTS invoiced in United States 
        dollars, the gross sales, Net Sales, and royalties payable shall be 
        expressed in United Sates dollars. With respect to sales of PRODUCTS 
        invoiced in a currency other than United Sates dollars, the gross 
        sales, Net Sales and royalties payable shall be expressed in the 
        currency of the invoice issued by the Party making the sale together 
        with the United States dollars equivalent of the royalty payable, 
        calculated using the rate of exchange published in the Wall Street 
        Journal for such currency on the last business day of the concerned 
        Calendar Quarter. Reports and payments shall be due on the forty 
        fifth (45th) day following the close of each Calendar Quarter. PMC 
        shall keep complete and accurate records in sufficient detail to 
        properly reflect all gross sales and Net Sales and to enable the 
        royalties payable hereunder to be determined.

5.2.	Audits.
        -------

5.2.1.	Upon the written request of CISTRON and not more than once in each 
        calendar year, PMC shall permit an independent certified public 
        accounting firm of internationally recognized standing, selected by 
        CISTRON and reasonably acceptable to PMC, at CISTRON's 



---------------------------------------------------------------------------
Confidential treatment has been requested for portions of this page of this 
exhibit.  The copy filed herewith omits the information subject to the 
confidentiality request.  Omissions are designated as ["xxxxx"].  The 
portions omitted have been filed separately with the Securities and 
Exchange Commission pursuant to such request for confidential information.
---------------------------------------------------------------------------

                                   -33-
<PAGE>34

        expense, to have access during normal business hours to such of the
        records of PMC as may be reasonably necessary to verify the accuracy 
        of the royalty reports hereunder for any year ending not more than 
        three (3) years prior to the date of such request. The accounting 
        firm shall disclose to CISTRON only whether the records are correct 
        or not and the specific details concerning any discrepancies. No 
        other information shall be shared.


5.2.2.	If such accounting firm concludes that additional royalties were 
        owed during such period, PMC shall pay the additional royalties 
        within thirty (30) days of the date CISTRON delivers to PMC such 
        accounting firm's written report so concluding. The fees charged by 
        such accounting firm shall be paid by CISTRON ; provided, however, 
        if the audit discloses that the royalties payable by PMC for the 
        audited period are more than one hundred and twenty percent (120%) 
        of the royalties actually paid for such period, then PMC shall pay 
        the reasonable fees and expenses charged by such accounting firm.

5.2.3.	PMC shall include in each permitted sublicense granted by it 
        pursuant to the Agreement a provision requiring the SUBLICENSEE to 
        make reports to PMC, to keep and maintain records of sales made 
        pursuant to such sublicense and to grant access to such records by 
        CISTRON's independent accountant to the same extent required with 
        respect to PMC's records under this Agreement.

5.2.4.	Except in the case of circumstances which would have prevented an 
        error or anomaly from being disclosed during the audit hereabove 
        mentioned, such as fraud or other failure to provide accurate 
        information, upon the expiration of three (3) years following the 
        end of any calendar year, the calculation of royalties payable with 
        respect to such year shall be binding and conclusive upon CISTRON, 
        and PMC, its Affiliates and Sublicensees shall be released from any 
        liability or accountability with respect to royalties for such year.

5.3.	Confidential Financial Information.
        -----------------------------------

        CISTRON shall treat all financial information subject to review
        under this Article 6 or under any sublicense agreement as 
        confidential, and shall cause its accounting firm to retain all such 
        financial information in confidence.



ARTICLE 6 - PAYMENTS.
---------------------

6.1.	Payment Term.
        -------------

	Royalties shown to have accrued by each royalty report provided for
        under Article 5 of this Agreement shall be due on the date such 
        royalty report is due. Payment of royalties in whole or in part may 
        be made in advance of such due date.


6.2.	Payment Method.
        ---------------

	All payments by PMC to CISTRON under this Agreement shall be paid in
        United States dollars, and all such payments shall be made without 
        deduction of bank transfer fees by bank wire transfer in immediately 
        available funds to the following bank account :

        Account No.     6101198381
        Bank :          Bank of New York, 399 Ridgedale Ave.,
                        E. Hanover, N.J. 07936-1488
        Code :          021202719
        Addressee :     Cistron Biotechnology, Inc.


	or to any other bank account designated in writing from time to 
        time, to PMC, by CISTRON.

                              -34-
<PAGE>35

6.3.	Withholding Taxes.
        ------------------

	Royalties and milestone payments shall be paid by PMC to CISTRON, 
        after deduction of any applicable withholding taxes. Prior to any 
        payment by PMC to CISTRON, PMC shall provide to CISTRON any forms 
        required to attest CISTRON's fiscal domiciliation in order to allow 
        PMC to claim application of the reduced rate of withholding tax 
        provided for in any applicable bilateral fiscal convention. CISTRON 
        shall promptly return such forms to PMC. In the event CISTRON fails 
        to promptly return such forms duly filled and signed, PMC shall 
        declare and pay withholding tax at the common law rate of the 
        applicable corporate income tax, and such tax shall then be deducted 
        from the corresponding payment by PMC to CISTRON. PMC shall pay 
        withholding tax to the proper taxing authority and proof of payment 
        of such tax shall be secured and sent to CISTRON as evidence of such 
        payment. If, in the opinion of either Party, the provisions of this 
        section become extremely burdensome, the Parties agree to meet and 
        discuss such other options as may be available to them.
        
	In order to properly document the tax file, CISTRON shall file or 
        have filed, and sign or have signed, the tax form herewith attached 
        as Exhibit 1 prior to each milestones or royalty payment owing from 
        PMC to CISTRON hereunder.
 


ARTICLE 7 - INVENTIONS AND PATENTS.
-----------------------------------

7.1.	Ownership and Commercialization of Inventions.
        ----------------------------------------------

	Ownership of Inventions : All rights, title and interest in and to 
        any technology or invention, whether or not patentable, and any 
        patent applications and patents based thereon, made or conceived (i) 
        by employees or others acting solely on behalf of CISTRON or its 
        Affiliates, including but not limited to CISTRON Improvements, shall 
        be owned solely by CISTRON or its Affiliates ; (ii) by employees or 
        others acting solely on behalf of PMC or its Affiliates, including 
        but not limited to PMC Improvements, shall be owned solely by PMC or 
        its Affiliates and (iii) by both employees or others acting on 
        behalf of CISTRON or its Affiliates and on behalf of PMC or its 
        Affiliates, shall be jointly owned by CISTRON and PMC (the "Joint 
        Inventions").

        CISTRON and PMC each hereby represents that all employees and other 
        Persons acting on its behalf in performing its obligations under 
        this Agreement shall be obligated under a binding written agreement 
        to assign to it, or as it shall direct, all Improvements conceived 
        or reduced to practice by such employees or other Persons during the 
        term of this Agreement.

        Commercialization of Joint Inventions :  During the term of this 
        Agreement PMC shall have the exclusive right to commercialize Joint 
        Inventions in the Field of Use and shall pay royalties to CISTRON in 
        accordance with this Agreement in consideration for such right. In 
        the event that CISTRON wishes to commercialize any Joint Invention 
        outside the Field of Use, CISTRON agrees to pay a royalty. 

        The Parties agree to negotiate in good faith such royalty so that it 
        reflects the value of the Joint Invention in relation to all other 
        technology and proprietary rights included in the product and/or 
        process embodying such Joint Invention.
        
                                   -35-
<PAGE>36

7.2.    Patent Prosecution and Maintenance.
        -----------------------------------

	Licensed Patents. CISTRON shall be responsible for and shall control 
        the preparation, filing, prosecution, grant and maintenance of all 
        LICENSED PATENTS. CISTRON shall prepare, file, prosecute and 
        maintain such LICENSED PATENTS in good faith consistent with its 
        customary patent policy and its reasonable business judgement, and 
        shall consider in good faith the interests of PMC in so doing.

	Joint Inventions. As to any Joint Inventions, CISTRON shall have the 
        first right to file patent applications with respect to such 
        inventions in the name of both Parties. CISTRON may elect not to 
        file and if it does so, PMC shall have the right to file the patent 
        applications in the name of both Parties. In each case, the filing 
        Party shall give the non-filing Party an opportunity to review the 
        text of the applications before filing, shall consult with the non-
        filing Party with respect thereto and shall supply the non-filing 
        Party with a copy of all applications as filed, together with notice 
        of their filing dates and serial numbers and fifty percent (50%) of 
        the out-of-pocket costs and expenses of the filing Party shall be 
        reimbursed by the other Party. Both Parties shall keep the other 
        advised of the status of actual and prospective patent application 
        filings and upon request, provide advanced copies of any documents 
        related to such filings and thereafter to the prosecution and 
        maintenance of all patent applications and patents.

	Costs. With respect to all filings hereunder, the filing Party shall 
        be responsible for payment of all costs and expenses related to such 
        filings, prosecution and maintenance, unless relieved of same 
        pursuant to Section 7.3 hereinafter, and except for jointly owned 
        patents, for which fifty percent (50%) of all such costs and 
        expenses shall be reimbursed to the filing Party by the other Party.


7.3.	Option to Prosecute and Maintain Patents.
        -----------------------------------------

	CISTRON shall give notice to PMC of any intention to cease 
        prosecution and/or maintenance, or not to proceed with an extension, 
        of LICENSED PATENTS and, in such case, shall permit PMC, at PMC's 
        sole discretion, to continue prosecution or maintenance or proceed 
        with the extension at its own expenses. If PMC elects to continue 
        prosecution or maintenance or to proceed with the extension, CISTRON 
        shall execute such documents and perform such acts at PMC's expense 
        as may be reasonably necessary to effect an assignment of such 
        LICENSED PATENTS to PMC in a timely manner, and more generally to 
        permit PMC to continue such prosecution and maintenance or to 
        proceed with the extension. Any patents and patent applications so 
        assigned shall not be considered as LICENSED PATENTS as of the date 
        of such assignment. No royalties shall be payable by PMC on sales of 
        PRODUCTS covered only by a Valid Patent Claim of a LICENSED PATENT 
        which has been assigned to PMC pursuant to this Section 7.3.


7.4.	Interference, Opposition, Reexamination and Reissue.
        ----------------------------------------------------
        (i)   The Parties shall use their respective best efforts to within
              ten (10) days of learning of any interference, opposition, 
              reexamination or reissue event, inform the other Party of any 
              request for, or filing or declaration thereof relating to 
              LICENSED PATENTS.  The Parties shall thereafter consult and 
              cooperate fully to determine the course of action with respect
              to any such proceeding. Both Parties shall have the right to
              review and comment on any submission to be made in connection
              with any such proceeding.

        (ii)  CISTRON shall not institute any reexamination or reissue 
              proceeding relating to LICENSED PATENTS without having first 
              consulted PMC.
                                   -36-
<PAGE>37

        (iii) In connection with any interference, opposition, reissue 
              or reexamination proceeding relating to LICENSED PATENTS, the 
              Parties shall cooperate fully and shall provide each other with 
              any information or assistance that either Party may reasonably 
              request. CISTRON shall keep PMC informed of developments in any 
              such action or proceeding, including, to the extent permissible, 
              the status of any settlement negotiations and the terms of any 
              offer related thereto.

        (iv)  CISTRON shall bear the expense of any interference, opposition, 
              reexamination or reissue proceeding relating to LICENSED PATENTS.


7.5.	Enforcement and Defense. 
        ------------------------

        (i)   Each Party shall give the other notice of either (a) any 
              infringement of LICENSED PATENTS, or (b) any misappropriation or
              misuse of LICENSED KNOW-HOW that has come to its attention. The 
              Parties shall thereafter consult and cooperate fully to determine
              a course of action, including but not limited to the commencement
              of legal action by either or both Parties to terminate any 
              infringement of LICENSED PATENTS or any misappropriation or 
              misuse of LICENSED KNOW-HOW.

        (ii)  In the event that LICENSED PATENTS are infringed by any Third-
              Party with respect to a PRODUCT in the Field of Use, CISTRON, 
              upon notice to PMC, shall have the first right, but not the 
              obligation, to institute and prosecute any action or proceeding 
              under LICENSED PATENTS with respect to such infringement, by 
              counsel of its choice, or to control the defense of any 
              declaratory judgment action arising from such infringement or 
              from the misappropriation or misuse of LICENSED KNOW-HOW, at its
              own expense and in the name of both Parties. CISTRON shall not 
              settle, compromise or take any action in such litigation which 
              diminish, limit or inhibit the scope, validity or enforceability
              of LICENSED PATENTS without the express permission of PMC. 
              CISTRON shall keep PMC advised of the progress of such 
              proceedings.

        (iii) In the event that a Third-Party is infringing any LICENSED
              PATENTS with respect to a PRODUCT in the Field of Use
              and CISTRON does not elect to institute an action, PMC, upon 
              notice to CISTRON, shall have the right, but not the obligation,
              to institute and prosecute any action or proceeding under 
              LICENSED PATENTS with respect to such infringement, by counsel of
              its choice, or to control the defense of any declaratory judgment
              action arising from such infringement or from the 
              misappropriat on or misuse of LICENSED KNOW-HOW, at its own 
              expense and in the name of both Parties. PMC shall not settle, 
              compromise or take any action in such litigation which diminish,
              limit or inhibit the scope, validity or enforceability of 
              LICENSED PATENTS without the prior approval of CISTRON, which 
              shall not be unreasonably withheld.

        (iv)  With respect to any action to terminate any infringement of 
              LICENSED PATENTS or any misappropriation or misuse of LICENSED 
              KNOW-HOW, the Parties shall cooperate fully and shall provide 
              each other with any information and assistance that either Party
              may reasonably request. In particular, either Party shall execute
              such documents necessary for the other Party to initiate and 
              prosecute the action or proceeding and cause its Affiliates and 
              Sublicensees to execute all such documents, if required. In the 
              event that either Party is unable to initiate or prosecute an 
              action solely in its own name, the other Party shall then join 
              such action voluntarily. Each Party shall keep the other informed 
              of the development of any action or proceeding including, to the
              extent permissible by law, the status of any settlement 
              negotiations and the terms of any offer related thereto.

        (v)   Any recovery obtained by either or both Parties in connection 
              with or as a result of any action or proceeding contemplated by 
              this Section 7.5, whether by settlement or otherwise, shall be 
              allocated in order as follows :

              (a)  The Party which initiated and prosecuted the action shall 
                   recoup all of its costs and expenses incurred in connection
                   with the action (provided that if PMC was the

                                   -37-
<PAGE>38

                   initiating Party and that the action proceeds were not
                   sufficient for PMC to recoup all its costs and expenses,
                   then PMC shall be allowed to deduct the balance of its
                   unrecovered costs and expenses from royalties payable to
                   CISTRON under Article 4 hereof) ;

              (b)  The other Party shall then, to the extent possible, recover
                   its costs and expenses incurred in connection with the
                   action; and

              (c)  The amounts of any recovery remaining shall then be
                   allocated between the Parties with PMC receiving all amounts
                   in respect of damages in the Field of Use and CISTRON
                   receiving all amounts in respect of damages out of the Field
                   of Use, except that any amounts recovered in connection with
                   infringement actions relating to jointly-owned patents shall
                   be equally shared between the Parties.

        (vi)  CISTRON shall inform PMC of any certification regarding any 
              LICENSED PATENTS it has received pursuant to 21 United States 
              Code 355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV), or any similar 
              provision in other countries, and shall provide PMC with a copy 
              of such certification within five (5) days of receipt. Both 
              Parties rights with respect to the initiation and prosecution of 
              any legal action as a result of such certification or any 
              recovery obtained as a result of such legal action shall be as 
              defined in paragraphs (a) to (c) of this Section 7.5.
        

7.6.	Notice of Patent Events.
        ------------------------

	CISTRON shall promptly give notice to the other Party of the grant, 
        lapse, revocation, surrender or invalidation of any LICENSED 
        PATENTS.

        
7.7.	Patent Term Restoration.
        ------------------------

	CISTRON shall notify PMC of (a) the issuance of each U.S. patent 
        included within the LICENSED PATENTS, giving the date of issue and 
        patent number for each such patent, and (b) each notice pertaining 
        to any patent included within the LICENSED PATENTS which it receives 
        as patent owner pursuant to the United Sates Drug Price Competition 
        and Patent Term Restoration Act of 1984 (hereinafter called the 
        "Act"), including notices pursuant to 101 and 103 of the Act
        from Persons who have filed a biological license application ("BLA")
        or an abbreviated new drug application ("ANDA"), whichever is
        applicable. Such notices shall be given promptly, but in any event
        within five (5) calendar days of each such patent's date of issue or
        receipt of each such notice pursuant to the Act, whichever is
        applicable. CISTRON shall notify PMC of each filing for patent term
        restoration under the Act, any allegations of failure to show due
        diligence and all awards of patent term restoration (extensions) with
        respect to the LICENSED PATENTS.

	Likewise, CISTRON or PMC, as the case may be, shall inform the other 
        Party of patent extensions and periods of data exclusivity in the 
        rest of the world regarding any PRODUCTS and more generally the 
        Parties shall diligently cooperate with respect to any procedures 
        for patent and period of data exclusivity extensions, such as but 
        not limited to Supplementary Protection Certificates, the above-
        mentioned Patent Term Restoration and corresponding GATT 
        regulations.

                                  -38-
<PAGE>39

ARTICLE 8 - GENERAL PROVISIONS
------------------------------

8.1.	Confidentiality
        ---------------

	(a) -	General
                -------
                Except as expressly set forth in this section 8, each Party
                shall cause its respective affiliates, officers, directors,
                employees, agents and subcontractors (collectively,
                "Representatives") to keep confidential any and all technical,
                commercial, scientific and other data, processes, documents or
                other information (whether in oral or written form) or
                physical object (including, without limitation, Biological
                Materials, intellectual property, marketing data, agreements
                between any Party and a Third-Party, license applications, and
                business plans and projections of any Party) acquired from the
                other Party (the "Other Party"), its affiliates or its
                Representatives prior to or after the date of this Agreement
                and which relates (in the case of a Party) to the Other Party
                or any of its Affiliates or their respective businesses
                ("Confidential Information"), and each Party shall not disclose
                directly or indirectly, and shall cause its Representatives not
                to disclose directly or indirectly, any Confidential
                Information to anyone outside such Person, such affiliates and
                their respective Representatives, except that the foregoing
                restriction shall not apply to any information disclosed
                hereunder to any Party, if such Person (the "Receiving Person")
                can demonstrate that such Confidential Information : 

                (i)   is or hereafter becomes generally available to the trade
                      or public other than by reason of any breach or default
                      by the Receiving Person, any of its affiliates or any
                      Representative of the foregoing with respect to a
                      confidentiality obligation under this Agreement ;

                (ii)  was already known to the Receiving Person or such
                      affiliate or Representative ;

                (iii) is disclosed to the Receiving Person or such affiliate
                      or Representative by a Third-Party who has the right
                      to disclose such information ;

                (iv)  based on such Person's good faith judgement with the
                      advice of counsel, is otherwise required to be disclosed
                      in compliance with applicable legal requirements to a
                      public authority such as, without limitations, the U.S.
                      Food & Drug Administration (FDA), the European Medicines
                      Evaluation Agency (EMEA), the French Agence du Medicament
                      or any comparable authority of any country having
                      jurisdiction.

                Whenever the Receiving Person becomes aware of any state of
                facts which would or might result in disclosure of Confidential
                Information pursuant to subparagraph (iv) above with the
                exception of the case here below referred to in Section 4.1.(g)
                in fine, it shall, if possible, promptly notify the Person
                making disclosure (the "Disclosing Person") prior to any such
                disclosure so that the Disclosing Person may seek a protective
                order or other appropriate remedy and/or waive compliance with
                the provisions of this Agreement.

                In any event, if the Receiving Person is unable to promptly
                notify the Disclosing Person or if such protective order or
                other remedy is not obtained, or if the Disclosing Person
                waives compliance with the provisions of this Agreement, the
                Receiving Person will furnish only that portion of the
                information which it is advised by counsel is legally required
                and will exercise reasonable efforts to obtain assurance that
                confidential treatment will be accorded the Confidential
                Information.

                Each Party shall be entitled, in addition to any other right
                or remedy it may have, at law or in equity, to an injunction,
                without the posting of any bond or other security except as
                required by the relevant laws, enjoining or restraining any
                other Party from any violation or threatened violation of
                this Section 8.
                                   -39-
<PAGE>40

	(b) -	Use of Confidential Information
                -------------------------------

                Each Party agrees that no Confidential Information shall :

                (i)   be used in its own business except as necessary to the 
                      fulfilment of the rights and obligations of such Party
                      under this Agreement ;

                (ii)  be assigned, licensed, sublicensed, marketed,
                      transferred or loaned, directly or indirectly to any
                      third Party other than a Representative or an Affiliate
                      Representative of such Party, except as necessary to the
                      fulfilment of the rights and obligations of the parties
                      under this Agreement ;

                (iii) be used or exploited by such Party or any of its 
                      Affiliates or their Representatives for its or their 
                      respective benefit or the benefit of any other
                      relationships with customers of such Party and its
                      affiliates.

                Without limiting the generality of the foregoing, each Party 
                agrees that, it shall not (and shall not permit any of its 
                Affiliates) at any time use any Confidential Information in the
                conduct of its business without the prior written consent of
                the Other Party. 

                The obligations set forth in this Section 8.1. shall extend to
                copies, if any, of Confidential Information made by any 
                Representatives referred to in paragraph (a) and to documents 
                prepared by such Persons which embody or contain Confidential 
                Information.

	(c) -	Protection of Confidential Information
                --------------------------------------

		Each Party shall deal with Confidential Information so as to 
                protect it from disclosure with a degree of care not less than 
                that used by it in dealing with its own information intended to
                remain exclusively within its knowledge and shall take
                reasonable steps to minimize the risk of disclosure of
                Confidential Information which shall include, without
                limitation, ensuring that only its affiliates and its and their
                Representatives who have a bona fide "need to know" such
                Confidential Information for purposes permitted or contemplated
                by this Agreement shall have access thereto. 

		Each Party, shall notify all of its Representatives who have 
                access to Confidential Information of its confidentiality and
                the care therefor required, and shall obtain from any Affiliate
                or any agent or subcontractor who is a Representative that is
                permitted access to such Confidential Information in accordance
                with this Section 8.1., an agreement of confidentiality
                incorporating the restrictions set forth herein.

	(d) -	Survival of Obligations
                -----------------------

		The obligations set forth in this Section 8.1. shall survive
                the termination of this Agreement for a period of five (5)
                years.

	(e) -	Return of Confidential Information
                ----------------------------------

                Within thirty (30) days after the termination of this
                Agreement, the Receiving Person shall (and shall cause its
                Affiliates' Representatives and its Affiliates to) return to
                the Disclosing Person or destroy all related documents and
                tangible items (included but not limited to unused Biological
                Materials) then in its possession which it has received from
                the Disclosing Person or any affiliate or Representative
                thereof pertaining, referring or relating to the Disclosing
                Person's Confidential Information, as well as all copies,
                summaries, records, descriptions, modifications, and
                duplications that it, or any of its affiliates
                or Representatives, has made from the documents or tangible
                items received from the Disclosing Person or any affiliate or
                Representative thereof; provided, however, that the Receiving 
                Person may retain one copy of each document in its legal files
                solely to permit the Receiving Person to continue to comply
                with its obligations hereunder and, in addition, may upon
                notice to the Disclosing Person, retain in its legal files or
                in the
                                   -40-
<PAGE>41

                office of outside legal counsel one copy of any document
                solely for use in any pending legal proceeding to which such
                document relates.

	(f) -	Publications
                ------------

		Each Party shall have the right to publish or present the
                results of the Research Program or of any research related to
                the Field of Use and announce scientific progress of the
                Research Program, provided such publication, presentation or
                announcement (and any revisions thereof, a "Publication") is
                submitted to the other Party at least ninety (90) days prior
                to submitting it to any Third-Party (including any editing
                Person). The other Party shall have ninety (90) days after
                receipt of the draft Publication to review and comment on such
                draft. Upon notice within such ninety (90) day period by the
                other Party that such Party reasonably believes the
                Publication would amount to the public disclosure of
                a patentable invention (including but not limited to a Joint 
                Invention) upon which a patent application should be filed
                prior to any such disclosure, submission of the concerned
                Publication to Third-Parties shall be delayed for a ninety (90)
                day period from the date of said notice, or for such longer
                period which may appear necessary for appropriately drafting
                and filing a patent application covering such invention. In
                addition, each Party shall take into account comments made by
                the other Party on any Publication and shall accept to have
                employees or others acting on behalf of the other Party be
                mentioned as co-authors on any Publication describing results
                to which such Persons shall have contributed. The Parties
                acknowledge the provisions relating to publications as set
                forth in the Research Agreement between CISTRON and Duke
                University dated September 1, 1998, and agree that such
                provisions shall prevail and control any publication
                proposed under such Research Agreement.


        (g)     Press Releases and other Disclosures to Third-Parties.

                Neither CISTRON nor PMC shall, without the prior written
                consent of the other, issue any press release or make any
                other public announcement or furnish any statement to any
                Person (other than either Party's respective Affiliates)
                concerning the existence of this Agreement and the
                transactions contemplated by this Agreement, except for
                (i) general statements referring to the existence of this
                Agreement, specifying its nature (Research Collaboration and
                License Option), the Field of Use and identity of the Parties
                but no other details, (ii) disclosures made in compliance with
                Section 4.1.(a) hereof, (iii) attorneys, consultants, and
                accountants retained to represent them in connection with the
                transactions contemplated hereby or as may be reasonably
                necessary to either Party's bankers, investors, attorneys or
                other professional advisers in connection with a merger or
                acquisition, provided such advisors are bound by
                confidentiality obligations essentially identical to those
                provided for herein, and (iv) occasional, brief comments by
                the respective executive officers of both Parties consistent
                with such guidelines for public statements as may be mutually
                agreed by the Parties made in connection with routine
                interviews with analysts or members of the financial press.
                In addition, either Party (after consultation with counsel) in
                its own right may make such further announcements and
                disclosures, if any, as may be required by applicable security
                laws and regulations (such as, without limitation, regulations
                of the US Securities & Exchange Commission (SEC) or the French
                Commission des Operations de Bourse (COB), or any equivalent
                authority of any country having jurisdiction), in which case
                the Party making the announcement or disclosure shall use its
                best efforts to give advance notice to, and discuss such
                announcement or disclosure with, the other Party and such other
                Party's attorneys.
                                       
                                   -41-
<PAGE>42

8.2.	Term and termination.
        ---------------------

8.2.1.	Expiration.
        -----------

	Unless terminated earlier pursuant to this Section 8.2. or Section 
        8.4. hereof, the Agreement shall expire on the expiration of PMC's 
        obligations to pay royalties under the Agreement in accordance with 
        the Royalty Term. Thereafter, PMC and its permitted Sublicensees (if 
        any) shall have a perpetual, fully paid-up, royalty-free, non-
        cancellable, worldwide license or sub-license (whichever is 
        applicable) to the CISTRON Technology.


8.2.2.	Termination by PMC.
        -------------------

	PMC shall have the right at any time, in its sole discretion, to 
        terminate this Agreement, by giving not less than three (3) months' 
        prior written notice to CISTRON of such termination.


8.2.3.	Termination for Cause.
        ----------------------

        (i)   Either Party may terminate this Agreement, at its option, upon 
              or after the breach of any material provision of the Agreement 
              by the other Party, if such breaching Party has not cured such 
              breach within ninety (90) days after written notice thereof 
              from the other Party.

        (ii)  PMC or CISTRON may terminate this Agreement upon written 
              notice to the other Party if the other Party makes a general 
              assignment for the benefit of creditors, is the subject of 
              proceedings in voluntary or involuntary bankruptcy or has a 
              receiver or trustee appointed for substantially all of its 
              property ; provided that in the case of an involuntary 
              bankruptcy proceeding such right to terminate shall only 
              become effective if the other Party consents thereto or such 
              proceeding is not dismissed within ninety (90) days after the 
              filing thereof.

        (iii) Each of the parties hereto acknowledges and agrees that this 
              Agreement (i) constitutes a license of Intellectual Property 
              (as such term is defined in the United States Bankruptcy Code, 
              as amended (the "Code"), and (ii) is an executory contract, 
              with significant obligations to be performed by each Party 
              hereto. The parties agree that PMC as LICENSEE may fully 
              exercise all of its rights and elections under the Code, 
              including, without limitation, those set forth in Section 365 
              (n) of the Code. The parties further agree that, in the event 
              that PMC elects to retain its rights as a licensee under the 
              Code, PMC shall be entitled to complete access to the CISTRON 
              Technology licensed to it hereunder and all embodiments of 
              such technology. Such embodiments of the CISTRON Technology 
              shall be delivered to PMC not later than (a) the commencement 
              of bankruptcy proceedings against CISTRON, unless CISTRON 
              elects to perform its obligations under the Agreement, or (b) 
              if not delivered under (a) above, upon the rejection of the 
              Agreement by or on behalf of CISTRON.


8.2.4.	Effect of Expiration and Termination.
        -------------------------------------

        Expiration or termination of the Agreement shall not relieve the
        Parties of any obligation accruing prior to such expiration or 
        termination. The provisions of Sections [TO BE COMPLETED] and 
        Articles [TO BE COMPLETED] shall survive the expiration or 
        termination of the Agreement. 

        Upon termination of this Agreement pursuant to Sections 8.2.2 or 
        8.2.3, and in the latter case, provided it is terminated as a 
        result of a  breach of a material obligation of PMC hereunder, all 
        rights granted to PMC hereunder shall revert to CISTRON, PMC shall 
        return the entire CISTRON Technology and all embodiments of such 
        technology to CISTRON and shall cease any use of it forthwith.  
        CISTRON shall have a right of first refusal on PMC's

                                  -42-
<PAGE>43

        intellectual property rights pertaining to any PRODUCT that was
        developed by PMC at the date of termination (including PMC rights on
        Joint Inventions), and CISTRON and PMC shall negotiate in good faith
        the Terms and conditions of a license from PMC to CISTRON on such
        PMC's rights relating to such PRODUCT(S) provided, however, that such
        rights shall not include any intellectual property relating solely 
        to antigens or to any compound other than the FACTOR and provided, 
        further, that PMC shall be under no obligation neither to provide 
        any technical assistance nor to supply any product or Biological 
        Material. In the event that after termination and reversal of rights 
        and/or license to CISTRON hereunder, CISTRON either alone or in 
        collaboration with any Third-Party or through licenses and sub-
        licenses eventually commercialize a PRODUCT, CISTRON shall pay to 
        PMC an amount equal to one half (50%) of any compensation received, 
        either in kind or in cash, by CISTRON with respect to or in 
        connection with such PRODUCT(S).

	Upon termination of this Agreement pursuant to Section 8.2.3 further 
        to a breach of a material obligation of CISTRON hereunder, the 
        LICENSE shall be deemed terminated and replaced by a perpetual, 
        fully paid-up, royalty-free, non-cancelable, exclusive and worldwide 
        license to the CISTRON Technology to PMC, with the right to grant or 
        maintain sub-licenses. 
        

8.3.	Indemnity.
        ----------

8.3.1.	Direct Indemnity.
        -----------------

8.3.1.1. Each Party shall indemnify and hold harmless the other Party, 
        its Affiliates, and their respective directors, officers, 
        shareholders, agents, consultants and employees from and against all 
        Third-Party claims, demands, liabilities, damages (including damages 
        directly or indirectly suffered by the other Party and/or its 
        Affiliates and their respective directors, officers, shareholders, 
        agents, consultants and employees) and expenses, including 
        attorneys' fees and costs (collectively, the "Liabilities") arising 
        out of the breach of any material provision of this Agreement by the 
        indemnifying Party or caused by an intentional act or omission of 
        the indemnifying Party.


8.3.1.2. PMC shall defend, indemnify and hold harmless CISTRON, its 
        Affiliates, and their respective directors, officers, shareholders, 
        agents, consultants and employees, from and against all Liabilities 
        suffered or incurred arising out of any Third-Party claims in 
        connection with the manufacture, design, testing, possession, 
        distribution, use, sale or other disposition by or through PMC, its 
        Affiliates or Sublicensees of any PRODUCTS, except in each case to 
        the extent such Liabilities resulted from the gross negligence, 
        recklessness or intentional acts or omissions by CISTRON.
        

8.3.2.	Procedure.
        ----------
	A Party (the "Indemnitee") that intends to claim indemnification 
        under this Article 8.3. shall promptly notify the other Party (the 
        "Indemnitor") of any Liability or action in respect of which the 
        Indemnitee intends to claim such indemnification, and the Indemnitor 
        shall have the right to participate in, and, to the extent the 
        Indemnitor so desires, jointly with any other Indemnitor similarly 
        noticed, to assume the defense thereof with counsel selected by the 
        Indemnitor ; provided, however, that the Indemnitee shall have the 
        right to retain its own counsel, with the fees and expenses to be 
        paid by the Indemnitor, if representation of such Indemnitee by the 
        counsel retained by the Indemnitor would be inappropriate due to 
        actual or potential differing interests between such Indemnitee and 
        any other Party represented by such counsel in such proceedings. 

                                   -43-
<PAGE>44

	The indemnity obligations under this Article 8.3. shall not apply to 
        amounts paid in settlement of any loss, claim, damage, liability or 
        action if such settlement is effected without the consent of the 
        Indemnitor, which consent shall not be withheld unreasonably. The 
        failure to deliver notice to the Indemnitor within a reasonable time 
        after the commencement of any such action, if prejudicial to its 
        ability to defend such action, shall relieve such Indemnitor of any 
        liability to the Indemnitee under this Article 8.3. The Indemnitee, 
        its Affiliates, employees and agents, shall cooperate fully with the 
        Indemnitor and its legal representatives in the investigation of any 
        action, claim or liability covered by this indemnification.


8.4.	Force Majeure.
        --------------
        No Party (or any of its Affiliates) shall be held liable or 
        responsible to the other Party (or any of its Affiliates) nor be 
        deemed to have defaulted under or breached the Agreement for failure 
        or delay in fulfilling or performing any term of the Agreement when 
        such failure or delay is caused by or results from causes beyond the 
        reasonable control of the affected Party (or any of its Affiliates) 
        including but not limited to fire, floods, embargoes, war, acts of 
        war (whether war be declared or not), insurrections, riots, civil 
        commotions, strikes, lockouts or other labor disturbances, acts of 
        God or acts, omissions or delays in acting by any governmental 
        authority or the other Party (collectively, "Events of Force 
        Majeure") ; 

        provided, however, that the affected Party (i) shall immediately 
        notify the other Party of the occurrence of any such Event of Force 
        Majeure and (ii) shall exert all reasonable efforts to eliminate, 
        cure or overcome any such Event of Force Majeure and to resume 
        performance of its covenants with all possible speed ; and provided, 
        further, that nothing contained herein shall require any Party to 
        settle on terms unsatisfactory to such Party any strike, lockout or 
        other labor difficulty, any investigation or proceeding by any 
        governmental authority or any litigation by any Third-Party. 
        Notwithstanding the foregoing, to the extent that an Event of Force 
        Majeure continues for a period in excess of six (6) months, the 
        affected Party shall promptly notify in writing the other Party of 
        such Event of Force Majeure and within four (4) months of the other 
        Party's receipt of such notice, the Parties agree to negotiate in 
        good faith either (i) to resolve the Event of Force Majeure, if 
        possible, (ii) to extend by mutual agreement the time period to 
        resolve, eliminate, cure or overcome such Event of Force Majeure, 
        (iii) to amend this Agreement to the extent reasonably possible, or 
        (iv) to terminate this Agreement.


8.5.	Assignment.
        -----------

        This Agreement in its entirety may not be assigned or otherwise 
        transferred, nor, except as expressly provided hereunder, may any 
        right or obligations pertaining to the Field of Use hereunder be 
        assigned or transferred to any Third-Party by either Party without 
        the consent of the other Party ; provided, however, that either Party 
        may, without such consent, assign this Agreement and its rights and 
        obligations hereunder to any of its Affiliates or in connection with 
        the transfer or sale of all or substantially all of its business, or 
        in the event of its merger or consolidation or change in control or 
        similar transaction. Any permitted assignee shall assume all 
        obligations of its assignor under this Agreement. Without limiting 
        the generality of the foregoing, without the prior written consent of 
        PMC, CISTRON shall not under any circumstances assign or transfer any 
        CISTRON Technology in the Field of Use unless (i) all of the rights 
        and obligations of CISTRON under this Agreement are assigned to the 
        same transferee(s) concurrently therewith, and (ii) such 
        transferee(s) expressly assume(s) in writing the performance of all 
        terms and conditions of this Agreement to be performed by CISTRON and 
        such assignment shall not relieved the assignor of any of its 
        obligations under this Agreement. Each Party acknowledges that the 
        other Party would suffer irreparable injury in the event of any 
        breach of this Article 8.5. and that therefore the remedy at law for 
        any breach or threatened breach hereof by any Party shall be 
        inadequate. Accordingly, upon a breach or threatened breach hereof by 
        any Party, the other Party shall, in addition and without prejudice 
        to any other rights and remedies it may have, be entitled as a matter 
        of right, without proof of

                                   -44-
<PAGE>45

        actual damages, to seek specific performance hereof and to such other
        injunctive or equitable relief to enforce, or prevent any violations
        (whether anticipatory, continuing or future) hereof.


8.6.	Adverse Experience Reporting.
        -----------------------------

        During the term of the Agreement, each Party shall notify the other 
        immediately of any information (howsoever obtained and from whatever 
        source) concerning any unexpected side effect, injury, toxicity or 
        sensitivity reaction, or any unexpected incidence, and the severity 
        thereof, associated with the clinical uses, studies, investigations, 
        tests and marketing of a PRODUCTS. For purposes of this Article 8.6., 
        "unexpected" shall mean (x) for a non-marketed PRODUCTS, an 
        experience that is not identified in nature, severity or frequency in 
        the current clinical investigator's confidential information 
        brochure, and (y) for a marketed PRODUCTS, an experience which is not 
        listed in the current labeling for such PRODUCTS, and includes an 
        event that may be symptomatically and patho-physiologically related 
        to an event listed in the labeling but differs from the event because 
        of increased frequency or greater severity or specificity. Each Party 
        further shall immediately notify the other of any information 
        received regarding any threatened or pending action by an agency 
        which may affect the safety and efficacy claims of a Product. Upon 
        receipt of any such information, the Parties shall consult with each 
        other in an effort to arrive at a mutually acceptable procedure for 
        taking appropriate action ; provided, however, that nothing contained 
        herein shall be construed as restricting either Party's right to make 
        a timely report of such matter to any government agency or take other 
        action that it deems to be appropriate or required by applicable law 
        or regulation.


8.7.	Severability.
        -------------
        Each Party hereby agrees that it does not intend to violate any 
        public policy, statutory or common laws, rules, regulations, treaty 
        or decision of any government agency or executive body thereof of any 
        country or community or association of countries. Should one or more 
        provisions of this Agreement be or become invalid, the Parties hereto 
        shall substitute, by mutual consent, valid provisions for such 
        invalid provisions which valid provisions in their economic effect 
        are sufficiently similar to the invalid provisions that it can be 
        reasonably assumed that the Parties would have entered into this 
        Agreement with such provisions. In case such provisions cannot be 
        agreed upon, the invalidity of one or several provisions of this 
        Agreement shall not affect the validity of this Agreement as a whole, 
        unless the invalid provisions are of such essential importance to 
        this Agreement that it is to be reasonably assumed that the Parties 
        would not have entered into this Agreement without the invalid 
        provisions.


8.8.	Miscellaneous.
        --------------

8.8.1.	Notices.
        --------

	Any consent, notice or report required or permitted to be given or
        made under this Agreement by one of the Parties hereto to the other 
        shall be in writing, delivered Personally or by facsimile (and 
        promptly confirmed by Personal delivery, first class air mail or 
        courier), first class air mail or courier, postage prepaid (where 
        applicable), addressed to such other Party at its address indicated 
        below, or to such other address as the addressee shall have last 
        furnished in writing to the addressor and (except as otherwise 
        provided in this Agreement) shall be effective upon receipt by the 
        addressee.

        If to CISTRON :

        CISTRON BIOTECHNOLGY, Inc.
        10 Bloomfield Avenue
        Pine Brook, NJ 07058

                                   -45-
<PAGE>46

        Attention : Chairman
        Telecopier : (973) 575-4854
        Telephone : (973) 575-1700

        with a copy to :

        Seth I. Truwit, Esq.
        Epstein Becker & Green, PC
        250 Park Avenue
        New York, NY 10177
        Telecopier : (212) 661-0989
        Telephone : (212) 351-4709

        If to PMC :

        PASTEUR MERIEUX Serums & Vaccins, S.A.
        58, avenue Leclerc
        69007 Lyon, France
        Attention :  Senior Vice President, Legal & Corporate Affairs
                     and General Counsel
        Telecopier : 011 33 4 37 37 70 61
        Telephone : 011 33 4 37 37 77 84

        CONNAUGHT LABORATORIES Inc.
        Route 611,
        Swiftwater, PA 18370
        Attention : Vice President, Business Development
        Telecopier : (717) 839-4600
        Telephone : (717) 839-4366


8.8.2.	Applicable Law.
        ---------------

	The Agreement shall be governed by and construed in accordance with 
        the laws of the State of New York, without regard to the conflict of 
        law principles thereof.


8.8.3.	Representations, warranties and covenants.
        ------------------------------------------

8.8.3.1. Representations and Warranties of PMC.
         --------------------------------------

        (a) PMC is a Societe Anonyme duly organized and existing under the 
            laws of France, with the corporate power to own, lease and 
            operate its properties and to carry on its business as now 
            conducted.

        (b) PMC has all necessary corporate power and authority to enter into 
            this Agreement and to consummate the transactions contemplated 
            hereby.

        (c) The execution, delivery and performance of this Agreement by PMC 
            does not conflict with or contravene the statutes of PMC nor will 
            the execution, delivery or performance of this Agreement conflict 
            with or result in a breach of, or entitle any Party thereto to 
            terminate, any material agreement or instrument to which PMC is a 
            Party, or by which any of its assets or properties is bound.

        (d) This Agreement has been duly authorized, executed and delivered 
            by PMC and constitutes a legal, valid and binding agreement of 
            PMC, enforceable against PMC in accordance with its terms, except 
            as enforceability may be limited by bankruptcy, insolvency, 
            moratorium, reorganization or other similar laws affecting 
            creditors' rights generally.

                                   -46-
<PAGE>47

8.8.3.2. Representations, Warranties and Covenants of CISTRON.
         -----------------------------------------------------

        (a) CISTRON is a corporation duly incorporated and validly existing 
            as a corporation in good standing under the laws of the State of 
            Delaware with the corporate power to own, lease and operate its 
            properties and to carry on its business as now conducted.

        (b) CISTRON has all necessary corporate power and authority to enter 
            into this Agreement and to consummate the transactions 
            contemplated hereby.

        (c) The execution, delivery and performance of this Agreement by 
            CISTRON does not conflict with or contravene its certificate of 
            incorporation or by-laws, nor will the execution, delivery or 
            performance of this Agreement conflict with or result in a breach 
            of, or entitle any Party thereto to terminate, any material 
            agreement or instrument to which CISTRON is a Party, or by which 
            any of its assets or properties is bound.

        (d) This Agreement has been duly authorized, executed and delivered 
            by CISTRON and constitutes a legal, valid and binding agreement 
            of CISTRON, enforceable against CISTRON in accordance with its 
            terms, except as enforceability may be limited by bankruptcy, 
            insolvency, moratorium, reorganization or other similar laws 
            affecting creditors' rights generally.

        (e) All LICENSED PATENTS listed on Schedule A as amended from time to 
            time, have been registered in, filed in or issued by the 
            appropriate patent offices of each jurisdiction as indicated on 
            such Schedule A, and in each case is currently in effect and all 
            maintenance fees and renewals thereof have been duly made with 
            respect thereto. CISTRON owns or has full and exclusive rights to 
            use and exploit under licenses (and to license or sublicense) all 
            its rights under such LICENSED PATENTS and the LICENSED KNOW-HOW. 
            Except as set forth on schedule 8.8.3.2.(e) hereto, there have 
            been no material claims made against CISTRON asserting the 
            invalidity or non-enforceability of, or with respect to such 
            LICENSED PATENTS , the misuse of such LICENSED PATENTS or the 
            LICENSED KNOW-HOW, nor is CISTRON aware that any such claims 
            exist. Except as set forth on schedule 8.8.3.2.(e) hereto, 
            CISTRON has not received a notice of conflict of such LICENSED 
            PATENTS or the LICENSED KNOW-HOW with the asserted rights of 
            others, or otherwise challenging its rights to use any of such 
            LICENSED PATENTS, or the LICENSED KNOW-HOW. None of the rights of 
            CISTRON under the LICENSED PATENTS or LICENSED KNOW-HOW shall be 
            adversely affected by the execution, delivery or performance of 
            this Agreement, or the consummation of the transaction 
            contemplated herein. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN 
            THIS SECTION, NEITHER PARTY MAKES ANY REPRESENTATION OR EXTENDS 
            ANY WARRANTIES OF ANY KIND EITHER EXPRESS OR IMPLIED, INCLUDING 
            BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A 
            PARTICULAR PURPOSE, NON-INFRINGEMENT, OR VALIDITY OF ANY PATENT 
            RIGHTS ISSUED OR PENDING.


8.8.4.	Dispute Resolution.
        -------------------

	The Parties agree that if any dispute or disagreement arises between 
        PMC on the one hand and CISTRON on the other in respect of this 
        Agreement, they shall follow the following procedure in an attempt 
        to resolve the dispute or disagreement.

        (a) The Party claiming that such a dispute exists shall give notice 
            in writing ("Notice of Dispute") to the other Party of the 
            nature of the dispute ;

        (b) Within twenty eight (28) business days of receipt of a Notice 
            of Dispute, a nominee or nominees of PMC and a nominee or 
            nominees of CISTRON shall meet in Person and exchange written 
            summaries reflecting, in reasonable detail, the nature and 
            extent of the dispute, and at this meeting they shall use their 
            reasonable endeavours to resolve the dispute ;

                                   -47-
<PAGE>48

        (c) If, within a further period of twenty eight (28) business days, 
            the dispute has not been resolved or if, for any reason, the 
            required meeting has not been held, then the Parties agree that 
            any dispute shall be referred to an arbitrator appointed by 
            agreement of CISTRON and PMC or, if no such agreement is 
            reached within sixty (60) business days after a Party commences 
            the arbitration, then by a panel of three arbitrators, with 
            each of PMC and CISTRON to select one arbitrator and those two 
            arbitrators to select the third. If all three arbitrators have 
            not been selected within sixty (60) business days after a Party 
            commences the arbitration, then the Parties agree to abide by 
            the selection of the remaining arbitrator to be named by a 
            representative of the International Chamber of Commerce. The 
            Parties agree that the Rules of the International Chamber of 
            Commerce shall govern such arbitration and that any decision of 
            the arbitrators shall be final and binding and shall be 
            enforceable in any court of competent jurisdiction worldwide 
            (regardless of whether one of the Parties fails or refuses to 
            participate in the arbitration). The Parties agree that all 
            arbitrations shall be conducted in the English language and 
            that the exclusive venue of all arbitrations shall be in 
            Zurich, Switzerland. The Party determined by the arbitrators to 
            be the Party substantially prevailing in the arbitration shall 
            be entitled to recover its legal and consultants' fees and 
            other costs reasonably incurred in connection with the 
            arbitration (as determined by the arbitrators) ; and

        (d) in the event of a dispute regarding any payments owing under 
            this Agreement, all undisputed amounts shall be paid promptly 
            when due and the balance, if any, promptly after resolution of 
            the dispute.


8.8.5.	Entire Agreement.
        -----------------

	This Agreement contains the entire understanding of the Parties with
        respect to the subject matter hereof. All express or implied 
        agreements and understandings, either oral or written, heretofore 
        made, are expressly superseded by this Agreement. This Agreement may 
        be amended, or any term hereof modified, only by a written 
        instrument duly executed by both Parties hereto.


8.8.6.	Independent Contractors.
        ------------------------

	CISTRON and PMC each acknowledge that they shall be independent 
        contractors and that the relationship between the two Parties shall 
        not constitute a partnership, joint venture or agency. Neither 
        CISTRON nor PMC shall have the authority to make any statements, 
        representations or commitments of any kind, or to take any action, 
        which shall be binding on the other Party, without the prior consent 
        of the other Party to do so.


8.8.7.	Affiliates.
        -----------

	Each Party shall cause its respective Affiliates to comply fully
        with the provisions of this Agreement to the extent such provisions 
        specifically relate to, or are intended to specifically relate to, 
        such Affiliates, as though such Affiliates were expressly named as 
        joint obligors hereunder.


8.8.8.	Waiver.
        -------

	The waiver by either Party hereto of any right hereunder or the
        failure to perform or of a breach by the other Party shall not be 
        deemed a waiver of any other right hereunder or of any other breach 
        or failure by said other Party whether of a similar nature or 
        otherwise.


8.8.9.	No Implied Licence.
        -------------------

	Nothing in this Agreement shall be deemed to constitute, by
        implication or otherwise, the grant by PMC to CISTRON, or by CISTRON 
        to PMC, of any license to, or interest in, or other rights under any 
        patent, patent application, proprietary know-how, trade secrets or 
        other intellectual property rights owned or possessed by PMC or 
        CISTRON, whichever is applicable, except as expressly provided for 
        herein.

                                   -48-
<PAGE>49
8.8.10.	Counterparts.
        -------------

	This Agreement may be executed in two or more counterparts, each of 
        which shall be deemed an original, but all of which together shall 
        constitute one and the same instrument.
        

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date 
first set forth above.


For CISTRON BIOTECHNOLOGY, INC. 



By:/s/BRUCE C. GALTON
   ------------------
Name : BRUCE C. GALTON 
Title : Chairman of the Board
        and Chief Executive Officer



For PASTEUR MERIEUX Sewrums & Vaccins S.A.



By: /s/DAVID J. WILLIAMS
    --------------------
Name : DAVID J. WILLIAMS
Title : President and
        Chief Operating Officer

                                   -49-
<PAGE>50
                                SCHEDULE A
                               ____________

                             LICENSED PATENTS


                                    -50-
<PAGE>51
                                SCHEDULE B -

                        PROVISIONS GOVERNING OWNERSHIP 

                        AND MANAGEMENT OF JOINT INVENTIONS.

                                   -51-