<PAGE>


                                                                   Exhibit 10.11



                     AMENDED AND RESTATED SECURITY AGREEMENT

                          Dated as of October 18, 2004

                                     between

                                   ORCEL LLC,
                                       and
                            ORTEC INTERNATIONAL INC.,
                               each as a Grantor,

                                       and


                            PAUL ROYALTY FUND, L.P.,
                                   as Grantee





<PAGE>


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                              Page
                                                                                                              ----
<S>                                                                                                         <C>
ARTICLE I  DEFINITIONS.........................................................................................1

   Section 1.1.       Certain Terms............................................................................1
   Section 1.2.       Assignment Agreement Definitions.........................................................3
   Section 1.3.       UCC Definitions..........................................................................3
   Section 1.4.       Other Interpretive Provisions............................................................3

ARTICLE II  SECURITY INTEREST..................................................................................4

   Section 2.1.       Grant of Security........................................................................4
   Section 2.2.       Continuing Security Interest.............................................................6
   Section 2.3.       Grantors Remains Liable..................................................................6

ARTICLE III  REPRESENTATIONS AND WARRANTIES....................................................................7

   Section 3.1.       Legal Status of Each Grantor, Location of Collateral, etc................................7
   Section 3.2.       Ownership; No Liens......................................................................7
   Section 3.3.       Validity.................................................................................7
   Section 3.4.       Intellectual Property....................................................................8
   Section 3.5.       Authorization, Approval..................................................................8
   Section 3.6.       Enforceability...........................................................................8

ARTICLE IV  COVENANTS..........................................................................................8

   Section 4.1.       As to Receivables........................................................................8
   Section 4.2.       Insurance...............................................................................10
   Section 4.3.       Intellectual Property...................................................................10
   Section 4.4.       Transfers and Other Liens...............................................................10
   Section 4.5.       Further Assurances......................................................................10
   Section 4.6.       General Covenants.......................................................................11

ARTICLE V  RIGHTS AND DUTIES OF GRANTEE.......................................................................12

   Section 5.1.       Grantee Appointed Attorney-in-Fact......................................................12
   Section 5.2.       Grantee May Perform.....................................................................13
   Section 5.3.       Limitations on Duties of Grantee........................................................13
   Section 5.4.       Reasonable Care.........................................................................14

ARTICLE VI  REMEDIES..........................................................................................14

   Section 6.1.       Certain Remedies........................................................................14

ARTICLE VII  MISCELLANEOUS PROVISIONS.........................................................................15
</TABLE>


                                       i




<PAGE>


<TABLE>
<S>                                                                                                         <C>
   Section 7.1.       Amendments..............................................................................15
   Section 7.2.       Release of Collateral...................................................................15
   Section 7.3.       Notices.................................................................................16
   Section 7.4.       Waiver; Cumulative Remedies.............................................................16
   Section 7.5.       Successors and Assigns..................................................................16
   Section 7.6.       Counterparts............................................................................16
   Section 7.7.       Severability............................................................................16
   Section 7.8.       Governing Law and Jurisdiction..........................................................17
   Section 7.9.       Waiver of Jury Trial....................................................................17
</TABLE>



Exhibits

Exhibit A                  Form of Patent Security Agreement



Schedules

Schedule I                 Locations of Certain Collateral
Schedule II                Offices For Filing Financing Statements
Schedule 3.1               Names and Corporate Reorganizations and Mergers



                                       ii




<PAGE>




                     AMENDED AND RESTATED SECURITY AGREEMENT

         AMENDED AND RESTATED SECURITY AGREEMENT (as amended, supplemented or
otherwise modified from time to time, this "Security Agreement"), dated as of
October 18, 2004 and entered into among ORCEL LLC, a Delaware limited liability
company ("Orcel") and ORTEC INTERNATIONAL INC., a Delaware corporation ("Ortec")
( Orcel and Ortec being herein individually, a "Grantor" and collectively, the
"Grantors"), and PAUL ROYALTY FUND, L.P., a Delaware limited partnership (and
formerly known as Paul Capital Royalty Acquisition Fund, L.P. (the "Grantee").

                                    RECITALS

         WHEREAS, Orcel, Ortec and the Grantee are parties to the Amended and
Restated Revenue Interests Assignment Agreement dated as of February 26, 2003
(as amended from time to time, the "Assignment Agreement");

         WHEREAS, Orcel and Grantee are parties to that certain Security
Agreement, dated as of August 29, 2001, as amended by Amendment No. 1 to
Security Agreement dated as of February 26, 2003 (the "Original Agreement"); and

         WHEREAS, in order to induce the Grantee to enter into the Consent and
Agreement (as defined below), Orcel and Grantee now wish to amend and restate
the Original Agreement in its entirety to, among other things, (i) add Ortec as
an additional grantor of the security interests contemplated by this Security
Agreement and (ii) make certain clarifications to the definition of Collateral.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Grantors hereby agree, for the
benefit of Grantee, as follows:

                                   ARTICLE I

                                   DEFINITIONS

         Section 1.1. Certain Terms.

         Capitalized terms used herein but not otherwise defined, shall have the
meanings set forth in the Assignment Agreement. The following terms (whether or
not underscored) when used in this Security Agreement, including its preamble
and recitals, shall have the following meanings:

         "Account" shall have the meaning as provided in the UCC.

         "Assignee Concentration Account" shall have the meaning set forth in
the Assignment Agreement.




<PAGE>



         "Assignor Concentration Account" shall have the meaning set forth in
the Assignment Agreement.

         "Assignment Agreement" shall have the meaning set forth in the recitals
hereto.

         "Cambrex" means Cambrex Bio Science Walkersville, Inc., a Delaware
corporation.

         "Cambrex Collateral" shall mean the "Collateral" as such term is
defined in the Cambrex Security Agreement.

         "Cambrex Security Agreement" means the Security Agreement dated as of
October 18, 2004 between Cambrex, Ortec and Orcel, as amended from time to time.

         "Collateral" shall have the meaning set forth in Section 2.1.

         "Consent and Agreement" shall mean the Consent and Agreement dated as
of October 18, 2004 between Cambrex and Grantee, as amended from time to time.

         "Event of Default" shall mean a Funding Termination Event.

         "General Intangible" shall have the meaning as provided in the UCC.

         "Grantor" shall have the meaning set forth in the preamble hereto.

         "Instrument" shall have the meaning as provided in the UCC.

         "Intellectual Property" shall have the meaning set forth in the
Assignment Agreement.

         "Joint Concentration Account" shall have the meaning set forth in the
Assignment Agreement.

         "Lockbox Account" shall have the meaning set forth in the Assignment
Agreement.

         "Lockbox Agreement" shall have the meaning set forth in the Assignment
Agreement.

         "Lockbox Bank" shall have the meaning set forth in the Assignment
Agreement.

         "Obligations" shall have the meaning set forth in the Assignment
Agreement.

         "Patent License" means any written agreement now or hereafter in
existence granting to Grantor any right to use any invention on which a patent
is in existence, including, without limitation, the agreements described in
Schedule l of the Patent Security Agreement.



                                       2




<PAGE>



         "Patent Security Agreement" means the Patent Security Agreement
executed and delivered by Grantor to Grantee and attached hereto as Exhibit A,
as such agreement may be amended, supplemented or otherwise modified from time
to time.

         "Pledged Deposit Accounts" shall have the meaning set forth in Section
2.1(i) hereof.

         "Proceeds" shall have the meaning as provided in the UCC.

         "Receivables" mean the Revenue Interests and the Related Receivables.

         "Related Receivables" shall have the meaning set forth in Section
2.1(f).

         "Security Agreement" shall have the meaning set forth in the preamble
hereto.

         "UCC" means the Uniform Commercial Code as in effect on the date hereof
in the State of New York, as amended from time to time, and any successor
statute; provided that if by reason of mandatory provision of law, the
perfection or the effect of perfection or non-perfection of the security
interest in the Collateral is governed by the Uniform Commercial Code of another
jurisdiction, "UCC" means the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provision hereof relating to such perfection or
effect of perfection or non-perfection.

         Section 1.2. Assignment Agreement Definitions.

         Unless otherwise defined herein or the context otherwise requires,
terms used in this Security Agreement, including its preamble and recitals, have
the meanings provided in the Assignment Agreement.

         Section 1.3. UCC Definitions.

         Unless otherwise defined herein or the context otherwise requires,
terms for which meanings are provided in the UCC are used in this Security
Agreement, including its preamble and recitals, with such meanings.

         Section 1.4. Other Interpretive Provisions.

         (a) The meanings of defined terms are equally applicable to the
singular and plural forms of the defined terms.

         (b) The words "hereof," "herein," "hereunder" and similar words refer
to this Security Agreement as a whole and not to any particular provision of
this Security Agreement; and subsection, Section, Schedule, and Exhibit
references are to this Security Agreement unless otherwise specified.

         (c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other writings,
however evidenced.


                                       3




<PAGE>



             (ii) The term "including" is not limiting and means "including
without limitation".

             (iii) The term "property" includes any kind of property or asset,
personal or mixed, tangible or intangible, other than real property.

         (d) Unless otherwise expressly provided herein, (i) references to
agreements (including this Security Agreement) and other contractual instruments
shall be deemed to include all subsequent amendments and other modifications
thereto, but only to the extent such amendments and other modifications are not
prohibited by the terms of any Transaction Document, and (ii) references to any
statute or regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing, supplementing, or
interpreting the statute or regulation.

         (e) The captions and headings of this Security Agreement are for
convenience of reference only and shall not affect the interpretation of this
Security Agreement.

                                   ARTICLE II

                                SECURITY INTEREST

         Section 2.1. Grant of Security.

         As collateral security for the prompt, full and faithful payment and
performance when due of the Obligations, each Grantor hereby assigns, pledges,
transfers and grants to Grantee a continuing lien on and a first priority
security interest in all of such Grantor's right, title, and interest in and to
the following property, wherever the same may be now or hereafter located, and
all supporting obligations and other security therefor, whether secured or
unsecured, and whether now owned or hereafter existing or acquired (the
"Collateral"):

         (a) all Revenue Interests;

         (b) all Assigned Interests;

         (c) all License Agreements (but only with respect to sales of Products
in North America), including, without limitation, that certain License
Agreement, dated as of October 18, 2004 between Ortec, Orcel and Cambrex;

         (d) all Distribution Agreements (but only with respect to sales of
Products in North America), including without limitation, that certain Sales
Agency Agreement, dated as of October 18, 2004 between Ortec and Cambrex;

         (e) the Management Agreement;

         (f) the Ortec Security Agreement;


                                       4




<PAGE>


         (g) the Exclusive License Agreement;

         (h) all Intellectual Property (but with respect to Patents and
trademark applications and registrations, only those registered or filed in
North America);

         (i) all Accounts, contract rights, payment intangibles, Instruments,
and General Intangibles, in each case, constituting, comprising, evidencing or
otherwise relating to any of the foregoing in this Section 2.1 (any and all such
Accounts, contract rights, payments intangibles, Instruments, and General
Intangibles being the "Related Receivables");

         (j) all books, records, data bases, and information, in each case,
specifically relating to any of the foregoing in this Section 2.1;

         (k) all money now or at any time in the possession or under the control
of, or in transit to, the Lockbox Bank, Grantee, the bank with the PRF/Cambrex
Lockbox Account (as defined in the Consent and Agreement), or each Grantor
relating to any of the foregoing in this Section 2.1; and

         (l) the Lockbox Account, the Joint Concentration Account and the
Assignee Concentration Account, the PRF/Cambrex Lockbox Account or in any bank
account or deposit account in which funds were received by each Grantor from or
on account of or relating to each of the foregoing in this Section 2.1
(collectively, the "Pledged Deposit Accounts"), all funds on deposit in each
such account, all investments arising out of such funds, all claims thereunder
or in connection therewith and special purpose subaccounts maintained therein,
and all monies and credit balances from time to time held in the Pledged Deposit
Accounts or such subaccounts; all notes, certificates of deposit, deposit
accounts, checks and other instruments from time to time hereafter delivered to
or otherwise possessed by any Grantor in substitution for or in addition to any
or all of the then existing items described in this subsection (l); and all
interest, dividends, cash, securities, rights, instruments and other property at
any time and from time to time received, receivable or otherwise distributed in
respect of such accounts, such funds, or such investments or received in
exchange for any or all of the items described in this subsection (l); and

         (m) all Cambrex Collateral, but only to the extent that such Cambrex
Collateral is the property of either Grantor;

         (n) all products and Proceeds of and from any and all of the foregoing
Collateral, all proceeds which constitute property of the types described in
clauses (a) through (m) and, to the extent not otherwise included, all payments
under insurance (whether or not Grantee is the loss payee thereof), including
return premiums with respect thereto, or any indemnity, warranty, or guaranty
payable by reason of loss or damage to or otherwise with respect to any of the
foregoing Collateral;

provided, however, that the term "Collateral" shall not include, and neither
Grantor shall be deemed to have granted a security interest in, any of such
Grantor's right, title or interest in, or any rights under, any contract or
other agreement existing on the Closing Date to the extent that


                                       5




<PAGE>



such grant would result in a breach of a term of such contract or agreement
prohibiting such grant without the consent of the other party thereto, other
than to the extent that any such term would be rendered ineffective pursuant to
Section 9-406 of the UCC.

         Section 2.2. Continuing Security Interest.

         This Security Agreement shall create a continuing security interest in
the Collateral and shall:

         (a) remain in full force and effect until the payment and performance
in full of all the Obligations;

         (b) be binding upon each Grantor and their respective successors,
transferees and assigns; and

         (c) inure, together with the rights and remedies of Grantee, to the
benefit of Grantee and its successors and assigns.

Upon the payment and performance in full of the Obligations, the security
interest granted herein shall terminate and all rights to the Collateral shall
revert to each Grantor. Upon any such termination, Grantee will, at the
Grantors' sole expense, promptly execute and deliver to each Grantor such
instruments and documents necessary and as such Grantor shall reasonably request
to evidence such termination.

         Section 2.3. Grantors Remains Liable.

         Anything herein to the contrary notwithstanding:

         (a) The Grantors shall remain liable under the contracts and agreements
included in the Collateral to the extent set forth therein and shall perform all
of its duties and obligations under such contracts and agreements to the same
extent as if this Security Agreement had not been executed;

         (b) The exercise by Grantee of any of its rights and remedies hereunder
shall not release the Grantors from any of their duties or obligations under any
such contracts or agreements included in the Collateral; and

         (c) Grantee shall not have any obligation or liability under any such
contracts or agreements included in the Collateral by reason of this Security
Agreement, and Grantee shall not be obligated to perform or fulfill any of the
obligations or duties of each Grantor thereunder or to take any action to
collect or (x) to make any inquiry as to the nature or sufficiency of any
payment the Grantors may be entitled to receive thereunder; (y) present or file
and claim or (z) enforce any claim for payment assigned hereunder.


                                       6




<PAGE>




                                   ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

         Each Grantor represents and warrants to Grantee as follows:

         Section 3.1. Legal Status of Each Grantor, Location of Collateral, etc.


         (a) Each Grantor's exact legal name is set forth on Schedule I and the
signature page hereof.

         (b) Orcel is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of Delaware. Ortec is
a corporation duly incorporated, validly existing and in good standing under the
laws of Delaware.

         (c) On the date hereof, the place(s) of business and chief executive
office of each Grantor and the office(s) where each Grantor keeps its respective
records concerning the Receivables are located at the addresses set forth on
Schedule I.

         (d) Neither Grantor has a trade name.

         (e) Except as set forth on Schedule 3.1, during the past five years,
neither Grantor has been known by any name different from the one set forth on
the signature page hereto, and neither Grantor has been the subject of any
merger or other corporate reorganization.

         (f) None of the Receivables is evidenced by a promissory note or other
instrument.

         Section 3.2. Ownership; No Liens.

         Orcel owns the Collateral free and clear of any Liens except for the
security interest created by this Security Agreement and, to the extent
applicable, the security interest created by the Cambrex Security Agreement, and
except as set forth in the next sentence. To the extent that Ortec owns any of
the Collateral, Ortec owns such Collateral free and clear of any Liens except
for the security interest created by this Security Agreement and, to the extent
applicable, the security interest created by the Cambrex Security Agreement. No
effective security agreement, financing statement, assignment, equivalent
security, lien or other instrument similar in effect covering all or any part of
the Collateral is on file or of record in any public office, except such as may
have been filed in favor of Grantee relating to this Security Agreement or in
favor of Cambrex relating to the Cambrex Security Agreement.

         Section 3.3. Validity.

         This Security Agreement creates a valid security interest in the
Collateral securing the payment and performance in full of the Obligations. Upon
the filing of appropriate financing statements in the applicable filing offices
in the jurisdictions listed in Schedule II, all filings, registrations and
recordings necessary or appropriate to create, preserve, protect and perfect the


                                       7




<PAGE>


first priority security interest granted by each Grantor to Grantee in the
Collateral will have been accomplished and will create a perfected security
interest therein prior to the rights of all other Persons therein and subject to
no other Liens, except as set forth in Schedule 3.04 to the Assignment
Agreement.

         Section 3.4. Intellectual Property.

         The Patents constitute all registered Intellectual Property owned or
used by each Grantor and the Patent Licenses constitute all agreements relating
to Intellectual Property owned or used by each Grantor. The execution, delivery
and performance of this Security Agreement or the Assignment Agreement by each
Grantor will not violate or cause a default under any of the Intellectual
Property or any material agreement in connection therewith. Each Grantor further
represents and warrants as to those representations and warranties set forth in
Section 3.12 of the Assignment Agreement as if set forth in its entirety herein.

         Section 3.5. Authorization, Approval.

         No authorization, approval, or other action by, and no notice to or
filing with, any Government Authority or other Person is required either:

         (a) for the grant by each Grantor of the security interest granted
hereby or for the execution, delivery, and performance of this Security
Agreement by such Grantor; or

         (b) for the perfection of or exercise by Grantee of its rights and
remedies hereunder, other than (i) the filing of financing statements in the
offices listed in Item B of Schedule I and (ii) the establishment of the Pledged
Deposit Accounts and the Assignor Concentration Account in accordance with
Section 5.10 of the Assignment Agreement.

         Section 3.6. Enforceability.

         This Security Agreement is the legally valid and binding obligation of
each Grantor, enforceable against such Grantor in accordance with its terms.

                                   ARTICLE IV

                                    COVENANTS

         Each Grantor hereby covenants and agrees that, so long as this Security
Agreement shall remain in effect, such Grantor agrees to the following:

         Section 4.1. As to Receivables.

         (a) Each Grantor shall keep its place(s) of business and its chief
executive office and the office(s) where it keeps its books and records
(including those concerning the Receivables) and all original copies of the
Distribution Agreements and the License Agreements located, in each case, at its
address specified in Item A of Schedule I, or, upon 30 days' prior


                                       8





<PAGE>


written notice to Grantee, at such other locations in a jurisdiction where all
actions required by the first sentence of Section 4.4 shall have been taken with
respect to the Receivables, the Distribution Agreements and the License
Agreements; not change its name or its state or place of incorporation or
organization except upon 30 days' prior written notice to Grantee; and hold and
preserve such books and records.

         (b) Except as otherwise provided in this subsection (b), until an Event
of Default has occurred and is continuing, each Grantor shall, subject to
Section 5.10 of the Assignment Agreement, continue to collect, at its own
expense, all amounts due or to become due either Grantor under the Management
Agreement, the Ortec Security Agreement, the Distribution Agreements and the
License Agreements. In connection with such collections, provided no Event of
Default shall have occurred and be continuing, each Grantor may, subject to
Section 5.10 of the Assignment Agreement, take (and, at Grantee's direction,
shall take) such action as such Grantor may deem necessary or advisable to
enforce collection of the Management Agreement, the Ortec Security Agreement or
the applicable Distribution Agreement or License Agreement. At any time after an
Event of Default has occurred and is continuing, Grantee shall have the right to
notify the account debtors or obligors under any Receivables of the security
interest of Grantee in such Receivables to Grantee and to direct such account
debtors or obligors to make payment to Grantee of any amounts due or to become
due thereunder and enforce collection of any of the Receivables by suit or
otherwise and surrender, release or exchange all or any part thereof, or adjust,
settle or compromise or extend or renew for any period (whether or not longer
than the original period) any indebtedness thereunder or evidenced thereby. If
an Event of Default has occurred and is continuing, upon the request of Grantee,
each Grantor will, at its own expense, notify any parties obligated on any of
the Receivables to make payment to Grantee of any amounts due or to become due
thereunder, and in such event, Grantee is authorized to endorse, in the name of
such Grantor, any item representing any payment on or other proceeds of any of
the Receivables.

         (c) After delivery to each Grantor by Grantee of a notice that an Event
of Default has occurred and is continuing: (i) all amounts and proceeds
(including Instruments) received by the Grantors in respect of any Receivables
shall be received in trust for the benefit of Grantee hereunder, shall be
segregated from other funds of the Grantors, and shall be forthwith paid over to
Grantee in the same form as so received (with any necessary endorsements) to be
held as cash collateral and applied as provided by this Security Agreement; and
(ii) subject to Section 5.10 of the Assignment Agreement, neither Grantor shall
adjust, settle, or compromise the amount or payment of any Receivable, or
release wholly or partly any account debtor or obligor thereof, or allow any
credit or discount thereon.

         (d) After the occurrence and during the continuance of an Event of
Default, (A) Grantee may in its own name or in the name of others communicate
with account debtors in order to verify with them to Grantee's reasonable
satisfaction the existence, amount and terms of (h) any Receivables and (B)
Grantee shall have the right, at the Grantors' expense, to make test
verifications of the Receivables in any reasonable manner and through any medium
that it considers advisable, and each Grantor agrees to furnish all such
assistance as Grantee may reasonably require in connection therewith.


                                       9





<PAGE>




         (e) Notwithstanding the foregoing, nothing in this Section 4.1 shall be
deemed to limit any provision contained in the Consent and Agreement.

         Section 4.2. Insurance.

         The Grantors will maintain or cause to be maintained at all times
insurance against loss or damage sufficient to cover all the Collateral that are
of an insurable nature to the same extent assets of a similar character are
usually so insured by companies similarly situated and owning like assets, with
insurers believed by the Grantors to be responsible and reputable. If an Event
of Default exists at the time any insurance proceeds relating to the Collateral
are received, all such proceeds shall be paid to Grantee for application in
accordance with the terms and conditions of the Assignment Agreement and this
Security Agreement.

         Section 4.3. Intellectual Property.

         The Grantors shall concurrently herewith deliver to Grantee the Patent
Security Agreement and all other documents, instruments and other items as may
be necessary for Grantee to file such agreements with the United States Patent
and Trademark Office and any similar domestic or foreign office, department or
agency. If, before the Obligations are paid in full, either Grantor obtains any
new Intellectual Property or rights thereto or becomes entitled to the benefit
of any Intellectual Property not listed on the schedules to each security
agreement, such Grantor shall give to Grantee prompt written notice thereof, and
shall amend the respective security agreement to include any such new
Intellectual Property. Each Grantor shall: (a) preserve and maintain all rights
in the Intellectual Property; and (b) upon and after the occurrence of an Event
of Default, use its best efforts to obtain any consents, waivers or agreements
necessary to enable such Grantor to exercise its remedies with respect to the
Intellectual Property. Neither Grantor shall abandon any right to file a patent
or trademark application relating to the Intellectual Property nor shall such
Grantor abandon any pending patent or trademark application or patent, trademark
or copyright (including without limitation any Patents or Patent Licenses)
without the prior written consent of Grantee.

         Section 4.4. Transfers and Other Liens.

         Each Grantor shall not:

         (a) subject to Section 4.7 below and except for the Cambrex Security
Agreement, grant a security interest in the Assigned Interests or the other
Collateral described in this Agreement to any other party without the prior
written consent of Grantee; or

         (b) subject to Section 4.7 below, sell, assign (by operation of law or
otherwise), lease, transfer or otherwise dispose of any of, or grant any Person
an option with respect to, the Collateral.

         Section 4.5. Further Assurances.

         Each Grantor agrees that, from time to time at its own cost and
expense, such Grantor will promptly execute and deliver and will cause to be
executed and delivered all further


                                       10





<PAGE>




instruments, assignments, notices, agreements and documents, including, without
limitation, financing and continuation statements, and will take all further
action and will cause all further action to be taken, that may be reasonably
necessary or desirable, or that Grantee may reasonably request, in order to
create, preserve, perfect and protect any security interest granted or purported
to be granted hereby and the priority thereof or to enable Grantee to exercise
and enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing each Grantor will:

         (a) if any Collateral shall be evidenced by a promissory note or other
instrument or negotiable document, deliver and pledge to Grantee hereunder such
promissory note, instrument or negotiable document duly endorsed and accompanied
by duly executed instruments of transfer or assignment, all in form and
substance reasonably satisfactory to Grantee;

         (b) execute and file, record or register such financing or continuation
statements, or amendments thereto, and such other instruments, assignments or
notices, as may be necessary or desirable, or as Grantee may request, in order
to create, preserve, perfect and protect the security interests and other rights
granted or purported to be granted to Grantee;

         (c) furnish to Grantee, from time to time, statements and schedules
further identifying and describing the Collateral and such other reports in
connection with the Collateral as Grantee may reasonably request, and all in
reasonable detail and in accordance with the terms of the Assignment Agreement;
and

         (d) at Grantee's request, appear in and defend any action or proceeding
that may affect such Grantor's title to or Grantee's security interest in the
Collateral.

With respect to the foregoing and the grant of the security interest hereunder,
each Grantor hereby authorizes Grantee to file one or more financing or
continuation statements, and amendments thereto, relative to all or any part of
the Collateral without the signature of such Grantor where permitted by law. A
carbon, photographic, or other reproduction of this Security Agreement or any
financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement where permitted by law.

         Section 4.6. General Covenants.

         Without limiting any of the foregoing covenants, each Grantor agrees
(a) not to use or permit any Collateral to be used unlawfully or in material
violation of any provision of the Assignment Agreement, this Security Agreement,
any other Transaction Document or any applicable statute, regulation or
ordinance or any policy of insurance covering the Collateral; and (b) to pay
promptly when due all taxes, assessments, charges, encumbrances and Liens now or
hereafter imposed upon or affecting any Collateral.

         Section 4.7. Factoring of Revenue Interests.

         Should either Grantor propose to enter into a factoring of the accounts
receivable represented by the Revenue Interests, Grantee shall negotiate and
enter into an intercreditor


                                       11






<PAGE>



arrangement with any party with which such Grantor enters into a factoring of
such accounts receivable containing terms and provisions mutually satisfactory
to such Grantor, the factor and Grantee and providing for, among other things,
the following:

         (a) the factor receiving a security interest in not more than an
undivided 81.5% of the accounts receivable represented by the Revenue Interests;

         (b) the maintenance in favor of Grantee of (i) a 100% exclusive
security interest in 18.5% of the accounts receivable represented by the total
Revenue Interests; (ii) a 100% exclusive security interest in the proceeds from
the factoring of the accounts receivable represented by the Revenue Interests;
and (iii) to the extent that any portion of the accounts receivable represented
by the Revenue Interests are not factored, a 100% exclusive security interest in
such unfactored portion of the accounts receivable represented by the Revenue
Interests;

         (c) the security interest that is granted to such factoring party in
the accounts receivable represented by the Revenue Interests in accordance with
clause (a) above shall be pari passu to Grantee's security interest granted in
Section 2.1 in the accounts receivable represented by the Revenue Interests; and

         (d) all proceeds from the factoring arrangement shall be disbursed
pursuant to instructions from Grantee first to Grantee in respect of all amounts
owing by either Grantor to Grantee and the balance into the Lockbox Account to
be disbursed in accordance with the terms of the Lockbox Agreement.

         Notwithstanding the foregoing, nothing in this Section 4.7 shall be
deemed to limit any provision contained in the Consent and Agreement.

                                   ARTICLE V

                          RIGHTS AND DUTIES OF GRANTEE

         Section 5.1. Grantee Appointed Attorney-in-Fact.

         Each Grantor hereby irrevocably appoints Grantee (and all Persons
designated for that purpose) as such Grantor's true and lawful attorney-in-fact,
with full authority and power in the place and stead of such Grantor and in the
name of such Grantor, Grantee or otherwise, from time to time in Grantee's
discretion from and after the occurrence and during the continuation of an Event
of Default and at such time or times thereafter as Grantee may, in its sole
discretion determine, to take any appropriate action and to execute any
instrument that Grantee may deem reasonably necessary or advisable to accomplish
the purposes of this Security Agreement (but Grantee shall not be obligated to
and shall have no liability to any Grantor or any third party for failure so to
do) including, without limitation:


                                       12






<PAGE>



         (a) to ask, demand, collect, enforce, sue for, recover, compromise,
receive, and give acquittance and receipts for moneys due and to become due
under or in respect of any of the Collateral;

         (b) to receive, endorse, and collect any checks, drafts or other
instruments, documents, and chattel paper in connection with clause (a) above;

         (c) to file any claims or take any action or institute any proceedings
(or to settle, adjust or compromise any such proceeding) that Grantee may deem
necessary or desirable for the collection of any of the Collateral or otherwise
to enforce the rights of Grantee with respect to any of the Collateral;

         (d) to perform the affirmative obligations of each Grantor hereunder
(including all obligations of such Grantor pursuant to Section 4.4);

         (e) to execute and deliver for and on behalf of each Grantor any and
all instruments, documents, agreements, and other writings necessary or
advisable for the exercise on behalf of such Grantor of any rights, benefits or
options created or existing under or pursuant to the Collateral; and

         (f) to execute endorsements, assignments, or other instruments of
conveyance and transfer.

Each Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section 5.1 is irrevocable and coupled with an
interest.

         Section 5.2. Grantee May Perform.

         If any Grantor fails to perform any agreement contained herein, Grantee
may itself (but shall not be obliged to) perform, or cause performance of, such
agreement, provided that Grantee shall in any event first have given the
Grantors written notice of its intent to do the same and neither Grantor shall
have, within 30 days of such notice (or such shorter period as Grantee may
reasonably determine is necessary in order to preserve the benefits of this
Security Agreement with respect to any material portion of the Collateral), paid
such claim or obtained to Grantee's satisfaction the release of the claim or
Lien to which such notice relates. Each Grantor agrees to reimburse Grantee upon
demand for any costs and expenses, including, without limitation, reasonable
attorneys' fees, Grantee incurs while acting as such Grantor's attorney-in-fact
hereunder, all of which costs and expenses are included in the Obligations
secured hereby.

         Section 5.3. Limitations on Duties of Grantee.

         Grantee shall be obligated to perform such duties and only such duties
as are specifically set forth in this Security Agreement, and no implied
covenants or obligations shall be read into this Security Agreement against
Grantee. If an Event of Default has occurred and is continuing, Grantee shall
exercise the rights and powers vested in it by this Security Agreement, and
shall not be liable (except for its gross negligence or willful misconduct) with
respect to any


                                       13





<PAGE>



action taken by it, or omitted to be taken by it, in accordance with, and
subject to the limitations contained in, the Assignment Agreement.

         Section 5.4. Reasonable Care.

         It is understood and agreed between the parties hereto that Grantee's
duty with respect to the custody, safekeeping, and physical preservation of the
Collateral in its possession should be to deal with it in the same manner as
Grantee deals with similar property for its own account; provided, however, that
Grantee shall not be required to make any presentment, demand, or protest, or
give any notice, and need not take any action to preserve any rights against any
other Person with respect to the Collateral.

                                   ARTICLE VI

                                    REMEDIES

         Section 6.1. Certain Remedies.

         If any Event of Default shall have occurred and is continuing:

         (a) Grantee may exercise in respect of the Collateral, in addition to
other rights available to it at law or in equity or otherwise, all the rights
and remedies of a secured party on default under the UCC (whether or not the UCC
applies to the affected Collateral) and also may (i) require each Grantor to,
and each Grantor hereby agrees that it will, at its expense and upon request of
Grantee forthwith, assemble all or part of the Collateral as directed by Grantee
and make it available to Grantee at a place to be designated by Grantee that is
reasonably convenient to both parties, (ii) exercise any and all rights and
remedies of the Grantors under or in connection with the Collateral, (iii)
withdraw all monies, securities and other property in the Pledged Deposit
Accounts for application to the Obligations, (iv) foreclose or otherwise enforce
Grantee's security interest in any manner permitted by law or provided for in
this Security Agreement, (v) without notice except as specified below, sell the
Collateral or any part thereof in one or more parcels at public or private sale,
at any place or places for cash, on credit, or for future delivery, and upon
such other terms as Grantee may deem commercially reasonable, (vi) recover from
each Grantor all costs and expenses, including, without limitation, reasonable
attorneys' fees, incurred or paid by Grantee in exercising any right, power,
privilege or remedy provided by this Security Agreement or by law, (vii) without
notice or demand of legal process, all of which are hereby expressly waived by
each Grantor, enter into property where any Collateral is located and take
possession thereof, and (viii) prior to the disposition of the Collateral,
prepare it for disposition in any manner and to the extent Grantee deems
appropriate; provided, however, that notwithstanding the foregoing to the
contrary, Grantee may sell or otherwise dispose the Collateral or any portion
thereof in its then condition without any preparation or processing. Each
Grantor agrees that, to the extent notice of sale shall be required by law, at
least ten (10) days' prior notice to such Grantor of the time and place of any
public sale or the time after which any private sale is to be made shall
constitute reasonable notification. Grantee shall not be obligated to make any
sale of Collateral regardless of notice of sale having


                                       14





<PAGE>



been given. Grantee may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned. Upon
any sale or other disposition pursuant to this Security Agreement, Grantee shall
have the right to deliver, assign and transfer to a transferee thereof the
Collateral or portion thereof and transfer to a transferee thereof the
Collateral or portion thereof so sold or disposed of. Each transferee at any
such sale or other disposition (including Grantee) shall hold the Collateral
free from any claim or right of whatever kind, including any equity or right of
redemption of each Grantor and each Grantor specifically waives (to the extent
permitted by law) all rights of redemption, stay or appraisal which it has or
may have under any rule of law or statute now existing or hereafter adopted.

         (b) All cash proceeds received by Grantee in respect of any sale of,
collection from, or other realization upon all or any part of the Collateral
shall be applied: first, to all costs, fees and expenses incurred by Grantee;
and second, to the Obligations. If any non-cash proceeds are received in
connection with any sale of Collateral, Grantee shall not apply such non-cash
proceeds to the Obligations unless and until such proceeds are converted to
cash; provided, however, that if such non-cash proceeds are not expected on the
date of receipt thereof to be converted to cash within one year after such date,
Grantee shall nonetheless use commercially reasonable efforts to convert such
non-cash proceeds to cash within such one-year period. Any surplus of such cash
or cash proceeds held by Grantee after payment in full of all the Obligations
shall be paid over to the Grantors or to whomsoever may be lawfully entitled to
receive such surplus.

         Notwithstanding the foregoing, nothing in this Section 6.1 shall be
deemed to limit any provision contained in the Consent and Agreement.

                                  ARTICLE VII

                            MISCELLANEOUS PROVISIONS

         Section 7.1. Amendments.

         No amendment, modification or waiver of any provision of this Security
Agreement or the Assignment Agreement, and no consent to any departure by any
Grantor herefrom shall in any event be effective unless the same shall be in
writing and signed by Grantee, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

         Section 7.2. Release of Collateral.

         If any of the Collateral shall be sold, transferred, or otherwise
disposed of by any Grantor in a transaction not expressly prohibited by the
Assignment Agreement, then Grantee shall, at such Grantor's written request,
promptly execute and deliver to such Grantor (at the sole cost and expense of
such Grantor) such instruments or documents necessary and as Grantor shall


                                       15





<PAGE>



reasonably request to release the Liens created hereby on such Collateral,
including any necessary UCC amendment, termination statement or partial
termination statement.

         Section 7.3. Notices.

         All notices and other communications shall be given as set forth in
Section 8.03 of the Assignment Agreement.

         Section 7.4. Waiver; Cumulative Remedies.

         (a) No failure to exercise and no delay in the exercise, on the part of
Grantee, of any right, remedy, power, or privilege hereunder and no course of
dealing with respect thereto shall impair such right, remedy, power or privilege
or be construed to or operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof, or the exercise of any other right, remedy,
power or privilege.

         (b) Each Grantor waives any right to require Grantee to proceed against
any Person or to exhaust any Collateral or to pursue any remedy in such
Grantee's power.

         (c) The rights, powers and remedies of Grantee under this Security
Agreement shall be in addition to all rights, powers and remedies given to
Grantee by virtue of any statute or rule of law, the Assignment Agreement or any
other agreement, all of which rights, powers and remedies shall be cumulative
and may be exercised successively or concurrently without impairing Grantee's
security interest in the Collateral.

         Section 7.5. Successors and Assigns.

         The provisions of this Security Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns, except that neither Grantor may assign or transfer any of its rights or
obligations under this Security Agreement without the prior written consent of
Grantee. Grantee may assign this Security Agreement, or any of its rights and
obligations hereunder, at any time to any other person or entity it deems
necessary or desirable without advance notice to Grantors, provided that prior
to or concurrently with such assignment such person or entity agrees in writing
(in form and substance reasonably satisfactory to Cambrex) to take subject to
and be bound by the provisions of the Consent and Agreement and provided that
written notice of such assignment is promptly thereafter given to Grantors and
Cambrex.

         Section 7.6. Counterparts.

         This Security Agreement may be executed in any number of separate
counterparts, each of which, when so executed, shall be deemed an original, and
all of said counterparts taken together shall be deemed to constitute but one
and the same instrument.

         Section 7.7. Severability.


                                       16





<PAGE>



         The illegality or unenforceability of any provision of this Security
Agreement or any instrument or agreement required hereunder shall not in any way
affect or impair the legality or enforceability of the remaining provisions of
this Security Agreement or any instrument or agreement required hereunder.

         Section 7.8. Governing Law and Jurisdiction.

         (a) THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ITS
CONFLICTS OF LAW PRINCIPLES).

         (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS SECURITY
AGREEMENT MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION
IN THE STATE, COUNTY AND CITY OF NEW YORK. BY EXECUTION AND DELIVERY OF THIS
SECURITY AGREEMENT, EACH GRANTOR HEREBY IRREVOCABLY CONSENTS TO AND ACCEPTS, FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY THE
NON-EXCLUSIVE JURISDICTION OF SUCH COURTS. EACH GRANTOR HEREBY FURTHER
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS SECURITY AGREEMENT OR ANY DOCUMENT RELATED HERETO.

         Section 7.9. Waiver of Jury Trial.

         EACH OF THE GRANTORS AND GRANTEE HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS SECURITY AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
TO THIS SECURITY AGREEMENT.



                            [Signature page follows]


                                       17




<PAGE>





         IN WITNESS WHEREOF, Ortec, Orcel and Grantee have caused this Security
Agreement to be duly executed and delivered by their respective duly authorized
officers as of the date first above written.




GRANTOR:                                ORCEL LLC



                                        By:     /s/ Ron Lipstein
                                           -------------------------------------
                                            Name:  Ronald Lipstein
                                            Title: Manager




GRANTOR:                                ORTEC INTERNATIONAL INC.




                                        By:     /s/ Ron Lipstein
                                           -------------------------------------
                                            Name:  Ronald Lipstein
                                            Title: Manager




GRANTEE:                                PAUL ROYALTY FUND, L.P.

                                        By: Paul Capital Management, LLC,
                                            its General Partner



                                            By:  /s/ Walter Flamenbaum
                                               ---------------------------------
                                               Name:  Walter Flamenbaum, M.D.
                                               Title: Managing Member



                     [SIGNATURE PAGE TO SECURITY AGREEMENT]





<PAGE>




                                                                       EXHIBIT A
                                                           to Security Agreement


                        FORM OF PATENT SECURITY AGREEMENT


            WHEREAS, ORCEL LLC, a Delaware limited liability company ("Grantor")
owns the Patents and Patent Applications listed on Schedule 1 annexed hereto,
and is a party to the Patent Licenses listed on Schedule l annexed hereto; and

            WHEREAS, Grantor, Ortec International Inc., a Delaware corporation
and Paul Capital Royalty Acquisition Fund, L.P., a Delaware limited partnership
("Grantee") are parties to a Revenue Interests Assignment Agreement dated as of
August 29, 2001 (the "Assignment Agreement"), pursuant to which, among other
things, Grantor sells, assigns, transfers and conveys to Grantee, and Grantee
purchases from Grantor, all of Grantor's rights and interests in and to the
Assigned Interests (as defined in the Assignment Agreement);

             WHEREAS, pursuant to the terms of the Security Agreement dated as
of August 29, 2001 (the "Security Agreement;" all capitalized terms defined in
the Assignment Agreement or the Security Agreement and not otherwise defined
herein have the respective meanings provided for in the Assignment Agreement or
the Security Agreement), between Grantor and Grantee, Grantor has granted to
Grantee a security interests as contemplated by the Security Agreement,
including, without limitation, all right, title and interest of Grantor in, to
and under all now owned and hereafter acquired North American Patents, Patent
applications and Patent Licenses, and all products and proceeds thereof (to the
extent granted therein), to secure the payment of all amounts owing by Grantor
under the Assignment Agreement and the other Obligations;

             NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Grantor does hereby grant to
Grantee a continuing security interest in all of Grantor's right, title and
interest in, to and under the following (all of the following items or types of
property being herein collectively referred to as the "Patent Collateral"),
whether presently existing or hereafter created or acquired:

      (1) each North American Patent and Patent application included in the
      Intellectual Property, including, without limitation, each Patent and
      Patent application referred to in Schedule l annexed hereto, together with
      any reissues, continuations or extensions thereof, and all of the goodwill
      of the business conducted in North America connected with the use of, and
      symbolized by, each such Patent and Patent application;





<PAGE>



      (2) each Patent License, including, without limitation, each Patent
      License listed on Schedule 1 annexed hereto; and

      (3) all products and proceeds of the foregoing, including, without
      limitation, any claim by Grantor against third parties for past, present
      or future infringement of any such Patent, including, without limitation,
      any Patent referred to in Schedule 1 annexed hereto, any Patent issued
      pursuant to a Patent Application referred to in Schedule l and any patent
      licensed under any Patent License listed on Schedule 1 annexed hereto.

             This security interest is granted in conjunction with the security
interests granted to Grantee pursuant to the Security Agreement. Grantor hereby
acknowledges and affirms that the rights and remedies of Grantee with respect to
the security interest in the Patent Collateral made and granted hereby are more
fully set forth in the Security Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein.

             IN WITNESS WHEREOF, Grantor has caused this Patent Security
Agreement to be duly executed by its duly authorized officer thereunto as of the
29th day of August, 2001.


                                              ORCEL LLC

                                              By:
                                                   -----------------------------
                                                   Name:  Ronald Lipstein
                                                   Title: Manager

Agreed and Accepted as of the
29th day of August, 2001

PAUL CAPITAL ROYALTY ACQUISITION FUND, L.P.

By:  Paul Capital Management, LLC,
     its General Partner

By:
   --------------------------------------
     Name:  Walter Flamenbaum, M.D.
     Title: Managing Member


                                       2




<PAGE>





                                 ACKNOWLEDGEMENT

STATE OF NEW YORK          )
                           )       ss:
COUNTY OF NEW YORK         )


         On the 29th day of August, 2001 before me personally appeared Ronald
Lipstein, to me personally known or proved to me on the basis of satisfactory
evidence to be the person described in and who executed the foregoing instrument
as the Manager of Orcel LLC who being by me duly sworn, did depose and say that
he is the Manager of Orcel LLC, the corporation described in and which executed
the foregoing instrument; that he knows the seal of said limited liability
company; that the seal affixed to said limited liability company by order of its
Management Committee; that he signed his name thereto by like order; and that he
acknowledged said instrument to be the free act and deed of limited liability
company.



                                              Notary Public


(Seal)


My commission expires:


                                       3




<PAGE>



                     Schedule I to Patent Security Agreement

                                     PATENTS

<TABLE>
<CAPTION>
                U.S. Patent No.                                        Expiration Date
                ---------------                                        ---------------
<S>                                                                <C>
RE # 35,399 (re-issue of U.S. Patent 5,282,859)                       February 1, 2011
   5,282,859 (Canadian Patent No. 2,080,693)                          February 1, 2011
                   6,039,760                                          February 1, 2011
                   6,500,464                                          December 28, 2020
                   6,638,709                                          December 26, 2020
</TABLE>


                                 PATENT LICENSES


None.




<PAGE>



                                                                      SCHEDULE I
                                                           to Security Agreement


                         LOCATIONS OF CERTAIN COLLATERAL



Exact Legal Name of Grantors
----------------------------

Orcel LLC
Ortec International Inc.


Jurisdiction of Incorporation of each Grantor
---------------------------------------------

Delaware


Place(s) Of Business And Chief Executive Office of the Grantors:
----------------------------------------------------------------

Each Grantor's principal place of business and chief executive offices are
located at 3960 Broadway, New York, New York 10032.


Addresses of the Properties at which the Grantors Maintain Records Relating to
------------------------------------------------------------------------------
the Collateral:
---------------

3960 Broadway
New York, New York 10032




<PAGE>


                                                                     SCHEDULE II
                                                           to Security Agreement



                     OFFICES FOR FILING FINANCING STATEMENTS



Delaware Secretary of State
UCC Division
P.O. Box 793
Dover, DE 19903




<PAGE>


                                                                    SCHEDULE 3.1
                                                           to Security Agreement



                 NAMES AND CORPORATE REORGANIZATIONS AND MERGERS


None.