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                                                             EXHIBIT 10.51


                               SECURITY AGREEMENT


     THIS AGREEMENT made and entered into this 11th day of February, 1997, by
and between Caraco Pharmaceutical Laboratories, Ltd., the address of which is
1150 Elijah McCoy Drive, Detroit, Michigan 48202 ("Debtor"), and David A.
Hagelstein, a Trustee of the David Hagelstein Trust u/a/d October 27, 1993, the
address of which is 1411 N. Woodward, Suite 313, Birmingham, Michigan 48109
("Secured Party").

                            R  E  C  I  T  A  L  S:

     In consideration of the mutual covenants and agreements of the parties
hereinafter set forth and good and valuable consideration paid and/or extended
by Secured Party to Debtor, the receipt and sufficiency of which is hereby
acknowledged by Debtor, the parties hereto agree as follows:

     1. CREATION OF SECURITY INTEREST. To secure the payment of the sums or
performance of the obligations referred to as the "Indebtedness" in Paragraph 2
of this Agreement, Debtor does hereby create in favor of Secured Party, its
successors and assigns, a continuing security interest and lien in all of
Debtor's right, title and interest in and to the following, wherever located,
(from time to time referred to as the "Collateral") which as used herein shall
have those definitions set forth below:

                    A.    ACCOUNTS.  All present and future
                         Accounts, Documents, Chattel Paper, Instruments,
                         Contracts Rights, General Intangibles (as defined
                         below) and choses in action, now owned or hereafter
                         acquired, including, without limitation, any right to
                         any refund of taxes heretofore or hereafter paid to
                         any governmental authority including, without
                         limitation, all new drug applications to, and
                         approvals of such applications from, the United States
                         Food and Drug Administration and other regulatory
                         agencies;

                    B.    SPECIFIED EQUIPMENT.  The
                         equipment listed on Schedule A hereto, and including,
                         without limitation, all accessions, accessories, tools
                          and dies, parts attached thereto or used or intended
                          to be used in connection therewith and all books,
                          records, instruments and documents relating thereto
                          or useful in maintaining or realizing upon such
                          equipment, and all substitutions of, improvements to
                          and replacements of as well as all additions to all
                          of the foregoing, whether now owned or hereafter
                          acquired by Debtor;

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                    C.   INVENTORY.  All Inventory and Goods, now owned or
                         hereafter acquired including, without limitation, raw
                         materials, scrap, work-in-process, finished Goods,
                         tangible property, stock-in-trade, wares and
                         merchandise used in, held for sale or sold in the
                         ordinary course of business, including, without
                         limitation, Goods for sale, lease or other
                         disposition which give rise to any Accounts, all
                         Goods which have been returned to, repossessed or
                         stopped in transit by the party granting a security
                         interest to Secured Party herein, and all accessions,
                         parts attached thereto or used or intended to be used
                         in connection therewith, and all books, records,
                         instruments and documents relating thereto or useful
                         in maintaining or realizing upon the Inventory;

                    D.   PROCEEDS.  Proceeds, and proceeds of hazard
                         insurance and eminent domain or condemnation awards of
                         all of the foregoing described assets and/or
                         properties or interests therein, including, without
                         limitation, all products of, and accessions to, such
                         assets or properties or interests therein.  In
                         addition thereto, any and all deposits or other sums
                         at any time credited by or due from Secured Party to
                         Debtor and any and all Instruments, Documents,
                         policies and certificates of insurance, securities,
                         Goods, Accounts, choses in action, chattel paper,
                         cash, property and the proceeds thereof (whether or
                         not the same are Collateral or Proceeds thereof
                         hereunder) owned by Debtor or in which Debtor has an
                         interest, which are now or at any time hereafter in
                         possession or control of Secured Party or in transit
                         by mail or carrier to or from Secured Party or in
                         possession of any third party acting on Secured
                         Party's behalf, without regard to whether Secured
                         Party received the same in pledge, for safekeeping, as
                         agent or otherwise, or whether Secured Party has
                         conditionally released the same;

                    E.   ACCOUNTS, CHATTEL PAPER, CONTRACTS, CONTRACT
                         RIGHTS, DOCUMENTS, GENERAL INTANGIBLES, GOODS,
                         INSTRUMENTS AND INVENTORY.  The foregoing terms shall
                         have meanings ascribed to them in the Uniform
                         Commercial Code as adopted by the State of Michigan,
                         as supplemented by the definitions set forth above;

whether now owned or hereafter acquired by Debtor, and all books, records,
instruments and documents relating thereto or useful in maintaining or
realizing upon the Collateral.

     2. INDEBTEDNESS.  Secured Party has agreed to loan Debtor the aggregate
amount of Two Hundred Thousand and No/100 ($200,000) Dollars in one or more
payments and Debtor shall pay to Secured Party when due all amounts evidenced
by one or more Secured Promissory Notes in the aggregate principal amount of
Two Hundred Thousand and no/100


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($200,000.00) Dollars, with interest as therein provided, executed and
delivered by Debtor to Secured Party (the "Notes"), as the same may be
modified, renewed, extended, amended or replaced from time to time, and shall
pay all amounts and perform all obligations required under or pursuant to this
Agreement and all other documents and/or agreements delivered to Secured Party
in connection with the Notes (the "Loan Documents"), such obligations of
payment and performance being hereinafter collectively referred to as the
"Indebtedness".

     3. ACCELERATION CLAUSE.  Upon the occurrence of any Default (as defined
pursuant to Section 9 hereof), all of the Indebtedness of Debtor, whether due
or not, shall become immediately due and payable in accordance with the terms
of the Notes and the other Loan Documents.

     4. USE OF COLLATERAL.  The Collateral shall be used exclusively in
connection with the conduct of Debtor's present business, unless Secured Party
gives its written consent to another use.  Secured Party shall have the right
to inspect the Collateral at any time, to inspect Debtor's books and records
with respect thereto and to make inquiry of account and contract debtors in
connection therewith, all at any time.

     5. REMOVAL.  The Collateral shall be kept at Debtor's business premises,
and shall not be removed therefrom without the written consent of Secured
Party.  Removal of any of the Collateral by Debtor, or its agents, servants or
employees, shall be deemed a willful taking, an unlawful conversion and a
default under this Agreement.  Use of the Collateral and sale of the Inventory
in the regular and ordinary course of Debtor's business shall not constitute a
prohibited removal of the Collateral for the purpose of this Agreement.

     6. REPAIRS AND TAXES.  Debtor shall at its own expense, from time to time,
replace and repair all parts of the Collateral as may be broken, worn, damaged
or otherwise in need of repair, and shall keep the Collateral in every respect
in good working order and repair.  Debtor shall pay all taxes charged against,
assessed or imposed upon any of the Collateral.

     7. INSURANCE.  Debtor shall keep the Collateral insured against loss and
damage by casualty, theft and such other perils with insurers and coverages
reasonably acceptable to Secured Party.

     8. DEBTOR'S WARRANTIES AND REPRESENTATIONS.  Debtor warrants, represents
and covenants that:

                    A.    The Collateral is or will be owned by Debtor and
                         except with respect to the collateral securing the
                         Sun Loan and Joliat Loan as defined in that certain
                         Inter-Creditor Agreement of even date herewith, the
                         Collateral is not subject to any security interests,
                         liens or encumbrances, charges, restrictions or
                         claims except as created by this Agreement, and
                         Debtor will defend the Collateral against the claims
                         and demands of all persons;


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                    B.   Debtor will execute, and will pay all costs of
                         filing of, any financing, continuation or termination
                         statement with respect to the security interest
                         created by this Agreement deemed necessary or
                         desirable by the Secured Party;

                    C.   Debtor shall from time to time, at the expense
                         of Debtor, execute and deliver all further instruments
                         and documents, and take all further actions, that the
                         Secured Party may reasonably deem necessary or
                         desirable, in order to perfect and protect any
                         security interest granted or purported to be granted
                         hereby or to enable the Secured Party to exercise and
                         enforce its rights and remedies hereunder with respect
                         to any Collateral.

                    D.   Debtor hereby authorizes the Secured Party to
                         file one or more financing or continuation statements,
                         and amendments thereto, relative to all or any part of
                         the Collateral, with or without Debtor's signature
                         thereon.

                    E.   Debtor was incorporated under the name J-Mac
                         Domestic, Inc., changed its name to Caraco, Inc. until
                         changing its name to its current name, and Debtor's
                         chief executive office and sole place of business is
                         located at 1150 Elijah McCoy Drive, Detroit, Michigan
                         48202.

                    F.   Debtor is a corporation duly organized under
                         the laws of Michigan, validly existing and in good
                         standing and has full corporate power to own, operate
                         and lease its properties and to carry on its business
                         as now conducted. Debtor is qualified to do business
                         in all jurisdictions where the nature of its
                         activities would make such qualification necessary and
                         the failure to so qualify would have a material and
                         adverse affect on the Debtor.

                    G.   Debtor has all power, statutory and otherwise,
                         to execute and deliver this Security Agreement, the
                         Notes and the Inter-Creditor Agreement, and the
                         execution hereof and thereof, and Debtor's performance
                         of its obligations hereunder and thereunder, have been
                         approved by all appropriate corporate action.  Such
                         agreements and documents constitute the legal, valid
                         and binding obligation of Debtor, enforceable against
                         such Debtor in accordance with its terms.

                    H.   The equipment listed on Schedule A hereto is
                         not subject to the lien of the Economic Development
                         Corporation of the City of



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                         Detroit and Debtor reasonably believes the
                         Equipment has a fair market value of not less than
                         $1.5 million.

                    I.   Debtor shall not move the Collateral or change
                         Debtor's name, identity or corporate structure unless
                         it has received Secured Party's prior written consent
                         thereto and has taken all action necessary or
                         reasonably requested by the Secured Party to amend any
                         financing statement or continuation statement filed
                         with respect to the Collateral in connection
                         therewith.

                    J.   The execution, delivery and performance of this
                         Agreement and the other Loan Documents by Debtor and
                         its performance of its obligations hereunder and
                         thereunder does not conflict with or result in any
                         violation of or constitute a breach or default under
                         (i) any term of the Articles of Incorporation or
                         Bylaws of Debtor, (ii) any indenture, agreement
                         instrument, order, judgment or decree to which Debtor
                         is a party, bound or subject or to which any of the
                         assets or business of Debtor are subject, (iii) any
                         law, statute or regulation of any governmental or
                         regulatory body.

                    K.   No approval or consent of the execution,
                         delivery and performance by the Debtor of this
                         Agreement, the Note, and the other Loan Documents is
                         required by law or by the Debtor's existing Articles
                         of Incorporation or Bylaws or by any contract,
                         indenture, agreement, instrument, order, judgment or
                         decree to which the Debtor is a party or otherwise
                         bound or to which any of its property or business is
                         subject, or by any indebtedness of the Debtor.

                    L.   There are no actions, proceedings or investigations
                         pending or, to the knowledge of the Debtor,
                         threatened against the Debtor before any
                         court, administrative agency or other governmental or
                         regulatory authority.  Neither the Debtor nor its
                         property and assets is subject to any judicial or
                         administrative order, judgment or decree which could
                         have a material adverse effect on the Debtor, its
                         business, properties, condition (financial or
                         otherwise) or prospects.  The Debtor has not violated
                         any federal, state or local laws, regulations or
                         orders.

        9. DEFAULT.  The following shall constitute defaults (each a "Default")
under this Agreement:

           A.    The occurrence of any breach of warranty or other
                 misrepresentation, omission or misstatement in connection
                 with or


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                         noncompliance or nonperformance of any of
                         Debtor's covenants, obligations (other than to make
                         payment), agreements (other than to make payment),
                         representations or warranties under this Agreement,
                         the Notes or any other Loan Document (including the
                         occurrence of any other default identified under this
                         Agreement or any of the other Loan Documents) which is
                         not cured within 15 days after notice thereof from
                         Secured Party to Debtor;

                    B.   Any default in the payment of any portion of the
                         Indebtedness when due in accordance with the terms of
                         the Note, this Agreement or the Loan Documents;

                    C.   Debtor's voluntarily application for the
                         appointment of a custodian, trustee or receiver to
                         take custody or dispose of any substantial portion of
                         its assets; or the appointment by a court of competent
                         jurisdiction of a custodian, trustee or receiver to
                         take custody or dispose of any substantial portion of
                         the assets of Debtor pursuant to any involuntary
                         proceeding and either (i) Debtor shall indicate
                         approval of, consent to, or acquiescence to such
                         appointment, or (ii) such custodian, trustee, or
                         receiver shall not be discharged within thirty (30)
                         days; or Debtor shall voluntarily seek protection from
                         creditors under any applicable state or federal
                         bankruptcy, liquidation or dissolution, insolvency, or
                         debt reorganization laws; or any of Debtor's creditors
                         shall institute any proceeding against Borrower under
                         any applicable state or federal bankruptcy,
                         liquidation or dissolution, insolvency, or debt
                         reorganization laws, and the same shall not be
                         dismissed or discharged within thirty (30) days.

                    D.   The liquidation, dissolution, or other discontinuance
                         of Debtor's corporate existence.

                    E.   The issuance of a writ or warrant or attachment,
                         garnishment, execution, distraint or similar
                         process against any material portion of the
                         Debtor's assets which remains undischarged and
                         unstayed for a period of thirty consecutive days.

                    F.   Debtor shall make a general assignment for the benefit
                         of its creditor.

                    G.   Any party to the Inter-Creditor Agreement (other than
                         Secured Party) shall default in the performance of
                         any covenant, agreement, condition or provision
                         thereof.


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        10. REMEDIES.   In the event of the occurrence of any default, Secured
Party may exercise its rights under law, including by way of enforcement under
the Uniform Commercial Code in effect in the State of Michigan as in effect
from time to time.  Secured Party may enter Debtor's premises without legal
process or any obligation to pay rent and remove the Collateral or require the
Debtor to assemble the Collateral and make it available to Secured Party at a
place within or outside the State of Michigan designated by Secured Party.  If
it so elects, Secured Party may and is hereby empowered, without legal process,
to enter any premises where the Collateral may be kept and take exclusive
possession of it on those premises with or without a custodian.  Secured Party
may thereafter sell the Collateral at one or more public or private sales, on
or away from Debtor's business premises.  Unless the Collateral is perishable,
threatens to decline speedily in value or is of a type customarily sold on a
recognized market, Secured Party shall give Debtor reasonable notice of the
time and place of any public sale thereof, or of the time after which any
private sale or any other intended disposition thereof is to be made.  The
requirement of reasonable notice shall be met if notice is mailed to Debtor,
postage prepaid, by first class certified mail, return receipt requested, at
least five (5) days prior to the date of the proposed sale or disposition.  At
any such sale, Secured Party may in its absolute discretion sell and dispose of
all the right, title, and interest of Debtor in and to any of the Collateral.
Any such sale may be for cash or for credit, and Secured Party may be the
purchaser.  Secured Party shall have the right to (i) demand payments of the
Accounts, (ii) enforce payment of the Accounts by legal proceedings or
otherwise, (iii) exercise all of Debtor's rights and remedies with respect to
the collection of the Accounts, (iv) settle, adjust or compromise any legal
proceedings brought to collect the Accounts, (v) if permitted by law, sell or
assign the Accounts upon such terms, for such amounts and at such time or times
as the Secured Party deems advisable, (vi) discharge and release the Accounts,
(vii) prepare, file and sign Debtor's name on any proof of claim in bankruptcy
or similar document against any account debtor, (viii) prepare, file and sign
any Debtor's name on any notice of lien, assignment or satisfaction of lien or
similar document in connection with the Accounts, (ix) do all acts and things
necessary in the Secured Party's sole discretion, to fulfill Debtor's
obligations under this Security Agreement, (x) endorse the name of Debtor upon
any Chattel Paper, Document, Instrument, invoice, freight bill, bill of lading
or similar document or agreement relating to the Collateral, (xi) use Debtor's
stationery and sign the name of Debtor to verifications of the Accounts and
notice thereof to Account debtors, and (xii) use the information recorded on or
contained in any data processing equipment and computer hardware, software and
source codes relating to the Collateral to which Debtor has access.  Out of the
monies arising from the sale and/or collection of the Collateral, Secured Party
shall retain any and all sums then owing to Secured Party, including all
additional advances and debts, and all costs, fees, charges and expenses in
connection therewith, with interest, including reasonable attorneys fees,
disbursements, premiums on bonds, custodian's fees, fees of public officers,
auctioneer's fees, plus advertising and labor, disbursements for use and
occupancy of premises and any and all other disbursements made by Secured Party
in connection with the taking, maintaining, storage and disposing of the
Collateral, tendering the excess (if any) to Debtor or its successors or
assigns.  If for any reason the Collateral shall fail to satisfy all of the
foregoing items, Debtor shall pay to Secured Party the resulting deficiency
upon demand.  Secured Party's remedies shall be cumulative and non-exclusive to
the fullest extent permitted by law.

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     11. DISCRETIONARY RIGHTS.  Exercise of or omission to exercise any right of
the Secured Party shall not affect any other subsequent right of the Secured
Party to exercise the same and the waiver of any default by the Secured Party
shall not be deemed a waiver of any subsequent Default.

     12. SEVERABILITY.   If any provision of this Agreement shall for any reason
be held to be invalid or unenforceable, that invalidity or unenforceability
shall not affect any other provision hereof, and this Agreement shall be
construed as if the invalid or unenforceable provision had never been contained
herein.

     13. NOTICES. All notices to the parties under this Agreement shall be
sufficient if mailed by certified mail, return receipt requested with
sufficient prepaid postage, to the parties at their addresses appearing at the
beginning of this Agreement, or at such other address as they shall designate
in writing as provided by this paragraph.  Notice so directed and posted shall
be effective upon receipt.

     14. GOVERNING LAW.  This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Michigan.

     15. COUNTERPARTS.  This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which shall
constitute one agreement.  The signature of any party to any counterpart shall
be deemed to be a signature to, and may be appended to, any other counterpart.

     16 CAPTIONS.  Captions to paragraphs contained in this Agreement, other
than in Paragraph 1.E., are for convenience only and are entirely without
substantive effect.

     17. SUCCESSORS.  This Agreement shall be binding upon, and the benefits
hereof shall inure to, the parties hereto and their respective successors and
assigns.   Debtor's obligations and rights hereunder shall not be assigned
without the prior written consent of Secured Party.

     18. INDEMNITY.  Debtor agrees to indemnify the Secured Party from and
against any and all claims, losses and liabilities in connection with or
arising out of this Security Agreement, the Inter-Creditor Agreement or the
Notes and any actions taken hereunder or thereunder, except where due to
Secured Party's gross negligence or wilful misconduct.

     19. WAIVER OF JURY TRIAL.  DEBTOR HEREBY WAIVES TRIAL BY JURY IN ANY
LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING OUT OF
THIS AGREEMENT OR ANY


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INSTRUMENT OR DOCUMENT RELATING HERETO.  THIS WAIVER IS INFORMED AND FREELY
MADE.

     THIS AGREEMENT was executed as of the date and year first above written.

                                DEBTOR:

                                CARACO PHARMACEUTICAL LABORATORIES, LTD.
                                a Michigan corporation

                                /s/ William R. Hurd

                                By: William R. Hurd
                                William R. Hurd
                                Its: President


                                SECURED PARTY:

                                DAVID HAGELSTEIN TRUST
                                u/a/d 10/27/93



                                /s/ David A. Hagelstein
                                By: David A. Hagelstein
                                David A. Hagelstein, Trustee


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