<PAGE>

                                                                    Exhibit 10.8

Certain confidential portions of this Exhibit were omitted by means of blackout
of the text (the "Mark"). This Exhibit has been filed separately with the
Secretary of the Securities and Exchange Commission without the Mark pursuant to
the Company's Application for Order Granting Confidential Treatment pursuant to
Rule 406 under the Securities Act of 1933, as amended.

[West Pharmaceutical Services LOGO]

                       WEST PHARMACEUTICAL SERVICES, INC.

                         And its wholly owned subsidiary

                   WEST PHARMACEUTICAL SERVICES DRUG DELIVERY
                         & CLINICAL RESEARCH CENTRE LTD.


                                       and



                     INNOVATIVE DRUG DELIVERY SYSTEMS, INC.




                       RESEARCH AND DEVELOPMENT AND OPTION
                                    AGREEMENT

                                (Nasal Fentanyl)





                             Dated October 24, 2000


<PAGE>

                  RESEARCH AND DEVELOPMENT AND OPTION AGREEMENT

         THIS IS A RESEARCH AND DEVELOPMENT AND OPTION AGREEMENT (the
"Agreement"), dated as of October 24, 2000 (the "Effective Date"), among West
Pharmaceutical Services, Inc., a Pennsylvania corporation, ("West") with offices
at 101 Gordon Drive, Lionville, PA, 19341, its wholly owned subsidiary West
Pharmaceutical Services Drug Delivery & Clinical Research Centre Ltd., a
corporation organized under the laws of England and Wales, ("West/Nottingham")
with offices at Albert Einstein Centre, Nottingham Science & Technology Park,
University Boulevard, Nottingham, NG7 2TN, United Kingdom (West and
West/Nottingham collectively being referred to herein as the "West Group"); and
Innovative Drug Delivery Systems, Inc., a Delaware corporation, ("IDDS") with
offices located at 787 Seventh Avenue, New York, New York 10019.

                                   Background

         West (directly and through its subsidiaries, including West/Nottingham)
is engaged in, among other things, the research and development of delivering
pharmaceutical compounds using its patented and proprietary drug-delivery
technology. West/Nottingham is the owner of the entire right, title and interest
in certain issued letters patent and pending patent applications relating to the
use of chitosan for the transmucosal delivery of pharmaceutical compounds,
including the delivery of morphine via the nasal mucosa. West, West/Nottingham
and IDDS have entered into a License Agreement as of August 25, 2000 (the
"License Agreement") under which West and West/Nottingham have granted IDDS an
exclusive worldwide license to make, use and sell products including fentanyl
covered by such patents for the treatment of pain in humans and animals.

         IDDS desires that the West Group to perform certain work for the
development of a product for administering fentanyl via the nasal mucosa, and to
itself conduct further development work and to pay West certain milestone
payments with respect thereto, and also desires to grant West an option to
manufacture commercial quantities of the developed products, all on the terms
and conditions set forth herein.

                                    Agreement

         Accordingly, intending to be legally bound, the Parties agree as
follows:

1.       Definitions. Terms defined in this Section 1 and parenthetically
         elsewhere in this Agreement will throughout this Agreement have the
         meanings here or there provided. Defined terms may be used in the
         singular or in the plural, as sense shall require.

         1.1.     "Affiliate" means, with respect to any Party, an entity, over
                  50% of the voting securities of which are directly or
                  indirectly controlled by such Party, or an entity that
                  directly or indirectly controls over 50% of the voting
                  securities of such Party.

<PAGE>

         1.2.     "Background IP" means know-how, knowledge, experience,
                  inventions, processes, technical information, trade secrets,
                  formulas, protocols, data and results (and any patents and
                  patent applications claiming any of the foregoing) arising
                  from or acquired outside the development activities under this
                  Agreement that is necessary or useful for practicing the art
                  covered by the Licensed Patents or the Program IP.

         1.3.     "Development Program" means the program of work for the
                  development of the Licensed Product, including milestones to
                  be achieved, cost estimates, relevant time schedules, etc.,
                  attached hereto as Exhibit A and as modified from time to time
                  by written agreement of the Parties.

         1.4.     "EMEA" means the European Agency for the Evaluation of Medical
                  Products.

         1.5.     "Fair Market Value" means, with respect to NLPT Securities,
                  the average closing bid price as quoted by the Exchange for
                  the 20-Business Day period that commences on the 10th Business
                  Day immediately preceding the date of the event that triggers
                  the milestone payment and ends on the 10th Business Day
                  immediately following such date. As used herein, a "Business
                  Day" is a day on which banks and the Exchange are open for the
                  transaction of business in New York City.

         1.6.     "Field of Use" means the delivery of fentanyl via the nasal
                  mucosa to humans or animals for the treatment of pain.

         1.7.     "FDA" means the U.S. Food and Drug Administration.

         1.8.     "IND" means an Investigational New Drug Application.

         1.9.     "Launch" means commencement of commercial sale of the Licensed
                  Product following receipt of all necessary Regulatory Agency
                  approvals

         1.10.    "Launch Date" means the date of the first such commercial sale
                  following the Launch.

         1.11.    "Licensed Patents" means the letters patent and letters patent
                  that may issue from patent applications listed in Schedule 1
                  of the License Agreement which relate to nasal fentanyl,
                  including all continuations, continuations-in-part,
                  divisionals, reissues and reexaminations thereof.

         1.12.    "Licensed Product" means fentanyl combined with chitosan or a
                  chitosan derivative or salt for administration to humans and
                  animals via the nasal mucosa and which is covered by one or
                  more claims of the Licensed Patents.


                                       2
<PAGE>

         1.13.    "Major Market Country" means the United States, Japan, or any
                  European Union nation party to the EMEA Mutual Recognition
                  guidelines for pharmaceutical products.

         1.14.    "NLPT Securities" means equity securities of IDDS or an
                  Affiliate that are listed on any of the New York Stock
                  Exchange, NASDAQ National Market System, NASDAQ Small-Cap
                  Market or American Stock Exchange (each, an "Exchange") and
                  that meet the continuing listing requirements of such Exchange
                  at the time the securities are issued.

         1.15.    "NDA" means a New Drug Application in the U.S., or the
                  analogous process as defined in applicable laws and
                  regulations by which application is made with the appropriate
                  Regulatory Agency of a given country for approval to market a
                  drug in that country.

         1.16.    "Party" means a party to this Agreement.

         1.17.    "Person" means an individual, partnership, limited liability
                  company, corporation, trust or unincorporated organization or
                  other business entity, and a government or agency or political
                  subdivision thereof.

         1.18.    "Program IP" means know-how, knowledge, experience,
                  inventions, processes, technical information, trade secrets,
                  formulas, protocols, data and results (and any patents and
                  patent applications claiming any of the foregoing), arising
                  from or acquired specifically in the course of the development
                  activities covered by this Agreement that relate specifically
                  to the Licensed Product within the Field of Use.

         1.19.    "Regulatory Agency" means any governmental regulatory
                  authority responsible for granting health or pricing
                  approvals, registrations, import permits and other approvals
                  required before the Licensed Product may be tested or marketed
                  in any country. Regulatory Agency shall include the FDA, EMEA
                  and any analogous agency in any other country or region.

         1.20.    Successful Completion" means, with respect to a Phase I
                  clinical study, results that would be considered commercially
                  reasonable grounds for deciding to immediately proceed with
                  further Phase II or Phase III clinical studies.

2.       Development Activities.

         2.1.     Conduct of Development Program; Condition to Commencement of
                  Work.

                  2.1.1.   Each Party will undertake development of the Licensed
                           Product in accordance with a written Development
                           Program agreed to by the West Group, on the one hand,
                           and IDDS, on the other hand, as set forth in Exhibit
                           A hereto. The Development Program may be modified
                           only by written agreement of the Parties. Each Party
                           will make every reasonable effort to complete its
                           responsibilities under the Development Program within
                           the timetables set out therein but if some cause
                           beyond the reasonable control or foresight of such
                           Party shall interrupt the progress of the Development
                           Program then the other Parties shall allow a
                           reasonable additional period of time to complete the
                           Development Program.


                                       3
<PAGE>

                  2.1.2.   IDDS need not commence development work on a Licensed
                           Product containing fentanyl and chitosan until the
                           FDA allows (by way of a pre-Phase III meeting or
                           otherwise) the commencement of Phase III clinical
                           studies with respect to a product containing opioid
                           alkaloid morphine and/or a salt thereof and chitosan.

         2.2.     Project Team.

                  2.2.1.   Promptly following the Effective Date, the Parties
                           shall form a Project Team, which shall be chaired by
                           a representative of IDDS and include representatives
                           of West and West/Nottingham. The Project Team shall
                           initially consist of those Persons listed on Schedule
                           A hereto.

                  2.2.2.   The purpose of the Project Team shall be to manage
                           the Development Program. The Project Team shall meet
                           monthly. Meetings may be held either in person or by
                           tele-conference or video-conference. The West Group
                           or IDDS, as applicable, shall prepare and circulate
                           written progress summaries of the Development Program
                           for the Project Team prior to each meeting, in such
                           form, content and detail as reasonably required by
                           the Project Team.

         2.3.     Payments for Development Work.

                  2.3.1.   IDDS shall pay to West the costs of the Development
                           Program work performed by or for West in the amounts
                           and according to the timetable as set forth in
                           Exhibit A. The Parties acknowledge that such cost may
                           vary by up to 10%, and West may revise any such
                           amount up or down by up to 10% by showing reasonable
                           justification therefor.

                  2.3.2.   IDDS shall have the right to select alternative
                           suppliers should West be unable to provide
                           competitive cost bids on any or all subprojects
                           listed in Exhibit A.

                  2.3.3.   IDDS shall have the right to select alternative
                           suppliers should West be unable complete any
                           subprojects listed in Exhibit A within a reasonable
                           projected timeframe.


                                       4
<PAGE>

                  2.3.4.   Payment Schedule. IDDS shall pay to West the costs
                           and fees for the subprojects listed in Exhibit A as
                           follows:

                           (a)  40% of the total subproject cost upon order
                                to commence;

                           (b)  30% of the total subproject cost invoiced
                                monthly in evenly divided amounts over the
                                duration of the subproject; and

                           (c)  30% of the total subproject cost upon
                                completion of the subproject.

                           (d)  Other than payments due upon order, payments
                                shall be due upon invoicing.

         2.4.     IDDS's Development and Commercialization Obligations. IDDS
                  shall, at its cost and expense, conduct the following
                  activities:

                  2.4.1.   IDDS shall perform the work set forth in and in
                           accordance with the Development Program.

                  2.4.2.   Diligently perform all activities necessary or
                           appropriate to obtain and maintain in full force and
                           effect Regulatory Agency approval in the U.S. and
                           each Major Market Country for the marketing of the
                           Licensed Product in the Field of Use; provided, that
                           IDDS shall not be required to pursue such Regulatory
                           Agency approvals in multiple Major Market Countries
                           simultaneously and IDDS may pursue such Regulatory
                           Agency approvals in such order as it decides
                           consistent with a commercially reasonable regulatory
                           strategy.

                  2.4.3.   At the earliest possible time, consistent with sound
                           scientific and business principles, file applications
                           for, and use its best commercial efforts to pursue
                           Regulatory Agency approval to sell, the Licensed
                           Product in each Major Market Country and, either
                           directly or through sublicensees under the License
                           Agreement, in other countries where a reasonable
                           market opportunity exists, and

                  2.4.4.   Use all reasonable commercial efforts to Launch the
                           Licensed Product within 90 days after receiving all
                           necessary approvals in each such country.

                  2.4.5.   IDDS shall maintain insurance covering all of its
                           development activities (including without limitation
                           insurance covering clinical trials) hereunder in such
                           amounts and against such risks as is customary by
                           companies engaged in the same or similar business and
                           similarly located, and shall, upon West's request,
                           furnish evidence reasonably satisfactory to West of
                           such insurance. Such policies shall, at a minimum,
                           provide for:


                                       5
<PAGE>

                           (a)  no less than $*** professional clinical trial
                                insurance coverage, including products and
                                complete operations coverage; and

                           (b)  no less than 30 days advance notice to West
                                from the insurer or broker of any change or
                                cancellation of such coverage.

         2.5.     West's Obligations.

                  2.5.1.   West shall, at its cost and expense, reasonably
                           cooperate with IDDS and provide IDDS with such
                           information and documentation in West's possession,
                           including without limitation data, graphs, figures
                           and specifications, as may be reasonably required for
                           IDDS to perform its development and commercialization
                           obligations hereunder (including without limitation
                           the necessary U.S. and foreign regulatory filings);
                           provided that this Section shall not be construed to
                           require West to perform any studies, trials or other
                           development or commercialization work.

                  2.5.2.   West shall perform the work set forth as West's
                           responsibilities in and in accordance with the
                           Development Program.

         2.6.     Survival of Obligations. Notwithstanding any other provision
                  of this Agreement, so long as the License Agreement remains in
                  effect, the obligations of IDDS under this Section 2 and the
                  obligations of West under Section 2.5.1 shall survive any
                  termination of this Agreement for any reason whatsoever,
                  including without limitation by reason of breach by West or
                  West/Nottingham.

3.       Milestone Payments.

         3.1.     Milestone Payments. In consideration of the obligations
                  undertaken by West and West/Nottingham and the rights granted
                  to IDDS under this Agreement and the License Agreement, IDDS
                  shall pay to West:

                  3.1.1.   Within thirty (30) days following successful
                           completion of proof-of-principle in vitro and in vivo
                           animal studies demonstrating the absorption,
                           distribution, metabolism, excretion (ADME), safety,
                           tolerability and efficacy of transnasal delivery of
                           fentanyl, the amount of U.S.$***;

                  3.1.2.   Within thirty (30) days following the successful
                           completion of the first Phase I trial for a Licensed
                           Product that is under development through an
                           IDDS-sponsored or West-sponsored IND, the amount of
                           U.S.$***.

*** Represents material which has been omitted pursuant to an Application for
    Order Granting Confidential Treatment and filed separately with the
    Commission.

                                       6
<PAGE>

                           (a)  For the purposes of this Section, "Phase
                                I trial" means an initial Phase I clinical
                                trial in normal volunteers or an initial
                                Phase I/II clinical trial in less than fifty
                                (50) patients suffering from pain, as
                                determined by IDDS in accordance with the
                                Development Program.

                  3.1.3.   Within 30 days following the administration of the
                           first dose in the first pivotal Phase III trial for a
                           Licensed Product that is under development through a
                           West-sponsored or IDDS-sponsored IND (or other
                           equivalent regulatory filing such as a CTX), the
                           amount of $***;

                  3.1.4.   Within 60 days following the first filing of an NDA
                           with a Regulatory Agency in a Major Market Country
                           for the Licensed Product, the amount of $***;
                           and

                  3.1.5.   Within 60 days following the date of the receipt of
                           the first approvable letter from a Regulatory Agency
                           of an NDA in a Major Market Country for a Licensed
                           Product, the amount of $***.

         3.2.     Extended Payment Date and Interest Thereon. Notwithstanding
                  the foregoing, IDDS may pay the amounts due under Sections
                  3.1.4 and 3.1.5 hereof up to an additional 30 days following
                  the applicable due date (i.e., up to 90 days after such due
                  date) without being in violation of this Agreement, provided
                  that any amounts remaining unpaid after 60 days from the due
                  date shall bear interest at the U.S. prime interest rate for
                  short-term funds plus two percentage points from such due date
                  until the date it is received. The interest will be calculated
                  on a daily average basis.

         3.3.     Manner of Payment. Except as provided in Section 3.4 hereof,
                  all amounts payable under this Agreement shall be in United
                  States dollars by wire transfer of immediately available funds
                  to an account or accounts specified in writing by West at
                  least five days prior to the due date thereof.

         3.4.     Payment By Issuance of NLPT Securities.

                  3.4.1.   If the Parties mutually agree, some or all of the
                           amounts due under Sections 3.1.4 and/or 3.1.5 hereof
                           may be paid by issuance to West of a number of shares
                           of NLPT Securities equal to the applicable payment
                           amount divided by the Fair Market Value; provided
                           that at the time the NLPT Securities are issued, the
                           aggregate percentage of the total outstanding
                           securities of the issuing company (the "Issuer") held
                           by West shall not exceed 19.9%.

                  3.4.2.   The Parties shall use their best efforts
                           approximately 60 days prior to the estimated date of
                           achievement of a milestone event to meet and discuss
                           the option of taking payment in NLPT Securities in
                           lieu of cash.

*** Represents material which has been omitted pursuant to an Application for
    Order Granting Confidential Treatment and filed separately with the
    Commission.

                                       7
<PAGE>

                  3.4.3.   Any NLPT Securities issued pursuant to his Section
                           3.4 shall be subject to the Securities Issuance and
                           Registration Rights Agreement between West and IDDS
                           entered into as of September 22, 2000.

         3.5.     Survival of Obligation to Make Milestone Payments.
                  Notwithstanding any other provision of this Agreement, so long
                  as the License Agreement remains in effect, the obligations of
                  IDDS under this Section 3 shall survive any termination of
                  this Agreement for any reason whatsoever, including without
                  limitation by reason of breach by any member of the West
                  Group.

4.       Option to Manufacture. IDDS hereby grants to West an option to first
         negotiate with IDDS for the right to manufacture and/or package
         commercial quantities of the Licensed Product (the "Manufacturing
         Rights Option"), as follows:

         4.1.     No later than eighteen (18) months prior to the estimated
                  Launch Date, IDDS shall notify West of its anticipated need
                  for commercial quantities of Licensed Product. Such notice
                  shall include reasonable details of its requirements,
                  including first-year volume forecast, target pricing and other
                  information reasonably available to IDDS that shall have a
                  bearing on West's decision to exercise the Manufacturing
                  Rights Option.

         4.2.     Within 15 days following receipt of IDDS's notice under
                  Section 4.1 hereof, West shall notify IDDS of its intent to
                  exercise or not exercise the Manufacturing Rights Option.

         4.3.     If West exercises its Manufacturing Rights Option, West and
                  IDDS shall promptly commence and diligently pursue for the
                  next 45 days good-faith negotiations towards agreement to, and
                  execution of, a definitive supply agreement with respect
                  thereto. The definitive agreement shall contain terms and
                  conditions that are usual and customary for supply agreements
                  of similar type for goods of similar kind and quantity in the
                  U.S.

         4.4.     If West fails to exercise its Manufacturing Rights Option
                  within the time period set forth in Section 4.2 hereof, or
                  West and IDDS fail to conclude agreement on the terms of such
                  agreement within the time period set forth in Section 4.3
                  hereof, then IDDS shall be free to negotiate with and conclude
                  agreements with third Persons for manufacturing and/or
                  packaging of the Licensed Product, provided that no such
                  agreement (i) shall contain price terms or other terms and
                  conditions that, in the aggregate, are less favorable to IDDS
                  than the West's last proposal or (ii) shall contain any
                  material terms and conditions that are more favorable to the
                  third Person than the terms and conditions set forth in IDDS's
                  notice to West under Section 4.1 hereof.


                                       8
<PAGE>

5.       Intellectual Property Rights.

         5.1      Each Party shall own all intellectual property developed by
                  its independent research and development projects.

         5.2      West and West/Nottingham own and shall own all Background IP.

         5.3      IDDS shall own all Program IP developed by the IDDS-funded
                  portions of the Development Program, provided that West shall
                  have a non-exclusive, worldwide, fully paid-up, royalty-free,
                  perpetual license (with right to sublicense) to all such
                  Program IP relating in any way to manufacturing, scale-up and
                  production processes, techniques, inventions and know-how,
                  including without limitation clinical- and production-scale
                  manufacturing processes.

6.       Term and Termination.

         6.1      Term and Expiration. This Agreement shall become effective as
                  of the Effective Date and, unless terminated earlier pursuant
                  to this Section 6, shall remain in effect until the last to
                  occur Launch Date after the Licensed Product has been Launched
                  in all Major Market Countries.

         6.2      Termination. This Agreement may be terminated as follows:

                  6.2.1    By mutual consent of the Parties at any time.

                  6.2.2    By either West or IDDS upon written notice to the
                           other:

                           (a)  in the event of a default by the other Party
                                in the due observance or performance of any
                                covenant, condition or limitation of this
                                Agreement or the License Agreement, but only
                                if the defaulting Party will not have
                                remedied its default within 30 days (or
                                within 5 Business Days in the event of
                                default under Section 3) after receipt of
                                written notice of such default from the
                                non-defaulting party; or

                           (b)  if the other Party is adjudicated a
                                bankrupt, if insolvency, bankruptcy,
                                reorganization, debt adjustment or
                                liquidation proceedings are instituted
                                against such Party and not dismissed within
                                60 days after the institution thereof, if a
                                receiver or trustee is appointed for such
                                party and its assets, or if such Party makes
                                a general assignment for the benefit of its
                                creditors.

         6.3      Survival. Notwithstanding the termination of this Agreement,
                  all rights and obligations that by their terms survive
                  termination shall remain unaffected until the complete
                  satisfaction or expiration thereof.


                                       9
<PAGE>

7.       Representations and Disclaimer.

         7.1      Representations by West and West/Nottingham. Each of West and
                  West/Nottingham represents and warrants to IDDS:

                  7.1.1    It has the full legal right, power and authority to
                           enter in this Agreement.

                  7.1.2    It has not entered, and will not enter, into any
                           agreement that conflicts with the provisions of this
                           Agreement.

         7.2      Representations by IDDS. IDDS represents and warrants to West
                  and West/Nottingham:

                  7.2.1    It has the full legal right, power and authority to
                           enter in this Agreement.

                  7.2.2    It has not entered, and will not enter, into any
                           agreement that conflicts with the provisions of this
                           Agreement.

         7.3      Disclaimer of Warranties. EXCEPT AS OTHERWISE EXPRESSLY SET
                  FORTH IN THIS AGREEMENT, NEITHER WEST NOR WEST/NOTTINGHAM
                  MAKES ANY REPRESENTATION, GUARANTEE OR WARRANTY OF ANY KIND,
                  EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO
                  REPRESENTATIONS OR WARRANTIES TO THE SUCCESS OF ANY
                  DEVELOPMENT EFFORTS TO BE TAKEN HEREUNDER OR THE RESULTS TO BE
                  EXPECTED FROM IDDS'S USE OF ANY LICENSED PRODUCT OR FROM THE
                  MANUFACTURE, USE OR SALE OF THE LICENSED PRODUCT AND NO RIGHTS
                  IMPLIED OR OTHERWISE ARE GRANTED. NEITHER WEST,
                  WEST/NOTTINGHAM NOR ANY AFFILIATE OF ANY OF THEM SHALL HAVE
                  ANY RESPONSIBILITY TO IDDS OR OTHERS UNDER ANY LEGAL PRINCIPLE
                  FOR THE ABILITY OF IDDS OR THE QUALITY OR PERFORMANCE OF ANY
                  LICENSED PRODUCT DEVELOPED HEREUNDER; FOR CLAIMS OF THIRD
                  PERSONS RELATING TO ANY LICENSED PRODUCT MANUFACTURED OR SOLD
                  BY IDDS OR ANY OF ITS AFFILIATES OR SUBLICENSEES, OR FOR ANY
                  FAILURE IN LICENSED PRODUCTION, DESIGN OR OPERATION OF ANY
                  LICENSED PRODUCT MANUFACTURED OR SOLD BY ANY OF THEM. WEST AND
                  WEST/NOTTINGHAM DISCLAIM ANY WARRANTIES OF MERCHANTABILITY OR
                  FITNESS FOR A PARTICULAR USE. IN NO EVENT SHALL WEST,
                  WEST/NOTTINGHAM OR ANY AFFILIATE OF ANY OF THEM BE LIABLE TO
                  IDDS OR ANY AFFILIATE OR SUBLICENSEE FOR INDIRECT, SPECIAL,
                  INCIDENTAL OR CONSEQUENTIAL DAMAGES UNDER THIS AGREEMENT OR
                  OTHERWISE, REGARDLESS OF WHETHER WEST, WEST/NOTTINGHAM OR ANY
                  AFFILIATE OF ANY OF THEM KNEW OR HAD REASON TO KNOW OF THE
                  POSSIBILITY OF SUCH DAMAGES.


                                       10
<PAGE>

8.       Miscellaneous Provisions.

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

         8.2      Assignment. This Agreement may not be assigned or otherwise
                  transferred by any Party without the consent of the other
                  parties; provided, however, that either Party may, without
                  such consent, assign this Agreement and its rights and
                  obligations hereunder to its Affiliates or in connection with
                  the transfer or sale of all or substantially all of its
                  business, or in the event of its merger or consolidation or
                  change in control or similar transaction. Any purported
                  assignment in violation of the preceding sentence shall be
                  void. Any permitted assignee shall assume all obligations of
                  its assignor under this Agreement.

         8.3      Severability. In the event any one or more of the provisions
                  contained in this Agreement should be held invalid, illegal or
                  unenforceable in any respect, the validity, legality and
                  enforceability of the remaining provisions contained herein
                  shall not in any way be affected or impaired thereby, unless
                  the absence of the invalidated provision(s) adversely affect
                  the substantive rights of the parties. The parties shall in
                  such an instance use reasonable efforts to replace the
                  invalid, illegal or unenforceable provision(s) with valid,
                  legal and enforceable provision(s) which, insofar as
                  practical, implement the purposes of this Agreement.

         8.4      Notices Any notice or other communication pursuant to this
                  Agreement will be deemed duly made or given: (i) when
                  delivered by hand; (ii) 10 business days after it is mailed,
                  certified or return receipt request, with postage prepaid;
                  (iii) when sent, if sent by telecopy (with receipt confirmed)
                  or (iv) when receipt is signed for when sent by Federal
                  Express, DHL or other express delivery service. Notices will
                  be addressed as follows:


                                       11
<PAGE>

         If to West or West/Nottingham to:

         West Pharmaceutical Services, Inc.
         101 Gordon Drive
         Lionville, Pennsylvania 19341
         Attention:        Division President, Drug Delivery Systems
         Telecopier:       610 594-3013

         With a required copy to:

         West Pharmaceutical Services, Inc.
         101 Gordon Drive
         Lionville, Pennsylvania 19341
         Attention:        General Counsel
         Telecopier:       610 594-3013

         If to IDDS to:

         Innovative Drug Delivery Systems, Inc.
         787 Seventh Avenue
         New York, NY 10019
         Attention:        David M. Tanen
         Telecopier:       212 554-4355


         8.5.     Governing Law/Jurisdiction. This Agreement is acknowledged to
                  have been made in and shall be construed, governed,
                  interpreted and applied in accordance with the federal patent
                  laws and the laws of the Commonwealth of Pennsylvania, without
                  giving effect to its conflict of laws provisions. The state
                  and federal courts in Pennsylvania shall have exclusive
                  jurisdiction over any litigation arising under this Agreement.

         8.6.     Arbitration Clause. Any controversy or claim arising out of or
                  relating to this Agreement or the breach thereof, which
                  remains unsettled following diligent efforts by each Party to
                  reach a mutually acceptable resolution of such claim or
                  controversy, shall be settled by arbitration administered by
                  the American Arbitration Association and judgment on the award
                  rendered by the arbitrator(s) may be entered in any court
                  having jurisdiction thereof. This Section shall not prevent
                  any Party from seeking equitable relief.

         8.7.     Entire Agreement. This Agreement, the License Agreement, and
                  the Confidentiality Agreement among the Parties entered into
                  as of August 25, 2000 constitute the entire Agreement between
                  the parties with respect to the subject matter hereof, and
                  supersede all proposals, oral or written, purchase orders,
                  confidentiality agreements and all other communications
                  between the parties with respect to such subject matter.


                                       12
<PAGE>

         8.8.     Modifications The terms and conditions of this Agreement may
                  be amended only by a written instrument duly executed by the
                  Parties.

         8.9.     Headings. The headings and captions preceding the Sections
                  hereof are inserted solely for convenience of reference, and
                  will not constitute part of this Agreement, nor will they
                  affect its meaning, construction or effect.

         8.10.    Independent Contractors. It is expressly agreed that West and
                  West/Nottingham, on one hand, and IDDS, on the other hand, are
                  independent contractors with respect to this Agreement and
                  that the relationship between them created by this Agreement
                  shall not constitute a partnership, joint venture or agency.
                  No Party hereto shall have the authority to make any
                  statements, representations or commitments of any kind, or to
                  take any action, which shall be binding on any other Party,
                  without the prior consent of the Party to do so.

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

         8.12.    Counterparts. The Agreement may be executed in counterparts,
                  each of


                                       13
<PAGE>

                  which shall be deemed an original, but all of which together
                  shall constitute one and the same instrument.



    IN WITNESS WHEREOF, the Parties hereto have caused this instrument to be
    executed in duplicate by their respective duly authorized officers.


    INNOVATIVE DRUG DELIVERY SYSTEMS, INC.





   By:   /s/ Mark C. Rogers
       ---------------------------------
          Mark C. Rogers, M.D., Chairman


   WEST PHARMACEUTICAL SERVICES, INC.





   By:    /s/ Donald E. Morel Jr.
       ---------------------------------
          Donald E. Morel Jr., Division President, Drug Delivery Systems


   WEST PHARMACEUTICAL SERVICES DRUG DELIVERY &
   CLINICAL RESEARCH CENTRE, LTD.





   By:    /s/ Donald E. Morel Jr.
       ---------------------------------
          Donald E. Morel Jr., Chairman


                                       14
<PAGE>

                                    EXHIBIT A

                          Scope of Development Project


<PAGE>

EXHIBIT A

Nasal Fentanyl Development Program - Work to be Performed by IDDS

<TABLE>
<CAPTION>
Project/Activity                                                                          Responsibility
----------------                                                                          --------------
<S>                                                                                           <C>          <C>
IND Filing                                                                                    IDDS         To be completed within
                                                                                                           *** from initiation
                                                                                                           of project To be
                                                                                                           initiated *** filing
                                                                                                           fof IND

Phase I Clinical Trials
    Prepare clinical supplies                                                                 IDDS
    Active trial                                                                              IDDS
    Analysis of plasma samples                                                                IDDS
    PK analysis of plasma data                                                                IDDS
    Write/issue clin/stat report phase 1                                                      IDDS

Additional Phase I Study (If Needed)
PK-PD Study
    Prepare clinical supplies                                                                 IDDS
    Active trial                                                                              IDDS
    Analysis of plasma samples                                                                IDDS
    PK analysis & report                                                                      IDDS
    Write/issue clin/stat report phase 1                                                      IDDS

Phase II Clinical Trials                                                                                   To be initiated within
Phase 2 trial in patients with ***                                                                         *** of IND filing
   Prepare clinical supplies                                                                  IDDS
   Active trial                                                                               IDDS
   Analysis of plasma samples                                                                 IDDS
   Write/issue clin/stat report phase 2                                                       IDDS

Phase III Clinical Trials                                                                                  To be initiated within
First pivotal efficacy trial in ***                                                                        *** of IND filing
   Prepare clinical supplies                                                                  IDDS
   Active trial                                                                               IDDS
   Analysis of plasma samples                                                                 IDDS
   PK analysis of plasma data                                                                 IDDS
   Write/issue clin/stat report phase 3                                                       IDDS
Second pivotal efficacy trial in ***
   Prepare clinical supplies                                                                  IDDS
   Active trial                                                                               IDDS
   Analysis of plasma samples                                                                 IDDS
   PK analysis of plasma data                                                                 IDDS
   Write/issue clin/stat report phase 3                                                       IDDS

Pilot/Process Evaluation Batch Manufacture
Tech Transfer to mfg site                                                                     IDDS
Complete production validation                                                                IDDS
3 consecutive scale-up batches for NDA filing                                                 IDDS
Pre-approval inspection                                                                       IDDS

Registration                                                                                                To be filed within
End of Phase II Report                                                                        IDDS          *** of IND filing
Annual IND Updates                                                                            IDDS
NDA Submission & Approval
   NDA packages for CMC, Toxicology and PK                                                    IDDS
</TABLE>

*** Represents material which has been omitted pursuant to an Application for
    Order Granting Confidential Treatment and filed separately with the
    Commission.

<PAGE>

EXHIBIT A

Nasal Fentanyl Development Program - Work to be Performed by WPS

$(000)
                        Description                                Total
                        -----------                                -----
Formulation Development & Optimization                           $   ***

Proof of Principle
*** Feasibility Study (***)                                      $   ***
Including analytical & report

Initial Human Volunteer Trial                                    $   ***
(*** subjects)
Including analytical & report

Analytical Method Development                                    $   ***
and Stability Testing

Subchronic
GLP Toxicology Studies (***)                                     $   ***

Manufacturing of Phase I
Clinical Supplies (up to 3,000 units)                            $   ***

IND Package for
Submission (CMC, Clinical, PK & Tox)                             $   ***

U.S. Phase I Clinical Trial                                      $   ***
Approx. 20 normal volunteers (not to exceed 50)
Selected single formulation & package
Including analytical & report                                 ____________

                                                      Total      $ ***

 *  Fixed Fee Projects
 ** Non-IND Study
*** Represents material which has been omitted pursuant to an Application for
    Order Granting Confidential Treatment and filed separately with the
    Commission.