<PAGE>
                                                                    Exhibit 10.4

          Confidential Materials omitted and filed separately with the
        Securities and Exchange Commission. Asterisks denote omissions.

              RESEARCH COLLABORATION AND EXCLUSIVE OPTION AGREEMENT

      This Research Collaboration and Exclusive Option Agreement ("Agreement")
is made as of December 1, 2005 (the "Effective Date") by and between Bausch &
Lomb Incorporated, a New York corporation with a place of business at One Bausch
& Lomb Place, Rochester, New York 14604-2701 ("B&L") and PTC Therapeutics, Inc.,
a Delaware corporation with a place of business at 100 Corporate Court, South
Plainfield, New Jersey 07080-2449 ("PTC").

                                    RECITALS

      WHEREAS, B&L desires to evaluate certain compounds in the possession of
PTC for the purpose of identifying potential candidates for development by B&L
for the treatment of ophthalmic diseases caused by angiogenesis;

      WHEREAS, PTC is pursuing a subset of these compounds as development
candidates in the area of oncology;

      WHEREAS, PTC desires to grant, and B&L desires to receive, an exclusive
option to license one or more such compounds selected by B&L for use in the
treatment, diagnosis and/or prevention of diseases of the eye.

      NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants contained herein, PTC and B&L hereby agree as follows:

1. Definitions. In addition to any terms defined elsewhere in this Agreement,
the following terms shall have the meanings set forth below.

      1.1 "Affiliate" means any corporation, association or other entity, which
directly or indirectly controls, is controlled by or is under common control
with the party in question. Solely for purposes of this definition the term
"control" means direct or indirect beneficial ownership of more than 50% of the
voting stock in such corporation or other business entity, or such other
relationship as in fact constitutes actual control.

      1.2 "Applicable Know-How" means any technical information, including all
biological, chemical, pharmacological, toxicological, clinical and assay
information, data, discoveries, inventions, improvements, know-how, materials,
processes, formulae and trade secrets, whether patentable or unpatentable (but
not patented), that at any time during the applicable Term are Controlled by PTC
and that relate to an Evaluation Compound in the applicable Field.


<PAGE>
                                      -2-

      1.3 "Applicable Laws" means all laws, ordinances, rules and regulations
applicable to this Agreement or the activities contemplated hereunder, including
without limitation the U.S. Federal Food, Drug, and Cosmetic Act, as amended.

      1.4 "Applicable Patents" means all U.S. and international patents and U.S.
and international patent applications that at any time during the applicable
Term are Controlled by PTC, the claims of which may be infringed, absent a
license, by the manufacture, use, sale, offer for sale or importation of an
Evaluation Compound in the applicable Field.

      1.5 "Confidential Information" means any information communicated by one
party hereto to the other, which is identified as proprietary or confidential by
the disclosing party, or which would be reasonably understood to be the type of
information which should be treated as proprietary or confidential. PTC's
Confidential Information shall include the Applicable Know-How. B&L's
Confidential Information shall include the B&L Improvements.

      1.6 "Controlled" means, with respect to any know-how or intellectual
property right, possession by a party, directly or through an Affiliate
controlled by such party, of the ability to grant the right to access or use, or
to grant a license or a sublicense to, such know-how or intellectual property
right as provided for herein without violating the terms of the agreement or
other arrangement with any third party under which such rights to access or use
are obtained.

      1.7 "Evaluation Compounds" means both the PTC Development Compounds and
the PTC Program Compounds.

      1.8 "Field" means (i) with respect to the PTC Program Compounds, the
treatment, diagnosis or prevention of diseases of the eye, and (ii) with respect
to the PTC Development Compounds, the treatment, diagnosis or prevention of
diseases of the eye through local delivery to the eye including without
limitation intravitreal injection and implantation.

      1.9 "PTC Development Compound" means any chemical compound listed on
Exhibit A-2 to this Agreement as supplemented from time to time with additional
compounds in related series.

      1.10 "PTC Program Compound" means any chemical compound listed on Exhibit
A-1 to this Agreement.

2. Evaluation Activities.

      2.1 Provision of Information regarding Evaluation Compounds. PTC shall
provide the following information to B&L to the extent available for each
Evaluation Compound promptly following B&L's request with respect to the first
group of Evaluation Compounds to be evaluated and then within [**] following
B&L's request with regard to subsequent groups of Evaluation Compounds to be
evaluated, provided that such requests with regard to subsequent groups of
Evaluation Compounds may occur no more often than [**] and no more often than
[**] during the Initial Term and [**] during the Extension Term:

            (a) PTC Compound Number ([**]);


<PAGE>
                                      -3-



            (b) molecular weight;

            (c) chemical name and structure, including calculated 2D and 3D
molecular features; provided, however, that (i) chemical names and structures
for PTC Program Compounds shall only be provided for inspection at PTC's offices
until such time as specific compounds are selected for evaluation by B&L, at
which time the names and structures of only those compounds selected will be
provided, and (ii) chemical names and structures for PTC Development Compounds
shall not be provided until after the in vitro screening proposed by B&L is
complete, and then only for those PTC Development Compounds actually screened
and for which B&L submits a written notice of continued interest;

            (d) [**];

            (e) [**];

            (f) [**];

            (g) [**];

            (h) a summary description of the government grants received by PTC
in support of its research and development efforts relating to any Evaluation
Compounds;

            (i) any additional Applicable Know-How that would reasonably be
expected to be material to B&L's evaluation of the Evaluation Compounds;
provided, however, that such additional Applicable Know-How shall only be
provided for inspection at PTC's offices until such time as specific Evaluation
Compounds are selected for evaluation by B&L; and

            (j) information regarding any of the following of which PTC becomes
aware following the Effective Date: (i) patent or other intellectual property
rights owned or controlled by any third party that would be infringed by such
Evaluation Compound or B&L's exercise of the evaluation license granted under
Section 4.1 in accordance with this Agreement; (ii) any claims made against PTC
asserting the invalidity, unenforceability, abuse or misuse of any of the
Applicable Know-How or Applicable Patents; (iii) any claim made by PTC of any
violation or infringement or misappropriation by others of PTC's rights in an
Evaluation Compound, or the Applicable Know-How or Applicable Patents; (iv) any
claim made that PTC is in conflict with or infringing upon the asserted rights
of others in connection with the Applicable Compound, or the Applicable Know-How
or Applicable Patents within the Field; (v) any patent or other intellectual
property rights owned or controlled by any third party that would be infringed
by the composition of matter of an Evaluation Compound or use of an Evaluation
Compound in the applicable Field; and (vi) any licenses or covenants not to sue
granted by PTC under the Applicable Know-How or Applicable Patents in the
applicable Field; provided that PTC shall have no liability for any Third Party
Claims under any provision of this Agreement based on any failure to disclose
any information described in this Section 2.1(l); and further provided that
PTC's obligation to provide the information described in this Section 2.1(l)
shall only commence once B&L intends to engage [**].

      2.2 Restrictions on Use of Information. B&L shall limit access to the
information disclosed pursuant to Section 2.1 above to those individuals under
its control who are involved in the evaluation process. In particular, B&L shall
not store such information on any computer system or in any database that is
either generally available to B&L scientific personnel or third party
consultants or advisers, unless B&L implements reasonable technological
measures (e.g.,
<PAGE>
                                      -4-


two-factor authentication employing unique userids and passwords) to prevent
such information from being accessed by individuals other than individuals who
are involved in the evaluation process. B&L shall not combine or aggregate such
information within any database containing information not developed pursuant to
the activities contemplated under this Agreement or a License Agreement.

      2.3 Provision of Evaluation Compounds. Subject to the limitation set forth
in Sections 2.6 and 2.7, PTC shall, upon request by B&L, make available to B&L
in such quantities as B&L may reasonably request any Evaluation Compound
selected by B&L for evaluation, screening, testing and formulation. Such
Evaluation Compounds shall be made available at PTC's facilities or shall be, at
B&L's request and expense, provided to B&L at B&L's facilities.

      2.4 Evaluation of PTC Development Compounds by B&L. B&L agrees that it
shall select the PTC Development Compounds as the first of the Evaluation
Compounds to be evaluated and shall, promptly following the Effective Date,
begin evaluation, screening, testing and formulation activities with regard to
the PTC Development Compounds. If the evaluation, screening, testing and/or
formulation done by B&L fails, B&L shall promptly notify PTC in writing whether
B&L intends to continue evaluation, screening, testing or formulation activities
with regard to the PTC Development Compounds.

      2.5 Support of Evaluation Activities. Subject to the limitation set forth
in Sections 2.6 and 2.7, PTC shall support B&L's evaluation activities under
this Agreement as reasonably requested by B&L, including without limitation, (i)
providing reasonable access to PTC's facilities and equipment required to
conduct such activities, (ii) procuring reagents, assays and other chemicals and
materials required to conduct such activities, (iii) making available one or
more qualified employees to conduct or assist in the conduct of such activities,
and (iv) otherwise reasonably cooperating with B&L.

      2.6 Payment for PTC Obligations. B&L shall pay PTC $[**] during the
Initial Term for PTC's obligations pursuant to Sections 2.3 and 2.5 (the "PTC
Obligations"), invoiced by PTC and paid by B&L in four installments of $[**] on
a quarterly basis (with quarters, for this purpose, deemed to be the four
consecutive three-calendar-month periods commencing with the Effective Date),
representing the equivalent of [**] Absent any additional payments by B&L
pursuant to Section 2.7, PTC's provision of [**] support during the Initial Term
shall represent an upper limit on the amount of support that PTC is required to
provide to fulfill the PTC Obligations.

      2.7 Additional Resources. By mutual agreement, PTC may provide additional
support for the B&L's evaluation activities beyond the PTC Obligations, for
which B&L shall reimburse PTC at a rate of $[**] for PTC resources (whether
internal or outsourced), or in the case of any out-of-pocket purchase of
materials or equipment, for the actual cost to PTC of such materials or
equipment.

      2.8 Payment Terms. Subject to Section 2.6 (which specifies the payment
amount for PTC's performance of the PTC Obligations), PTC shall invoice B&L at
the end of each quarter for activities during the quarter then ended specifying
the work performed, the man hours expended and the out of pocket expenses
incurred, and B&L shall pay such invoices within [**]

<PAGE>
                                      -5-


following receipt of invoice. If B&L disputes any amounts in an invoice, it
shall notify PTC in writing of the reasons for such dispute within [**] of
receipt of such invoice. B&L's failure to pay such disputed amounts after
written notice is given to PTC shall not constitute a material breach of this
Agreement for such time period as the parties are working together in good faith
to resolve the dispute.


3. Option.

      3.1 Fee for Option Grant. Within fifteen (15) days following the Effective
Date, B&L shall pay to PTC the sum of Three Hundred Thousand Dollars ($300,000)
via check or wire transfer to a bank account designated by PTC.

      3.2 Option to PTC Program Compounds.

            (a) Grant of Option. Subject to the terms and conditions set forth
in this Agreement, PTC hereby grants to B&L, and B&L hereby accepts, an
exclusive option (the "PTC Program Compounds Option") to obtain, from time to
time during the Term, one or more exclusive, worldwide licenses to develop and
commercialize one or more of the PTC Program Compounds in the applicable Field
pursuant to the terms and conditions set forth in Exhibit B (each such license,
a "License Agreement").

            (b) Exercise of PTC Program Compounds Option. B&L may exercise the
PTC Program Compounds Option at any time and as often during the Term as B&L, in
its sole discretion, may determine, by providing written notice of such exercise
to PTC specifying the PTC Program Compound that is the subject of such exercise.
Following exercise of the PTC Program Compounds Option, the parties shall
memorialize the license granted to B&L by executing a written License Agreement
for such PTC Program Compound in the form attached hereto as Exhibit B, and such
PTC Program Compound shall be deemed a "Licensed Compound".

            (c) Exercise Fee. Within [**] following execution of the first such
License Agreement for a Licensed Compound under Section 3.2(b), B&L shall pay to
PTC the sum of [**] Dollars ($[**]), and within [**] following execution of each
subsequent License Agreement for a Licensed Compound under Section 3.2(b), B&L
shall pay to PTC the sum of [**] Dollars ($[**]). Such amounts shall be paid via
check or wire transfer to a bank account designated by PTC at the time of
execution of each such License Agreement.

      3.3 Option to PTC Development Compounds.

            (a) Grant of Option. Subject to the terms and conditions set forth
in this Agreement, PTC hereby grants to B&L, and B&L hereby accepts, an
exclusive option (the "PTC Development Compounds Option") to obtain a worldwide
license to develop and commercialize the PTC Development Compounds in the
applicable Field as further described in this Section.

            (b) Exercise of Option. B&L may exercise the PTC Development
Compounds Option at any time during the DC Term that B&L, in its sole
discretion, may determine, by providing written notice of such exercise to PTC.

<PAGE>
                                      -6-



            (c) Negotiation of License Agreement. Following the Effective Date
the parties shall negotiate the terms and conditions of an exclusive, worldwide
license to develop and commercialize the PTC Development Compounds in the
applicable Field. Following exercise of the PTC Development Compounds Option and
execution of a license agreement with respect thereto, the PTC Development
Compounds shall be deemed "Licensed Compounds". Notwithstanding the foregoing,
if after B&L exercises the PTC Development Compounds Option the parties do not
reach agreement on the terms of such license agreement and enter into such
license agreement prior to the date [**] following the expiration of the DC
Term, B&L's rights under this Agreement with respect to the PTC Development
Compounds shall expire and be of no further force or effect; provided that the
parties shall extend their negotiations for an additional [**] beyond the
expiration of such negotiation period if, by mutual agreement, the parties
determine that such negotiations then remain active and viable.

4. Intellectual Property.

      4.1 Evaluation License. PTC hereby grants to B&L, and B&L hereby accepts,
an exclusive license under the Applicable Know-How and the Applicable Patents to
evaluate, screen, test and formulate the Evaluation Compounds for utility in the
applicable Field. With the consent of PTC, not to be unreasonably withheld, B&L
may transfer the Evaluation Compounds to, and have such evaluation, screening,
testing and formulation performed for it by, a third-party service provider,
provided that B&L shall be responsible for compliance with the terms of this
Agreement by any such third-party service provider.

      4.2 Exclusivity. PTC agrees that, during the applicable Term, it shall not
evaluate, screen or test for any third party, or permit any third party to
evaluate, screen, or test (i) any of the Evaluation Compounds for utility in the
applicable Field, (ii) disclose any Applicable Know-How to any third party for
use in the applicable Field, or (iii) grant or have granted, within the
applicable Field, any license, option to license or covenant not to sue under
any of the Applicable Patents to any third party.

      4.3 B&L Improvements. B&L shall own all right, title and interest in and
to, any new process, manufacture, compound, composition of matter, improvement,
discovery, claim, formula, process, trade secret, technology or know-how
relating to any Evaluation Compound that is conceived or first reduced to
practice solely by B&L employees, agents and/or third party contractors during
the applicable Term as a result of the activities contemplated under this
Agreement, including all patent and other intellectual property rights thereto
(collectively, "B&L Improvements").

      4.4 Joint Improvements. The parties shall jointly own all right, title and
interest in and to, any new process, manufacture, compound, composition of
matter, improvement, discovery, claim, formula, process, trade secret,
technology or know-how relating to any Evaluation Compound that is conceived or
first reduced to practice jointly by one or more B&L employees, agents and/or
third party contractors, on the one hand, and one or more PTC employees, agents
and/or third party contractors, on the other hand, during the applicable Term as
a result of the activities contemplated under this Agreement, including all
patent and other intellectual property rights thereto (collectively, "Joint
Improvements"). Subject to Section 4.5, each party may freely license or assign
its interest in Joint Improvements without the consent of
<PAGE>
                                      -7-

the other party and without any duty to account to the other party. B&L and PTC
shall be jointly responsible, using outside patent counsel mutually agreed upon
by the parties and free of ethical conflict, for the preparation, filing,
prosecution and maintenance of Joint Improvement patents and patent applications
and the parties shall share equally the responsibility for all documented
external costs associated therewith. Should either party elect to discontinue
its payment obligations under this Section 4.4 for costs incurred for the
filing, prosecution and maintenance of a Joint Improvement patent or patent
application in one or more countries, at the request of the other party such
party will assign its full right, title and interest in and to such particular
patent or patent application to such other party

      4.5 License to B&L Improvements and Joint Improvements. B&L hereby grants
to PTC, and PTC hereby accepts, a non-exclusive, royalty-free, worldwide
license, with the right to sublicense, to B&L Improvements for use outside of
the applicable Field. At the request of PTC, B&L shall negotiate terms,
including the payment of fees and royalties, under which (i) such non-exclusive
licenses may be converted to exclusive licenses, and (ii) B&L will grant an
exclusive license to B&L's interest in the Joint Improvements for use outside of
the applicable Field.

      4.6 Restriction on Practice and Use of Applicable Know-How and Applicable
Patents. Notwithstanding the license rights granted herein, B&L shall not
practice or use any Applicable Know-How or Applicable Patents to synthesize or
discover any compound other than Evaluation Compounds, nor to determine the
structure of any PTC Development Compound in advance of a disclosure of such
compound's structure pursuant to Section 2.1(b). Breach of this Section 4.6
shall constitute material breach of this Agreement under Section 5.3, remedies
for which shall not be limited by Section 8.

5. Term and Termination.

      5.1 Initial Term. The term of this Agreement shall commence as of the
Effective Date and, unless extended or earlier terminated as forth
below, shall continue:

      (i) with respect to the PTC Program Compounds, for a period of one (1)
      year following the Effective Date (the "Initial Term"); and

      (ii) with respect to the PTC Development Compounds, until the earlier of
      (a) the date, if any, on which B&L has notified PTC in writing pursuant to
      Section 2.4 that B&L does not intend to continue evaluation, screening,
      testing or formulation activities with regard to the PTC Development
      Compounds; (b) the date, if any, of the execution of a license agreement
      pursuant to Section 3.3; or (c) one (1) year following the Effective Date
      (the "DC Term").

      5.2 Extension Term. B&L may elect to extend the term of this Agreement
solely with respect to the PTC Program Compounds for one (1) additional period
of six (6) months following the Initial Term (the "Extension Term") by (i)
notifying PTC in writing of such election at least [**] prior to the expiration
of the Initial Term, which written notice shall specify the PTC Program
Compounds that remain the subject of interest by B&L (the "Extension
Compounds"), and (ii) paying to PTC the non-refundable sum of [**] Dollars
($[**]) prior to the
<PAGE>
                                      -8-


expiration of the Initial Term. Following such extension, the term "Evaluation
Compounds" shall refer only to the Extension Compounds. With respect to PTC
Program Compounds, the Initial Term together with any applicable Extension Term
shall be referred to herein as the "Term." With respect to PTC Development
Compounds, any references to the "Initial Term" or the "Term" shall mean the DC
Term.

      5.3 Termination for Breach. Either party may terminate this Agreement upon
written notice to the other party in the event that the other party has failed
to perform a material obligation under this Agreement, and has failed to cure
such non-performance within sixty (60) days following receipt of written notice
specifying in reasonable detail the nature of such failure.

      5.4 Termination by B&L. B&L may terminate this Agreement without cause in
B&L's sole discretion upon ninety (90) days written notice to PTC.

      5.5 Effect of Expiration and Termination.

            (a) Expiration of DC Term. Subject to Section 3.3(c), upon
expiration of the DC Term, (i) the PTC Development Compound Option shall expire;
(ii) rights granted to the PTC Development Compounds shall, if they are not
Licensed Compounds, revert to PTC; (iii) the evaluation license granted under
Section 4.1 shall terminate with respect to the PTC Development Compounds; and
(iv) B&L shall disclose to PTC and permit PTC to use all evaluation, screening,
testing and formulation data and the like generated pursuant to this Agreement
relating to the PTC Development Compounds, if they are not Licensed Compounds.

            (b) Expiration of the Term. Upon expiration of the Term, (i) the PTC
Program Compounds Option shall expire; (ii) rights to all PTC Program Compounds
that are not Licensed Compounds shall revert to PTC; (iii) the evaluation
license granted under Section 4.1 shall terminate with respect to the PTC
Program Compounds; and (iv) B&L shall disclose to PTC and permit PTC to use all
evaluation, screening, testing and formulation data and the like generated
pursuant to this Agreement relating to all PTC Program Compounds that are not
Licensed Compounds.

            (c) Termination. Upon termination of this Agreement under Sections
5.3 or 5.4, (i) each of the PTC Development Compounds Option and the PTC Program
Compounds Option shall expire; (ii) rights to all Evaluation Compounds that are
not Licensed Compounds shall revert to PTC; (iii) the evaluation license granted
under Section 4.1 shall terminate; and (iv) B&L shall disclose to PTC and permit
PTC to use all evaluation, screening, testing, formulation and similar data (but
not techniques, protocols or methodologies) generated pursuant to this Agreement
relating to all Evaluation Compounds that are not Licensed Compounds.

            (d) License upon Expiration or Termination. B&L shall, and hereby
does, grant to PTC a non-exclusive license, effective as of expiration or
termination of the applicable Term with respect to an Evaluation Compound that
is not a Licensed Compound, under all know-how and patent rights that are
conceived or first reduced to practice by B&L employees, agents and/or third
party contractors prior to such expiration or termination as a result of the
activities contemplated under this Agreement which know-how and patent rights
cover the Evaluation Compound or method of use of such Evaluation Compound in
the applicable Field,
<PAGE>
                                      -9-



with the right to sublicense, to make, have made, use, offer for sale, sell and
import such Evaluation Compound, and only the Evaluation Compound, in any
country of the world. At the request of PTC, B&L shall negotiate terms,
including the payment of fees and royalties, under which such non-exclusive
license may be converted to an exclusive license, subject to any non-exclusive
licenses that may have been granted by B&L to any third parties prior to such
request.

            (e) No Effect on Licensed Compounds. Neither termination nor
expiration of this Agreement shall terminate or otherwise affect licenses
granted with regard to Licensed Compounds prior to the date of such termination
or expiration, and all such licenses shall survive such termination or
expiration.

      5.6 Survival. Termination or expiration shall not relieve either party
from any obligations accrued as of the date of such termination or expiration.
The obligations of the parties under Sections 2.2, 4.3, 4.4, 4.5, 5.5, 5.6, 7,
8, 9, 10 and 11 shall survive termination or expiration of this Agreement.

6. Warranties, Representations and Covenants.

      6.1 Representations, Warranties and Covenants of Each Party.

            (a) Authority. Each party represents and warrants that it possesses
all right, title, interest and authority necessary to enter into this Agreement,
perform its obligations hereunder and grant the rights embodied herein and that
it is not aware of any legal impediment that would inhibit its ability to
perform its obligations under this Agreement.

            (b) No Conflicts. Each party represents and warrants to the other
that the execution, delivery and performance of this Agreement does not: (i)
conflict with, or constitute a breach of, any order, judgment, agreement or
instrument to which such party is a party or is otherwise bound; or (ii) require
the consent of any person or entity.

      6.2 Representations, Warranties and Covenants of PTC.

            (a) Compliance with Laws. PTC covenants, represents and warrants
that it shall comply with all Applicable Laws.

            (b) Third Party Intellectual Property. PTC represents and warrants
that to its knowledge as of the Effective Date there are no patent or other
intellectual property rights owned or controlled by any third party that would
be infringed by the Evaluation Compounds or B&L's exercise of the evaluation
license granted under Section 4.1 in accordance with this Agreement.

      6.3 Representations, Warranties and Covenants of B&L. B&L covenants,
represents and warrants that it shall comply with all Applicable Laws.
<PAGE>
                                      -10-

7. Indemnification.

      7.1 PTC Indemnification.

            (a) Indemnity. PTC shall indemnify, defend and hold harmless B&L and
its Affiliates, and their directors, officers, agents and employees
(collectively, the "B&L Indemnified Parties") from and against all claims,
demands, losses, liabilities, damages, costs and expenses (including reasonable
attorneys' fees and any costs of settlement) incurred by the B&L Indemnified
Parties resulting from or arising in connection with any claim, suit, action or
proceeding brought by a third party (a "Third Party Claim") against any such B&L
Indemnified Party based on:

                  (i) PTC's breach of any of PTC's covenants, representations or
warranties hereunder; or

                  (ii) any act or omission constituting recklessness, gross
negligence or willful misconduct on the part of PTC.

            (b) Limitations on PTC Indemnification. PTC shall have no obligation
to indemnify, defend or hold harmless the B&L Indemnified Parties in connection
with any Third Party Claim to the extent such Third Party Claim is covered by
B&L's obligations under Section 7.2, or arises from: (i) a B&L Indemnified
Party's breach of any of B&L's covenants, representations or warranties
hereunder; or (ii) any act or omission constituting recklessness, gross
negligence or willful misconduct on the part of any of the B&L Indemnified
Parties.

      7.2 B&L Indemnification.

            (a) Indemnity. B&L shall indemnify, defend and hold harmless PTC,
its Affiliates, and their directors, officers, agents and employees
(collectively, the "PTC Indemnified Parties") against all claims, demands,
losses, liabilities, damages, costs and expenses (including reasonable
attorneys' fees and any costs of settlement) incurred by the PTC Indemnified
Parties resulting from or arising in connection with a Third Party Claim brought
against any such PTC Indemnified Party based on:

                  (i) B&L's breach of any of B&L's covenants, representations or
warranties hereunder; or

                  (ii) any act or omission constituting recklessness, gross
negligence or willful misconduct on the part of B&L.

            (b) Limitations on B&L Indemnification. B&L shall have no obligation
to indemnify, defend or hold harmless the PTC Indemnified Parties in connection
with any Third Party Claim to the extent such Third Party Claim is covered by
PTC's obligations under Section 7.1, or arises from: (i) a PTC Indemnified
Party's breach of any of PTC's covenants, obligations, agreements,
representations or warranties hereunder; or (ii) any act or omission
constituting recklessness, gross negligence or willful misconduct on the part of
any of the PTC Indemnified Parties.
<PAGE>
                                      -11-




      7.3 Indemnification Procedure.

            (a) Notification and Cooperation. The party seeking indemnification
hereunder (the "Indemnified Party") shall: (i) promptly notify in writing the
party obligated to indemnify (the "Indemnifying Party") of any claim, action or
proceeding of a third party for which the Indemnified Party seeks
indemnification; and (ii) cooperate fully with the Indemnifying Party and its
legal representatives in the investigation of any such claim, action or
proceeding. The Indemnified Party's failure to comply with its obligations under
this Section shall not constitute a breach of this Agreement nor relieve the
Indemnifying Party of its indemnification obligations hereunder, except to the
extent, if any, that the Indemnifying Party's defense or settlement of the
affected claim, action or proceeding was actually and materially impaired
thereby.

            (b) Defense. The Indemnifying Party shall conduct, at its own
expense, the defense of any and all such claims, charges, suits or other actions
by a third party, and the Indemnified Party may, at its own expense, assist in
such defense if it so chooses, provided that the Indemnifying Party shall
control such defense and all negotiations relative to the settlement of any such
claim. Neither party shall settle or admit liability with respect to any such
claims, charges, suits or other actions which could result in liability to the
other party without the prior written consent of the other party, which consent
shall not be unreasonably withheld or delayed.

8. Limitation of Liability. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE
CONTRARY, NEITHER PTC NOR B&L, NOR THEIR RESPECTIVE AFFILIATES, DIRECTORS,
OFFICERS, EMPLOYEES OR AGENTS, SHALL HAVE ANY LIABILITY TO THE OTHER FOR ANY
SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, IN CONNECTION WITH OR
ARISING OUT OF THIS AGREEMENT, EVEN IF SUCH DAMAGES WERE FORESEEABLE, EXCEPT TO
THE EXTENT SUCH DAMAGES ARE OWED TO A THIRD PARTY BY A PARTY ENTITLED TO
INDEMNIFICATION UNDER THIS AGREEMENT AND EXCEPT FOR ANY DAMAGES ARISING FROM
BREACH OF A PARTY'S CONFIDENTIALITY OBLIGATIONS UNDER THIS AGREEMENT.

9. Confidentiality.

      9.1 Nondisclosure and Nonuse Obligations. During the Term, and thereafter
after expiration or termination hereof, each party will maintain all
Confidential Information of the other party in trust and confidence and will not
disclose any Confidential Information of the other party to any third party or
use any Confidential Information of the other party except to the extent
required to enjoy its rights or comply with its obligations under this
Agreement. Confidential Information shall be disclosed only to employees,
agents, Affiliates and consultants who have a need for such information and who
are bound by obligations of nondisclosure and non-use at least as restrictive as
those set forth herein. Each party shall be responsible for any disclosure or
use of the Confidential Information by such employees, agents, Affiliates and
consultants. Each party shall protect the other party's Confidential Information
using not less than the same standard of care with which it treats its own
Confidential Information, but at all times shall use at least reasonable care.


<PAGE>
                                      -12-


      9.2 Exceptions. Confidential Information shall not include any information
which:

            (a) is now, or lawfully becomes, generally known or available to the
public through no fault of the recipient;

            (b) is known by the receiving party at the time of receiving such
information;

            (c) is hereafter lawfully furnished to the receiving party by a
third party, as a matter of right and without restriction on disclosure;

            (d) is independently developed by the receiving party without any
breach of this Section as evidenced by its written records; or

            (e) is the subject of a written permission to disclose provided by
the disclosing party.

      9.3 Authorized Disclosure. Notwithstanding any other provision of this
Agreement, each party may disclose Confidential Information of the other party
if such disclosure is required: (i) by an order of a court or other governmental
body, or any political subdivision thereof or arbitral panel with jurisdiction
over the disclosing party; or (ii) by law or regulation (including, without
limitation, to comply with any applicable securities regulation, stock exchange
or NASDAQ disclosure requirements), but only to the extent that any such
disclosure is reasonably necessary. With respect to any order of a court or
other governmental body, the disclosing party shall, if practicable, first have
given written notice to the other party hereto and shall use reasonable efforts
to limit the scope and content of such disclosure to the required scope and
content. With respect to disclosure required by Applicable Laws or regulations
(including, without limitation, any applicable securities regulation, stock
exchange or NASDAQ disclosure requirements), the disclosing party shall, if
practicable, first give written notice to the other party hereto and allow the
other party a reasonable opportunity to comment on the content of such
disclosure and shall consult with the other party with respect to the comments
of such other party.

      9.4 Obligations at End of Term. Each party agrees, at the request of the
other party, upon expiration or termination of this Agreement to either: (i)
return to the other party all originals and copies of the other party's
Confidential Information; or (ii) at the other party's option, destroy all
originals and copies of the other party's Confidential Information and to
certify in writing such destruction to the other party; provided, however that
(a) the receiving party may keep one copy of the other party's Confidential
Information in a secure location, solely for purposes of enforcing and
determining such party's rights and obligations under this Agreement; (b) PTC
shall have no obligation to return or destroy any copies embodying the B&L
Improvements or the Joint Improvements; and (c) B&L shall have no obligation to
return or destroy any Applicable Know-How relating to any Licensed Compounds or
the Joint Improvements.

      9.5 Injunctive Relief. The parties agree that any breach of the
restrictions contained in this Section or Section 4.6 will cause irreparable
harm to the non-breaching party entitling the non-breaching party to injunctive
or other preliminary relief in addition to all other legal remedies.
<PAGE>

                                      -13-

10. Publicity. All publicity, press releases and other announcements regarding
this Agreement or the transactions contemplated hereby shall be reviewed in
advance by, and subject to the written approval of, both parties.
Notwithstanding the foregoing, either party may, without the written consent of
the other, disclose the terms of this Agreement insofar as reasonably required
to comply with applicable securities laws (including, without limitation, any
applicable stock exchange or NASDAQ disclosure requirements); provided, however,
that where practicable the disclosing party shall provide advance notice and a
reasonable opportunity to the other party to provide comments regarding any
confidential treatment or similar request. The disclosing party shall if
practicable reasonably consider any such comments from the other party. In
addition, each party shall have the right to disclose, under obligations of
confidentiality and as reasonably required, the terms of this Agreement to
potential acquirers, investors, lenders, licensees, sublicensees, contractors
and other third parties in connection with acquisition, financing, product
development or commercialization activities.

11. Miscellaneous.

         11.1 Bankruptcy. All licenses granted under this Agreement by PTC to
B&L, for all purposes of Section 365(n) of Title XI of the United States Code
("Title XI"), are licenses of rights to "intellectual property" as defined in
Title XI. If PTC seeks or involuntarily is placed under Title XI and the trustee
rejects this Agreement as contemplated under 11 U.S.C. 365(n)(1), B&L hereby
elects pursuant to Section 365(n) to retain all rights granted to B&L under this
Agreement to the extent permitted by law.

         11.2 Relationship of the Parties. Nothing in this Agreement shall be
deemed to create any contract or relationship of employment between B&L and PTC
or any personnel of PTC. PTC shall be responsible for all federal, state and
local laws pertaining to income taxes, withholding taxes, Social Security,
unemployment compensation, worker's compensation and any other rights, benefits,
or obligations relating to such personnel.

         11.3 Notices. All notices required or permitted hereunder must be given
in writing and mailed postage prepaid, certified or registered mail, return
receipt requested, or sent by a nationally recognized express courier service,
or hand-delivered at the following addresses:

         To PTC:           PTC Therapeutics, Inc.
                           100 Corporate Court
                           South Plainfield, New Jersey 07080-2449
                           Attn.: Legal Dep't

         Email copy to: legal@ptcbio.com

         To B&L:           Bausch & Lomb Incorporated
                           One Bausch & Lomb Place
                           Rochester, New York  14604-2701
                           Attn.: Senior Vice President - Research and
                                  Development and Chief Scientific Officer

<PAGE>

                                      -14-

         Copy to:          Bausch & Lomb Incorporated
                           One Bausch & Lomb Place
                           Rochester, New York  14604-2701
                           Attn.: Senior Vice President and General Counsel

         All notices shall be deemed made upon receipt by the addressee as
evidenced by the applicable written receipt.

         11.4 Captions and Section References. The titles, headings or captions
in this Agreement do not define, limit, extend, explain or describe the scope or
extent of this Agreement or any of its terms or conditions and therefore shall
not be considered in the interpretations, construction or application of this
Agreement.

         11.5 Severability. If any term or provision of this Agreement shall be
found to be invalid, illegal or otherwise unenforceable, such finding shall not
affect the other terms or provisions of this Agreement, or the whole of this
Agreement, but such term or provision shall be deemed modified to the extent
necessary to render such term or provision enforceable, and the rights and
obligations of the parties shall be construed and enforced accordingly,
preserving to the fullest permissible extent the intent and agreements of the
parties set forth in this Agreement.

         11.6 Amendment. No amendment, change or modification of any of the
terms, provisions or conditions of this Agreement shall be effective unless made
in a writing that expressly references this Agreement and is signed on behalf of
the parties hereto by their duly authorized representatives.

         11.7 Waiver. No waiver of any term, provision or condition of this
Agreement, whether by conduct or otherwise, in any one or more instances, shall
be deemed to be or construed as a further or continuing waiver of any such or
other term, provision or condition of this Agreement.

         11.8 Force Majeure. Neither party shall be liable hereunder to the
other party nor shall be in breach for failure to perform its obligations caused
by circumstances beyond the control of either party, including, but not limited
to: acts of nature; fires; earthquakes; floods; riots; wars; civil disturbances;
sabotage; accidents; shortages or government actions. In the case of any such
event, the affected party shall promptly notify the other party, and shall keep
the other party informed of the event in writing specifying the extent to which
its performance will likely be affected. The party affected shall exert
reasonable diligent efforts to eliminate, cure or overcome any such cause and
resume performance as soon as practicable.

         11.9 Benefits and Binding Nature of Agreement. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns permitted under this Agreement.

         11.10 Assignment; Change in Control. The rights under this Agreement
may not be assigned by either party (the "Assigning Party") without the written
consent of the other party (the "Non-Assigning Party") except (i) to any
Affiliate of the Assigning Party or (ii) to any party

<PAGE>

                                      -15-

which acquires substantially all of the assets and business of the Assigning
Party to which this Agreement relates.

         11.11 Entire Agreement. This Agreement, including the Exhibits attached
hereto, sets forth the entire agreement between the parties hereto pertaining to
the subject matter hereof and supersedes all negotiations, preliminary
agreements, memoranda or letters of proposal or intent, discussions and
understandings of the parties hereto in connection with the subject matter
hereof.

         11.12 Governing Law and Forum. This Agreement and all claims related to
it, its execution or the performance of the parties under it, shall be construed
and governed in all respects according to the laws of the State of New York. The
parties agree that all actions or proceedings arising in connection with this
Agreement shall be tried and litigated exclusively in the courts located in the
Borough of Manhattan, New York, New York. This choice of venue is intended by
the parties to be mandatory and not permissive in nature, and to preclude the
possibility of litigation between the parties with respect to, or arising out
of, this Agreement in any jurisdiction other than that specified in this
Section. Each party waives any right it may have to assert the doctrine of forum
non-conveniens or similar doctrine or to object to venue with respect to any
proceeding brought in accordance with this Section.

         11.13 Counterparts. This Agreement may be executed in counterparts. For
purposes hereof, a facsimile copy of this Agreement, including the signature
page hereto, shall be deemed to be an original. Notwithstanding the foregoing,
the parties shall deliver original execution copies of this Agreement to one
another as soon as practicable following execution thereof.

         [The remainder of this page is left intentionally blank. Signature page
follows.]

<PAGE>

                                      -16-

         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the day and year first above written.

BAUSCH & LOMB INCORPORATED                     PTC THERAPEUTICS, INC.

By: /s/ STEPHEN C. McCLUSKI                    By: /s/ MARK E. BOULDING
   -----------------------------                  -----------------------------

Name: Stephen C. McClusky                      Name: Mark E. Boulding

Title: Senior Vice President and CFO           Title: SVB, Business Development
                                                      and Legal

<PAGE>

                                    EXHIBIT A
                                       TO
                             RESEARCH COLLABORATION
                         AND EXCLUSIVE OPTION AGREEMENT

                          LIST OF EVALUATION COMPOUNDS

Exhibit A-1 (PTC Program Compounds):  [attached]
Exhibit A-2 (PTC Development Compounds):  [attached]

<PAGE>


EXHIBIT A-1 (PTC PROGRAM COMPOUNDS)

Note: These aliases were assigned using PTC MTA reference code [**]

[**]
[**]
[**]
[**]

<PAGE>

EXHIBIT A-2 (PTC DEVELOPMENT COMPOUNDS)

Note: These aliases were assigned using PTC MTA reference code [**]

[**]
[**]
























                                      -1-
<PAGE>

                                    EXHIBIT B
                                       TO
                             RESEARCH COLLABORATION
                         AND EXCLUSIVE OPTION AGREEMENT

                                LICENSE AGREEMENT

         This License Agreement ("Agreement") is entered into as of [INSERT DATE
OF EXERCISE OF THE OPTION] by and between Bausch & Lomb Incorporated, a New York
corporation with a place of business at One Bausch & Lomb Place, Rochester, New
York 14604-2701 ("B&L") and PTC Therapeutics, Inc., a Delaware corporation with
a place of business at 100 Corporate Court, South Plainfield, New Jersey
07080-2449 ("PTC") and shall be effective as of the HSR Clearance Date or, if no
filing is to be made under the HSR Act, then it shall be effective on the date
set forth above (in either case, the "Effective Date").

                                    RECITALS

         WHEREAS, B&L and PTC have entered into a Research Collaboration and
Exclusive Option Agreement dated as of December 1, 2005 under which B&L is
granted the exclusive right to evaluate certain compounds in the possession of
PTC for the purpose of identifying potential candidates for development by B&L
for the treatment, diagnosis and/or prevention of diseases of the eye (the
"Research Collaboration and Exclusive Option Agreement");

         WHEREAS, under the terms of the Research Collaboration and Exclusive
Option Agreement, B&L was granted an exclusive option to license one or more
such compounds selected by B&L for use in the treatment, diagnosis and/or
prevention of diseases of the eye; and

         WHEREAS, B&L has exercised such option with regard to the Licensed
Compound (as defined below) and PTC desires to grant to B&L, and B&L wishes to
acquire from PTC, an exclusive worldwide right and license to such Licensed
Compound in accordance with the terms and conditions of this Agreement.

         NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants contained herein, PTC and B&L hereby agree as follows:

1. Definitions. In addition to any terms defined elsewhere in this Agreement,
the following terms shall have the meanings set forth below.

         1.1 "Affiliate" means any corporation, association or other entity,
which directly or indirectly controls, is controlled by or is under common
control with the party in question. Solely for purposes of this definition the
term "control" means direct or indirect beneficial ownership of more than 50% of
the voting stock in such corporation or other business entity, or such other
relationship as in fact constitutes actual control.

         1.2 "Annual Net Sales" means worldwide Net Sales actually invoiced
during a Fiscal Year, or portion thereof, during the term of this Agreement.

<PAGE>

         1.3 "Applicable Laws" means all laws, ordinances, rules and regulations
applicable to this Agreement or the activities contemplated hereunder, including
without limitation the U.S. Federal Food, Drug, and Cosmetic Act, as amended.

         1.4 "B&L Improvement" means any new compound that is conceived or first
reduced to practice by B&L employees, agents and/or third party contractors
during the term of this Agreement, including all patent and other intellectual
property rights thereto Controlled by B&L, but only to the extent the foregoing
covers a compound that is a chemical modification of a Licensed Compound.

         1.5 "Commercially Reasonable Efforts" means the efforts and resources
normally used by an established pharmaceutical company for a pharmaceutical
product owned exclusively by such company (i.e., without any royalty or similar
obligation to another person or entity in respect of development or
commercialization of such product) with a similar market potential at a similar
stage in its development or commercialization, taking into account the
competitiveness of the marketplace, its proprietary position with respect to
such product, applicable regulatory circumstances, the profitability of such
product, the likelihood of success of commercialization, and other relevant
factors. Commercially Reasonable Efforts shall be deemed to have not occurred if
B&L, an Affiliate of B&L or sublicensee of B&L has not, within three (3) years
following the Effective Date, submitted an IND for a Licensed Product, commenced
human clinical trials for a Licensed Product, received Registration Approval for
a Licensed Product or made a commercial sale of a Licensed Product in a Major
Territory.

         1.6 "Confidential Information" means any information communicated by
one party hereto to the other, which is identified as proprietary or
confidential by the disclosing party, or which would be reasonably understood to
be the type of information which should be treated as proprietary or
confidential. All reports provided by B&L to PTC under this Agreement shall be
deemed Confidential Information of B&L no matter how marked or disclosed.

         1.7 "Controlled" means, with respect to any know-how or intellectual
property right, possession by a party, directly or through an Affiliate
controlled by such party, of the ability to grant the right to access or use, or
to grant a license or a sublicense to, such know-how or intellectual property
right as provided for herein under which such rights to access or use are
obtained.

         1.8 "FDA" means the United States Food and Drug Administration.

         1.9 "Field" means the treatment, diagnosis or prevention of diseases of
the eye.

         1.10 "Fiscal Quarter" means B&L's fiscal quarters which are based on
the Fiscal Year and are published annually by B&L's Corporate Finance
Department.

         1.11 "Fiscal Year" means the fiscal year of B&L, which is the 52 or 53
week period ending on the last Saturday in December of each calendar year.

         1.12 "HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended (15 U.S.C. Sec. 18a), and the rules and regulations
promulgated thereunder.

                                        2

<PAGE>

         1.13 "HSR Clearance Date" means the earlier of (a) the date on which
the FTC or DOJ shall notify PTC and B&L of early termination of the applicable
waiting period under the HSR Act or (b) the day after the date on which the
applicable waiting period under the HSR Act expires.

         1.14 "IND" means an Investigational New Drug Application filed by B&L
with the FDA or any comparable application filed with a Regulatory Authority of
a country other than the United States as may be required as a legal
prerequisite to the commencement of human clinical trials of the Licensed
Compound.

         1.15 "Licensed Compound" means the compound known as [INSERT NAME OF
LICENSED COMPOUND], as further described on Schedule 1.14, and equivalents
thereof, including, but not limited to, analogs, homologs, derivatives,
variants, conjugates, tautomers, isomers and prodrugs thereof, but expressly
excluding the PTC Development Compounds (as defined in the Research
Collaboration and Exclusive Option Agreement).

         1.16 "Licensed Know-How" means any technical information, including all
biological, chemical, pharmacological, toxicological, clinical and assay
information, data, discoveries, inventions, improvements, know-how, materials,
processes, formulae and trade secrets, whether patentable or unpatentable (but
not patented), that at any time during the term of this Agreement prior to the
first commercial sale in a Major Territory of a Licensed Product by B&L, or an
Affiliate or sublicensee of B&L, are Controlled by PTC, and that relate to the
Licensed Compound in the Field.

         1.17 "Licensed Patents" means (a) all U.S. and international patents
and U.S. and international patent applications that at any time during the term
of this Agreement prior to the first commercial sale in a Major Territory of a
Licensed Product by B&L, or an Affiliate or sublicensee of B&L, are Controlled
by PTC, the claims of which may be infringed, absent a license, by the
manufacture, use, sale, offer for sale or importation of the Licensed Compound
in the Field, (b) all continuations, divisionals, substitutions, extensions,
reissues and reexaminations thereof and, solely to the extent entirely supported
by any of the foregoing, claims in continuations-in-part thereof, and (c)
patents resulting from the foregoing.

         1.18 "Licensed Product" means any prophylactic, diagnostic or
therapeutic product composed of or including a Licensed Compound.

         1.19 "Major Territory" means each of (i) the United States, (ii) Japan,
and (iii) at least three of the following: France, the United Kingdom, Germany,
Italy, and Spain.

         1.20 "NDA" means a New Drug Application or similar application or
submission filed with a Regulatory Authority of a country or group of countries
by B&L or an Affiliate of B&L, approval of which by such Regulatory Authority
would constitute Registration Approval.

         1.21 "Net Sales" means the gross invoice price of Licensed Products
sold or commercially disposed of for value by B&L or an Affiliate or sublicensee
of B&L in an arm's length transaction with a third party (other than an
Affiliate or sublicensee of B&L), less the following:

                                       3

<PAGE>

         (a) discounts, charge backs, Medicare or other government rebates, and
         rebates taken or allowed;

         (b) credits or allowances given or made for rejections or return of any
         previously sold Licensed Product taken or allowed;

         (c) to the extent included in such gross invoice price any tax or
         government charge imposed on the production, import, export, sale,
         delivery or use of such Licensed Product, including, without
         limitation, any value added or similar tax or government charge, but
         not including any tax levied with respect to income; and

         (d) to the extent included in such gross invoice price any reasonable
         and documented packaging and shipping charges.

         Notwithstanding any other provision of this Section, Net Sales shall
not include the transfer:

         (i) without consideration of any Licensed Product for use in any
         clinical trial or in any pre-clinical or other research;

         (ii) without consideration of any Licensed Product as samples or other
         use to promote additional Net Sales in commercially reasonable amounts
         consistent with the normal business practices of B&L; or

         (iii) without consideration of any Licensed Product for compassionate
         use.

         Such adjustments shall be consistent with customary accounting
practices within B&L and in accordance with U.S. Generally Accepted Accounting
Principles ("GAAP"), consistently applied.

         If a Licensed Product is sold in the form of a combination product
containing one or more active ingredients that are themselves not the Licensed
Product (a "Combination Product"), then for the purpose of calculating royalties
owed on sales of the Combination Product, Net Sales shall be calculated as
follows: first, B&L shall determine the actual Net Sales of such Combination
Product (calculated using the above described deductions) and then such amount
shall be multiplied by the fraction A/(A+B), where A is the invoice price of the
actual Licensed Product component of such Combination Product, and B is the
total invoice price of the other active ingredient component(s) of such
Combination Product. If the invoice price of either the Licensed Product or the
other active ingredient component(s) of such Combination Product cannot be
determined, Net Sales of such Combination Product shall be equitably determined
by an independent third party selected by mutual agreement of the parties.

         1.22 "New Active Ingredient" means a chemically modified Licensed
Compound which is neither (i) [**] or efficacy of the first Licensed Compound,
nor (ii) a regulatory equivalent of the first Licensed Compound, such as those
delineated in 37 C.F.R. Section 1.710(b)(1).

                                       4

<PAGE>

         1.23 "Phase I Clinical Trial" means an initial human clinical trial of
the Licensed Compound conducted by B&L or an Affiliate or sublicensee of B&L in
order to initially study the safety, absorption, distribution, metabolism and/or
excretion of the Licensed Compound.

         1.24 "Phase II Clinical Trial" means a human clinical trial of the
Licensed Compound that is conducted by B&L or an Affiliate or sublicensee of B&L
in order to initially study the efficacy of the Licensed Compound for a specific
indication within the Field, which trial follows a Phase I Clinical Trial.

         1.25 "Pivotal Clinical Trial" means a pivotal human clinical trial of
the Licensed Compound that is conducted by B&L or an Affiliate of B&L in an
extended patient population intended to support the filing of an NDA for such
Licensed Compound within the Field.

         1.26 "Registration Approval" means, with respect to any country or
group of countries, all approvals by the appropriate Regulatory Authority
necessary to permit commercial marketing and sales of the Licensed Product in
the Field in such country or group of countries.

         1.27 "Regulatory Authority" means the FDA in the United States or the
equivalent of the FDA in any country other than the United States, or a
successor agency to the foregoing in a given country.

         1.28 "Successful Completion" means that the applicable Phase I Clinical
Trial, Phase II Clinical Trial, or Pivotal Clinical Trial has been completed in
essential accordance with the protocol for the trial and sufficient data have
been obtained that satisfy the objectives and clinical endpoints specified in
the protocol. With respect to a specific trial, "Successful Completion" shall be
deemed to have occurred upon the subsequent commencement of any other trial that
has objectives and/or clinical endpoints that are more advanced than those set
forth in the protocol for the completed trial.

         1.29 "Valid Claim" means any claim covering the Licensed Compound (i)
of an issued and unexpired patent within the Licensed Patents, which has not
lapsed, been revoked or abandoned or held permanently unenforceable or invalid
by a decision of a court or other governmental agency of competent jurisdiction,
or (ii) of a patent application within the Licensed Patents that has been
pending for no more than seven years, or (iii) of an issued and unexpired patent
within the B&L Improvements, which has not lapsed, been revoked or abandoned or
held permanently unenforceable or invalid by a decision of a court or other
governmental agency of competent jurisdiction, or (iv) of a patent application
within the B&L Improvements that has been pending for no more than seven years.
For the purpose of clarity, patent and patent applications within the B&L
Improvements may be owned by B&L.

2. License Grant.

         2.1 Grant. PTC hereby grants to B&L, and B&L hereby accepts, an
exclusive, worldwide license, with the right to sublicense, under the Licensed
Know-How and Licensed Patents to develop, make, have made, use, sell, offer for
sale, promote and import Licensed Products, solely in the Field.

                                       5

<PAGE>

         2.2 Sublicenses. B&L shall have the exclusive right to grant
sublicenses under the license granted under Section 2.1 without the prior
written approval of PTC, provided, however, that any such sublicense shall be
subject in all respects to the restrictions, exceptions, royalty obligations,
reports, termination provisions, development and commercialization diligence
obligations, and other provisions contained in this Agreement. B&L shall pay
PTC, or cause its Affiliates or sublicensees to pay PTC, royalties, as set forth
in Section 3.2, on Net Sales of such Affiliates or sublicensees as if such Net
Sales had been made by B&L. Each Affiliate and sublicensee shall report its Net
Sales to PTC through B&L, which Net Sales shall be aggregated with any Net Sales
of B&L for purposes of determining the Net Sales upon which royalties are to be
paid to PTC. B&L and its Affiliates shall have the right to appoint resellers
and distributors for the sale and distribution of the Licensed Product in the
Field and B&L shall have the right to appoint third parties to promote or
co-promote the Licensed Product in the Field subject to the terms of this
Agreement, all without the consent of PTC.

         2.3 Technology Transfer; Adverse Events. Upon execution of this
Agreement and thereafter within [**] following request by B&L (provided that
such requests may occur no more often than once [**]) until the first commercial
sale in a Major Territory of a Licensed Product by B&L, PTC shall provide to B&L
any update to the information provided by PTC to B&L pursuant to Section 2.1 of
the Research Collaboration and Exclusive Option Agreement that is then known to
PTC with respect to the Licensed Compound. In addition, each party shall
promptly disclose to the other all safety information, technical complaints and
adverse events regarding the Licensed Compound and any products containing such
Licensed Compound in accordance with customary procedures for sharing such
information between two entities in the pharmaceutical industry that each have
obligations to report and/or act on such information.

         2.4 License to B&L Improvements. B&L hereby grants to PTC, and PTC
hereby accepts, a non-exclusive, royalty-free, worldwide license, with the right
to sublicense, to B&L Improvements for use outside of the Field. At the request
of PTC, B&L shall negotiate terms, including the payment of fees and royalties,
under which such non-exclusive licenses may be converted to exclusive licenses.

3. Consideration.

         3.1 Milestone Payments. B&L shall pay to PTC the following payments
within thirty (30) days following the occurrence of each milestone event:

<TABLE>
<CAPTION>
   NO.                MILESTONE EVENT          PAYMENT
<S>         <C>                                <C>
    1       [**]                                $[**]
    2       [**]                                $[**]
    3       [**]                                $[**]
    4       [**]                                $[**]
    5       [**]                                $[**]
    6       [**]                                $[**]
</TABLE>

                                       6

<PAGE>


<TABLE>
<S>         <C>                                 <C>
    7       [**]                                $[**]
    8       [**]                                $[**]
    9       [**]                                $[**]
</TABLE>

In the event that any milestone event in the table above does not occur but then
a subsequent milestone event in the table above does occur with respect to a
Licensed Compound or Licensed Product, the milestone payment for the missed
milestone event shall become payable concurrently with the milestone payment for
the subsequently occurring milestone event, provided, however, that milestone
number 6 and milestone number 7 shall not be payable unless they have actually
occurred, milestone number 8 shall not be payable unless milestone number 6 has
first occurred and milestone number 9 shall not be payable unless milestone
number 7 has first occurred.

         3.2 Royalties. B&L shall pay to PTC a royalty on Net Sales as follows:

                  (a) [**]% of that portion of Annual Net Sales that is less
than or equal to $[**];

                  (b) [**]% of that portion of Annual Net Sales that exceeds
$[**] but is less than or equal to $[**];

                  (c) [**]% of that portion of Annual Net Sales that exceeds
$[**] but is less than or equal to $[**]; and

                  (d) [**]% of that portion of Annual Net Sales that exceeds
$[**].

         No more than one royalty payment shall be made with respect to any unit
of a Licensed Product.

         3.3 Lump Sum Payment. In addition, B&L shall pay to PTC a lump sum (one
time) payment of $[**] within [**] following the end of the first Fiscal Year in
which Annual Net Sales equals or exceeds $[**].

         3.4 Quarterly Reporting and Payment. Within [**] following the end of
each Fiscal Quarter during the term of this Agreement, B&L shall (a) calculate
and report to PTC (i) the number of units of each Licensed Product sold during
such Fiscal Quarter; (ii) B&L's calculation, based upon the books and records of
B&L, of Net Sales during such Fiscal Quarter, including an itemization of gross
amounts invoiced and amounts deducted in the calculation of such Net Sales; and
(iii) B&L's calculation of amounts owed to PTC under Section 3.2 and Section 3.3
(if applicable) for such Fiscal Quarter, taking into account the cumulative Net
Sales for any preceding Fiscal Quarters for the Fiscal Year in which such Fiscal
Quarter falls; and (b) pay to PTC the amounts owed to PTC under Section 3.2 and
Section 3.3 for such Fiscal Quarter.

         3.5 Post-Termination Report. Within [**] days following any termination
of this Agreement, B&L shall (a) calculate and report to PTC (i) the number of
units of each Licensed Product sold prior to such termination and not previously
reported; (ii) B&L's calculation, based

                                       7

<PAGE>

upon the books and records of B&L, of Net Sales for any portion of a Fiscal
Quarter prior to such termination not previously reported, including an
itemization of gross amounts invoiced and amounts deducted in the calculation of
such Net Sales; and (iii) B&L's calculation of amounts owed to PTC under Section
3.2 and Section 3.3 (if applicable) for such portion of a Fiscal Quarter prior
to such termination; and (b) pay to PTC the amounts owed to PTC under Section
3.2 and Section 3.3 (if applicable) for such period following termination and
not yet paid.

         3.6 Offsets for Adverse Patents. Should B&L determine in its reasonable
discretion that in order to commercialize a Licensed Product it is necessary to
obtain rights under one or more patents or patent applications owned or
controlled by one or more third parties and that cover the Licensed Compound or
its manufacture, use, sale, offering for sale or importation in the Field, then
B&L shall be entitled to negotiate and enter into agreements with such third
parties and [**]% of any amounts payable with respect to the Licensed Compound
by B&L under such agreements shall be credited against royalties payable by B&L
to PTC, with respect to Net Sales in the country(-ies) for which such third
party agreements are necessary, under Section 3.2 of this Agreement, provided,
however, that such amounts credited shall not exceed [**] percent ([**]%) of
amounts otherwise due to PTC in any Fiscal Quarter with respect to Net Sales in
any country(-ies) for which such third party agreements are necessary.

         3.7 Reduction in Royalty Rate in Response to Generic Competition.
Notwithstanding the foregoing Section 3.2, on a Fiscal Quarter-by-Fiscal Quarter
basis and a country-by-country basis, in any country where there is a Competing
Product (as defined below) sold in such country and (a) there exists no Valid
Claim, or (b) after consultation with each other, PTC and B&L elect not to
pursue individually or jointly action seeking to stop the sale of such Competing
Product in such country, or (c) B&L and/or its Affiliates and/or sublicensees
are not entitled to bring or able to initiate an action (whether in their own
name or in the name of PTC) to, or otherwise able to, stop any person from
selling a Competing Product in such country, the royalty payable under Section
3.2 (after giving effect to any reduction under Section 3.6) on Net Sales in
such country shall be reduced (i) to [**] percent ([**]%) of the otherwise
applicable royalty if the aggregate sales of Competing Products in such country
exceed [**] percent ([**]%) but are less than [**] percent ([**]%) of the total
market for sales of products in the same ophthalmic therapeutic class and of the
same type in such country, and (ii) to [**] percent ([**]%) of the otherwise
applicable royalty if the aggregate sales of Competing Products in such country
exceed [**] percent ([**]%) in the same ophthalmic therapeutic class and of the
same type in such country. For purposes of this provision, "Competing Product"
shall mean any product that incorporates the Licensed Compound.

         3.8 Determination of Otherwise Applicable Royalty for Purposes of
Reduction Pursuant to Section 3.6 or 3.7. For any Fiscal Quarter in which (a)
B&L's aggregate royalty obligation under Section 3.2 would, before any offset or
reduction pursuant to Section 3.6 or 3.7, be calculated based on two or more
applicable royalty rates pursuant to Section 3.2 and (b) an offset or reduction
pursuant to Section 3.6 or 3.7 is applicable with respect to any country, the
royalty payable on Net Sales in such country during such Fiscal Quarter, before
any offset or reduction pursuant to Section 3.6 or 3.7, shall be determined by
applying the royalty rate brackets to Net Sales in such country in the same
proportion as the royalty rate brackets are applied to worldwide Net Sales
during such Fiscal Quarter. By way of example, if, before any offset or
reduction pursuant to Section 3.6 or 3.7, the royalty rate applicable to [**]%
of

                                       8

<PAGE>

worldwide Net Sales during such Fiscal Quarter is [**]%, and the royalty rate
applicable to [**]% of worldwide Net Sales during such Fiscal Quarter is [**]%,
then the royalty rate applicable to [**]% of Net Sales in such country during
such Fiscal Quarter shall be deemed [**]%, and the royalty rate applicable to
[**]% of Net Sales in such country during such Fiscal Quarter shall be deemed
[**]%.

         3.9 Records and Audit Rights. B&L shall, in accordance with GAAP, keep
full and accurate books and records with respect to the amounts payable
hereunder for no less than three (3) calendar years after the end of the Fiscal
Year in respect of which payment is to be made hereunder. B&L shall permit PTC
to have such books and records examined by certified public accountants retained
by PTC and reasonably acceptable to B&L, during regular business hours and upon
reasonable advance written notice, but not later than three (3) calendar years
following the rendering of any reports, accounting and payments under this
Agreement and no more often than one (1) time per Fiscal Year. Such accountants
shall keep confidential any information obtained during such examination and
shall report only the amounts which the accountants believe to be due and
payable hereunder. Any such information so reviewed and any such information
reported shall be considered the Confidential Information of B&L. If the audit
discloses an underpayment, B&L shall promptly remit to PTC any shortfall. If the
audit discloses an underpayment that is in excess of 10% of the total amount due
to PTC for any Fiscal Quarter, B&L shall pay PTC's reasonable out-of-pocket
costs of the audit.

         3.10 Currencies. Payments under this Agreement shall be made in United
States dollars. Net Sales data for each country shall be converted into United
States dollars using the applicable monthly exchange rate for converting such
local currency to United States dollars in accordance with B&L's worldwide
accounting systems.

         3.11 Taxes. B&L may withhold the appropriate tax from any payment to be
made to PTC under this Agreement provided that such withholding is required by
Applicable Laws and B&L submits the amounts withheld to the applicable tax
authorities. In such event B&L shall furnish PTC with proof of payment of such
tax together with official or other appropriate evidence issued by the
applicable government authority. B&L and PTC shall cooperate to take advantage
of any applicable tax treaties pursuant to which the withholding of taxes can be
legally avoided or minimized.

         3.12 Duration of Royalty Obligations. The obligation of B&L to pay
royalties under this Section 3 shall terminate on a country-by-country basis on
the later of (i) the date on which there exists no Valid Claim in such country,
or (ii) ten (10) years after the first commercial sale for monetary value for
use or consumption by the general public of the Licensed Product by B&L or any
of its Affiliates or sublicensees in such country following Registration
Approval for the Licensed Product in such country. Following termination of
B&L's obligation to pay royalties in a country pursuant to this Section 3.12,
the license and rights granted to B&L hereunder with respect to such country
shall become non-exclusive, fully paid-up, royalty-free, irrevocable and
perpetual.

4. Obligations of B&L.

                                       9

<PAGE>

         4.1 Control and Cooperation. B&L shall, at its own expense, solely
control and be solely responsible for developing, manufacturing, registering and
commercializing the Licensed Compound. All registration filings will be made in
the name of B&L and shall be held by B&L. PTC shall cooperate, at B&L's expense
(as mutually agreed by the parties in connection with any request by B&L for
such assistance), to the extent reasonably necessary to assist B&L in such
filings, in obtaining Registration Approvals and in complying with all ongoing
regulatory requirements including analysis of technical complaints and adverse
events.

         4.2 Diligence. B&L shall use Commercially Reasonable Efforts to develop
a Licensed Product, and to obtain Registration Approval for and market a
Licensed Product in all Major Territories.

         4.3 Joint Development Committee.

                  (a) Formation. Within sixty (60) days following the Effective
Date, the parties shall form a committee (the "Joint Development Committee")
comprising at least two representatives from each party of appropriate
backgrounds and level.

                  (b) Responsibilities. The Joint Development Committee will be
responsible for (i) reviewing and providing consultation regarding B&L's plans
and progress in developing, manufacturing, registering and commercializing a
Licensed Product and (ii) discussing other matters related to this Agreement
referred to it by either party. Each party's representatives to the Joint
Development Committee shall communicate with one another as necessary to perform
the parties' respective obligations hereunder. B&L's representatives shall (a)
provide to PTC's representatives quarterly written reports regarding the status
of B&L's efforts in developing, manufacturing, registering and commercializing
the Licensed Compound, including information regarding clinical planning and the
progress of any clinical trials; (b) permit PTC's representatives to be present
during clinical trial investigator calls and meetings; (c) permit PTC's
representatives to review development and clinical data, minutes of project team
meetings and regulatory correspondence (including drafts of material regulatory
correspondence to be sent by B&L to Regulatory Authorities reasonably in advance
of submission); and (d) provide PTC's representatives with access to such other
information regarding B&L's plans and progress in developing, manufacturing,
registering and commercializing a Licensed Product as PTC's representatives
shall reasonably request.

                  (c) Meetings. The Joint Development Committee shall hold its
first meeting in person within ninety (90) days following the Effective Date.
Thereafter, the Joint Development Committee will meet on a quarterly basis
either in person or by telephone at mutually acceptable times and locations. At
each meeting, each party may bring one or more additional advisors, experts or
vendors to participate in the meeting, provided that each such advisor, expert
or vendor signs an appropriate nondisclosure agreement prohibiting disclosure of
Confidential Information acquired in connection with such participation.

                  (d) Disagreements. Any matter of disagreement related to
development, manufacture, registration and commercializing of the Licensed
Compound shall be referred to a designated senior executive of each party for
resolution. [**] any matter of disagreement that is not resolved by such
referral if such senior executives are unable to resolve the dispute within a

                                       10

<PAGE>

reasonable time period after such referral. For the avoidance of doubt, nothing
in this Section 4.3 shall be construed as giving either party the right to
modify any provision of this Agreement.

5. Term and Termination.

         5.1 Term. The term of this Agreement shall commence as of the Effective
Date and unless terminated earlier as set forth below, shall continue until B&L
has no further obligation to pay royalties pursuant to Section 3.

         5.2 Termination by PTC. PTC may terminate this Agreement upon written
notice to B&L in the event that:

                  (a) B&L has failed to pay any undisputed amounts when due
hereunder within forty-five (45) days following receipt by B&L of written notice
from PTC demanding the payment of such amount; or

                  (b) B&L has failed to use Commercially Reasonable Efforts to
develop a Licensed Product in accordance with Section 4.2, above, and PTC has
reviewed all information contained in the reports and other information provided
by B&L pursuant to Section 4.3, above, has compared such information with the
standards set forth in Section 4.2, above, and has provided written notice to
B&L that specifically identifies how B&L has failed to comply with Section 4.2;
provided that PTC's right of termination shall not become effective unless B&L
has failed, within [**] following receipt of such written notice, to either
begin or resume Commercially Reasonable Efforts to develop a Licensed Product in
accordance with Section 4.2, which termination right shall be PTC's sole remedy
for failure by B&L to use Commercially Reasonable Efforts to develop a Licensed
Product in accordance with Section 4.2 and which termination, and the effect of
termination under Section 5.4 below, shall apply only to the Major Territory in
which B&L has failed to use Commercially Reasonable Efforts to develop a
Licensed Product, provided that if such termination applies to all three of the
Major Territories, such termination, and the effect of termination under Section
5.4 below, shall also apply to all countries and territories outside the Major
Territories in which B&L, or an Affiliate or sublicensee of B&L, has not
received Registration Approval for, or made a commercial sale as of, a Licensed
Product prior to the effective date of such termination; or

                  (c) B&L has failed to perform any other material obligation
under this Agreement, and has failed to cure such non-performance within [**]
following receipt by B&L of written notice from PTC specifying in reasonable
detail the nature of such failure.

         5.3 Termination by B&L. B&L may terminate this Agreement without cause
in B&L's sole discretion upon ninety (90) days written notice to PTC.

         5.4 Effect of Termination.

                  (a) Termination of Licenses, Reversion of Rights, Etc. Upon
any termination of this Agreement by PTC pursuant to Section 5.2 or by B&L
pursuant to Section 5.3 (i) the licenses granted hereunder shall terminate; (ii)
all rights granted hereunder to B&L shall revert to PTC for the benefit of PTC
and B&L shall transfer to PTC all pre-clinical and clinical data, all regulatory
filings, including drug master files, IND's, NDA's and Registration Approvals,
and

                                       11

<PAGE>

the like regarding the Licensed Product; (iii) if requested by PTC, B&L will
supply reasonable quantities of the Licensed Product to PTC, on a cost plus
[**]% basis, for up to [**] (if B&L or any of its Affiliates are manufacturing
Licensed Product as of such termination) or transition any third party supply
arrangement for the Licensed Product to PTC that B&L has in force as of such
termination to the extent permitted under such supply arrangement; and (iv) for
the [**] immediately following termination B&L shall be entitled to sell any
completed inventory of Licensed Product which remain on hand as of the date of
the termination, and to sell new inventory to the extent necessary to satisfy
its contractual and legal obligations, so long as B&L pays to PTC the royalties
applicable to said subsequent sales in accordance with the terms and conditions
as set forth in this Agreement. Neither termination nor expiration of this
Agreement shall terminate or otherwise affect the Research Collaboration and
Exclusive Option Agreement or any other licenses granted to B&L under any other
agreements between B&L and PTC.

                  (b) Grant of License to PTC. B&L shall, and hereby does, grant
to PTC a non-exclusive license, effective as of termination pursuant to Section
5.2 or Section 5.3, under all know-how Controlled by B&L prior to such
termination and under all patent rights Controlled by B&L prior to such
termination the claims of which may be infringed, absent such license, by the
manufacture, use, sale, offer for sale or importation of the Licensed Compound,
with the right to sublicense, to make, have made, use, offer for sale, sell and
import the Licensed Compound, and only the Licensed Compound, in any country of
the world. No other, further or different license is granted or implied pursuant
to this Section 5.4(b). At the request of PTC, B&L shall negotiate terms,
including the payment of fees and royalties, under which such non-exclusive
license may be converted to an exclusive license, subject to any licenses that
may have been granted by B&L to any third parties prior to such request.

         5.5 Survival. Termination or expiration shall not relieve either party
from any obligations accrued as of the date of such termination or expiration.
The obligations of the parties under Sections 2.4, 3.5, 3.9, 3.12, 5.4, 5.5, 9,
10, 11, 12 and 13 shall survive termination or expiration of this Agreement.

6. Warranties, Representations and Covenants.

         6.1 Representations, Warranties and Covenants of Each Party.

                  (a) Authority. Each party represents and warrants that it
possesses all right, title, interest and authority necessary to enter into this
Agreement, perform its obligations hereunder and grant the rights embodied
herein and that it is not aware of any legal impediment that would inhibit its
ability to perform its obligations under this Agreement.

                  (b) No Conflicts. Each party represents and warrants to the
other that the execution, delivery and performance of this Agreement does not:
(i) conflict with, or constitute a breach of, any order, judgment, agreement or
instrument to which such party is a party or is otherwise bound; or (ii) require
the consent of any person or entity.

         6.2 Representations and Warranties of PTC.

                  (a) Compliance with Laws. PTC covenants, represents and
warrants that it shall comply with all Applicable Laws.

                                       12
<PAGE>
            (b) No Claims. PTC represents and warrants as of the Effective Date
that, except as disclosed by PTC to B&L in writing prior to the Effective Date
with respect to the Licensed Compound, which disclosure is also set forth on
Schedule 6.2(b) attached hereto, (i) there have been no claims made against PTC
asserting the invalidity, unenforceability, abuse or misuse of any of the
Licensed Know-How and Licensed Patents specifically relating to the Licensed
Compound; (ii) PTC has not made any claim of any violation or infringement or
misappropriation by others of PTC's rights in the Licensed Compound, or the
Licensed Know-How or Licensed Patents specifically relating to the Licensed
Compound within the Field; and (iii) PTC has not received any notice that PTC is
in conflict with or infringing upon the asserted rights of others in connection
with the Licensed Compound, or the Licensed Know-How or Licensed Patents
specifically relating to the Licensed Compound within the Field.

            (c) Third Party Intellectual Property. PTC represents and warrants
to its knowledge as of the Effective Date that, except as disclosed by PTC to
B&L in writing prior to the Effective Date with respect to the Licensed
Compound, which disclosure is set forth on Schedule 6.2(c) attached hereto,
there are no patent or other intellectual property rights owned or controlled by
any third party that would be infringed by the composition of matter of the
Licensed Compound or use of the Licensed Compound in the Field that would
prevent B&L from making, using, selling, offering for sale or importing the
Licensed Compound in the Field pursuant to this Agreement.

            (d) No Conflicting Licenses. PTC covenants, represents and warrants
that, except as disclosed by PTC to B&L in writing prior to the Effective Date
with respect to the Licensed Compound, which disclosure is set forth on Schedule
6.2(d) attached hereto, no licenses or covenants not to sue under the Licensed
Know-How or Licensed Patents, and no rights to make, have made, use, sell, offer
for sale, promote or import products containing the Licensed Compound, have been
or shall be granted by PTC in the Field.

            (e) U.S. Government Support. PTC represents and warrants as of the
Effective Date that, except as disclosed by PTC to B&L in writing prior to the
Effective Date with respect to the Licensed Compound, which disclosure is set
forth on Schedule 6.2(e) attached hereto, no research support was received from
the United States or any other government body relating to the research or
development of the Licensed Compound and that none of the Licensed Patents or
Licensed Know-How may be deemed a "subject invention" under 35 U.S.C. Section
201.

      6.3 Representations, Warranties and Covenants of B&L. B&L covenants,
represents and warrants that it shall comply with all Applicable Laws.

7.    Patent Preparation, Filing, Prosecution and Maintenance.

      7.1 Responsibility. PTC is responsible for preparing, filing, prosecuting
and maintaining the Licensed Patents, including any interferences, oppositions,
reissues or reexaminations. However, PTC shall provide, or cause its agent to
provide, to B&L copies of relevant correspondence between PTC and the United
States Patent Office or the various international patent offices and matters.
Upon B&L's request, PTC shall be available to consult with B&L on matters
relating to preparing, filing, prosecuting or maintaining any of the
applications or patents that are part of the Licensed Patents. PTC shall
implement all reasonable


                                       13
<PAGE>
requests made by B&L with regard to the preparation, filing, prosecution and
maintenance of the patent applications and patents within the Licensed Patents.

      7.2 Abandonment. If PTC desires to abandon any patent or patent
application that is part of the Licensed Patents, it shall provide reasonable
written notice to B&L and provide B&L the opportunity, at B&L's expense, to
assume responsibility for preparing, filing, prosecuting and maintaining such
patent application or patent in PTC's name. B&L shall have no obligation to pay
royalties attributable to any such patents maintained by B&L; accordingly,
patents maintained by B&L shall not be deemed Licensed Patents for the purpose
of determining whether, under Section 3.7 or Section 3.12, a Valid Claim exists.

      7.3 Cooperation. PTC and B&L shall cooperate in preparing, filing,
prosecuting and maintaining the patent applications and patents that are part of
the Licensed Patents.

8.    Infringement of Intellectual Property.

      8.1 Notice. If either party becomes aware of any misappropriation or
infringement or threatened misappropriation or infringement of any the Licensed
Know-How and the Licensed Patents in the Field, then such party shall give
written notice to the other party within ten (10) days of becoming aware of such
infringement or threat.

      8.2 Enforcement Actions. B&L shall have the right, but not the obligation,
to bring an enforcement action and take any other reasonable steps to defend the
Licensed Know-How and the Licensed Patents against misappropriation or
infringement in the Field at its own expense; which steps may include the
negotiation of appropriate settlements and cross-licenses. PTC hereby agrees, in
addition to its other obligations under this Section, to be joined as a party to
any such action. If PTC is required to be joined as a party, PTC may retain its
own counsel at its own expense or may elect to be represented in the enforcement
action by B&L's counsel at B&L's expense. PTC shall also have the right to
co-fund an enforcement action or defense. If B&L does not initiate a response to
any infringement within ninety (90) days after it has received notice thereof,
then PTC shall have the right to undertake such action itself at its own
expense. Each party shall have the right to approve any settlement,
cross-license, etc., such approval not to be unreasonably withheld or delayed.

      8.3 Distribution of Amounts Paid by Third Parties. In any legal proceeding
brought by a party and funded solely by that party, any damages or other amounts
recovered as a result of the proceeding will be retained by that party. In any
other legal proceeding, any damages or other amounts will be distributed as
follows: the damages or other amounts will first be used to reimburse each party
for the cost of the suit or action (including attorneys' fees and any other
third-party costs) actually paid by each party, then split evenly. Damages or
other amounts recovered as a result of the proceeding retained by B&L shall not
be deemed Annual Net Sales or otherwise subject to royalties or other payment
obligations to PTC under this Agreement.

9.    Indemnification.

      9.1 PTC Indemnification.


                                       14
<PAGE>
            (a) Indemnity. PTC shall indemnify, defend and hold harmless B&L and
its Affiliates, and their directors, officers, agents and employees
(collectively, the "B&L Indemnified Parties") from and against all claims,
demands, losses, liabilities, damages, costs and expenses (including reasonable
attorneys' fees and any costs of settlement) incurred by the B&L Indemnified
Parties resulting from or arising in connection with any claim, suit, action or
proceeding brought by a third party (a "Third Party Claim") against any such B&L
Indemnified Party based on:

                  (i) PTC's breach of any of PTC's covenants, representations or
warranties hereunder; or

                  (ii) any act or omission constituting recklessness, gross
negligence or willful misconduct on the part of PTC.

            (b) Limitations on PTC Indemnification. PTC shall have no obligation
to indemnify, defend or hold harmless the B&L Indemnified Parties in connection
with any Third Party Claim to the extent such Third Party Claim is covered by
B&L's obligations under Section 9.2, or arises from: (i) a B&L Indemnified
Party's breach of any of B&L's covenants, representations or warranties
hereunder; or (ii) any act or omission constituting recklessness, gross
negligence or willful misconduct on the part of any of the B&L Indemnified
Parties.

      9.2 B&L Indemnification.

            (a) Indemnity. B&L shall indemnify, defend and hold harmless PTC,
its Affiliates, and their directors, officers, agents and employees
(collectively, the "PTC Indemnified Parties") against all claims, demands,
losses, liabilities, damages, costs and expenses (including reasonable
attorneys' fees and any costs of settlement) incurred by the PTC Indemnified
Parties resulting from or arising in connection with a Third Party Claim brought
against any such PTC Indemnified Party based on:

                  (i) B&L's breach of any of B&L's covenants, representations or
warranties hereunder;

                  (ii) the pre-clinical testing, clinical testing, manufacture,
distribution, marketing, advertisement, promotion or sale of the Licensed
Product by B&L, its Affiliates and sublicensees, including without limitation
any Third Party Claim based on personal injury, death or infringement of patent
or other intellectual property rights that relate to a Licensed Product (other
than infringement resulting from a breach by PTC of its representations and
warranties hereunder) resulting from such pre-clinical testing, clinical
testing, manufacture, distribution, marketing, advertisement, promotion or sale
of the Licensed Product; or

                  (iii) any act or omission constituting recklessness, gross
negligence or willful misconduct on the part of B&L.

            (b) Limitations on B&L Indemnification. B&L shall have no obligation
to indemnify, defend or hold harmless the PTC Indemnified Parties in connection
with any Third Party Claim to the extent such Third Party Claim is covered by
PTC's obligations under Section 9.1, or arises from: (i) a PTC Indemnified
Party's breach of any of PTC's covenants,

                                       15
<PAGE>
obligations, agreements, representations or warranties hereunder; or (ii) any
act or omission constituting recklessness, gross negligence or willful
misconduct on the part of any of the PTC Indemnified Parties.

      9.3 Indemnification Procedure.

            (a) Notification and Cooperation. The party seeking indemnification
hereunder (the "Indemnified Party") shall: (i) promptly notify in writing the
party obligated to indemnify (the "Indemnifying Party") of any claim, action or
proceeding of a third party for which the Indemnified Party seeks
indemnification; and (ii) cooperate fully with the Indemnifying Party and its
legal representatives in the investigation of any such claim, action or
proceeding. The Indemnified Party's failure to comply with its obligations under
this Section shall not constitute a breach of this Agreement nor relieve the
Indemnifying Party of its indemnification obligations hereunder, except to the
extent, if any, that the Indemnifying Party's defense or settlement of the
affected claim, action or proceeding was actually and materially impaired
thereby.

            (b) Defense. The Indemnifying Party shall conduct, at its own
expense, the defense of any and all such claims, charges, suits or other actions
by a third party, and the Indemnified Party may, at its own expense, assist in
such defense if it so chooses, provided that the Indemnifying Party shall
control such defense and all negotiations relative to the settlement of any such
claim. Neither party shall settle or admit liability with respect to any such
claims, charges, suits or other actions which could result in liability to the
other party without the prior written consent of the other party, which consent
shall not be unreasonably withheld or delayed.

10.   Limitation of Liability. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE
CONTRARY, NEITHER PTC NOR B&L, NOR THEIR RESPECTIVE AFFILIATES, DIRECTORS,
OFFICERS, EMPLOYEES OR AGENTS, SHALL HAVE ANY LIABILITY TO THE OTHER FOR ANY
SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, IN CONNECTION WITH OR
ARISING OUT OF THIS AGREEMENT, EVEN IF SUCH DAMAGES WERE FORESEEABLE, EXCEPT TO
THE EXTENT SUCH DAMAGES ARE OWED TO A THIRD PARTY BY A PARTY ENTITLED TO
INDEMNIFICATION UNDER THIS AGREEMENT AND EXCEPT FOR ANY DAMAGES ARISING FROM
BREACH OF A PARTY'S CONFIDENTIALITY OBLIGATIONS UNDER THIS AGREEMENT.

11.   Confidentiality.

      11.1 Nondisclosure and Nonuse Obligations. During the term of this
Agreement, and thereafter after expiration or termination hereof, each party
will maintain all Confidential Information of the other party in trust and
confidence and will not disclose any Confidential Information of the other party
to any third party or use any Confidential Information of the other party except
to the extent required to enjoy its rights or comply with its obligations under
this Agreement. Confidential Information shall be disclosed only to employees,
agents, Affiliates and consultants who have a need for such information and who
are bound by obligations of nondisclosure and non-use at least as restrictive as
those set forth herein. Each party shall be responsible for any disclosure or
use of the Confidential Information by such employees, agents,

                                       16
<PAGE>
Affiliates and consultants. Each party shall protect the other party's
Confidential Information using not less than the same standard of care with
which it treats its own Confidential Information, but at all times shall use at
least reasonable care.

      11.2 Exceptions. Confidential Information shall not include any
information which:

            (a) is now, or lawfully becomes, generally known or available to the
public through no fault of the recipient;

            (b) is known by the receiving party at the time of receiving such
information;

            (c) is hereafter lawfully furnished to the receiving party by a
third party, as a matter of right and without restriction on disclosure;

            (d) is independently developed by the receiving party without any
breach of this Section as evidenced by its written records; or

            (e) is the subject of a written permission to disclose provided by
the disclosing party.

      11.3 Authorized Disclosure. Notwithstanding any other provision of this
Agreement, each party may disclose Confidential Information of the other party
if such disclosure is required: (i) by an order of a court or other governmental
body, or any political subdivision thereof or arbitral panel with jurisdiction
over the disclosing party; or (ii) by law or regulation (including, without
limitation, to comply with any applicable securities regulation, stock exchange
or NASDAQ disclosure requirements), but only to the extent that any such
disclosure is reasonably necessary. With respect to any order of a court or
other governmental body, the disclosing party shall, if practicable, first have
given written notice to the other party hereto and shall use reasonable efforts
to limit the scope and content of such disclosure to the required scope and
content. With respect to disclosure required by Applicable Laws or regulations
(including, without limitation, any applicable securities regulation, stock
exchange or NASDAQ disclosure requirements), the disclosing party shall, if
practicable, first give written notice to the other party hereto and allow the
other party a reasonable opportunity to comment on the content of such
disclosure and shall consult with the other party with respect to the comments
of such other party.

      11.4 Obligations at End of Term. Each party agrees, at the request of the
other party, upon expiration or termination of this Agreement to either: (i)
return to the other party all originals and copies of the other party's
Confidential Information; or (ii) at the other party's option, destroy all
originals and copies of the other party's Confidential Information and to
certify in writing such destruction to the other party; provided, however that
the receiving party may keep one copy of the other party's Confidential
Information in a secure location, solely for purposes of enforcing and
determining such party's rights and obligations under this Agreement.

      11.5 Injunctive Relief. The parties agree that any breach of the
restrictions contained in this Section will cause irreparable harm to the
non-breaching party entitling the non-breaching party to injunctive or other
preliminary relief in addition to all other legal remedies.


                                       17
<PAGE>
12.   Publicity. All publicity, press releases and other announcements regarding
this Agreement or the transactions contemplated hereby shall be reviewed in
advance by, and subject to the written approval of, both parties.
Notwithstanding the foregoing, either party may, without the written consent of
the other, disclose the terms of this Agreement insofar as reasonably required
to comply with applicable securities laws (including, without limitation, any
applicable stock exchange or NASDAQ disclosure requirements); provided, however,
that where practicable the disclosing party shall provide advance notice and a
reasonable opportunity to the other party to provide comments regarding any
confidential treatment or similar request. The disclosing party shall if
practicable reasonably consider any such comments from the other party. In
addition, each party shall have the right to disclose, under obligations of
confidentiality and as reasonably required, the terms of this Agreement to
potential acquirers, investors, lenders, licensees, sublicensees, contractors
and other third parties in connection with acquisition, financing, product
development or commercialization activities..

13.   Miscellaneous.

      13.1 Bankruptcy. All licenses granted under this Agreement by PTC to B&L,
for all purposes of Section 365(n) of Title XI of the United States Code ("Title
XI"), are licenses of rights to "intellectual property" as defined in Title XI.
If a bankruptcy proceeding is commenced by or against PTC under Title XI, B&L
shall be entitled to a copy of any and all such intellectual property maintained
by PTC, and the same, if not in the possession of B&L, shall be promptly
delivered to it (a) upon B&L's written request following the commencement of
such bankruptcy proceeding, unless PTC, or its trustee or receiver, elects
within Thirty (30) days to continue to perform all of its obligations under this
Agreement, or (b) if not delivered as provided under Section (a) above, upon
B&L's request following the rejection of this Agreement by or on behalf of PTC.
If B&L has taken possession of all applicable embodiments of the intellectual
property of PTC pursuant to this Section and the trustee in bankruptcy of PTC
does not reject this Agreement, B&L shall return such embodiments upon request.
If PTC seeks or involuntarily is placed under Title XI and the trustee rejects
this Agreement as contemplated under 11 U.S.C. 365(n)(1), B&L hereby elects
pursuant to Section 365(n) to retain all rights granted to B&L under this
Agreement to the extent permitted by law.

      13.2 Notices. All notices required or permitted hereunder shall be given
in writing and mailed postage prepaid, certified or registered mail, return
receipt requested, or sent by a nationally recognized express courier service,
or hand-delivered at the following addresses:

      To PTC:     PTC Therapeutics, Inc.
                  100 Corporate Court
                  South Plainfield, New Jersey 07080-2449
                  Attn.: Legal Dep't

      Email copy to: legal@ptcbio.com

      To B&L:     Bausch & Lomb Incorporated
                  One Bausch & Lomb Place
                  Rochester, New York  14604-2701


                                       18
<PAGE>
                  Attn.: Senior Vice President - Research and Development and
                         Chief Scientific Officer

      Copy to:    Bausch & Lomb Incorporated
                  One Bausch & Lomb Place
                  Rochester, New York  14604-2701
                  Attn.: Senior Vice President and General Counsel

      All notices shall be deemed made upon receipt by the addressee as
evidenced by the applicable written receipt.

      13.3 Captions and Section References. The titles, headings or captions in
this Agreement do not define, limit, extend, explain or describe the scope or
extent of this Agreement or any of its terms or conditions and therefore shall
not be considered in the interpretations, construction or application of this
Agreement.

      13.4 Severability. If any term or provision of this Agreement shall be
found to be invalid, illegal or otherwise unenforceable, such finding shall not
affect the other terms or provisions of this Agreement, or the whole of this
Agreement, but such term or provision shall be deemed modified to the extent
necessary to render such term or provision enforceable, and the rights and
obligations of the parties shall be construed and enforced accordingly,
preserving to the fullest permissible extent the intent and agreements of the
parties set forth in this Agreement.

      13.5 Amendment. No amendment, change or modification of any of the terms,
provisions or conditions of this Agreement shall be effective unless made in a
writing that expressly references this Agreement and is signed on behalf of the
parties hereto by their duly authorized representatives.

      13.6 Waiver. No waiver of any term, provision or condition of this
Agreement, whether by conduct or otherwise, in any one or more instances, shall
be deemed to be or construed as a further or continuing waiver of any such or
other term, provision or condition of this Agreement.

      13.7 Force Majeure. Neither party shall be liable hereunder to the other
party nor shall be in breach for failure to perform its obligations caused by
circumstances beyond the control of either party, including, but not limited to:
acts of nature; fires; earthquakes; floods; riots; wars; civil disturbances;
sabotage; accidents; shortages or government actions. In the case of any such
event, the affected party shall promptly notify the other party, and shall keep
the other party informed of the event in writing specifying the extent to which
its performance will likely be affected. The party affected shall exert
reasonable diligent efforts to eliminate, cure or overcome any such cause and
resume performance as soon as practicable.

      13.8 Benefits and Binding Nature of Agreement. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns permitted under this Agreement.


                                       19
<PAGE>
      13.9 Assignment; Change in Control. The rights under this Agreement may
not be assigned by either party (the "Assigning Party") without the written
consent of the other party (the "Non-Assigning Party") except (i) to any
Affiliate of the Assigning Party or (ii) to any party which acquires
substantially all of the assets and business of the Assigning Party to which
this Agreement relates.

      13.10 Entire Agreement. This Agreement sets forth the entire agreement
between the parties hereto pertaining to the subject matter hereof and
supersedes all negotiations, preliminary agreements, memoranda or letters of
proposal or intent, discussions and understandings of the parties hereto in
connection with the subject matter hereof.

      13.11 Governing Law and Forum. This Agreement and all claims related to
it, its execution or the performance of the parties under it, shall be construed
and governed in all respects according to the laws of the State of New York. The
parties agree that all actions or proceedings arising in connection with this
Agreement shall be tried and litigated exclusively in the courts located in the
Borough of Manhattan, New York, New York. This choice of venue is intended by
the parties to be mandatory and not permissive in nature, and to preclude the
possibility of litigation between the parties with respect to, or arising out
of, this Agreement in any jurisdiction other than that specified in this
Section. Each party waives any right it may have to assert the doctrine of forum
non-conveniens or similar doctrine or to object to venue with respect to any
proceeding brought in accordance with this Section.

      13.12 Counterparts. This Agreement may be executed in counterparts. For
purposes hereof, a facsimile copy of this Agreement, including the signature
page hereto, shall be deemed to be an original. Notwithstanding the foregoing,
the parties shall deliver original execution copies of this Agreement to one
another as soon as practicable following execution thereof.

            [The remainder of this page is left intentionally blank.
                            Signature page follows.]



                                       20
<PAGE>
      IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
on the day and year first above written.

BAUSCH & LOMB INCORPORATED               PTC THERAPEUTICS, INC.

By:________________________________      By:________________________________

Name:______________________________      Name:______________________________

Title:_____________________________      Title:_____________________________




                                       21
<PAGE>
                                  SCHEDULE 1.14

                    DESCRIPTION OF LICENSED COMPOUND SCAFFOLD



                                       22
<PAGE>
                                 SCHEDULE 6.2(B)

                                     CLAIMS



                                       23
<PAGE>
                                 SCHEDULE 6.2(C)

                        THIRD PARTY INTELLECTUAL PROPERTY



                                       24
<PAGE>
                                 SCHEDULE 6.2(D)

                              CONFLICTING LICENSES



                                       25
<PAGE>
                                 SCHEDULE 6.2(E)

                               GOVERNMENT SUPPORT



                                       26