<PAGE>   1
                                              * Confidential Treatment Requested

                                                                   EXHIBIT 10.13

                   NEW ASSAY DEVELOPMENT AND OPTION AGREEMENT

        This NEW ASSAY DEVELOPMENT AND OPTION AGREEMENT (the "Agreement"),
effective as of June 20, 2000 (the "Effective Date"), is made by and between
Third Wave Technologies, Inc., a Wisconsin corporation, with a place of business
at 502 S. Rosa Road, Madison, WI 53719 ("TWT"), and SmithKline Beecham
Biologicals SA, a Belgian corporation, with a place of business at 89 rue de
l'Institut, B-1330 Rixensart, Belgium ("SBB"), and sets forth the agreement of
the parties as follows:

1. DEFINITIONS. The capitalized terms used herein shall have the definitions as
set forth in this Section 1, unless otherwise defined herein:

        a. "Affiliate" shall mean an entity which controls, is controlled by or
is under common control with SBB. For purposes of this definition, "control"
shall mean ownership or control, directly or indirectly, of more than fifty
percent (50%) of the shares of the subject entity entitled to vote in the
election of directors.

        b. "Confidential Information" shall have the meaning as set forth in
Section 7 below.

        c. "Development and Marketing Agreement" shall have the meaning as set
forth in Section 10 below.

        d. "Development Program" shall have the meaning as set forth in Section
2 below.

        e. "Evaluation" shall have the meaning as set forth in Section 4 below.

        f. "Field" shall mean use of Products for (A) SBB's own clinical trial
and pre-clinical trial applications (i.e., conducted by or on behalf of SBB or
its affiliates for SBB or its affiliate's own therapeutic applications)
conducted for a Pharmaccine or (B) reporting of patient results, in each case in
connection with the selection or determination of patients to receive a
therapeutic regime including a Pharmaccine and/or monitoring of therapeutic
progress and outcomes in connection with the treatment of such patients with a
Pharmaccine.

        g. "Improvement" shall mean any Invention which substantially comprises
an improvement, modification, or derivative of the Invader Squared Assays,
including without limitation, improvements and enhancements to: (i) assay ease
of use; (ii) methodologies, including sample preparation methods or procedures;
(iii) detection methods and protocols; (iv) data collection or analysis; (v)
multiplexing methods; or (vi) automation or miniaturization methodologies,
techniques and equipment.

        h. "Invader Squared Assay" shall have the meaning as set forth on
Attachment 1 hereto.

        i. "Initiation Notice" shall have the meaning as set forth in Section 3
below.

        j. "Initiation Payment" shall mean, with respect to a particular Phase,
the amount payable to TWT as described in Section 6 below.

        k. "Invention" shall mean any and all discoveries and inventions derived
from the Invader Squared Assays (whether patentable or not), made in the course
of performing the Evaluation or otherwise in connection with SBB's use of the
TWT Materials as permitted hereunder and all intellectual property rights
therein.

        1. "Option Notice" shall have the meaning as set forth in Section 10
below.

        m. "Option Period" shall mean the 90 day period beginning upon TWT's
receipt of the Option Notice or such longer period as the parties may agree in
writing.


<PAGE>   2

        n. "Pharmaccine" shall mean a therapeutic vaccine being developed or
marketed by or on behalf of SBB.

        o. "Phase" shall mean, individually, the Initial Phase, DNA Phase or RNA
Phase, as applicable.

        p. "Product" shall mean a diagnostic assay based on TWT's proprietary
Invader Squared Assay platform for a target nucleotide sequence designated by
SBB for use in the Field, in each case to the extent that TWT has the right to
develop such targets hereunder without (i) breaching the provisions of any
agreement to which TWT is a party at the time of SBB's designation or (ii)
infringing any third party intellectual property rights.

        q. "SBB Materials" shall mean, with respect to a particular Phase, the
sequence information and other materials described in Attachment 2 for such
Phase.

        r. "Standstill Period" shall mean the period expiring 90 days after
delivery of the Invader Squared Assays corresponding with the last Phase of the
Development Program initiated in accordance with this Agreement.

        s. "TWT Materials" shall mean, with respect to a particular Phase, the
Invader Squared Assays developed under the Development Program therefor.

        t. "TWT Technology" shall mean all know-how, patent and other
intellectual property rights owned or controlled by TWT and covering the
manufacture, use, sale or importation of the Products.

2. DEVELOPMENT PROGRAM. Promptly following execution hereof TWT shall use
diligent efforts to develop the Invader Squared Assays described in Attachment 1
for the Initial Phase, and upon receipt of the Initiation Payment for each
remaining applicable Phase, TWT shall use diligent efforts to develop the
Invader Squared Assays described in Attachment 1 for the corresponding Phase, in
each case subject to SBB providing TWT the corresponding SBB Materials. A
description of the development tasks to be performed by TWT for each Phase
hereunder is attached hereto as Attachment 1 (the "Development Program"). Upon
completion of each Phase of the Development Program, TWT agrees to transfer to
SBB the corresponding TWT Materials in accordance with the schedule set forth on
Attachment 1. TWT agrees to ship the TWT Materials CIP (Carriage and Insurance
Paid, Incoterms 1990) to the customs agent in Belgium reasonably designated by
SBB in writing. In addition to the TWT Materials, TWT shall provide to SBB the
quality control test data for the TWT Materials shipped to SBB hereunder.

3. PHASE INITIATION. Any time within sixty (60) days after SBB's receipt of the
Invader Squared Assays from the last initiated Phase, SBB may initiate the next
Phase (i.e., the DNA Phase or RNA Phase) by notifying TWT in writing of its
intent to initiate such Phase (the "Initiation Notice") and paying the
corresponding Initiation Payment. Notwithstanding the foregoing, the parties may
mutually agree in writing to extend such 60 day period in the event that SBB is
unable to reasonably complete the last initiated Phase during the 60-day period,
provided that in such event SBB shall use all diligent efforts to complete such
evaluation as soon as possible.

4. USE OF TWT MATERIALS. SBB agrees that all TWT Materials obtained from TWT
pursuant to this Agreement, shall be used solely for (i) its own internal
research and development purposes and (ii) evaluating whether or not SBB desires
to enter into the Development and Marketing Agreement (as described below)
and/or otherwise agreed by TWT in writing, such agreement not being unreasonably
withheld (the "Evaluation"), and


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not for any other commercial purposes, including diagnostic applications.
Without limiting the foregoing, SBB further agrees (y) not to transfer the TWT
Materials to any third party or allow such third party access thereto, directly
or indirectly, including via a service bureau, except to the extent necessary
and for purposes of SBB's conduct of the Evaluation hereunder, in which case SBB
shall notify TWT in writing of such transfer which shall be under the same
confidentiality terms as provided herein, and (z) at all times to use the TWT
Materials in compliance with all applicable laws, rules and regulations
pertaining to the use thereof. The TWT Materials shall include the original
materials transferred to SBB, as well as any derivatives or Improvements
developed by SBB therefrom.

5. EVALUATION SUPPORT. During the Initial Phase, TWT shall provide at SBB's
facilities in Rixensart one (1) senior scientist with expertise in the use of
Invader assays designated by TWT for up to 40 hours of training and support with
respect to the Invader Squared Assays transferred hereunder including use,
trouble-shooting, result analysis and the like, in each case at mutually
agreeable times and schedules within a seven (7)-day period. For subsequent
Phases, SBB may request substantially similar support and training services, and
in case of such request, TWT shall provide such training and support. In
consideration of any such on-site training and support, SBB shall pay to TWT, in
addition to the Initiation Payments set forth below, [* * * *] per Phase,
within 30 days of receipt of a corresponding invoice for such training and
support service, such invoice being released only after the completion of the
training and support service which is requested by SBB.

6. PAYMENTS. In consideration of TWT performing each Phase of the Development
Program and transferring the corresponding TWT Materials, SBB agrees to pay to
TWT, within 30 days of receipt of the corresponding invoice, the following
amounts as set forth below and in accordance with footnotes 1 and 2 below, as
applicable:

<TABLE>
<CAPTION>
             PHASE                 INITIATION PAYMENT(1)           REAGENT PAYMENT(2)
         -------------             ---------------------    -------------------------------
<S>                                 <C>                     <C>
         Initial Phase                  US [* * * *]          US [* * * *]/Invader Squared
                                                                         Assay
           RNA Phase                    US [* * * *]          US [* * * *]/lnvader Squared
                                                                         Assay
           DNA Phase                    US [* * * *]        US [* * * *]/Invader Squared Assay
</TABLE>

7. CONFIDENTIALITY. Each of SBB and TWT agrees that it shall not publish or
otherwise disclose and shall not use for any purpose except for purposes of this
Agreement any information received from the other party

----------

(1) The Initiation Payment with respect to a particular Phase will be due and
payable as follows: (i) with respect to the Initial Phase, [* * * *] within 10
days of the Effective Date and [* * * *] at the time the Reagent Payment for the
Initial Phase is due (i.e., within 30 days after receipt of the invoice for the
corresponding Invader Squared Assays); and (ii) with respect to each of the RNA
Phase and DNA Phase, within 30 days of receipt of the invoice for the Initiation
Notice for such Phase.

(2) The Reagent Payment with respect to a particular Phase will be due and
payable within 30 days of receipt of a corresponding invoice for the
corresponding Invader Squared Assays, such invoice being released upon the
delivery of such Invader Squared Assays.


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pursuant to this Agreement which if disclosed in tangible form is marked
"confidential" or with other similar designation to indicate its proprietary
nature, or if disclosed orally is confirmed as confidential by the party
disclosing such information at the time of such disclosure and confirmed in
writing within thirty (30) days of such disclosure (collectively, "Confidential
Information"). Without limiting the foregoing, it is understood that the SBB
Materials and the TWT Materials shall be deemed to be Confidential Information
of SBB or TWT, as applicable, whether or not marked as such. Notwithstanding the
foregoing, it is understood and agreed that Confidential Information shall not
include information that, in each case as demonstrated by written documentation:
(a) was already known or becomes known to the receiving party, other than under
an obligation of confidentiality or (b) was developed by the receiving party
without reference to any Confidential Information received from the other party
or (c) is in or becomes part of the public domain, except in violation of this
Agreement.

8. INTELLECTUAL PROPERTY RIGHTS. SBB shall retain all right, title and interest
in and to the SBB Materials and the SBB Materials shall not be used for any
purpose other than for purposes of the Development Program. Subject to SBB's
rights in the SBB Materials (including SBB's rights in any patent rights
claiming the target sequences of particular Invader Squared Assay), all right,
title and interest in and to all TWT Materials transferred hereunder shall
remain vested in TWT. Without limiting the foregoing, it is understood and
agreed that subject to the rights granted to TWT with respect to Improvements,
SBB will own all right, title and interest in and to all Inventions. SBB hereby
grants to TWT a non-exclusive, fully paid-up, worldwide right and license, with
the right to grant and authorize sublicenses, in and to Improvements. It is
understood and TWT hereby represents to SBB that it has obtained substantially
similar rights to improvements to TWT's technologies from its other similarly
situated transferees and customers, and TWT shall not make available
Improvements to any third party unless such third party makes available to TWT
the right to make comparable improvements available to SBB. It is further
understood and agreed that TWT will use commercially reasonable efforts, as it
deems appropriate, to incorporate Improvements and comparable improvements
obtained from third parties into the Products hereunder and products that may be
developed and/or supplied to SBB under the Development and Marketing Agreement
(as described below). Nothing in this Agreement is to be construed as granting a
license from one party to the other except as expressly provided herein, under
any patent or other intellectual property rights owned by such party, unless a
separate agreement for such rights is executed by SBB and TWT. Without limiting
the foregoing, it is understood that if SBB controls issued patents claiming the
target sequence of a particular Invader Squared Assay, TWT shall not have the
right to commercialize such Invader Squared Assay unless SBB otherwise agrees.

9. STANDSTILL. TWT hereby agrees that during the Standstill Period not to enter
into any agreement, understanding or other arrangement with a third party that
would legally preclude TWT from entering into the Development and Marketing
Agreement, as contemplated below. Notwithstanding the foregoing, the parties may
mutually agree in writing to extend the Standstill Period in the event that SBB
is unable to reasonably complete its Evaluation of the Invader Squared Assays
during the 90-day period, provided that in such event SBB shall use all diligent
efforts to complete such evaluation as soon as possible. In the event that SBB
gives TWT the Option Notice (as described below), the parties will negotiate in
good faith the Development and Marketing Agreement (as described below) during
the Standstill Period.

10. DEVELOPMENT AND MARKETING AGREEMENT. If at any time prior to the expiration
of the Standstill Period, SBB gives TWT written notice (the "Option Notice")
referencing this Section 10 and indicating its desire to negotiate an agreement
pursuant to which: (i) SBB and TWT would collaborate to develop Products and
(ii) TWT would grant to SBB an exclusive, world-wide right under the TWT
Technology to distribute the Products for the Field (the "Development and
Marketing Agreement"). SBB and TWT shall discuss during the Option


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Period the terms and conditions upon which SBB and TWT will be willing to enter
into the Development and Marketing Agreement.

11. WARRANTY DISCLAIMER. TWT SUPPLIES THE TWT MATERIALS WITHOUT ANY WARRANTY,
REPRESENTATION OR UNDERTAKING WHATSOEVER, EXPRESSED OR IMPLIED, INCLUDING, BUT
NOT LIMITED TO, ANY WARRANTY RESPECTING THE EFFICIENCY, PERFORMANCE,
WORKMANSHIP, CONDITION, MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE OR
NONINFRINGEMENT.

12. TERM/TERMINATION. Unless earlier terminated in accordance with this Section
12, this Agreement will become effective on the Effective Date and remain in
full force and effect until the expiration of the Standstill Period or the
Option Period, whichever is later. Notwithstanding the foregoing, SBB may
terminate this Agreement at any time by providing written notice to TWT; and TWT
may terminate this Agreement in the event that SBB materially breaches or
otherwise fails to perform its obligations hereunder effective on 30 days'
written notice provided that SBB fails to cure such breach or failure in such
30-day period. Sections 4, 7, 8 and 14 shall survive the expiration or
termination of this Agreement. For avoidance of doubt, it is understood and
agreed that in the event that this Agreement expires or terminates without the
parties entering into the Development and Marketing Agreement for any reason,
neither party shall have any liability to the other party for failure to enter
into the same.

13. PUBLICITY. Each of the parties hereto agrees not to disclose to any third
party the financial terms of this Agreement nor the exact target of the assay,
without the prior written consent of the other party hereto, except to advisors,
investors and others on a need-to-know basis under circumstances that reasonably
ensure the confidentiality thereof, or to the extent required by law.
Notwithstanding the foregoing, within five (5) days after the Effective Date,
the parties shall agree upon and issue a press release announcing the execution
of this Agreement and describing the collaboration without however mentioning
the option granted to SBB hereunder, thereafter, each party may disclose to
third parties the information disclosed in such press release without the need
for further approval by the other party.

14. GENERAL. This Agreement and any dispute arising from the performance or
breach hereof shall be governed by and construed and enforced in accordance
with, the laws of the United States and the State of Wisconsin, without
reference to conflicts of laws principles. This Agreement (including the
Attachments hereto) sets forth the entire agreement between the parties with
respect to the subject matter herein and supersede all previous or
contemporaneous understandings with respect thereto, whether oral or written.
Nonperformance of any party shall be excused to the extent that performance is
rendered impossible by strike, fire, earthquake, flood, governmental acts or
orders or restrictions, failure of suppliers, or any other reason where failure
to perform is beyond the reasonable control of the nonperforming party. This
Agreement may only be amended or any right or obligation waived with a written
document signed by authorized representatives of the party to be charged and
expressly refers to this Agreement. SBB may not assign or otherwise transfer its
rights and obligations hereunder without the prior written approval of TWT,
except SBB may assign this Agreement to an Affiliate provided that (i) SBB
notifies TWT of such assignment and (ii) SBB remains responsible for the
obligations of its Affiliate hereunder. If any provision hereof should be held
invalid, illegal or unenforceable in any jurisdiction, such provision shall be
stricken and all other provisions hereof shall remain in full force and effect
in such jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible.

15. NOTICES. All notices, requests and other communications hereunder shall be
in writing and shall be personally delivered, sent by registered or certified
mail, return receipt requested, postage prepaid, or sent via


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facsimile in each case to the respective address specified below, or such other
address as may be specified in writing to the other parties hereto:

SBB:                            SmithKline Beecham Biologicals SA
                                89 rue de l'Institut
                                B -1330 Rixensart, Belgium
                                Attn: Vice-President and Director, Business
                                      Development
                                Fax: (32-2) 656 80 26

TWT:                            Third Wave Technologies, Inc.
                                502 S. Rosa Road
                                Madison, WI 53719-1256
                                U.S.A.
                                Attn: President
                                Fax: +(608)273-6989

16. COUNTERPARTS. This Agreement may be executed in two counterparts, each of
which shall be deemed an original, and all of which together, shall constitute
one and the same instrument.

The parties hereto have caused this Agreement to be duly executed and effective
as of the last date below.

THIRD WAVE TECHNOLOGIES, INC.          SMITHKLINE BEECHAM BIOLOGICALS S.A.


By: /s/ LANCE FORS                        By: /s/ MONCEF SLAOUI
   ------------------------------         --------------------------------------
   LANCE FORS, PRESIDENT & CEO            MONCEF SLAOUI, VICE PRESIDENT AND
                                          DIRECTOR, BUSINESS DEVELOPEMENT AND
                                          ALLIANCES, STRATEGIC PLANNING AND
                                          IMMUNOTHERAPEUTICS

Date: June 7, 2000                     Date: June 20, 2000
     ------------------------------         ------------------------------------



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                                  ATTACHMENT 1

                               DEVELOPMENT PROGRAM

In the course of performing the Development Program for each of the
corresponding Phases TWT will develop the following Invader Squared Assays as
set forth below. For purposes of the Agreement, "Invader Squared Assay" shall
mean an Invader RNA Assay and/or Invader DNA Assay, as applicable.

INITIAL PHASE: During the Initial Phase of the Development Program, TWT will
develop an [* * * *] for each of the target sequences designated by SBB in each
of the [* * * *] and [* * * *] transcripts and provide SBB 1000 determinations
of each such Invader RNA Assay within 90 days of TWT's receipt of the SBB
Materials for the Initial Phase, as set forth in more detail below.

RNA PHASE: During the RNA Phase of the Development Program, TWT will develop an
Invader RNA Assay for each of the target sequences designated by SBB in each of
the [* * * *] transcripts (or such other mRNA transcripts reasonably designated
by SBB, but in no case more than 5 mRNA transcripts, in each case subject to the
provisions of Section 1(p) above) and provide SBB 1000 determinations of each
such Invader RNA Assay within 90 days of TWT's receipt of the SBB Materials for
the RNA Phase, as set forth in more detail below.

DNA PHASE: During the DNA Phase of the Development Program, TWT will develop an
Invader DNA Assay(4) for not more than 3 target sequences designated by SBB (in
each case subject to the provisions of Section 1(p) above) and provide SBB 1000
determinations(5) of each such Invader DNA Assay within 90 days of TWT's receipt
of the SBB Materials for the DNA Phase, as set forth in more detail below.

A. The Development Program for each Invader RNA Assay for mRNA detection and
   quantification will encompass the following:

    1.  At the initiation of the Initial Phase or RNA Phase, as applicable, SBB
        will provide TWT with the appropriate genetic sequence specifying the
        mRNA target of interest as set forth on Attachment 2.

----------

(3) Each Invader RNA Assay for mRNA detection and quantification consists of an
assay or assay components which will permit SBB to detect and quantify the mRNA
of interest. Each Invader RNA Assay [* * * *]. Each Invader mRNA assay will
include control standard set to establish a standard quantification curve.
Complete instructions will be provided for each Invader mRNA Assay.

(4) Each Invader DNA Assay for genotyping detection and quantification consists
of an assay or assay components which will permit TWT to detect each allele of
interest. [* * * *]. Each Invader DNA assay will include control standard set to
establish a standard quantification curve. Complete instructions will be
provided for each Invader DNA Assay.

(5) Each determination for an Invader Squared Assays for genotype detection and
quantification include a determination for each allele, which is done in two
separate microtiter wells in the current assay configuration.


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 Additionally, SBB will provide TWT with total cellular RNA material known to
contain the mRNA target of interest at a minimal expression level, and at a
maximal expression level; provided, however, if SBB provides the American Type
Culture Collection (ATCC) accession numbers for available appropriate cell
lines, TWT will acquire such cell lines for use in the development of the
Invader RNA Assays. TWT estimates that  more or less 10ug of total cellular RNA
material known to contain the mRNA target will be required for each target.

    2.  Primary Invader Reaction:

        o   TWT will design two (2) target-specific oligonucleotide probes (an
            "Invader" probe and a "Primary" probe) for use in the Primary
            Invader Reaction. The Invader probe will be designed to hybridize to
            the 3' portion of the target sequence, and form a region that
            overlaps the duplex formed by the Primary probe and target by at
            least a single nucleotide base. TWT's proprietary Cleavase enzymes
            will recognize the structure created by this overlapping region and
            cleave the 5' end of the Primary probe for use in the Secondary
            Invader Reaction.

        o   The melting temperature (Tm) of the target-specific Primary probe
            will be estimated. In order to optimize signal generation, a
            temperature near the Tm of the Primary probe will be utilized for
            the Primary Invader Reaction such that the reaction cycle
            (hybridization of Primary probe, cleavage of the 5' end of the
            Primary probe, release of the remaining 3' portion of the Primary
            probe) will occur rapidly under such conditions.

        The rapid cycling of the Primary probes allows each copy of mRNA target
        to serve as the substrate for multiple Primary probe cleavage events
        during reaction incubation. The accumulation of 5' fragments of the
        Primary probe is directly proportional to the number of mRNA target
        present in the test sample.

    3.  Secondary Invader Reaction:

        o   TWT will design oligonucleotides that will function as a Secondary
            target and a "Signal" probe in the Secondary Invader Reaction. The
            cleaved 5' end of the Primary probe from the Primary Invader
            Reaction is designed to act as a "Secondary Invader" probe in the
            Secondary Invader Reaction (i.e., the Signal probe will be designed
            such that the 3' end of the Secondary Invader probe (5' of the
            Primary probe from the Primary Invader Reaction) will overlap the 5'
            most region of hybridization of the Signal probe/Secondary target
            complex). TWT's proprietary Cleavase enzymes will recognize the
            structure created by this overlapping region and cleave the 5' end
            of the Signal probe for subsequent detection. The Signal probe will
            include a quencher dye and a fluorescein-phosoramadite label. Due to
            the proximity of these dyes in the uncleaved Signal probe, the
            fluorescein label is quenched by the quencher dye via a Fluorescence
            Resonance Energy Transfer (FRET) mechanism. Cleavage of the 5' end
            of the Signal probe between the labels enables spatial separation of
            the quencher dye and fluorescein, thus enabling fluorescence
            detection using FRET technology.

        o   The Tm of the Signal probe will be estimated. In order to optimize
            signal generation, a temperature near the Tm of the Signal probe
            will be utilized for the Secondary Invader Reaction such that the
            reaction cycle (hybridization of Signal probe, cleavage of the 5'
            end of the Signal probe, release of the remaining 3' portion of the
            Signal probe) will occur rapidly under such conditions.


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<PAGE>   9

        This rapid cycling allows multiple Signal probes to be cleaved during
        reaction incubation. The accumulation of signal (5' fragments of the
        Signal probe) is directly proportional to the number of Secondary
        Invader probes (from the Primary Invader reaction) generated in the
        Primary Invader Reaction.

    4.  TWT will develop appropriate standards (in vitro RNA transcripts) for
        use in the Invader RNA Assay and will demonstrate assay
        proof-of-principle using this material. From time to time during the
        assay Development Program, SBB will provide TWT with appropriate
        cellular material known to have the mRNA target of interest expressed at
        various levels. TWT will use this material for further assay refinement
        and optimization.

    5.  TWT will perform its standard quality control procedures on each of the
        Invader RNA Assays using the ATCC cell lines designated by SBB and
        provide the results of such quality control to SBB.

    6.  TWT estimates that a minimum of 0.1 attomole of the mRNA target will be
        required in each determination for detection and quantification in an
        Invader RNA Assay. Each Invader RNA Assay transferred hereunder will
        detect 0.1 attomole of the appropriate RNA standard.

B. The Development Program for each Invader DNA Assay for genotyping detection
   and quantification assay will encompass the following:

    1.  At the initiation of the DNA Phase, SBB will provide TWT with the
        appropriate genetic sequence specifying the DNA target of interest as
        set forth on Attachment 2. Additionally, SBB will provide TWT with the
        appropriate PCR product and/or genomic DNA containing the target
        sequence of interest; provided, however, if SBB provides the ATCC
        accession numbers for available appropriate cell lines, TWT will acquire
        such cell lines for use in the development of the Invader DNA Assays.
        TWT estimates that between 10-100 femtamoles of PCR product or 1 ug of
        genomic DNA material known to contain the DNA target will be required
        for each target.

    2.  Primary Invader Reaction:

            o   TWT will design three (3) target-specific oligonucleotide probes
                for use in the Primary Invader Reaction: (i) an "Invader" probe
                (a probe designed hybridize to the 3' portion of the target
                sequence, and form a region that overlaps the duplex formed by
                the appropriate Signal probe and target by at least a single
                nucleotide base); (ii) a "Signal" probe for the major allele
                ("wild-type") sequence and (iii) a "Signal" probe for the mutant
                or minor allele ("mutant") sequence. Each Signal probe will
                comprise a probe designed to hybridize to the 5' portion of the
                appropriate target sequence and overlap with the Invader probe.
                TWT's proprietary Cleavase enzymes will recognize the structure
                created by this overlapping region and cleave the 5' end of the
                wild-type and mutant probes for use in the Secondary Invader
                Reaction (described below).

            o   The Tm of both the wild-type and mutant Signal probes will be
                estimated. In order to optimize signal generation, a temperature
                near the Tm of these probes will be utilized for the both the
                Primary and Secondary Invader Reactions such that the reaction
                cycle


                                      iii
<PAGE>   10

                (hybridization of a Signal probe, cleavage of its 5' end, and
                release of the remaining 3' portion) will occur rapidly under
                isothermal conditions.

            The rapid isothermal cycling of the Signal probes allows each copy
            of PCR product or genomic DNA target to serve as the substrate for
            multiple Signal probe cleavage events during reaction incubation.
            The accumulation of 5' fragments of the wild-type Signal probe is
            directly proportional to the number of wild-type target molecules
            present in the test sample. Likewise, the accumulation of 5'
            fragments of the mutant Signal probe is directly proportional to
            the number of mutant target molecules present in the test sample.
            Since the Primary and Secondary Invader Reactions will take place
            simultaneously, the Primary and Secondary Reaction temperature
            optima will be designed to be compatible.

    3.  Secondary Invader Reaction:

        o   TWT will design an oligonucleotide that will function as both a
            Secondary target and a "Secondary Signal" probe in the Secondary
            Invader Reaction. After cleavage in the Primary Invader Reaction the
            5' end of the wild-type and mutant Signal probes from the Primary
            Invader Reaction will be designed to act as "Secondary Invader"
            probes in the Secondary Invader Reaction (i.e., the Secondary Signal
            probe will be designed such that the end of the Secondary Invader
            probe (5' of the Signal probe from the Primary Invader Reaction)
            will overlap the 5' most region of hybridization of the Secondary
            Signal probe/Secondary target complex). TWT's proprietary Cleavase
            enzymes will recognize the structure created by this overlapping
            region and cleave the 5' end of the Signal probe for subsequent
            detection. The Secondary Signal probe will be designed to include a
            quencher dye and a fluorescein phosoramadite label. Due to the
            proximity of these dyes in the uncleaved Secondary Signal probe, the
            fluorescein label is quenched by the quencher dye via a Fluorescence
            Resonance Energy Transfer (FRET) mechanism. Cleavage of the 5' end
            of the Secondary Signal probe between the labels enables spatial
            separation of the quencher dye and fluorescein, thus enabling
            fluorescence detection using FRET technology.

        o   The Tm of the Secondary Invader probe will be estimated and sequence
            optimized in order to optimize signal generation, a temperature near
            the Tm of the Secondary Invader probe will be utilized for the
            Invader reaction such that the reaction cycle (hybridization of
            Secondary Invader probe, cleavage of the 5' end of the Signal probe,
            release of the Secondary Invader probe) will occur rapidly under
            isothermal conditions.

        As a result of the Secondary Signal/Secondary target complex being
        present in excess and the rapid isothermal cycling of the Secondary
        Invader probe allowing each copy of Secondary Invader probe to cause
        multiple signal generation cleavage events during reaction incubation,
        the accumulation of 5' fragments of the Secondary Signal probe is
        directly proportional to the number of Secondary Invader probe molecules
        generated in the Primary Invader Reaction.

    4.  TWT will develop appropriate standards (in vitro DNA transcripts) for
        use in the Invader DNA Assay and will demonstrate assay
        proof-of-principle using this material. From time to time during the
        assay Development Program, SBB will provide TWT with appropriate genomic
        DNA known to have the DNA target of interest expressed at various
        levels. TWT will use this material for further assay refinement and
        optimization.


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    5.  TWT will perform its standard quality control procedures on each of the
        Invader DNA Assays using the ATCC cell lines designated by SBB and
        provide the results of such quality control to SBB.

    6.  TWT will determine appropriate assay cut-off values for each Invader DNA
        Assay for assessment of genotype (wild-type homozygous, mutant
        homozygous, wild-type/mutant heterozygous) based on fluorescence signal.

    7.  TWT estimates that approximately 20pg of PCR product or approximately
        100ng of genomic DNA will be required in each determination for
        detection and quantification in an Invader DNA Assay. Each Invader DNA
        Assay transferred hereunder will detect 100ng of the appropriate genomic
        DNA standard.




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                                  ATTACHMENT 2

                                  SBB MATERIALS

Upon initiation of each of the Phases below, SBB shall provide TWT with the SBB
Materials as follows:

INITIAL PHASE: (i) identify the ATCC cell lines to be acquired by TWT for
purposes of quality control of each of the mRNA targets; (ii) identify the
unique target region on each of human mRNA transcripts: [* * * *] and provide
the gene sequence information for each target gene; (iii) provide TWT with more
or less 10ug of total cellular mRNA material known to contain the mRNA target of
interest at a minimal expression level, and at a maximal expression level, for
each target, unless such materials are reasonably available from ATCC; and (iv)
provide such other information (including any additional sequence information,
known polymorphsims or other mutational changes in the target region) as TWT may
reasonably require from time to time.

RNA PHASE: (i) identify the ATCC cell lines to be acquired by TWT for purposes
of quality control of each of the mRNA targets; (ii) identify the unique target
region on each of human mRNA transcripts: [* * * *] (or such other mRNA
transcripts reasonably designated by SBB but in no case more than a total of 5
mRNA transcripts) and provide the gene sequence information for each target
gene; (iii) provide TWT with more or less 10ug of total cellular RNA material
known to contain the mRNA target of interest at a minimal expression level, and
at a maximal expression level, for each target, unless such materials are
reasonably available from ATCC; and (iv) provide such other information
(including any additional sequence information, known polymorphsims or other
mutational changes in the target region) as TWT may reasonably require from time
to time.

DNA PHASE: (i) identify the ATCC cell lines to be acquired by TWT for purposes
of quality control of each of the DNA targets; (ii) identify the unique target
region on each of human genes sequences designated by SBB (in no case more than
a total of 3 DNA sequences) and provide the gene sequence information for each
target gene; (iii) provide TWT with 100 femtamoles of PCR product or 1ug genomic
DNA material known to contain the DNA target of interest for each target; and
(iv) provide such other information (including any additional sequence
information, known polymorphsims or other mutational changes in the target
region) as TWT may reasonably require from time to time.



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