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                                                                   EXHIBIT 10.21




                             DEVELOPMENT AND LICENSE

                                    AGREEMENT

                                     BETWEEN

                                 CIMA LABS INC.

                                       AND

                       AMERICAN HOME PRODUCTS CORPORATION

                           ACTING THROUGH ITS DIVISION

                                   ESI LEDERLE

                                       FOR

                      RAPID DISSOLVING LORATADINE TABLETS

<PAGE>   2


                        DEVELOPMENT AND LICENSE AGREEMENT

               THIS AGREEMENT is signed this 14th day of January 2000 between
CIMA LABS INC., a corporation organized and existing under the laws of the State
of Delaware with offices located at 1000 Valley View Road, Eden Prairie,
Minnesota 55344 (hereafter, together with its Affiliates, referred to as
("CIMA"), and American Home Products Corporation (acting through its division,
ESI Lederle), a corporation organized and existing under the laws of the State
of Delaware with offices located at 130 N. Radnor-Chester Road, St. Davids,
Pennsylvania 19087 ("ESI").

                                    ARTICLE I

                                   DEFINITIONS

         1.1 ACTIVE INGREDIENT means ethyl 4-(8-chloro-5, 6-dihydro-11H-benzo
[5,6] cyclohepta [1,2-b]pyridin-11-ylid-ene)-1-piperidine carboxylate, known as
loratadine.

         1.2 ADVERSE EXPERIENCE means the definition in the current 21 CFR
"Sections 312.32 and 314.80, as in effect from time to time.

         1.3 AFFILIATE means (i) any Person which at the time of determination
is directly or indirectly controlled by any party hereto; (ii) any Person which
at the time of determination directly or indirectly controls any party hereto;
or (iii) any Person which is under the direct or




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indirect control of any such Person as described in subparagraphs (i) or (ii).
Control in this Section means ownership of greater than fifty percent (50%) of
the voting stock or other voting interests in the Person in question. For
purposes of this Agreement, Immunex Corporation shall not be considered to be an
affiliate of ESI.

         1.4 AGENCY means any governmental regulatory authority responsible for
granting approvals, including Pricing Approvals, for the sale of the Product in
a country in the Territory.

         1.5 ANDA means an Abbreviated New Drug Application, as defined in the
United States Food, Drug and Cosmetic Act, as amended, and applicable FDA rules
and regulations.

         1.6 CIMA PATENTS shall mean those Patents and Patent applications owned
or Controlled by CIMA during the Term of this Agreement that claim the Product,
its manufacture or method of use, including the Patents and Patent applications
which are set forth on Exhibit A hereto.

         1.7 COMMERCIALLY REASONABLE EFFORTS means efforts and resources
normally used by a party for a compound or product owned by it or to which it
has rights, which is of similar market potential at a similar stage in its
product life, taking into account the competitiveness of the marketplace, the
proprietary position of the compound or product, the regulatory structure
involved, the profitability of the applicable products, and other relevant
factors. It is anticipated that the level of efforts and resources may change at
different times during the product life cycle of a compound or product.


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         1.8 CONTROL OR CONTROLLED in the context of intellectual property
rights means rights to intellectual property sufficient to allow a grant of
rights to a party.

         1.9 DIRECT COST means the costs for those items specified in Exhibit B,
which costs are calculated in accordance with U.S. generally accepted accounting
principles consistently applied.

         1.10 EFFECTIVE DATE means the date determined in Section 14.10.

         1.11 FDA means the United States Food and Drug Administration, or any
successor thereto.

         1.12 GOOD CLINICAL PRACTICE OR GCP means the then current standards for
clinical trials for pharmaceuticals, as set forth in the United States Federal
Food, Drug and Cosmetics Act and applicable regulations promulgated thereunder,
as amended from time to time, and such standards of good clinical practice as
are required by the European Union and other organizations and governmental
agencies in countries in which Product is intended to be sold, to the extent
such standards are not inconsistent with United States GCP.

         1.13 GOOD LABORATORY PRACTICE OR GLP means the then current standards
for laboratory activities for pharmaceuticals, as set forth in the United States
Federal, Food, Drug and Cosmetics Act and applicable regulations promulgated
thereunder, as amended from time to time, and such standards of good laboratory
practice as are required by the European Union and other organizations and
governmental agencies in countries in which Product is intended to be sold, to
the extent such standards are not inconsistent with United States GLP.



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         1.14 GOOD MANUFACTURING PRACTICE OR GMP means the current standards for
the manufacture of pharmaceuticals, as set forth in the United States Federal,
Food, Drug and Cosmetics Act and applicable regulations promulgated thereunder,
as amended from time to time, and such standards of good manufacturing practices
as are required by the European Union and other organizations and governmental
agencies in countries in which Product is intended to be sold, to the extent
such standards are not inconsistent with United States GMP.

         1.15 GROSS PROFIT means Net Sales less total cost of goods (including
Active Ingredient provided to CIMA at ESI's Direct Cost), shipping (including
costs of shipping Product from CIMA to ESI), packaging and storage.

         1.16 HSR ACT means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended, and the rules and regulations promulgated thereunder.

         1.17 LAUNCH DATE means the date of first commercial shipment of the
Product by ESI or its Affiliates or their respective subdistributors to Third
Parties in a country in the Territory.

         1.18 MAJOR COUNTRY means any of the United States, Germany, or the
United Kingdom. The foregoing countries may also collectively be referred to as
Major Countries.

         1.19 NET SALES means the gross invoice price for Product sold by ESI
or its Affiliates or sublicensees or subcontractors to a Third Party customer
less the reasonable and customary accrual-basis deductions from such gross
amounts for: (i) normal and customary trade, cash and other discounts,
allowances and credits actually allowed and taken directly with respect to
sales of Product, (ii) credits or allowances actually granted for damaged
goods, returns or rejections of Product; (iii) sales or similar taxes (including
duties or other governmental charges levied on, absorbed or otherwise imposed
directly on the sales of Product, including, without limitation, value added
taxes or other governmental charges otherwise measured by the billing amount)
which are included in billing amount, and excluding any taxes imposed on or
measured by the net income or profits of the selling party; (iv) uncollectable
accounts; (v) charge back payments and rebates granted to managed health care
organizations or to federal, state and local governments, their agencies, and
purchasers and reimbursers or to trade customers, including but not limited to,
wholesalers and chain and pharmacy buying groups; and (vi) rebates (or
equivalents thereof) that are granted to or charged by national, state,
provincial or local governmental authorities in countries other than the United
States.

         Such amounts shall be determined from the books and records of ESI, its
Affiliates and their respective sublicensees and subdistributors maintained in
accordance with U.S.



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generally accepted accounting principles consistently applied, and such amounts
shall be calculated using the same accounting principles used for other ESI
products.

         Sales between or among ESI, its Affiliates and its sublicensees and
subdistributors shall be excluded from the computation of Net Sales if such
Affiliates or sublicensees and subdistributors are not end-users, but Net Sales
shall include the subsequent final sales to Third Parties by any such
Affiliates or sublicensees or subdistributors. Where (i) Product is sold by ESI,
its Affiliates or its sublicensees and subdistributors other than in an
arms-length sale or as one of a number of items without a separate invoiced
price; or (ii) consideration for Product shall include any non-cash element, the
Net Sales applicable to any such transaction shall be deemed to be ESI's average
Net Sales for the applicable quantity of to the Product at that time.

         1.20 PATENTS means all patents and patent applications, and all
additions, divisions, continuations, continuations in-part, pipeline protection,
substitutions, reissues, extensions, registrations, patent term extensions,
supplementary protection certificates and renewals of any of the above.

         1.21 PERSON means an individual, a corporation, a partnership, an
association, a trust or other entity or organization, including a government or
political subdivision or an agency thereof.

         1.22 PRICING APPROVAL means any approval for price or reimbursement as
may be necessary or appropriate as a prerequisite for marketing the Product in a
particular country of the Territory.

         1.23 PRODUCT means rapid dissolving tablets containing 10 milligrams
Active Ingredient in any of CIMA's current fast dissolve technologies, which
include the DuraSolv(TM) and OraSolv(R)



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technologies. The Product shall be pharmaceutically equivalent and bioequavalent
to CLARITIN(R) REDITABS containing 10 milligrams Active Ingredient.

         1.24 REGULATORY APPROVAL means the product license or marketing
approval necessary as a prerequisite for marketing the Product in a particular
country in the Territory.

         1.25 REGULATORY DOCUMENTS means all regulatory submissions, Regulatory
Approvals, and Pricing Approvals.

         1.26 SPECIFICATIONS means the specifications for the Product as set
forth in Exhibit C hereto, as may be amended from time to time by the parties in
the course of Product development and in accordance with the regulatory
submissions and/or Regulatory Approvals, or as otherwise required by regulatory
authorities.

         1.27 SUPPLY AGREEMENT means the agreement for the exclusive supply of
Product by CIMA to ESI between the parties and effective on the Effective Date.

         1.28 TECHNICAL INFORMATION means (a) techniques and data, including
ideas, inventions (including patentable inventions), practices, methods,
knowledge, know-how, trade secrets, skill, experience, documents, apparatus,
clinical and regulatory strategies, test data, including pharmacological,
toxicological and clinical test data, analytical and quality control data,
manufacturing, patent data or descriptions relating to Product, and (b) chemical
formulations, compositions of matter, product samples and assays relating to
Product.



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         1.29 TERM shall have the meaning set forth in Section 10.1.

         1.30 TERRITORY means the world.

         1.31 THIRD PARTY means any Person other than a party to this Agreement
or an Affiliate of a party to this Agreement

         1.32 $ means United States dollars.

                                   ARTICLE II

                          GRANT OF RIGHTS; EXCLUSIVITY

         2.1 GRANT OF RIGHTS During the Term of this Agreement, CIMA hereby
grants to ESI, an exclusive license under the CIMA Patents and Technical
Information, and CIMA's interest in Joint Patent Rights, to market, promote,
use, distribute, sell, have sold and to import and export Product within the
Territory, provided that CIMA grants only a non-exclusive license under U.S.
Patent No. 5,225,197 and corresponding patents throughout the world. In addition
to the foregoing, ESI shall have an exclusive license under the CIMA Patents ad
Technical Information, and CIMA's interest in the Joint Patent Rights, to make
(and to have made) Product in the Territory subject to, and in accordance with,
the provisions of Sections 2.4,11.3(b) and the applicable provisions of the
Supply Agreement.

         2.2 SUBLICENSE RIGHTS The rights granted to ESI hereunder includes the
right to sublicense all or part of such rights to ESI Affiliates and/or Third
Parties in all or part of the Territory; provided that (a) the terms and
conditions of such grant of sublicense rights (i) are consistent with and do not
violate the terms and conditions of this Agreement, and (ii) provide ESI with
the right and obligation to enforce such terms and



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conditions; (b) ESI remains primarily liable and responsible for the performance
of any such Affiliates and Third Parties according to the terms of this
Agreement; and (c) if ESI grants a sublicense to a Third Party, then ESI shall
promptly notify CIMA of the identify of the Third Party; provided, however that
any sublicense of the rights contained in Section 2.4 hereof or Section 2.9 of
the Supply Agreement shall be subject to the prior written consent of CIMA, such
consent not to be unreasonably withheld or delayed.

         2.3 EXCLUSIVITY During the Term of this Agreement, with respect to
countries not subject to European Union (EU) competition law, neither party
shall develop, manufacture, license, distribute or sell any rapid dissolving
solid dosage form containing the Active Ingredient that competes with Product in
the Territory ("Competing Product"). With respect to countries of the Territory
subject to EU competition law, during the Term of this Agreement, neither party
shall manufacture or distribute any Competing Product in the Territory.
Notwithstanding anything contained in this Section 2.3, nothing contained herein
shall prevent ESI or any Affiliate of ESI from acquiring an interest in a
business (the "Acquired Business") which is developing, has developed or is
selling any Competing Product in the Territory (the "Competing Operations")
where the annual revenues of the Competing Operations do not exceed twenty
percent (20%) of the aggregate annual revenues of the Acquired Business.

         2.4 ESI RIGHT TO MANUFACTURE At any time after filing of an ANDA for
Product in the United States, ESI shall have the right to transfer manufacture
of the Product from CIMA to ESI, upon three (3) months' prior written notice to
CIMA. Upon receipt of such notice, CIMA shall use Commercially Reasonable
Efforts to transfer to ESI the Technical Information relating primarily to the
manufacture of Product, including all manufacturing




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<PAGE>   10
 know-how, that is reasonably necessary to enable ESI to make and have made
Product. In such event, ESI shall pay to CIMA a [***CONFIDENTIAL TREATMENT
REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.***] technical transfer fee upon completion of the technology
transfer (as indicated by ESI's or its contract manufacturer's completion of
validation batches of Product), plus out-of-pocket expenses, incurred by CIMA
directly related to such technical assistance.

                                   ARTICLE III

                             DEVELOPMENT ACTIVITIES

         3.1 DEVELOPMENT AND REGISTRATION RESPONSIBILITIES FOR THE PRODUCT Each
party agrees to use its Commercially Reasonable Efforts to perform its
obligations to develop, be the first person to file an ANDA with Paragraph IV
certification, and register the Product to meet the timetable set forth in
Exhibit D. Each party shall comply with all applicable GLP, GCP and GMP in the
conduct of the development of the Product. CIMA shall (a) be responsible for
conducting the ongoing development work for Product; (b) design and conduct all
dosage form, formulation, process, and chemistry manufacturing and control (CMC)
and related technical studies on Product, including preparation of dosage form
CMC regulatory documents, and conduct scale-up activities for the manufacture of
Product. ESI shall be responsible for and shall (a) conduct all pivotal
biostudies, and (b) file, own and maintain all submissions for Regulatory
Approval and Regulatory Approvals of Product in the Territory. CIMA shall be
responsible for providing the CMC and related technical components of such
submissions, as jointly determined by the parties, and ESI shall be responsible
for formatting such documentation for, and submitting such documentation to, the
appropriate Agencies in the Territory. The ANDA shall be filed with



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CIMA as approved manufacturer. The parties shall cooperate with, and assist,
each other in connection with their activities hereunder including addressing
regulatory questions, and preparing updates and supplements to regulatory
filings for Product in the Territory. ESI, however, shall be responsible for all
communications with the FDA and post-Regulatory Approval regulatory requirements
in the Territory, including pharmacovigilance and Adverse Drug Experience
reporting, unless otherwise agreed in advance in writing by the parties.

         3.2 FUNDING OF PRODUCT DEVELOPMENT

            (a) ESI shall make the following non-refundable, non-creditable
development payments to CIMA in $:

            1. Within three (3) days after the Effective Date: [***CONFIDENTIAL
               TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE
               SECURITIES AND EXCHANGE COMMISSION.***]

            2. Upon successful completion (as determined by ESI) of pivotal
               biostudy for the Product.

                    [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED
               SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.***]


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<PAGE>   12

            3. Upon FDA acceptance of ANDA filing for the Product:

<TABLE>
               --------------------------------------------------------------------------------
<S>                                                                <C>
               Option A   ESI is first Person to file  Paragraph   [***CONFIDENTIAL
                          IV certification                         TREATMENT REQUESTED,
                                                                   PORTION OMITTED FILED
                                                                   SEPARATELY WITH THE
                                                                   SECURITIES AND
                                                                   EXCHANGE COMMISSION.***]
               --------------------------------------------------------------------------------
               Option B   ESI is not first Person to file          [***CONFIDENTIAL
                          Paragraph IV certification               TREATMENT REQUESTED,
                                                                   PORTION OMITTED FILED
                                                                   SEPARATELY WITH THE
                                                                   SECURITIES AND
                                                                   EXCHANGE COMMISSION.***]
               --------------------------------------------------------------------------------
</TABLE>


3.2 (b) In addition to the development payments described in Section 3.2(a), ESI
shall pay to CIMA, within thirty( 30) days of receipt of CIMA's invoice,
development costs on successful completion of the development activities for the
Product and in amounts not to exceed the budgeted amounts set forth below. Such
development costs shall be invoiced by CIMA at CIMA's Direct Cost.



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<PAGE>   13
<TABLE>
               --------------------------------------------------------------------------------
<S>                                               <C>
                Formulation Development           [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
                                                  OMITTED FILED SEPARATELY WITH THE SECURITIES
                                                  AND EXCHANGE COMMISSION.***]


               --------------------------------------------------------------------------------
                Scale-up of Final Formulation     [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
                                                  OMITTED FILED SEPARATELY WITH THE SECURITIES
                                                  AND EXCHANGE COMMISSION.***]


               --------------------------------------------------------------------------------
                Full-Scale GMP Batch
                Manufactured for Bioequivalence
                Studies                           [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
                                                  OMITTED FILED SEPARATELY WITH THE SECURITIES
                                                  AND EXCHANGE COMMISSION.***]


               --------------------------------------------------------------------------------
                CMC Preparation                   [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
                                                  OMITTED FILED SEPARATELY WITH THE SECURITIES
                                                  AND EXCHANGE COMMISSION.***]
               --------------------------------------------------------------------------------

</TABLE>

                                                                              12
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<TABLE>
               ----------------------------------------------------------------------------------
<S>                                               <C>
                Validation/Commercialization
                (only if CIMA manufactures
                launch quantities of Product)     [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
                                                  OMITTED FILED SEPARATELY WITH THE SECURITIES
                                                  AND EXCHANGE COMMISSION.***]
               ----------------------------------------------------------------------------------
                                            Total                               $800,000
               ----------------------------------------------------------------------------------
</TABLE>

         ESI shall fund all clinical biostudies for the Product.

                                   ARTICLE IV

                              DILIGENCE OBLIGATIONS

         4.1      PERFORMANCE OBLIGATIONS

                  (a) ESI shall, subject to supply by CIMA of launch quantities
of Product, use Commercially Reasonable Efforts to launch Product as soon as
commercially reasonable in each Major Country, within three (3) months following
the later of Regulatory Approval or if applicable, Pricing Approval, provided
the pricing is approved within ESI's global pricing limits. The Product must
also be free of all other legal and regulatory encumbrances.

         4.2 RECORD KEEPING Each party shall record, to the extent practical and
customary in the industry, all Technical Information relating to the Product
development in written form, which writing shall be signed, dated and witnessed,
consistent with standard



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practices of each party. All such written records of the parties shall be
maintained in a form sufficient to satisfy Regulatory Agencies.

         4.3 ADVERSE DRUG EXPERIENCES To the extent either party receives any
information regarding Adverse Drug Experiences related to the use of the
Product, such party shall promptly provide the other party with such information
in accordance with the Adverse Event Reporting Procedures set forth in Exhibit E
hereto (as may be amended from time to time upon written agreement of the
parties).

                                    ARTICLE V

                            ROYALTY PAYMENTS TO CIMA


         5.1 ROYALTIES PAYABLE BY ESI Following the Launch Date of Product in
any country in the territory, ESI shall pay to CIMA, on a quarterly basis, a
royalty in the amounts set forth below on Gross Profits of the Product during
the previous quarter.





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<PAGE>   16

<TABLE>
<S><C>
             (a) During any period from the Launch Date in which    [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
                 there is no other launched generic to              OMITTED FILED SEPARATELY WITH THE SECURITIES AND
                 CLARITIN(R) REDITABS                               EXCHANGE COMMISSION.***] of Product Gross Profit
                                                                    in the Territory, plus a quarterly payment in
                                                                    the amount of the lesser of [***CONFIDENTIAL
                                                                    TREATMENT REQUESTED, PORTION OMITTED FILED
                                                                    SEPARATELY WITH THE SECURITIES AND EXCHANGE
                                                                    COMMISSION.***]


                 During any period from the Launch Date in which    [***CONFIDENTIAL TREATMENT REQUESTED, PORTION
                 there is another launched generic to               OMITTED FILED SEPARATELY WITH THE SECURITIES AND
                 CLARITIN(R) REDITABS                               EXCHANGE COMMISSION.***] of Product Gross Profit
                                                                    in the Territory.
</TABLE>


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             (b) ESI shall either (i) pay to CIMA royalties on Product Gross
                 Profit sold by any Third party sublicensee, or (ii) provide
                 in such sublicense that such sublicensee shall pay to ESI
                 royalties on Product Gross Profit sold by such sublicensee,
                 in either case at the royalty rate set forth in Section
                 5.1(a) that would be applicable had such Gross Profits been
                 made by ESI, and provided that in either case, ESI shall remain
                 liable for the timely payment of all such royalties.

         5.2 ROYALTY REPORTS During the Term of this Agreement following the
Launch Date of Product in any country, ESI shall, within forty five (45) days
after each calendar quarter for sales of Product in the United States and within
sixty (60) days after each calendar quarter for sales of Product outside the
United States, furnish to CIMA a written quarterly report showing (i) the gross
sales of Product sold by ESI and its Affiliates and sublicensees during the
reporting period and the calculation of Net Sales and Gross Profit from such
gross sales; (ii) the royalties and other payments which shall have accrued
hereunder in respect of such sales; (iii) withholding taxes, if any, required by
law to be deducted in respect of such royalty payments; (iv) the Launch Date(s)
of Product in any country(ies) during the reporting period; and (v) the exchange
rates used in determining the amount of payment hereunder. Payments accrued in
such quarter shall be paid to CIMA no later than the respective time periods for
the United States (45 days) and other countries (60 days) for submission of
royalty reports after each calendar quarter.

         5.3 INSPECTION OF RECORDS The parties shall maintain at their offices,
accurate and complete books and records consistent with sound business and
accounting this Agreement by the respective party to be determined. ESI and CIMA
shall permit an



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independent certified accountant (subject to obligations of confidentiality)
appointed by the other party and reasonably acceptable to ESI or CIMA (as
applicable), at the other party's expense, to examine such books and records at
all reasonable times for the sole purpose of (i) verifying ESI's or CIMA's (as
applicable) reports and accounting submitted to the other party hereunder and
(ii) determining the correctness of payments. In the event of any underpayment
of any payment by at least five percent (5%), the costs of such inspection shall
be borne by the party who made such underpayment and such underpayment shall be
forthwith paid by such party to the other party with interest at the rate
specified in Section 5.5.

         5.4 PAYMENTS Each party shall make all payments due to the other party
hereunder in $ by wire transfer in immediately available funds to an account
designated by the payee party.

         5.5 INTEREST The parties shall pay interest on any amounts overdue
under this Agreement at a rate equal to the $ prime or equivalent rate quoted by
Citibank N.A. or another mutually acceptable bank, as in effect during the
period from the date due until payment.

         5.6 EXCHANGE RATES All royalty payments to be made pursuant to this
Agreement shall be made in $. Amounts based on Net Sales in currencies other
than $ shall be converted to $ at the ESI financial statement exchange rates
applied by ESI on a consistent basis in ESI's own financial accounting on the
date such payment is due.

         5.7 CURRENCY BLOCKAGE Where payments are due hereunder for sales of
Product in a country where, by reason of currency regulations or taxes of any
kind, it is impossible or illegal for ESI to transfer payments to CIMA in that
country, such payments




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<PAGE>   19

shall be deposited by ESI in whatever currency is allowable for the benefit or
credit of CIMA in an accredited bank in that country that is reasonably
acceptable to CIMA.

         5.8 WITHHOLDINGS Any and all income or similar taxes imposed or levied
on account of the receipt of payments under this Agreement which are required to
be withheld shall be paid by ESI on behalf of CIMA and shall be paid to the
proper taxing authority. Proof of payment shall be secured, if available, and
sent to CIMA by ESI as evidence of such payment in such form as required by the
tax authorities having jurisdiction over ESI. Such taxes shall be deducted from
the payments that would otherwise be remittable by ESI. ESI shall take
reasonable measures to assist CIMA in obtaining credit for such taxes against
CIMA's United States tax liabilities.

                                   ARTICLE VI

                         REPRESENTATIONS AND WARRANTIES

         6.1 REPRESENTATION AND WARRANTIES OF EACH PARTY Each of CIMA and ESI
hereby represents, warrants and covenants to the other party hereto as follows:

         (a) it is a corporation or entity duly organized and validly existing
             under

         (b) the laws of the state or other jurisdiction of incorporation or
             formation;

         (c) the execution, delivery and performance of this Agreement by such

         (d) party has been duly authorized by all requisite corporate action
             and does not

         (e) require any shareholder action or approval;

         (f) it has the power and authority to execute and deliver this
Agreement and to perform its obligations hereunder; and




                                                                              18
<PAGE>   20

         (g) the execution, delivery and performance by such party of this
Agreement and its compliance with the terms and provisions hereof does not and
will not conflict with or result in a breach of any of the terms and provisions
of or constitute a default under (i) a loan agreement, guaranty, financing
agreement, agreement affecting a product or other agreement or instrument
binding or affecting it or its property (ii) the provisions of its charter or
operative documents or bylaws; or (iii) any order, writ, injunction or decree of
any court or governmental authority entered against it or by which any of its
property is bound.

         6.2 REPRESENTATIONS AND WARRANTIES OF CIMA In addition to the
representations and warranties made by CIMA under Section 6.1 above, CIMA hereby
further represents and warrants to ESI that:

         (a) As of the Effective Date, the CIMA Patents are existing and, to the
best of its knowledge, are not invalid or unenforceable, in whole or in part;

         (b) It has the full right, power and authority to grant all of the
right, title and interest in the licenses granted under Article II hereof;

         (c) It has not, prior to the Effective Date, previously assigned,
transferred, conveyed or otherwise encumbered its right, title and interest in
Product, or the CIMA Patents, or CIMA Technical Information, with respect to
which ESI has been granted a license or other rights hereunder in the Territory,
provided that CIMA has granted, and may in the future grant, licenses to Third
Parties under such CIMA Patents and CIMA Technical Information which licenses do
not conflict with the rights granted to ESI under this Agreement;


                                                                              19
<PAGE>   21

         (d) It is the sole and exclusive owner of the CIMA Patents and
Technical Information existing as of the Effective Date, all of which are free
and clear of any liens, charges and encumbrances, except as provided in Section
6.2(c), and no other person, corporate or other private entity, or governmental
entity or subdivision thereof, has or shall have any claim of ownership with
respect to the CIMA Patents or Technical Information in the Territory, provided
that CIMA has only a non-exclusive license under U.S. Patent No. 5,225,197 and
its corresponding foreign counterparts;

         (e) To the best of its knowledge the CIMA Patents and Technical
Information do not, as of the Effective Date, interfere or infringe on any valid
intellectual property rights owned or possessed by any Third Party in the
Territory, provided that whereas ESI is aware of the possibility of interference
between one or more of the CIMA Patents and United States Patent 5,464,632 (the
'632 Patent), and ESI is aware of patents corresponding to said '632 Patent in
other jurisdictions, no such representation is made with respect to said '632
Patent or with respect to any corresponding patent.

         (f) As of the Effective Date, there are no claims, judgments or
settlements against or owed by CIMA or, to the best of its knowledge, pending or
threatened claims or litigation relating to the CIMA Patents or Technical
Information;

         (g) During the Term of this Agreement it will use Commercially
Reasonable Efforts not to diminish the rights under the CIMA Patents and
Technical Information licensed to ESI hereunder, by not committing or permitting
any actions or omissions which would cause the breach of any agreements between
itself and Third Parties which provide for intellectual property rights
applicable to the development, manufacture, use or sale of Product, that it will
provide ESI promptly with notice of any such alleged breach, and that as



                                                                              20
<PAGE>   22

of the Effective Date, it is in compliance in all material respects with any
agreements with Third Parties relating to the CIMA Patents and Technical
Information.

         6.3 REPRESENTATION BY LEGAL COUNSEL Each party hereto represents that
it has been represented by legal counsel in connection with this Agreement and
acknowledges that it has participated in the drafting hereof. In interpreting
and applying the terms and provisions of this Agreement, the parties agree that
no presumption shall exist or be implied against the party which drafted such
terms and provisions.

                                   ARTICLE VII

                                 INDEMNIFICATION

         7.1 INDEMNIFICATION BY ESI Except as provided in Section 9.3, ESI shall
indemnify, defend and hold harmless CIMA and its Affiliates, and each of its and
their respective employees, officers, directors and agents (each a "CIMA
Indemnified Party") from and against any all liability, loss, damage, cost and
expense (including reasonable attorney's fees) (collectively, a "Liability")
which the CIMA Indemnified Party may incur, suffer or be required to pay
resulting from or arising in connection with (i) the breach by ESI of any
representation or warranty contained in this Agreement, or (ii) the manufacture,
promotion, distribution, use, testing, marketing, sale or other disposition of
Product by ESI, its Affiliates or sublicensees. Notwithstanding the foregoing,
ESI shall have no obligation under this Agreement to indemnify, defend or hold
harmless any CIMA Indemnified Party with respect to claims, demands, costs or
judgments which result from either (x) the failure of Product supplied by CIMA
or its Affiliates to comply with the Specifications or the



                                                                              21
<PAGE>   23

applicable Regulatory Approvals or (y) the willful misconduct or negligent acts
or omissions of CIMA, its Affiliates, or any of their respective employees,
officers, directors or agents.

         7.2 INDEMNIFICATION BY CIMA Except as provided in Section 9.3, CIMA
shall indemnify, defend and hold harmless ESI and its Affiliates, and each of
its and their respective employees, officers, directors and agents (each, a "ESI
Indemnified Party") from and against any Liability which the ESI Indemnified
Party may incur, suffer or be required to pay resulting from or arising in
connection with the breach by CIMA of any representation or warranty contained
in this Agreement. Notwithstanding the foregoing, CIMA shall have no obligation
under this Agreement to indemnify, defend, or hold harmless any ESI Indemnified
Party with respect to claims, demands, costs or judgments which result from the
failure of Active Ingredient supplied by ESI or its Affiliates to comply with
the Specifications or the applicable Regulatory Approvals, or from the willful
misconduct or negligent acts or omissions of ESI, its Affiliates, or any of
their respective employees, officers, directors or agents.

         7.3 CONDITIONS TO INDEMNIFICATION The obligations of the indemnifying
party under Sections 7.1 and 7.2 are conditioned upon delivery of written notice
to the indemnifying party of any potential Liability promptly after the
indemnified party becomes aware of such potential Liability, provided, however,
that the failure to give such notice promptly shall not impair a party's rights
to indemnification under this Article VII unless the delay in providing such
notice has a material adverse effect on the ability of the indemnifying party to
defend against such Liability. The indemnifying party shall have the right to
assume the defense of any suit or claim related to the Liability if it has
assumed responsibility for the suit or claim in writing; however, if in the
reasonable judgment of the



                                                                              22
<PAGE>   24

indemnified party, such suit or claim involves an issue or matter which could
have a material adverse effect on the business operations or assets of the
indemnified party, the indemnified party may waive its rights to indemnity under
this Agreement and control the defense or settlement thereof, but in no event
shall any such waiver be construed as a waiver of any rights such party may have
as against any Third Party at law or in equity. If the indemnifying party
defends the suit or claim, the indemnified party may participate in (but not
control) the defense thereof at its sole cost and expense.

         7.4 SETTLEMENTS Neither party may settle a claim of action related to a
Liability without the consent of the other party, if such settlement would
impose any monetary obligation on the other party or require the other party to
submit to an injunction or otherwise limit the other party's rights under this
Agreement. Any payment made by a party to settle any such claim or action shall
be at its own cost and expense except in the event that such payment was made
with the prior written consent of the indemnifying party, in which case such
payment will be subject to the indemnification obligations of the parties as set
forth in this Article VII.

         7.5 INSURANCE Each party further agrees to obtain and maintain, during
the term of this Agreement, Comprehensive General Liability Insurance, including
Products Liability Insurance, with reputable and financially secure insurance
carriers to cover its indemnification obligations under Section 7.1 or 7.2, as
applicable, or, in the case of ESI, self-insurance, in each case with limits of
not less than one million dollars ($1,000,000.00) per occurrence and two million
dollars ($2,000,000.00) in the aggregate.



                                                                              23
<PAGE>   25

                                  ARTICLE VIII

                                 CONFIDENTIALITY

         8.1 NONDISCLOSURE During the Term of this Agreement and for a period of
five (5) years thereafter, all proprietary and confidential business, technical,
scientific and/or regulatory information, including Technical Information,
disclosed to the receiving party or its Affiliates (herein collectively, the
(Receiving Party) by the other party or its Affiliates (herein collectively, the
(Disclosing Party) hereunder or under the existing Confidentiality Agreement
between the parties which is marked as confidential at the time of disclosure,
or if disclosed or obtained orally or visually (or otherwise in a non-written
form), was described or summarized in a writing or other tangible form and
identified as confidential and forwarded to the Receiving Party within thirty
(30) days of such disclosure (collectively, Confidential Information), shall be
deemed to be confidential and shall be treated as such by the Receiving Party
and shall not be disclosed, in whole or in part, by the Receiving Party to any
other Person except as expressly set forth herein, and shall be used only for
the purposes of this Agreement. Notwithstanding the foregoing these mutual
obligations of confidentiality shall not apply to any information to the extent
that such information is:

         (i) independently developed by such party as documented by prior
written records outside the scope and not in violation of this Agreement;

         (ii) legally in the public domain at the time of its receipt or
thereafter legally becomes part of the public domain through no fault of the
recipient;

         (iii) received without an obligation of confidentiality from a Third
Party having the right to disclose such information;

         (iv) released from the restrictions of this Article VIII by the express
written consent of the Disclosing Party;



                                                                              24
<PAGE>   26

         (v) as may be required for securing Regulatory Approval, or as may be
required to be disclosed to an Agency or as otherwise required by a court order
or any law or regulation (including, as may be required in connection with any
filings made with the Securities and Exchange Commission or by the disclosure
policies of a major stock exchange in the Territory); provided, however, that at
the other party's request, the disclosing party shall request that the relevant
legal or regulatory authority, or major stock exchange, treat as confidential
any Confidential Information of either party included in any such disclosure and
generally use diligent efforts to seek confidential treatment where available.


         8.2 SCOPE OF CONFIDENTIALITY CIMA and ESI agree to limit the disclosure
of any Technical Information and other Confidential Information received
hereunder to such Affiliates, officers and employees as are necessary to carry
out the provisions of this Agreement and who are likewise bound by provisions
equivalent to this Article VIII, except that, with CIMA's written consent, which
shall not be unreasonably withheld or delayed, ESI may disclose Confidential
Information of CIMA to consultants, to distributors, and to actual or potential
sublicencees and subdistributors, provided that they are likewise bound by
confidentiality provisions similar to, or more stringent than, those set forth
in this Article VIII. The parties shall take reasonable measures to assure that
no unauthorized use or disclosure is made by Persons to whom access to such
Confidential Information is granted. Unauthorized use or disclosure by any
person who has been given access to Confidential Information by a Receiving
Party hereunder shall be deemed to be unauthorized use or disclosure by such
Receiving Party, and the Receiving Party shall be responsible to the Disclosing
Party hereunder.



                                                                              25
<PAGE>   27

                                   ARTICLE IX

               TECHNOLOGY AND DATA OWNERSHIP RIGHTS; INFRINGEMENT

         9.1 OWNERSHIP OF DATA AND TECHNICAL INFORMATION

             (a) CIMA shall solely own all formulation, system design, chemistry
manufacturing and control (CMC) and manufacturing process data and documents
that arise out of the development program ("CIMA Data"), and ESI shall execute
such documents and take such actions as are necessary to implement the
foregoing. ESI shall solely own all clinical data and documents arising from the
development program for Product funded by ESI ("ESI Data"), and CIMA shall
execute such documents and take such actions as are necessary to implement the
foregoing. ESI agrees to disclose to CIMA, on an on-going basis, in writing, all
ESI Data, provided that CIMA shall not be permitted to use such ESI Data except
for internal research purposes, and further provided that ESI shall not disclose
such ESI Data to any Third Party.

             (b) Inventorship of any inventions acquired or developed in
connection with the development program shall be determined by reference to
United States patent laws pertaining to inventorship. Accordingly, (i) if an
invention is made in connection with the development program by one (1) or more
employees or consultants of each party, it shall be deemed to be a "Joint
Invention". If one or more claims included in an issued Patent or pending patent
application which is filed in a patent office in the Territory claim such Joint
Invention following rules shall govern ownership of such Patent or patent
application: (a) Joint Inventions which relate to specifically Loratadine and/or
administration of Loratadine shall be the sole property of ESI, (b) Joint
Inventions which relate to rapidly-dissolving dosage forms shall be the sole
property of CIMA but shall be included in the CIMA Patents and shall be subject
to the license granted hereunder; and



                                                                              26
<PAGE>   28

             (c) any other Joint Inventions shall be jointly owned by CIMA and
ESI as Joint Patent Rights hereunder. If an invention is made in connection with
the development program solely by an employee or consultant of a party, it shall
be solely owned by such party, and any Patent filed claiming such solely owned
invention shall also be solely owned by such party. Each party shall require its
employees and consultants to disclose to it any inventions relating to the
Product in writing promptly after conception, and each party shall, subsequent
to any such disclosures to it by its employees or consultants, promptly disclose
such inventions to the other party. Each party shall ensure that its employees
and consultants shall assign his/her interest in such invention(s) to his/her
respective party employer, as the case may be, and such rights shall therefore
vest in the respective party employer to whom the inventor assigns his/her
rights. CIMA shall use Commercially Reasonable Efforts to obtain and maintain
CIMA Patents for the CIMA DuraSolv(TM) (OraSolv(R)) technologies in the Major
Countries. The parties shall mutually agree upon how and where to file and
prosecute any Joint Patent Rights, the maintenance of any ensuing Joint Patent
Rights covering such Joint Inventions, and how to license, enforce, defend and
protect any such Joint Patent Rights and how to share the costs relating
thereto.

         9.2 INFRINGEMENT

             (a) Each party shall promptly report in writing to the other party
during the term of this Agreement any known infringement or suspected
infringement of any of the CIMA Patents in the Territory by manufacture, use or
sale of a Product on a commercial scale in derogation of the rights granted to
ESI hereunder (hereinafter, a "Related Infringement") of which it becomes aware,
and shall provide the other party with all available evidence supporting said
infringement or suspected infringement.



                                                                              27
<PAGE>   29

             (b) Except as provided in paragraph (d) below, CIMA shall have the
right to initiate an infringement or other appropriate suit anywhere in the
Territory against any Third Party who at any time has infringed, or is suspected
of infringing, any of the CIMA Patents. CIMA shall give ESI sufficient advance
notice of its intent to file any suit on account of a Related Infringement and
the reasons therefor, and shall provide ESI with an opportunity to make
suggestions and comments regarding such suit. CIMA shall keep ESI promptly
informed, and shall from time to time consult with ESI regarding the status of
any such suit on account of a Related Infringement and shall provide ESI with
copies of all documents filed in, and all written communications relating to,
such suit.

             (c) CIMA shall have the sole and exclusive right to select counsel
for any suit referred to in subsection (b) above and shall, except as provided
below, pay all expenses of the suit, including without limitation attorneys'
fees and court costs. ESI, in its sole discretion, may elect, within 60 days
after the commencement of such litigation on account of a Related Infringement,
to contribute to the costs incurred by CIMA in connection with such litigation
and, if it so elects, any damages, royalties, settlement fees or other
consideration received by CIMA as a result of such litigation shall be shared by
CIMA and ESI pro rata based on their respective sharing of the costs of such
litigation provided that such pro rata share shall not exceed fifty percent
(50%) unless CIMA has consented to a higher share in writing. In the event that
ESI elects not to contribute to the costs of such litigation, CIMA shall be
entitled to retain any damages, royalties, settlement fees or other
consideration for infringement resulting therefrom. If necessary, ESI shall join
as a party to the suit but shall be under no obligation to participate except to
the extent that such participation is required as the result of being a named
party to the suit. ESI shall offer



                                                                              28
<PAGE>   30


reasonable assistance to CIMA therewith at no charge to CIMA except for
reimbursement of reasonable out-of-pocket expenses incurred in rendering such
assistance. ESI shall have the right to participate and be represented in any
such suit by its own counsel at its own expense. CIMA shall not settle any such
suit on terms which grant any license to any other party in derogation of the
rights granted to ESI hereunder without obtaining the prior written consent of
ESI, which consent shall not be unreasonably withheld.

             (d) In the event that CIMA elects not to initiate an infringement
or other appropriate suit pursuant to subsection (b) above on account of a
Related Infringement after reasonable efforts to abate such Related Infringement
without litigation have failed, but in no event later than ninety (90) days
after ESI's notice to CIMA under Section 9.3(a), CIMA shall promptly advise ESI
of its intent not to initiate such a suit, ESI shall have the right, at the
expense of ESI, of initiating an infringement or other appropriate suit against
the party or parties committing such Related Infringement. In exercising its
rights pursuant to this subsection (d), ESI have the sole and exclusive right to
select counsel and shall, except as provided below, pay all expenses of the suit
including without limitation attorneys' fees and court costs. CIMA, in its sole
discretion, may elect, within 60 days after the commencement of such litigation,
to contribute to the costs incurred by ESI in connection with such litigation,
and, if it so elects, any damages royalties, settlement fees or other
consideration received by ESI as a result of such litigation shall be shared by
ESI and CIMA pro rata based on their respective sharing of the costs of such
litigation provided that such pro rata share shall not exceed fifty percent
(50%) unless ESI has consented to a higher share in writing.

         In the event that CIMA elects not to contribute to the costs of such
litigation, ESI shall be entitled to retain any damages, royalties, settlement
fees or other consideration for



                                                                              29
<PAGE>   31

infringement resulting therefrom. If necessary, CIMA shall join as a party to
the suit but shall be under no obligation to participate except to the extent
that such participation is required as a result of being named a party to the
suit. At ESI's request, CIMA shall offer reasonable assistance to ESI in
connection therewith at no charge to ESI except for reimbursement of reasonable
out-of-pocket expenses incurred in rendering such assistance. CIMA shall have
the right to participate and be represented in any such suit by its own counsel
at its own expense.

         9.3 CLAIMED INFRINGEMENT

             (a) In the event that a Third Party at any time provides written
notice of a claim to, or brings an action, suit or proceeding against, either
party or any of their respective Affiliates, claiming infringement of its patent
rights, based upon an assertion or claim arising out of the filing of an ANDA
for Product, or the use, manufacture, distribution or sale of Product, such
party shall promptly notify the other party of the claim or the commencement of
such action, suit or proceeding, enclosing a copy of the claim and/or all papers
served.

             (b) If a Third Party at any time brings an action, suit or
proceeding against ESI and/or CIMA and/or their Affiliates, claiming
infringement of its patent rights, based upon ESI's filing of an ANDA for
Product in the Territory, ESI shall be responsible for the defense, costs and
expenses, including attorney's fees, thereof. ESI shall have the right to use
counsel of its own choice and shall control the defense of any such action, suit
or proceeding. If CIMA desires to have additional counsel of its own choice
participate in the defense, CIMA shall be solely responsible for the costs and
expenses of its counsel. ESI shall have the authority to settle any such action,
suit or proceeding with the prior written consent of CIMA, such consent not to
be unreasonably withheld or delayed. If ESI receives



                                                                              30
<PAGE>   32

any payment(s) as part of the settlement of any such threatened or actual
action, suit or proceeding, then after deduction of ESI's costs and expenses,
including attorney's fees, the balance (if any) of such payment(s) shall be
split eighty percent (80%) to ESI and twenty percent (20%) to CIMA.

             (c) If a Third Party at any time brings an action, suit or
proceeding against ESI and/or its Affiliates, claiming infringement of its
patent rights, based upon an assertion or claim arising out of the use,
importation, distribution, offer for sale or sale of Product in the Territory on
account of the CIMA rapid dissolve technology used to manufacture Product, the
parties shall share equally responsibility for and any and all costs and
expenses associated with such legal actions including, without limitation,
damages, settlement payments, attorneys' fees and court costs. Each party shall
offer reasonable assistance to the other party in connection therewith at no
charge to the other party except for reimbursement of reasonable out-of-pocket
expenses incurred in rendering such assistance.

             (d) This Section 9.3 states the entire responsibility of CIMA in
the case of any claimed infringement or violation of any Third Party's patent
rights.

                                    ARTICLE X

                              TERM AND TERMINATION

         10.1 TERM This Agreement shall be effective as of the Effective Date,
and, unless sooner terminated by mutual agreement or pursuant to any other
provision of this Agreement, shall continue in full force and effect, on a
country-by-country basis, until the



                                                                              31
<PAGE>   33

later to occur of (a) ten (10) years from the Launch Date of Product in such
country, or (b) expiration of the last to expire of the CIMA Patents in each
such country (the "Term").

         10.2 TERMINATION FOR DEFAULT Each party may terminate this Agreement if
the other party commits a material breach of any material obligation under this
Agreement and fails to remedy such breach within sixty (60) days (or, in the
case of a late payment, ten (10) business days of notice of such breach), or
other longer period of time if mutually agreed; provided that if the defaulting
party initiates steps within the sixty (60) day notice period to remedy or cure
the breach, unless the parties mutually agree otherwise, such termination shall
become effective only if the breach is not remedied within one hundred and
twenty (120) days after the initial notice from the non-defaulting party. For
purposes of clarification, unless otherwise mutually agreed by the parties in
writing, (a) in no event shall a defaulting party have longer than one hundred
twenty (120) days to remedy a material breach (other than a material breach of a
payment obligation) under this Section, and (b) in no event shall a defaulting
party have longer than ten (10) business days to remedy a material breach of a
payment obligation under this Section.

         10.3 TERMINATION BY ESI ESI shall have the right, in its sole
discretion, to terminate this Agreement at any time upon six (6) months' prior
written notice to CIMA.



                                                                              32
<PAGE>   34

                                   ARTICLE XI

                      EFFECT OF EXPIRATION AND TERMINATION

         11.1 EXPIRATION Upon expiration (but not termination) of this
Agreement, ESI shall have the fully paid-up, royalty free, perpetual,
irrevocable, non-exclusive right, itself and/or through its Affiliates, to
make, have made, promote, market, distribute, sell, have sold, import and
export Product pursuant to the Regulatory Documents and Technical Information
(including manufacturing know-how).

         11.2 DEVELOPMENT COMMITMENTS In the event that CIMA terminates this
Agreement pursuant to Section 10.2 or ESI terminates this Agreement pursuant to
Section 10.3, all development commitments (internal and external) of CIMA
incurred or committed up through the effective date of such termination shall
become due and payable to CIMA by ESI on the effective date of such termination.

         11.3 TRANSFER OF DOCUMENTS

              (a) In the event that CIMA terminates this Agreement pursuant to
Section 10.2 or ESI terminates this Agreement pursuant to Section 10.3, (i) ESI
promptly but no later than within forty-five (45) days of such termination,
shall assign and transfer to CIMA all ESI Data as relates to Product and (ii)
ESI shall, within sixty (60) days of a request by CIMA, execute all documents
necessary to assign to CIMA and/or its Affiliates all Regulatory Documents in
the countries in the Territory where the Agreement has been terminated which
relate to Product. In the event that no such assignment may legally be made in
any country in the Territory, ESI shall continue to maintain such Regulatory
Documents and shall provide to CIMA and/or CIMA's Affiliates and/or their
designees continuing access and/or the right to cross-reference


                                                                              33
<PAGE>   35
all such Regulatory Documents. Upon CIMA's request, ESI shall within the same
period deliver to CIMA or its designees full copies (both paper and electronic,
where available) of any Regulatory Documents in ESI's or its Affiliates'
possession or control. In such event, CIMA shall pay to ESI [***CONFIDENTIAL
TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.***] of CIMA's gross profits (including payments to CIMA by
Third Parties) on Product in the Territory, payable quarterly with supporting
documentation, sold by CIMA or a Third Party marketing partner up to the total
of ESI's out-of-pocket costs for Product development consisting of raw
materials, biostudy costs, and amounts paid under Section 3.2(b) for product
development costs.

              (b) In the event that ESI terminates this Agreement pursuant to
Section 10.2, CIMA shall grant to ESI the exclusive right, and shall use
Commercially Reasonable Efforts to transfer to ESI the CIMA Data and
manufacturing know-how used by CIMA that is reasonably necessary to enable ESI
to develop and register Product in the Territory, and to enable ESI either
itself or through a contract manufacturer to manufacture Product. ESI shall pay
CIMA, on a country-by-country basis, a royalty on Product sold by ESI thereafter
equal to [***CONFIDENTIAL TREATMENT REQUESTED, PORTION OMITTED FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION.***] of ESI's Gross Profit during
the term.

              (c) After the Term, ESI shall have a full paid-up, irrevocable,
non-exclusive right in the Territory to use the data and documents and other
Technical Information arising out of the development program for Product that
are owned by CIMA (including any and all Technical Information relating
primarily to the manufacture of the Product, including all manufacturing
know-how) and CIMA shall use Commercially Reasonable Efforts to transfer to ESI
the manufacturing know-how that is reasonably necessary to enable ESI to make
and have made Product.

              11.4 NO DAMAGES UPON EXPIRATION OR TERMINATION Except as otherwise
set forth in this Agreement, neither party shall be entitled to any compensation
whatsoever as a result of expiration or termination of this Agreement, but
without limiting either party's damages for any breach of this Agreement.



                                                                              34
<PAGE>   36

              11.5 CONTINUING OBLIGATIONS Termination or expiration of this
Agreement for any reason shall be without prejudice to any obligations which
shall have accrued to the benefit of either party prior to such termination or
expiration. Upon termination or expiration of this Agreement, any payments owed
to the other party on or before the effective date of termination would be due
within thirty (30) days of the effective date of such termination or expiration.
The following provisions of this Agreement shall survive expiration or
termination hereof Article VIII, Section 9.1, Articles XI and XIV.

                                   ARTICLE XII

                                   TRADEMARKS

         12.1 USE OF CIMA'S TRADEMARK BY ESI ESI shall market the Product under
its own tradename. However, ESI may refer to CIMA's DuraSolv(TM) or OraSolv(R)
trademarks (the "MARKS") as applicable on the package, internal leaflet and
promotional material of the Product by printing "Produced with CIMA DuraSolv(TM)
(OraSolv(R)) technology" or word DuraSolv(TM) (OraSolv(R)). For this purpose,
CIMA grants to ESI and its Affiliates a non-exclusive license to use CIMA's
DuraSolv(TM) and OraSolv(R) trademarks during the Term. Prior to its printing,
ESI (or an Affiliate) shall send CIMA a sample of the packaging, internal
leaflet and related promotional material for CIMA's prior approval of ESI's use
of the MARKS.

         12.2 TRADEMARK OWNERSHIP AND USE

              a. ESI recognizes CIMA's exclusive ownership of and title in and
to the MARKS, and shall not at any time do or permit to be done any act or thing
which would in any way impair the rights of CIMA in and to the MARKS or in any
trademark registration



                                                                              35
<PAGE>   37

application therefor, and shall not at any time claim any right of interest in
or to the MARKS or the aforesaid trademark application therefor.

              b. ESI agrees that during the term of the Agreement and after its
termination, however occurring, that ESI shall not:


                 (i) use the MARKS or any other mark confusingly similar thereto
              in connection with any goods not covered by this Agreement which
              would be likely to cause confusion between the parties; or

                 (ii) apply for or seek registration anywhere in the world, at
              any time, for the MARKS or any other mark confusingly similar
              thereto; or

                 (iii) commit or do any act which might prejudice or adversely
              affect the validity of the MARKS or CIMA's ownership thereof or
              dilute or diminish the value of the MARKS to CIMA.

              c. ESI shall use the MARKS only in a proper trademark sense and
shall identify the MARKS as a registered trademark of CIMA by including use of
the registered trademark symbol (R) or the symbol (TM) in association with the
MARKS as specified by CIMA.

              d. ESI agrees that all goodwill resulting from its use of the
MARKS shall inure to the exclusive benefit of CIMA.

              e. ESI shall assist CIMA in obtaining or maintaining registrations
for the MARKS by supplying specimens, other proofs of use and other information
or documents reasonably necessary to obtain or maintain registration of the
MARKS in all jurisdictions within the Territory.

              12.3 QUALITY CONTROL ESI agrees that, to the extent the Product is
manufactured by a party other than CIMA pursuant to this Agreement, the Product
shall be manufactured



                                                                              36
<PAGE>   38

in accordance with the Specifications. CIMA shall have the right to inspect the
Products sold in connection with the MARKS so that CIMA can determine that the
Products meet the Specifications. If the quality of any Products is determined
not to meet the Specifications, then ESI shall not use any of the MARKS in
connection with such Products and ESI shall, at its option, either (i) destroy
such Products or (ii) repackage such Products to eliminate use of the MARKS.

                                  ARTICLE XIII

                         PRESS RELEASES AND PUBLICATIONS

         13.1 PRESS RELEASES The parties agree to issue a joint press release,
in the form attached hereto as Exhibit F, upon the Effective Date. All other
press releases and public announcements related to this Agreement shall be
approved in advance in writing by the other party.

         13.2 PUBLICATIONS The parties shall mutually agree upon publications
and the publication strategy with respect to work undertaken by the parties
relating to Product, and neither party shall publish any result or study
generated or developed under this Agreement except upon review by the other
party at least sixty (60) days prior to submission of an abstract or manuscript
for publication.

                                   ARTICLE XIV

                                  MISCELLANEOUS

         14.1 FORCE MAJEURE Neither party shall be liable for delay or failure
to perform its obligations hereunder for so long as that failure or delay is the
result of an event beyond its



                                                                              37
<PAGE>   39

control which it could not have avoided by the exercise of reasonable diligence,
(a force majeure event), provided that such party uses commercially Reasonable
Efforts to comply with the terms of this Agreement as soon as practicable. A
party asserting a force majeure event shall notify the other party promptly,
giving an indication of the likely extent and duration thereof.

         14.2 ASSIGNMENT; SUCCESSORS AND ASSIGNS Neither party shall at any
time, without obtaining the prior written consent of the other party, assign or
transfer this Agreement to any Person. Notwithstanding the foregoing, each party
shall be permitted to assign this Agreement to its Affiliates or to perform this
Agreement, in whole or in part, through its Affiliates, provided that such party
shall be primarily liable and responsible for performance by such Affiliate
hereunder; and each party may also assign this Agreement to any successor by
merger or upon a sale of all or substantially all of the assets to which this
Agreement relates. This Agreement shall be binding upon and shall inure to the
benefit of the parties and their successors and permitted assigns.

         14.3 NOTICES Any notices required or permitted to be given hereunder
shall be in writing and shall be delivered by air courier service (requiring
signature upon receipt) or sent by first class air mail, postage prepaid, or
telefax (confirmed by phone conversation with the recipient) to the addresses
set forth below. The parties may change the address at which notice is to be
given by giving notice to the other party as herein provided. All notices shall
be deemed effective upon receipt by the party to whom it is addressed.




                                                                              38
<PAGE>   40

If to CIMA:                CIMA LABS, Inc.
                           10000 Valley View Road
                           Eden Prairie, Minnesota  55344

                           Attention: Dr. John Siebert
                                      President and CEO
                           Telephone: (612) 947-8762
                           Telefax:   (612) 947-8770


If to ESI:        ESI Lederle        With a copy to:
130 North Radnor-Chester Road        American Home Products Corporation
St. Davids, Pennsylvania 19087       5 Giralda Farms
                                     Madison, New Jersey 07940

Attention:  President                Attention:
Telephone: (610) 971-4550            Senior Vice President & General Counsel
Telefax:  (610) 995-3394             Telephone: (973) 660-6040
                                     Telefax: (973) 660-7050

         14.4 GOVERNING LAW AND JURISDICTION This Agreement and its execution,
validity and interpretation shall be governed in all respects in accordance with
the laws of the State of Delaware, excluding conflicts of law rules.

         14.5 SEVERABILITY In the event that any provision of this Agreement
shall be held to be unenforceable, invalid or in contravention of applicable
law, such provision shall be of no effect, and the parties shall negotiate in
good faith to replace such provision with a provision which effects to the
extent possible the original intent of such provision.

         14.6 COMPLETE AGREEMENT; MODIFICATIONS This Agreement, together with
all Exhibits attached hereto, constitutes the entire Agreement between the
parties with respect to the present subject matter, all prior negotiations,
agreements and understandings being expressly canceled hereby. This Agreement
may be amended only by a written agreement



                                                                              39
<PAGE>   41


embodying the full terms of the amendment signed by authorized representatives
of both parties.

         14.7 NO AGENCY Neither party shall by virtue of this Agreement have any
power to bind the other to any obligation nor shall this Agreement create any
relationship of agency, partnership or joint venture.

         14.8 NO WAIVER No term or condition of this Agreement shall be
considered waived unless reduced to writing and duly executed by an officer of
the waiving party. Any waiver by any party of a breach of any term or condition
of this Agreement will not be considered as a waiver of any subsequent breach of
this Agreement, of that term or condition or any other term or condition hereof.

         14.9 COUNTERPARTS This Agreement may be executed in counterparts, each
of which together shall constitute one and the same Agreement.

         14.10 HSR FILING To the extent necessary, each of CIMA and ESI shall
file, as soon as practicable after the date this Agreement was signed by each of
the parties, with the Federal Trade Commission (the "FTC") and the Antitrust
Division of the United States Department of Justice (the "Antitrust Division")
the notification and report form (the "Report") required under the HSR Act with
respect to the transactions as contemplated hereby and shall reasonably
cooperate with the other party to the extent necessary to assist the other party
in the preparation of its Report and to proceed to obtain necessary approvals
under the HSR Act, including but not limited to the expiration or earlier
termination of any and all applicable waiting periods required by the HSR Act.
Each party shall bear its own expenses, including, without limitation, legal
fees, incurred in connection with preparing such filings. If a Report is filed
by the parties under the HSR Act, then the Effective Date




                                                                              40
<PAGE>   42

shall be the date upon which the necessary approvals have been obtained under
the HSR Act or that the notice and waiting period under the HSR Act has expired
or been terminated.

         IF THE PARTIES DETERMINE THAT NO REPORT IS REQUIRED TO BE FILED UNDER
THE HSR ACT, THE EFFECTIVE DATE SHALL BE THE DATE FIRST WRITTEN ABOVE.

         In the event that a Report is required to be filed under the HSR Act,
either party may, prior to the Effective Date, terminate this Agreement by
written notice to the other party, if, within one hundred twenty (120) days
after this Agreement is signed by each of the parties, approval of the
transactions contemplated by this Agreement under the HSR Act has not been
obtained or the notice and waiting period, as may be extended by the FTC, under
the HSR Act has not expired without adverse action regarding this Agreement or
the transactions contemplated hereby. If this Agreement is terminated pursuant
to this Section 14.10, then, notwithstanding any provision in this Agreement to
the contrary, neither party shall have any further obligation to the other party
with respect to the subject matter of this Agreement except for the obligations
set forth in Article VIII hereof, which obligations shall survive any
termination of this Agreement.

         14.11 COMPLIANCE ISSUES The parties acknowledge that the export of
technical data, materials or products is subject to the exporting party
receiving the necessary export licenses and that the parties cannot be
responsible for any delays attributable to export controls which are beyond the
reasonable control of either party. The parties agree that regardless of any
disclosure made by the party receiving an export of any ultimate destination of
any technical data, materials or products, the receiving party will not
re-export either directly or indirectly, any technical data, material or
products without first obtaining the applicable validated or general license
from the United States Department of Commerce, FDA and/or any other agency or
department of the United States Government as required.



                                                                              41
<PAGE>   43


         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

CIMA LABS INC.                              ESI LEDERLE
By:  /s/ John M. Siebert                    By:  /s/ Mike Dey
Name:  John M Siebert                       Name:  Mike Dey
Title: President and CEO                    Title: President




                                                                              42
<PAGE>   44
                                LIST OF EXHIBITS



                  Exhibit A         CIMA PATENTS

                  Exhibit B         DIRECT COSTS

                  Exhibit C         SPECIFICATIONS

                  Exhibit D         DEVELOPMENT TIMELINE

                  Exhibit E         ADVERSE EVENTS

                  Exhibit F         PRESS RELEASE



                                                                              43
<PAGE>   45






                                    EXHIBIT A

                                  CIMA PATENTS



1.   UNITED STATES PATENT NO. 5,178,878

2.   UNITED STATES PATENT NO. 5,225,197

3.   UNITED STATES PATENT APPLICATION NO. 09/057,884 ALLOWED AUGUST 3, 1999

4.   ALL FOREIGN COUNTERPARTS TO THE ABOVE LISTED PATENTS AND PATENT
     APPLICATIONS




                                                                              44
<PAGE>   46



                                    EXHIBIT B

                                  DIRECT COSTS


                  "DIRECT COST" means (a) costs directly attributable to an
activity (i.e., those costs which vary with such activity), including, but not
limited to, direct labor and benefit expenses for such activity and consumable
bulk and other materials, as determined in accordance with United States
generally accepted cost accounting practices consistently applied, plus (b)
fixed overhead costs allocable to the activity, including, but not limited to,
direct benefit and labor expenses for technical services and support services,
depreciation, maintenance and repairs and insurance costs associated with such
activity, as determined in accordance with United States generally accepted
cost accounting practices consistently applied.



                                                                              45
<PAGE>   47


                                    EXHIBIT C

                                 SPECIFICATIONS

          THE SPECIFICATIONS ARE SET FORTH IN THE FOLLOWING FOUR PAGES.

<PAGE>   48

                               CIMA LABS, INC.(R)
                          Raw Materials Specifications

                             Loratadine, Micronized

COMPONENT #: 20-46837-900               APPROVED:  (Quality Control)
                                                                     -----------
EFFECTIVE DATE:  11-26-99               APPROVED:  (Materials)
                                                              ------------------
SUPERSEDES:  11-2-99                    APPROVED:  (Product Compliance)
                                                                       ---------

<TABLE>
<S>                              <C>
PURCHASING SPECIFICATIONS        All materials must meet CIMA specifications.

SUPPLIER/MANUFACTURER            Quimical Sintetica, S.A.

SHIPPING SPECIFICATIONS          50-kg Double poly-lined, fiber drums

MATERIAL IDENTIFICATION          Marking must show product name, manufacturer's name,
                                 manufacturer's lot number, CIMA purchase order number,
                                 CIMA component number, and quantity per container.

SAFETY PRECAUTIONS               Refer to Material Safety Data Sheets

SAMPLING                         In accordance with                              SOP 360070

SAMPLE SIZE                      300 g                                           SOP 360006

RETEST DATE                      Annually from date of receipt                   SOP 360015

RETEST SAMPLE SIZE               75 g                                            SOP 360006

EXPIRATION DATE                  Five years from the date of manufacture         SOP 360015

SAMPLE RETENTION                 225 g                                           SOP 360016

STORAGE CONDITIONS               Store in sealed containers at ambient
                                 warehouse conditions.

REFERENCE                        Manufacturer's COA

ATTACHMENTS                      A.  Raw Material Worksheet
</TABLE>


These specifications are agreeable to the supplier/manufacturer unless exception
is made in writing.  These are the governing factors pertaining to the quality
of material shipped against all orders placed on or after the date of these
specifications.


                                 Specifications

                 Loratadine 10 MG Orally disintegrating Tablets

Formulation No. CL-099-02                          Specification No. R-0105-00



SPECIFICATION (THROUGH SHELF LIFE)

<TABLE>
<CAPTION>
TEST                          SPECIFICATION                                            TEST METHOD
--------------------------------------------------------------------------------------------------
<S>                           <C>                                                      <C>
Physical Appearance           White to off-white, flat-faced, 3/8", round,
                              beveled tablet                                             ATM-123

Identity*                     Positive for Loratadine
                              1)  HPLC                                                   ATM-276
                              2)  IR                                                     ATM-281
Assay (90.0 - 110.0%)         9.00 - 11.00 mg/tablet                                     ATM-276

                              1)  NMT 0 Tabs +- 15% label claim (8.50-11.50
                                  mg/tab) and % RSD = < 6.0%; (n =10)                    ATM-275
                                                      -
                              2)  NMT 0 Tabs +- 25% label claim (7.50-12.50
                                  mg/tab) and NMT 1 Tabs +- 15% label claim
                                  (8.50-11.50 mg/tab) and % RSD = < 7.8%; (n =30)
                                                                  -
Water content by KF           Record                                                     ATM-279

Dissolution                   NLT 80% (Q) at 15 minutes                                  ATM-272
                              1)  S1 (n=6) Each individual tablet NLT 85% at
                                  15 minutes.
                              2)  S2 (n=12) Average of 12 tablets (S1+S2) NLT
                                  80% at 15 minutes.  Each individual tablet
                                  NLT 65% at 15 minutes.
                              3)  S3 (n=24) Average of 24 tablets (S1+S2+S3) NLT
                                  80% at 15 minutes.  NMT 2 tablets less than
                                  65% and no tablets less than 55% at 15 minutes.

Related substances:
        Impurity I            Record                                                     ATM-280
        Impurity II           Record
        Impurity III          Record
        Impurity IV           Record
        Impurity V            Record
        Individual Other      Record
        Total                 Record
</TABLE>

*  Test performed at initial release only; product maintains specification
throughout shelf life.

                                 Specifications

                 Loratadine 10 MG Orally disintegrating Tablets

Formulation No.  CL-099-02                        Specification No. R-0105-00

                                    History

<TABLE>
<CAPTION>
REVISION NO.                       CHANGES                       ORIGINATOR
---------------------------------------------------------------------------
<S>                                <C>                           <C>
00                                 Original                      Walid Habib/
                                                                 Jim Klancke
</TABLE>


                      Loratadine Packaging Specifications


Subject to modifications as determined by Wyeth-Ayerst and CIMA Packaging and
Regulatory Affairs staff.


- Each blister card will contain 6 blisters.
- Each carton will contain 5 blister cards.
- Each case will contain 24 to 48 cartons.
- The label for carton will come from ESI Lederle, and will have a barcode for
  that NDC as well as additional information.
- Each blister card will have the following printed on it:

     1. Name of product
     2. Name of active
     3. Name of manufacturer
     4. Lot number
     5. Expiration date
     6. NDC
     7. Directions of opening


                                                                              46
<PAGE>   49

                                    EXHIBIT D

                              DEVELOPMENT TIMELINE

-    Formulation, process, and analytical development ongoing completed

-    Pivotal biostudy supplies available (submission lot) December, 1999

-    Initiate pivotal biostudies

-    Complete pivotal biostudies
     ANDA Filing

-    FDA Final Approval





                                                                              47
<PAGE>   50




                                    EXHIBIT E

                                 ADVERSE EVENTS

                     ADVERSE EXPERIENCE REPORTING PROCEDURES


         The parties hereby agree that the following terms will govern
disclosures of each party to the other with respect to adverse event reporting
relating to Product as clinically tested or marketed by or on behalf of either
party.

1.       DEFINITIONS.

         1.1 ADVERSE EXPERIENCE OR EVENT (AE): An AE is defined by ESI as any
             untoward, undesired, or unplanned event in the form of signs,
             symptoms, disease, or laboratory or physiological observations
             occurring in a human being in a temporal relationship to use of an
             ESI product regardless of casual relationship. This includes:

             -  any clinically significant worsening of a pre-existing
                condition;

             -  an AE occurring from overdose (i.e., a dose higher than that
                prescribed by a health care professional for clinical reasons)
                of an ESI product, whether accidental or intentional;

             -  an AE occurring from abuse (i.e., use for non-clinical reasons)
                of an ESI product;

             -  an AE that has been associated with the discontinuation of the
                use of an ESI product;

             -  any failure of expected pharmacological action (for spontaneous
                reports).

             If there is any doubt whether the information constitutes an AE,
             the information will be treated as an AE.

         1.2 SERIOUS AE: A serious AE is defined by ESI as an AE occurring at
             any dose that: results in death; is life-threatening (see below);
             requires inpatient hospitalization or prolongation of an existing
             hospitalization; results in a persistent or significant disability
             or incapacity (see below); results in cancer; results in a
             congenital anomaly or birth defect. Additionally, IMPORTANT MEDICAL
             EVENTS that may not result in death, be life-threatening, or
             require hospitalization may be considered a serious AE when, based
             upon appropriate medical judgment, they may jeopardize the patient
             or subject and may require medical or surgical intervention to
             prevent one of the outcomes listed in this definition. Examples of
             such medical events include allergic bronchospasm requiring
             intensive treatment in an emergency room or at home; blood
             dyscrasias or convulsions that do not result in hospitalization; or
             the development of drug dependency or abuse.


                                       1
<PAGE>   51
             1.2.1 Life-threatening refers to immediate risk of death as the
                   event occurred. A life-threatening experience does not
                   include an experience that, had it occurred in a more severe
                   form, might have caused death but as it actually occurred did
                   not create an immediate risk of death. For example, hepatitis
                   that resolved without evidence of hepatic failure would not
                   be considered life-threatening even though hepatitis of a
                   more severe nature can be fatal. Similarly, an allergic
                   reaction resulting in angioedema of the face would not be
                   life-threatening, even though angioedema of the larynx,
                   allergic bronchospasm, or anaphylaxis can be fatal.

             1.2.2 Disability is defined as a substantial disruption in a
                   person's ability to conduct normal life functions.

             1.2.3 For studies, all pregnancies and all overdoses will be
                   reported to GSSE in the same time frame as serious AEs.

             1.2.4 A serious AE obtained from tests in laboratory animals
                   includes any experience suggesting a significant risk for
                   human subjects, including any findings of mutagenicity,
                   teratogenicity, or carcinogenicity.

             1.2.5 If there is any doubt whether the information constitutes a
                   serious AE, the information will be treated as a serious AE.

         1.3 NON-SERIOUS AE: is any AE which does not meet the criteria for a
             serious AE.

         1.4 UNEXPECTED AE: An unexpected AE is one that is not listed in the
             current product labeling. The current product labeling is either
             the package insert (for marketed ESI products) or the current
             investigator's brochure (for investigational ESI products). An
             unexpected AE includes any event that may be symptomatically and
             pathophysiologically related to an event listed in the labeling,
             but differs from the labeled event because of greater severity or
             specificity. For example, hepatic necrosis would be unexpected (by
             virtue of greater severity) if the product labeling referred only
             to elevated hepatic enzymes or hepatitis. Similarly, cerebral
             thromboembolism and cerebral vasculitis would be unexpected (by
             virtue of greater specificity) if the labeling only listed cerebral
             vascular accidents.

         1.5 PRODUCT (DRUG, VACCINE, BIOLOGICAL, DEVICE)-RELATED: For the
             purposes of regulatory reporting for investigational products, an
             AE will be considered "product-related" (i.e., drug-related,
             vaccine-related, etc.) for studies if either the investigator, the
             Medical Monitor, the CR&D Clinical Project Team Medical Monitor (or
             designee), OR the Local Monitor (if applicable) assesses the AE(s)
             as possibly, probably, or definitely related.


                                       2

<PAGE>   52

                  1.   An AE will be considered "not product-related" for
                       studies if the investigator AND the medical monitor(s)
                       AND the local monitor (if applicable) assess the AE(s) as
                       probably not related or definitely not related, or
                       "relationship remote."

                  2.   Whenever the investigator's or monitor's assessment is
                       unknown or unclear, the AE(s) will be treated as
                       product-related for the purposes of reporting to
                       regulatory authorities.

         1.6 PROTOCOL-RELATED: AEs from studies that are not product-related may
             nevertheless be considered by the investigator OR the medical
             monitor(s) OR the local monitor (if applicable) to be
             protocol-related. For purposes of reporting to GSSE and regulatory
             authorities, these will be reported in the same manner as
             product-related events.

         1.7 ANDA HOLDER is defined as: An "Applicant" for regulatory approval
             of a Product in any regulatory jurisdiction, including a holder of
             a foreign equivalent thereto.

         1.8 Capitalized terms not defined in this Exhibit E shall have the
             meaning assigned thereto in the Agreement.

2.       With respect to the Product or Active Ingredient, the Parties agree
         as follows:

         a.       All initial reports and any follow-up information (oral or
                  written) for any and all Serious AEs as defined above, (other
                  than with respect to animal studies) which become known to
                  either Party (other than from disclosure by or on behalf of
                  the other Party) must be communicated by telephone, telefax or
                  electronically directly to the other Party and/or the ANDA
                  Holder, ("Holder") within forty-eight (48) hours of receipt of
                  the information. Written confirmation of the Serious AE
                  received by such Party should be sent to the other Party
                  and/or the Holder as soon as it becomes available, but in any
                  event within forty-eight (48) hours of initial report of the
                  Serious AE by such Party.

         b.       Both Parties shall exchange Medwatch and/or CIOMs forms and
                  other health authority reports within forty-eight (48) hours
                  of submission to any Regulatory Authority.

         c.       All initial reports and follow-up information received for all
                  Non-Serious AEs for marketed Product which become known to a
                  Party (other than from disclosure by or on behalf of the other
                  Party) must be communicated in writing, by telefax or
                  electronically to the other Party within ten (10) days, on
                  Medwatch or CIOMs forms (where possible).

         d.       Each Party shall coordinate and cooperate with the other
                  whenever practicable to prepare a single written report
                  regarding all Serious and/or Non-Serious AEs, provided,
                  however, that neither Party shall be obligated to delay
                  reporting of any AE in violation of applicable law or
                  regulations regarding the reporting of AEs.


                                       3

<PAGE>   53



3.       The Parties further agree that:

         a.  A written report be forwarded to the other Party within forty-eight
             (48) hours of receipt by the Party making the report, for AEs for
             animal studies which suggest a potential significant risk for
             humans;

         b.  Each Party will give the other Party a report via a print-out or
             computer disk of all AEs reported to it and its Affiliates relating
             to the Product or Active Ingredient within the last year, within
             thirty (30) days of receipt of a request from the other Party but
             not more often than four (4) times a year;

         c.  If either Party wishes access to AE Reports of the other Party
             relating to the Product or Active Ingredient, upon request of that
             Party, the other Party shall make available its AE records relating
             to the Product or Active Ingredient (including computer disks) for
             viewing and copying by the other Party. The Parties may discuss the
             transfer of AE Reports by computer disk.

         d.  Disclosure of information hereunder by a Party to the other Party
             shall continue as long as either Party and/or its Affiliates or
             designees continue to clinically test or market Product or Active
             Ingredient.


4.       Each Party shall diligently undertake the following further obligations
         where both Parties are or will be performing clinical trials with
         respect to the Product or Active Ingredient.

         a.  Upon the Effective Date, each Party shall identify individuals who
             shall be responsible for identifying all AE reporting requirements
             in all countries of the Territory as set forth in the Agreement,
             and any amendments thereto;

         b.  To immediately consult with the other Party, with respect to the
             investigation and handling of any Serious AE disclosed to it by the
             other Party or by a third Party and to allow the other Party to
             review the Serious AE and to participate in the follow-up
             investigation;

         c.  To immediately advise the other Party of any Product and/or Active
             Ingredient safety communication received from a health authority
             and consult with the other Party with respect to any Product and/or
             Active Ingredient warning, labeling change or change to an
             investigators' brochure involving safety issues proposed by the
             other Party, including, but not limited to the safety issues agreed
             to by the Parties;

         d.  To diligently handle in a timely manner the follow-up investigation
             and resolution of each AE reported to it;



                                       4

<PAGE>   54
         e.  To provide the other Party mutually agreed upon audit rights of its
             AE reporting system and documentation, upon prior notice, during
             normal business hours, at the expense of the auditing Party and
             under the confidentiality obligations set forth in the Agreement;

         f.  To meet in a timely fashion from time to time as may be reasonably
             required to implement the adverse event reporting and consultation
             procedures described in this Exhibit E, including identification of
             those individuals in each Party's Drug Safety group who will be
             responsible for reporting to and receiving AE information from the
             other Party, and the development of a written standard operating
             procedure with respect to adverse event reporting responsibilities,
             including reporting responsibilities to investigators;

         g.  Where possible, to transmit all data electronically;

         h.  to report to each other any addenda, revisions or changes to the
             Agreement (e.g., change in territories, local regulations, addition
             of new licensors/licensees to the Agreement, etc.) which might
             alter the adverse event reporting responsibilities hereunder;

         i.  to utilize English as the language of communication and data
             exchange between the Parties;

         j.  to develop a system of exchange of documents and information in the
             event that the Agreement involves more than two Parties;

         k.  to work together to develop an electronic system to transmit AE
             data.

5.       The Parties may meet after the Effective Date of the Agreement to
         establish a separate agreement for adverse event exchange which will
         supersede this Exhibit E.



                                       5





<PAGE>   55

                                    EXHIBIT F

                                  PRESS RELEASE

FOR IMMEDIATE RELEASE:      Contact:      John M. Siebert, Ph.D.
                                          President and Chief Executive Officer
                                          CIMA LABS INC.
                                         (612) 947-8700


          CIMA LABS INC. ANNOUNCES SIGNING OF LICENSE, DEVELOPMENT AND
                 SUPPLY AGREEMENTS WITH AMERICAN HOME PRODUCTS

                    - CIMA'S FOURTH PRESCRIPTION PRODUCT  -

Eden Prairie, MN, January XX, 2000 - CIMA LABS INC. (NASDAQ: CIMA) today
announced the signing of a License and  Development Agreement, as well as a
Supply Agreement with American Home Products for an undisclosed prescription
product.

"This is a significant event for CIMA.  It illustrates the commercial
viability of our second fast-dissolve technology," DuraSolv(TM), and the
continued success of all our fast-dissolve technologies", commented John M.
Siebert, Ph.D., President and Chief Executive Officer of CIMA LABS INC..  "These
agreements reinforce the level of confidence CIMA has developed with large
pharmaceutical partners."

DuraSolv(TM) is a robust, patented oral dosage form which incorporates
microencapsulated drug ingredients into tablets that dissolve quickly in the
mouth. DuraSolv(TM) is designed to improve taste acceptance and address the
difficulty of swallowing traditional tablets and capsules, while offering a
convenient oral dosage form that can be taken anywhere and anytime, therefore
increasing compliance.

CIMA LABS, INC. based in Minneapolis, Minnesota, is a drug delivery company that
specializes in oral drug delivery systems to improve patient compliance and
drug efficacy.  These systems include OraSolv(R), OraSolv(R) SR/CR and
DuraSolv(TM), fast-dissolve technologies, and OraVescent(TM), a dual
fast-dissolve/oral transmucosal system for improved oral absorption, targeted
site-specific absorption and fast onset of action.

                                      ###



                                                                               1