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                             CANCELLATION AGREEMENT

entered into between

BIGMAR,  INC,  a  Delaware  corporation  having  its place of  business  at 6660
Doubletree Avenue #20, Columbus, Ohio, 43229 USA, hereafter "BIGMAR",
duly represented by Mr. John Tramontana, president of BIGMAR

and

CERBIOS-PHARMA  SA, a Swiss corporation having its place of business at via Pian
Scairolo 6, 6917 Barbengo, Switzerland, hereafter "CERBIOS", duly represented by
Mr.  Giuseppe  Rovelli,  in  accordance  with  the  Resolution  of the  board of
directors of Cerbios executed on March 25, 1997,  hereto enclosed in original as
Exhibit A.

                                       ***


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                                                                               2

RECITALS

Whereas
a) on November  14, 1995 Bigmar and the Sapec  division of Cerbios  have entered
   into  the  Exclusive  distribution  and  supply  agreement  relating  to  the
   following products:
   Leucovorin Calcium (Calcium Folinate)
   6S - Calcium Folinate
   Calcium Methyl - tetrahydrofolate
   Disodium Clodronate;

b) on December  14, 1995  Bigmar and the Sapec  division of Cerbios  executed an
   addendum to the above  mentioned  agreement of November 14, 1995  relating to
   the additional following products:
   Sodium Leucovorin (Sodium Folinate)
   Dacarbazine
   Methotrexate;

c) in November  1996,  according  to par 2 of the above  mentioned  agreement of
   November  14,  1995,  Bigmar  paid a license fee of US$100,000 -- to Cerbios,
   with    value date November 21, 1996;

d) Bigmar made several purchases relating to some of the products concerning the
   above mentioned agreement of November 14, 1995;


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                                                                               3

e) the  parties  deem  that it is in their  own  best  interest  to close  their
   commercial  relationships  relating  to  the  above  mentioned  agreement  of
   November 14, 1995 and its addendum of December 14, 1995,

all this aforementioned,
the parties agree as follows:

1. The parties agree to cancel and cancel the Exculsive  distribution and supply
   agreement  of November  14, 1995 as well as its addendum of December 14, 1995
   with immediate effect.

2. The  license  fee of  US$100,000--remains  for the benefit and the account of
   Cerbios,  which  therefore  is  entitled  to keep such  amount,  without  any
   obligation to refund it to Bigmar.

3. With the  execution  of the present  Cancellation  agreement  the parties are
   lifted  from  any  and  all   obligations   connected   with   the  Exclusive
   distribution  and  supply  agreement  of  November  14,  1995  as well as its
   addendum  of  December   14,  1995,   except  from  those   relating  to  the
   confidentiality  clause  (clause 10), which shall continue to have effect and
   from those relating to the payment of the outstanding invoices.

4. The  present  agreement  shall  take  effect  and enter into force as soon as
   Bigmar will have  delivered  two originals of the  corresponding   "Unanimous
   written  consent of the board of  directors  of Bigmar,  Inc.",  in  the form
   attached hereto as EXHIBIT B, to the notary public



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                                                                               4

   Mr. Pietro Moggi,  who is herewith  instructed by the parties to receive such
   resolution  and  deliver  one  original of  this   resolution   to   Cerbios.

   Bigmar undertakes to deliver this resolution to the notary public within  the
   10th of April 1997. 

   In case of failure to provide the "Unanimous  written consent  of  the  board
   of  directors  of  Bigmar,  Inc."   within   the  10th  of  April  1997,  the
   present agreement will not come into force and will be  considered  null  and
   void.

5. This  agreement  shall be governed by and  construed in  accordance  with the
   substantive  laws of the State of Ohio, USA,  without regard to Ohio's choice
   of law rules.

6. Any  disputes  or  differences  between  the  parties  arising  out of, or in
   connection  with  this  agreement  shall  be  resolved  in New York by a sole
   arbitrator, in accordance with the rules and regulations of the International
   Chamber of Commerce of Paris.

In witness whereof,  both parties have caused this agreement to be signed in six
originals, two for each party and two for the notary public, by their respective
duly authorised officers or representatives on the date indicated below.

Lugano, 27th of March 1997

BIGMAR, INC.                                     CERBIOS-PHARMA SA

By:                                              By:
   ---------------------------                      ---------------------------
   Name: John Tramontana                            Name: Giuseppe Rovelli
   Title: President                                 Title: Officer



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                                    VERBALE
                        DEL CONSIGLIO DI AMMINISTRAZIONE
                                     DELLA

                          CERBIOS-PHARMA SA, BARBENGO

La riunione del consiglio e tenuta a Barbengo, negli uffici della Cerbios-Pharma
SA, che dopo discussione ha adottato le seguenti risoluzioni:

1. e approvata la sottoscrizione  della convenzione con Bigmar,  Inc., Columbus,
   Ohio,  relativa alla risoluzione del contratto   "Exclusive  distribution and
   supply agreement"   stipulato il 14 novembre 1995 tra la divisone Sapec della
   Cerbios-Pharma  e  la  Bigmar,   Inc.;  e  parimenti  annullata  la  modifica
   contrattuale del 14 dicembre 1995;

2. e conferito mandato al signor Giuseppe Rovelli per la firma della convenzione
   con Bigmar, Inc.

Lugano, 25 marzo 1997

/s/ Ing. Attilio Melera                           /s/ Jan Jacob van Troostenburg
-------------------------------                   ------------------------------
ING. ATTILIO MELERA                               JAN JACOB VAN TROOSTENBURG

/s/ Pierangelo Ghirlanda
-------------------------------
PIERANGELO GHIRLANDA




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                                    MINUTES
                           OF THE BOARD OF DIRECTORS
                                       OF

                         CERBIOS-PHARMA INC., BARBENGO


The meeting of the Board of Directors  was held in  Barbengo,  at the offices of
Cerbios-Pharma Inc., and after discussion adopted the following resolutions:

1. The  subscription to the convention  with Bigmar,  Inc.,  Columbus,  Ohio was
   approved  according to the  resolution  of the  "Exclusive  distribution  and
   supply agreement"  contract dated 14 November 1995 between the Sapec division
   of Cerbios Pharma and Bigmar Inc.; the  contractual  amendment of 14 December
   1995 was also nullified.

2. Mr.  Giuseppe  Rovelli was given  power-of-attorney  for the convention  with
   Bigmar, Inc.

Lugano, 25 March 1997



(signature)                             (signature)
----------------------------            -------------------------------
Engineer Attilio Melera                 Jan Jacob Van Troostenburg

(signature)
----------------------------
Pierangelo Ghirlanda



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                           UNANIMOUS WRITTEN CONSENT
                                       OF
                             THE BOARD OF DIRECTORS
                                       OF
                                  BIGMAR, INC.


The  undersigned,  being all of the  Directors of BIGMAR,  INC.,  a  corporation
organised and existing under the laws of the State of Delaware (the  "Company"),
do  hereby  consent,   pursuant  to  Section  141(f)  of  the  Delaware  General
Corporation  Law and Section 15 of the Restated  Bylaws of the  Company,  to the
adoption  without a meeting of the following resolutions and that this action be
taken without a meeting  pursuant to said Section 141(f) of the Delaware General
Corporation Law and Section 141(f) of the Delaware  General  Corporation Law and
Section 15 of the Restated Bylaws of the Company;

Whereas,  Mr.  John  Tramontana  has  disclosed  to the Board of  Directors  his
interests and willingness in the  cancellation of the  Distribution  and License
Agreements (defined below);

Whereas, a majority of the disinterested directors of the Company has determined
that the cancellation of the (i) Exclusive  Distribution  and Supply  Agreement,
dated  November 14, 1995,  between the Company and the SAPEC Division of Cerbios
Pharma SA ('Sapec'), (ii) License and Supply Agreement, dated November 14, 1995,
between  the  Company  and   Bioferment,   a  division  of  Cerbios   Pharma  SA
("Bioferment")  and (iii) Exclusive  Distribution  and Supply  Agreement,  dated
December  14,  1995,  between  the  Company and  Bioferment  (collectively,  the
"Distribution and License  Agreements"),  is desirable and in the best interests
of the Company; and

Whereas, the Cancellation  Agreements have already been signed on March 27, 1997
by Cerbios-Pharma SA and by Mr. John Tramontana, in his capacity of president of
Bigmar,  Inc., on behalf of Bigmar,  Inc., a copy of which is attached hereto as
Exhibit A, B and C; and

Whereas,  Mr. John Tramontana has given to the Board of Directors an original of
each of the above three Cancellation Agreements, which correspond in full to the
Exhibits A, B and C; and

Whereas, a majority of the disinterested directors of the Company has determined
that the above Cancellation Agreements, which effect the cancellation of each of
the Distribution and License  Agreements are desirable and in the best interests
of the Company.


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NOW, THEREFORE,  BE IT RESOLVED, that the Cancellation Agreements be, and hereby
are, approved, authorized, ratified and adopted in all respects; and be it

FURTHER RESOLVED, that the execution and delivery of the Cancellation Agreements
by the President  Mr. John  Tramontana  is the  enforceable  and binding act and
obligation  of the Company,  without the signature or  attestation  of any other
officer of the Company or the affixing of any corporate seal; and be it

FURTHER RESOLVED,  that any and all actions heretofore or hereafter taken within
the terms of the foregoing  resolutions be, and hereby are,  affirmed,  approved
and ratified as the act and deed of the Company.

This Unanimous Written Consent may be executed in multiple counterparts, each of
which shall  constitute  an original and all of which shall  constitute a single
document.

IN WITNESS WHEREOF, the undersigned have executed this Unanimous Written Consent
on         , 1997 and directed that it be filed with the minutes of  proceedings
of the Board of Directors.

                                     /s/ John G. Tramontana
                                         -------------------------
                                         JOHN G. TRAMONTANA


                                         -------------------------
                                         MICHAEL K. MEDORS


                                         -------------------------
                                         BERNARD KRAMER


                                         -------------------------
                                         ERIC M. CHEN


                                         -------------------------
                                         JOHN MORRIS


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