EXHIBIT 10.35

                                LICENSE AGREEMENT

This License  Agreement is entered into as of the 25th day of March,  2002, (the
"Effective  Date") by VaxGen,  Inc.,  a  Delaware  corporation  ("VaxGen"),  and
Celltrion,  Inc., a Korean  corporation  ("Celltrion")  (each also  singularly a
"Party" and collectively the "Parties") as follows:

                                                                     WITNESSETH:

WHEREAS,  VaxGen is the owner of certain  patent rights and knowhow  relating to
the fermentation,  purification and manufacture of recombinant proteins, as well
as the  owner of  certain  related  biological  materials,  protocols  and other
knowhow;

WHEREAS,  Celltrion wishes to obtain a license under such intellectual property;
and

WHEREAS, VaxGen is willing to grant such a license to Celltrion on the terms set
forth herein.

NOW,  THEREFORE,  in consideration of the mutual promises  contained herein, the
Parties agree as follows:

Article 1.0 Certain Definitions

The terms defined elsewhere in this Agreement shall have the meanings  specified
herein.  The following  terms shall have the following  meanings for purposes of
this Agreement:

1.1  "Facility" shall mean a certain pharmaceutical manufacturing facility to be
     constructed by Celltrion in Incheon, Korea, pursuant to other agreements to
     which Celltrion and VaxGen (and others) are party.

1.2  "Licensed Knowhow" shall mean any and all proprietary information, methods,
     processes,  techniques,  data  and  biologic  materials  which  are  in the
     possession  of or controlled  by VaxGen  presently or hereafter  during the
     term of this Agreement,  which VaxGen is free to license or sublicense, and
     which are necessary or useful for the manufacture of any Licensed  Product;
     provided  however,  that  "Licensed  Knowhow"  shall not include any rights
     licensed to VaxGen  pursuant to that certain  License and Supply  Agreement
     between VaxGen and Genentech,  Inc. dated as of May 1, 1996 (the "Genentech
     Agreement").  "Licensed Knowhow" shall include,  without limitation,  those
     items listed or described on Exhibit "A" attached hereto.

1.3  "Licensed  Patent  Rights" shall mean all patents and patent  applications,
     and all patents issuing therefrom, together with all extensions,  reissues,
     reexaminations,    substitutions,   renewals,   divisions,   continuations,
     continuations-in-part  and foreign counterparts  thereof or therefor,  that
     are in the  possession of or  controlled  by VaxGen  presently or hereafter
     during the term of this  Agreement,  and which VaxGen is free to license or
     sublicense,  to the extent that any of the  foregoing  relates to or claims
     the manufacture of any Licensed Product;  provided however,  that "Licensed
     Patent Rights" shall not include any rights  licensed to VaxGen pursuant to
     the Genentech  Agreement.  "Licensed Patent Rights" shall include,  without
     limitation,  those patent  applications  and patents  listed on Exhibit "B"
     attached hereto.

1.4  "Licensed  Product"  shall mean any  pharmaceutical  formulation  that: (i)
     could not be  manufactured  without  infringing  one or more  claims of the
     Licensed Patent Rights, or (ii) is manufactured,  in whole or part, through
     the use of Licensed Knowhow.

Article 2.0 License Grant

2.1  License Grant. Subject to the other terms and conditions of this Agreement,
     VaxGen hereby  grants to Celltrion an exclusive  license under the Licensed
     Patent  Rights  and  Licensed  Knowhow  to make  Licensed  Products  in the
     Republic of Korea for sale any where in the world, except for AIDSVAX which
     is  subject  to a  separate  Sub-License  Agreement.  With  respect  to the
     Licensed Patent Rights or Licensed Knowhow,  Celltrion shall have no rights
     other than the rights as granted under this Agreement

2.2  Sub-licenses.  Celltrion  shall  have no right  to  sublicense  its  rights
     hereunder without the prior written consent of

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     VaxGen, which consent may be withheld by VaxGen in its sole discretion.

Article 3.0 Technology Transfer

3.1  Celltrion shall have the right to require VaxGen,  at Celltrion's  expense,
     to  transfer  the  Licensed  Patent  Rights  and the  Licensed  Knowhow  to
     Celltrion.   The   Parties   shall  in  good  faith   determine   the  most
     cost-effective and timely means of effecting such transfer, consistent with
     Exhibit "C" attached hereto.

3.2  VaxGen shall  provide to Celltrion all the relevant  documents,  materials,
     designs,  data and other information  necessary for the use of the Licensed
     Patents Rights and the Licensed Know-how by Celltrion and for manufacturing
     the  Licensed  Product by  Celltrion.  The timing and method of delivery of
     those documents shall be determined  later based on mutual agreement by the
     Parties.

3.3  VaxGen shall  arrange,  to the extent  necessary for the  construction  and
     operation of the Facility and manufacture of AIDSVAX as contemplated by the
     Parties,  for the employees of Celltrion to receive  continuing and ongoing
     professional  training and education at the pilot plant operated by VaxGen,
     and/or at the 12 KL  facility  of  VaxGen  or  elsewhere  as  requested  by
     Celltrion.  Celltrion  shall  bear  all  out-of-pocket  expenses  for  such
     training,  including airfare and accommodations for the Celltrion employees
     and,  to the  extent  such  training  occurs in  Incheon  City,  for VaxGen
     personnel,  provided,  however,  that  the  salaries  of  VaxGen  personnel
     providing  such  professional  training  and  education  shall  be borne by
     VaxGen. All costs of providing technical assistance relating to the design,
     engineering,  and  construction  of the Facility,  including  out-of-pocket
     expenses and salaries of VaxGen personnel, shall be borne by Celltrion.

3.4  Upon the  reasonable  request by Celltrion,  VaxGen shall  dispatch its own
     technicians and specialists with appropriate  experience and qualifications
     to  Celltrion  to assist in the  transfer  and use of the  Licensed  Patent
     Rights  and the  Licensed  Knowhow  by  Celltrion  for the  manufacture  of
     AIDSVAX. In this case, all out-of-pocket expenses for such visits by VaxGen
     personnel, including but not limited to airfare, accommodations,  board and
     local  transportation,  shall be borne by  Celltrion,  and the  salary  for
     VaxGen  personnel  so  dispatched  to  Celltrion  shall be borne by VaxGen.
     VaxGen shall provide free of charge all technical  assistance as reasonably
     necessary, including but not limited to troubleshooting problems, up to the
     date of validation of the Facility by the relevant regulatory  authorities.
     Any and all  expenses  relating  to any  technical  assistance  provided by
     VaxGen personnel,  including  out-of-pocket expenses and their salary, that
     is provided to  Celltrion  after the date of  validation  shall be borne by
     Celltrion.

3.5  In the event that any technical assistance reasonably required by Celltrion
     cannot be provided by VaxGen,  VaxGen and Celltrion  shall meet and discuss
     possible approaches to obtaining such assistance, and VaxGen shall make its
     best efforts to procure such assistance on favorable terms to Celltrion.

3.6  All other  matters  relating to the transfer of  technology  not  expressly
     provided herein shall be agreed upon by the Parties. The Parties shall meet
     and discuss the detailed  program for the transfer of technology as soon as
     practically possible.

Article 4.0 Accounting Records

4.1  Reports.  Within  90 days  after  the  last day of each  calendar  quarter,
     Celltrion  shall render to VaxGen an accounting  for such calendar  quarter
     showing, on a Licensed  Product-by-Licensed  Product and country-by-country
     basis, all sales of Licensed Products during such quarter.

4.2  Celltrion Accounting Records.  Celltrion shall keep full, true and accurate
     books of account  containing all particulars which may be necessary for the
     purpose of showing sales of all Licensed  Products on a  country-by-country
     basis.  Celltrion's  complete books of account and supporting data therefor
     shall be kept at its  principal  place of business  for at least five years
     following  the end of the  calendar  year to which they pertain (and access
     shall not be denied thereafter, if reasonably available), and shall be made
     available for inspection  and copying  during regular  business hours by an
     independent accountant retained by VaxGen at VaxGen's sole expense.

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Article 5.0 Intellectual Property Rights

5.1  Ownership.  VaxGen shall retain title to the Licensed  Knowhow and Licensed
     Patent Rights,  including,  without  limitation,  any Licensed  Knowhow and
     Licensed  Patent  Rights  developed  or  invented  by VaxGen in the future.
     Celltrion shall retain title to any improvements to the Licensed Knowhow or
     Licensed Patent Rights developed or invented solely by Celltrion; provided,
     however,  that  VaxGen  shall have a  royalty-free  non-exclusive  right to
     practice  any such  improvements  as it sees  fit.  The  Parties  shall own
     jointly any  improvements to any Licensed Knowhow or Licensed Patent Rights
     which are developed or invented by both Parties. Designation of inventor(s)
     on any patent  application  is a matter of law, and shall be solely  within
     the  discretion  of  qualified  patent  counsel of VaxGen and  Celltrion to
     determine  in  accordance  with  United  States  laws of  inventorship  and
     competent written evidence of the Parties.

5.2  Patent  Filing,  Prosecution  and  Maintenance.  During  the  term  of this
     Agreement,.  VaxGen shall be responsible  for the filing,  prosecution  and
     maintenance  of all  Licensed  Patent  Rights at its sole cost and expense;
     provided,  however, that Celltrion shall reimburse all reasonable costs and
     expenses  incurred by VaxGen in relation  to the  filing,  prosecution  and
     maintenance in Korea made for the benefit of Celltrion  hereunder within 30
     days of receipt  of an invoice  from  VaxGen  setting  forth such costs and
     expenses.  VaxGen  shall keep  Celltrion  informed of the status of filing,
     prosecution  and  maintenance of Licensed  Patent Rights in Korea,  by: (i)
     updating Celltrion on a regular basis (and in any event not less frequently
     than annually)  regarding the status of the patent applications and patents
     within  the  Licensed   Patent  Rights  by  providing   Celltrion   with  a
     then-current  version of Exhibit A to this  Agreement and reviewing it with
     Celltrion as  reasonably  requested;  and (ii)  notifying  Celltrion of any
     interference,   opposition,  re-examination  request,  nullity  proceeding,
     appeal or other interparty  action or reissuance  proceeding  involving the
     Licensed  Patent  Rights in  Korea..  VaxGen  shall  determine  in its sole
     discretion whether or not to file, perfect, prosecute,  maintain or take or
     not take any other action with respect to any patent  application or patent
     within the Licensed Patent Rights generally or in Korea (including, without
     limitation, any interference,  opposition,  re-examination request, nullity
     proceeding,  appeal or other  interparty  action or  reissuance  proceeding
     involving the Licensed Patent Rights).  However,  if VaxGen desires to take
     (or not take) any such action in or for the benefit of Korea but  Celltrion
     is not prepared to reimburse VaxGen therefor as required hereunder, in such
     case  VaxGen  shall be free to take (or not take)  such  action at its sole
     cost and  expense  and,  on notice  from  VaxGen to  Celltrion,  the rights
     licensed to  Celltrion  under this  Agreement  with  respect to such patent
     application  or patent  shall return to VaxGen and  thereafter  be excluded
     from the Licensed Patent Rights.

5.3  Patent Infringement

     (a)  If either Party learns that a third party is  infringing  or allegedly
          infringing any Licensed  Patent Rights,  it shall promptly  notify the
          other Party  thereof.  The Parties shall  cooperate and use reasonable
          efforts to stop such alleged infringement without litigation.

     (b)  VaxGen shall have the sole right (but not the  obligation) to take the
          appropriate  steps to remove the  infringement  or alleged of Licensed
          Patent  Rights,  including,  without  limitation,  initiating  a suit,
          proceeding or other legal action.

5.4  Third Party Patent Rights. If a notice of infringement is received by, or a
     suit is  initiated  against,  either  Party with  respect  to any  Licensed
     Product,  the  Parties  shall  consult  in good  faith  regarding  the best
     response.

Article 6.0 Confidentiality

6.1  Confidentiality.  In the course of performance of this Agreement, one Party
     may disclose to the other Party or receive from the other Party information
     which is confidential  information of the disclosing  Party. In order to be
     considered   confidential   information  of  the  disclosing   Party,  such
     information  must be in  writing  and  designated  as  confidential,  or if
     disclosed  orally  must be  confirmed  in  writing  to the  other  Party as
     confidential  within  30 days  after  such oral  disclosure  ("Confidential
     Information").   In  addition,   for  the   purposes  of  this   Agreement,
     Confidential  Information shall not include  information that (in each case
     as evidenced by written records or other competent evidence):

     (a)  was known to the receiving  Party at the time of disclosure  hereunder
          by the disclosing Party;

     (b)  was  generally  available to the public or was  otherwise  part of the
          public domain at the time of disclosure hereunder, or became generally
          available to the public or otherwise  part of the public  domain after
          disclosure  hereunder  other than  through  any act or omission of the
          receiving Party in breach of this Agreement;
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     (c)  became known to the  receiving  Party after  disclosure  from a source
          that had a lawful right to disclose such information to others; or

     (d)  was independently  developed by the receiving Party without the use of
          any Confidential Information of the disclosing Party.

     Each Party shall protect and keep  confidential  and shall not use, publish
     or  otherwise  disclose to any third party the other  Party's  Confidential
     Information  for a  period  of five  years  from  the  date  of  disclosure
     hereunder,  except as  otherwise  permitted  by this  Agreement or with the
     other Party's prior consent. The foregoing notwithstanding,  each Party may
     disclose  Confidential  Information  of the other Party during any official
     proceeding before a court or governmental  agency, or as a part of a patent
     application filed on inventions made under this Agreement,  or as necessary
     in order to manufacture Licensed Products as contemplated herein;  provided
     that  the  Party  whose  Confidential   Information  is  included  in  such
     application  shall have the opportunity to review such proposed  disclosure
     at least 30 days  prior to the date of such  filing  and does not object in
     writing  to such  proposed  disclosure.  In the event of an  objection  the
     consultation provisions of Section 7.2 below shall apply.

Article 7.0 Representations and Warranties

7.1  Disclaimer.  Except as expressly  provided in this  Agreement,  the Parties
     disclaim  all other  representations  and  warranties,  express or implied,
     including, without limitation, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A
     PARTICULAR PURPOSE, or NON-INFRINGEMENT.

7.2  Mutual  Representations and Warranties.  Each party represents and warrants
     to the other Party that the representing and warranting  Party, to its best
     knowledge:  is free to  enter  this  Agreement  and in so doing it will not
     violate any other agreement to which it is party or subject.

7.3  Representations and Warranties by VaxGen. VaxGen represents and warrants to
     Celltrion that it has the right to grant the license set forth hereinabove,
     free from any  inconsistent  claims or  restrictions  in favor of any third
     party.

     (a)  the Licensed Patent Rights and Licensed  Knowhow,  taken together with
          the  intellectual  property  rights to be licensed and  transferred to
          Celltrion  pursuant  to a certain  sublicense  agreement  between  the
          Parties  of even date  herewith  (the  "Sublicense  Agreement")  , are
          suitable  and adequate to  manufacture  the Vaccine (as defined in the
          Sublicense Agreement) at the scale currently produced by Genentech;

     (b)  no license of additional intellectual property from any third party is
          necessary in order to manufacture  the Vaccine as contemplated in that
          certain Supply Agreement (the "Supply  Agreement") between the Parties
          of even date herewith; and

     (c)  to the best of  VaxGen's  knowledge,  manufacture  of the  Vaccine  as
          contemplated  in the  Supply  Agreement  will  not  infringe  upon the
          intellectual property rights of any third party.

Article 8.0 Liability

8.1  Limitation  of  Liability.  Neither  Party shall be liable to the other for
     indirect,  incidental,  special or consequential  damages arising out of or
     resulting  from any term or condition of this  Agreement or with respect to
     their performance or lack thereof.

8.2  Indemnification  by Celltrion.  Celltrion shall indemnify,  defend and hold
     harmless  VaxGen  and  its  directors,   officers,  employees,  agents  and
     affiliates from and against all costs, claims, suits, liabilities, expenses
     (including  reasonable  attorneys'  fees)  and  damages  arising  out of or
     resulting from the manufacture by Celltrion of any Licensed Product, except
     to the  extent  that such cost,  claim,  suit,  expense or damage  arose or
     resulted  from  any  willful  or  negligent  act  or  omission  by  VaxGen.
     Celltrion's indemnification obligations hereunder shall be conditioned upon
     VaxGen  (i)  giving  reasonable  notice to  Celltrion  of any such claim or
     action,  (ii)  tendering  the defense of such claim or action to Celltrion,
     (iii)   reasonably   assisting   Celltrion  (at  Celltrion's   expense)  in
     investigating and defending such claim or action, and (iv) not compromising
     or settling such claim or action without Celltrion's prior consent.

8.3  Indemnification by VaxGen. VaxGen shall indemnify, defend and hold harmless
     Celltrion and its  directors,  officers,  employees,  agents and affiliates
     from and against all costs, claims, suits, liabilities, expenses (including
     reasonable

<PAGE>

     attorneys'  fees) and damages  arising out of or resulting  from the use or
     sale by VaxGen of any  Licensed  Product,  except to the  extent  that such
     cost, claim,  suit, expense or damage arose or resulted from any willful or
     negligent   act  or  omission  by   Celltrion.   VaxGen's   indemnification
     obligations  hereunder  shall be  conditioned  upon  Celltrion:  (i) giving
     reasonable notice to VaxGen of any such claim or action, (ii) tendering the
     defense  of such  claim or action to  VaxGen,  (iii)  reasonably  assisting
     VaxGen (at VaxGen's  expense) in investigating  and defending such claim or
     action,  and (iv) not compromising or settling such claim or action without
     VaxGen's prior consent.

8.4  Insurance.  Without  limiting any  indemnification  obligations  under this
     Agreement, Celltrion shall obtain and maintain on an on-going basis for the
     time period  specified  herein below  comprehensive  general  liability and
     products liability insurance (including  contractual  liability coverage of
     Celltrion's indemnification obligations under this Agreement) in the amount
     of at least $5 million per occurrence and annual aggregate  combined single
     limit for bodily injury and property damage liability,  with such insurance
     coverage to be maintained with an insurance company or companies reasonably
     acceptable  to  VaxGen  and  with  a  deductible  or  maximum  self-insured
     retention  not to exceed  $500,000  per  occurrence  and annual  aggregate.
     Celltrion shall obtain such insurance  coverage no later than 90 days prior
     to the  commencement  of the first  human  clinical  trial  testing  of any
     Licensed Product (other than AIDSVAX, as addressed by separate agreement of
     the Parties) and thereafter shall maintain such insurance  coverage without
     interruption during the term of this Agreement and for a period of at least
     10 years  after the  expiration  or  termination  of this  Agreement.  Such
     insurance shall name VaxGen as an additional  insured,  shall state that it
     is primary to any valid and collectible insurance available to VaxGen which
     also covers the same loss for which Celltrion has liability pursuant to the
     Agreement  shall  contain a  cross-liability  or  severability  of interest
     clause, and shall state that VaxGen will be provided with at least 30 days'
     advance written notice of any termination,  cancellation or material change
     in the insurance  policy.  Celltrion  shall provide VaxGen with evidence of
     such  insurance  coverage as required under this Agreement by no later than
     the deadline  specified  above for obtaining such insurance  coverage,  and
     thereafter  shall continue to provide VaxGen with evidence of such required
     insurance  coverage  on an  annual  basis (by not  later  than each  annual
     renewal date of such coverage)  during the term of this Agreement and for a
     period of at least 10 years after the  expiration  or  termination  of this
     Agreement. Celltrion may satisfy its obligation to provide evidence of such
     required insurance coverage by providing VaxGen with complete copies of the
     insurance policies themselves or certificates from its insurance company or
     companies evidencing the coverage required hereunder.

Article 9.0 Term and Termination

9.1  Term.  This  Agreement  shall  commence on the Effective  Date and,  unless
     earlier  terminated  in  accordance  herewith,  shall  expire  on the  15th
     anniversary of the Effective Date.  Following  expiration,  Celltrion shall
     retain a  perpetual,  royalty-free  right to continue  to use the  Licensed
     Knowhow and Licensed  Patents  existing as of the date of expiration in the
     manner provided in Section 2.1, above.

9.2  Termination for Default.  Failure by either Party to comply with any of its
     material  obligations  set  forth  in  this  Agreement  shall  entitle  the
     non-defaulting  Party to give the defaulting Party a notice  specifying the
     nature of the default and requiring the  defaulting  Party to make good its
     default. If such default is not cured within 30 days after such notice, the
     non-defaulting  Party shall be  entitled,  without  prejudice to any of its
     other rights  under this  Agreement or available to it at law or in equity,
     to terminate this  Agreement  effective upon a notice of termination to the
     defaulting Party.

9.3  Termination for Insolvency or Bankruptcy.  Either Party may, in addition to
     any other  remedies  available  to it by law or in equity,  terminate  this
     Agreement,  in whole or in part as the terminating Party may determine,  by
     notice to the other  Party in the event the other  Party  shall have become
     insolvent or bankrupt,  or shall have made an assignment for the benefit of
     its creditors,  or there shall have been appointed a trustee or receiver of
     the other Party or for all or a substantial part of its property,  or there
     shall have been issued a warrant of  attachment,  execution,  distraint  or
     similar process  against any substantial  part of the property of the other
     Party, or any case or proceeding  shall have been commenced or other action
     taken  by  or   against   the  other   Party  in   bankruptcy   or  seeking
     reorganization,    liquidation,   dissolution,   winding-up,   arrangement,
     composition  or  readjustment  of its debts or any other  relief  under any
     bankruptcy,  insolvency,  reorganization or other similar act or law of any
     jurisdiction  now or  hereafter in effect,  provided  that in any such case
     such event  shall have  continued  for 60 days  undismissed,  unbonded  and
     undischarged.  Furthermore,  all rights and licenses  granted under to this
     Agreement are, and shall otherwise be deemed to be, for purposes of Section
     365(n)  of  the  Bankruptcy  Code,  licenses  of  rights  to  "intellectual
     property" as defined under Section 101(56) of the United States  Bankruptcy
     Code.

9.4  Unilateral  Termination.  Celltrion  shall have the right to terminate this
     Agreement, in its sole discretion, on six months' prior notice to VaxGen.

<PAGE>

9.5  Effect of Termination

     (a)  Expiration or  termination  of this  Agreement for any reason shall be
          without  prejudice  to any  rights  which  shall  have  accrued to the
          benefit of either Party prior to such expiration or  termination,  and
          shall  not  relieve  either  Party  from  its  obligations  which  are
          expressly  indicated  to survive  expiration  or  termination  of this
          Agreement;  such rights and obligations  include,  without limitation,
          those under  Sections 4.2,  5.3,  5.4, 6.1, 8.1, 8.2, 8.3, 9.5,  10.1,
          10.2, and 10.5 of this Agreement.

     (b)  On any  termination  of  this  Agreement  (other  than  by  virtue  of
          expiration of its term) Celltrion  promptly shall return to VaxGen all
          tangible  Licensed Patent Rights,  Licensed Knowhow and other property
          owned by VaxGen (whether solely or jointly with Celltrion) that are in
          Celltrion's possession or control, including,  without limitation, all
          biological  materials and  improvements  to Licensed  Patent Rights or
          Licensed Knowhow.

Article 10.0 General Provisions

10.1 Notices.  Any  notice,  request,   delivery,  demand,  report,  accounting,
     approval or consent  required or permitted to be given under this Agreement
     shall be in writing and shall be deemed  sufficiently given on the same day
     as delivery if  delivered  in person or  transmitted  by  telecopier  (with
     confirmed  answer-back)  in any case by 5:00 p.m.  local time,  on the next
     business day if sent by overnight  courier  service,  and in three business
     days if sent by registered or certified  mail, in any case addressed to the
     Party to whom it is  directed  at its  address  shown  below or such  other
     address as such Party shall have last given by notice to the other Party in
     accordance with this Section:

         If to VaxGen, addressed to:    VaxGen, Inc.
                                        1000 Marina Boulevard
                                        Brisbane, CA 94005-1841
                                        Attn: Dr. Lance K. Gordon, CEO

         If to Celltrion, addressed to: Celltrion, Inc.
                                        Hanmi Bank Building, 13th Floor
                                        1127, Guwol-Dong, Namdong-Gu
                                        Incheon City, 405-220, Korea
                                        Attn: Mr. James P. Panek

10.2 Governing  Law.  This  Agreement  shall be  governed  by and  construed  in
     accordance with the laws of the State of California  (other than its choice
     of law principles).

10.3 Entire  Agreement.  Except for a certain  Sublicense  Agreement between the
     Parties of even date herewith,  this Agreement is the entire  agreement and
     understanding  between  the  Parties  with  respect to the  subject  matter
     hereof,  and  supersedes  and  cancels  any  and  all  prior  negotiations,
     correspondence,  understandings  and  agreements,  whether written or oral,
     between the Parties respecting the subject matter hereof.

10.4 Binding Effect and  Assignment.  This  Agreement  shall be binding upon and
     inure to the benefit of the Parties hereto and their  respective  permitted
     successors and assigns, subject to the remainder of this Section 10.4. This
     Agreement  shall  not be  assignable  by  either  Party in whole or in part
     without the other Party's prior consent in its sole discretion, except that
     either  Party may assign  this  Agreement  in whole or in part  without the
     other  Party's  consent  in  connection  with  any  consolidation,  merger,
     redemption,  put or sale of stock,  conveyance of substantially  all of the
     assigning  Party's assets, or  change-of-control  transaction that involves
     the assigning Party.

10.5 Dispute  Resolution.  In the  event of any  dispute,  controversy  or claim
     arising  out of or  relating to this  Agreement,  the Parties  shall try to
     settle it  amicably  between  themselves  including  first  referring  such
     dispute,  controversy  or  claim  to a  member  of each  Party's  Board  of
     Directors  for  resolution.  If the  Parties  are unable to so settle  such
     dispute,  controversy  or claim  within 30 days after such  referral,  then
     either  Party  may,  by  notice to the  other,  have it  referred  to their
     respective chief executive officers for attempted  resolution by good faith
     negotiations  within  30 days  after  such  notice.  In the event the chief
     executive officers are not able to resolve it, either Party may at any time
     after the 30-day period invoke the  arbitration  provisions of this Section
     10.5.

<PAGE>

      All  arbitration  proceedings  shall be conducted in  accordance  with the
      Rules of Arbitration  and  Conciliation  of the  International  Chamber of
      Commerce,  in  English.  All  arbitration  proceedings  shall  be  in  San
      Francisco,  California if initiated by Celltrion and in Seoul,  Korea,  if
      initiated by VaxGen. The Party requesting arbitration shall serve upon the
      other  Party  a  demand  for  arbitration  stating  the  substance  of the
      controversy,  dispute or claim, and the contention of the Party requesting
      arbitration.  Within 60 days  after the  demand,  the  Parties  shall each
      select one  arbitrator,  which  arbitrators  shall together select a third
      arbitrator.  The three  arbitrators are to act as neutral  arbitrators and
      shall have no past,  present or anticipated  future  affiliation  with the
      Parties which would unduly  influence the  independence  of an arbitrator.
      The  decision of the  arbitrators  shall be in writing  setting  forth the
      basis therefore.

      The arbitrators  shall have the authority to award  compensatory  damages,
      interest,  tort damages (but not punitive or similar damages) and specific
      performance  and other  equitable  relief.  The Parties shall abide by the
      award  rendered  in such  arbitration  proceeding,  and such  award may be
      enforced and executed upon in any court having jurisdiction over the Party
      against whom enforcement of such award is sought.  During such arbitration
      proceedings,  each Party shall pay its arbitrators'  fees,  administration
      charges  and  related  expenses  of  arbitration.  The losing  Party shall
      thereafter  reimburse the prevailing  Party for all such costs incurred in
      connection with such arbitration.

10.6  Waiver.  The waiver by either Party of any breach of or default  under any
      of the  provisions  of this  Agreement  or the failure of either  Party to
      enforce any of the  provisions of this  Agreement or to exercise any right
      thereunder  shall not be  construed  as a waiver  of any  other  breach or
      default or a waiver of any such rights or provisions hereunder.

10.7  Severability. If any part of this Agreement shall be held invalid, illegal
      or unenforceable by any court of authority having  jurisdiction  over this
      Agreement  or either  Party,  such part shall be  ineffective  only to the
      extent of such invalidity,  illegality or  unenforceability,  and shall be
      validly  reformed by addition  or  deletion of wording as  appropriate  to
      avoid such result and as nearly as possible  approximate the intent of the
      Parties. If unreformable, this Agreement shall be divisible and deleted in
      such jurisdiction, but elsewhere shall not be affected.

10.8  Publicity.  Celltrion and VaxGen shall  consult and obtain mutual  consent
      before  making any public  announcement  concerning  this  Agreement,  the
      subject  matter  hereof  or use of the  other  Party's  name,  except  for
      information  that is already  in the public  domain or where the nature of
      such  information  has been  previously  approved for disclosure (in which
      case this Section 10.8 will no longer  apply to that  previously  approved
      information).

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

10.10 No Other Rights. No rights or licenses, express or implied, are granted to
      Celltrion  by  this  Agreement  to use in any  manner  any  trade  name or
      trademark of VaxGen,  or any other  intellectual  property  not  expressly
      covered by this Agreement.

10.11 Force  Majeure.  Neither  Party  shall be  liable to the other for loss or
      damages or shall have any right to  terminate  this  Agreement  (except as
      otherwise  provided  in this  Agreement)  for any  default or delay of the
      other Party in its  performance  under this Agreement that is attributable
      to an act of God, flood, fire, explosion,  strike, lockout, labor dispute,
      casualty or accident,  war,  revolution,  civil  commotion,  act of public
      enemies,  blockage  or  embargo,  injunction,  law,  order,  proclamation,
      regulation,   ordinance,  demand  or  requirement  of  any  government  or
      subdivision,  authority or representative  of any such government,  or any
      other cause beyond the reasonable  control of the affected  Party,  if the
      Party  affected  shall give  prompt  notice of any such cause to the other
      Party.  The Party giving such notice shall  thereupon be excused from such
      of its  obligations  hereunder  for  the  period  of  time  that  it is so
      disabled.

10.12 Headings. Headings are for the convenience of reference only and shall not
      control the  construction  or  interpretation  of any of the provisions of
      this Agreement.

10.13 No  Partnership.  Nothing in this Agreement is intended or shall be deemed
      to constitute a partnership, agency,  employer-employee,  or joint venture
      relationship  between the Parties.  Neither Party shall incur any debts or
      make any commitments for the other Party.

10.14 Modification.  Any modification to this Agreement shall be made in writing
      duly signed by both Parties.

IN WITNESS  WHEREOF,  the Parties  each have caused  this  Agreement  to be duly
executed by its duly authorized representative as of the date set forth above.

<PAGE>

VAXGEN, INC.                         CELLTRION, INC.

By: ______________________           By: ______________________________
Name: Dr. Lance K. Gordon            Name: Mr. Jung-Jin Seo
Title: Chief Executive Officer       Title: Co-Representative Director


                                     CELLTRION, INC.

                                     By: ______________________________
                                     Name: Mr. James P. Panek
                                     Title: Co-Representative Director

<PAGE>

                                    Exhibit A

                                Licensed Knowhow

                                                             Platform Technology

VaxGen will provide to Celltrion all  necessary  knowhow to establish a platform
technology capability for the design, startup and validation,  operation and FDA
licensure of a commercial scale cell culture  manufacturing  operation  suitable
for  production  of bulk  human  therapeutic  proteins,  including  AIDSVAX  and
monoclonal antibodies.

This transfer  will include  platform  technology  required for:

      o     Seed culture preparation and culture expansion

      o     Commercial scale cell culture

      o     Cell separation, harvest and cell inactivation

      o     Commercial   scale   affinity,   ion  exchange  and  size  exclusion
            chromatography

      o     Viral inactivation/removal

      o     Ultrafiltration, diafiltration and tangential flow filtration

      o     Media and buffer preparation

      o     All associated analytical methods

VaxGen will establish this platform  technology  capability by providing knowhow
in the following categories:

Facility Design

Overall plant design and layout concepts
Process flow, material flow and personnel flow requirements
Area classifications and architectural finish requirements
Air flow and pressurization requirements
Utility requirements
Support services and laboratory requirements

Process Design

Process descriptions
Process flow diagrams
Process controls and automation strategy
Equipment lists
Equipment layouts
Process and instrumentation drawings

Startup and Validation

Validation Master Plan
Turn-over Package requirements
Installation, Operation and Performance Qualification (IQ,OQ,PQ) requirements
Controls Qualification
Environmental monitoring (particulate, bioburden)requirements
Equipment cleaning and product change-over requirements
Sterility testing requirements
Documentation system requirements
Calibration and preventative maintenance requirements

<PAGE>

Operations

Personnel training requirements and records
Access and gowning procedures
Process and equipment trouble shooting
Trial run and "buffer blank" planning and execution support
Process deviation and Out Of Spec (OOS) investigation requirements and support
Cell Culture contamination prevention plans and investigation support
Quality Systems SOP's

Licensure Support

FDA Facility Plan review preparation and coordination
CMC section requirements to support BLA amendment
FDA inspection preparation and mock audits
FDA inspection participation and coordination
Inspection observations resolution

<PAGE>

                                    Exhibit B

                             Licensed Patent Rights

There are no  issued  patents  or  patent  applications  filed  relating  to the
Licensed Patent Rights as of the date of execution of the License Agreement.

<PAGE>

                                                                       Exhibit C

                         Schedule of Technology Transfer

The knowhow  described in Exhibit A will be transferred in phases  corresponding
to the  forecasted  schedule  for  development  of the Launch  facility  and the
Incheon facility. Transfer of knowhow will be initiated in the following phases:

     Launch and Incheon Facilities Design                           1Q02 - 4Q02

o    Platform Technology Facility Design

o    Platform Technology Process Design

o    AIDSVAX Method of Manufacture

         Lists of raw material

         Process flow chart

         Cell substrate/host cell descriptions

         Expression vector descriptions

         Cell seed culture procedures

         Cell growth and harvesting procedures

         Purification and downstream processing procedures


|_|  AIDSVAX Process Description

|_|  AIDSVAX Validation Requirements and Master Plan

     Launch Facility Start-up, Validation and Operation              1Q03 - 3Q04
     overlapping with Incheon Facility Construction

|_|  Platform Technology Startup and Validation

|_|  Platform Technology Operations

|_|  AIDSVAX Validation Requirements and Master Plan (Incheon Facility)

|_|  AIDSVAX Drug Substance Storage and Shipping Requirements

|_|  AIDSVAX Process validation procedures and data

|_|  Copies of completed batch history records for actual AIDSVAX launch
     facility qualification production lots (completed Manufacturing and
     Analytical Testing "tickets").

|_|  AIDSVAX Regulatory Documents (and subsequent updates)

|_|  Associated Training of Celltrion Staff

     Incheon Facility Start-up and Validation                        3Q04 - 4Q05

|_|  AIDSVAX Materials

|_|  AIDSVAX Description and Characterization

|_|  AIDSVAX Process Controls

|_|  AIDSVAX Drug Substance Specifications and Analytical Methods

|_|  AIDSVAX Manufacturing Documents

|_|  AIDSVAX Analytical Documents

|_|  Other AIDSVAX Quality Documents and Support

|_|  Associated Training of Celltrion Staff

     Incheon Facility Licensure, Technology  4Q05 - Expiration of Supply
     Agreement and Quality Support

|_|  Platform Technology and AIDSVAX Specific Licensure Support

|_|  Associated Training of Celltrion Staff