DISTRIBUTION AGREEMENT


This   Agreement   is  made  as  of  August  4,  1997  by  and  between   Matrix
Pharmaceutical,  Inc., 34700 Campus Dr.,  Fremont,  California  94555, a company
duly  organized  and  existing  under  the laws of  Delaware,  United  States of
America,  ("Matrix")  and  Altana,  Inc.,  Melville,  New York,  a company  duly
organized and existing under the laws of New York ("Altana").

                                   WITNESSETH:

Whereas,  Matrix is the  owner  and  manufacturer  of the  Product  (hereinafter
defined) and is interested in having its Product marketed,  sold and distributed
in the Field and in the Territory (each as hereinafter defined); and

Whereas, Altana has facilities, distribution systems and sales personnel capable
of selling the Product and is interested in marketing,  selling and distributing
the Product in the Territory, and

Whereas,  Matrix and Altana jointly agree that it is mutually desirable to enter
into this Agreement with respect to the supply, marketing, distribution and sale
of the Product.

NOW, THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:

1.       DEFINITIONS.

1.1.     The term "Product"  shall mean  formulations  of Matrix's  AccuSite(TM)
         (fluorouracil/epinephrine)  injectable gel and any future  formulations
         involving  fluorouracil/epinephrine)  collagen  for  the  treatment  of
         condyloma  acuminata  (genital  warts) in commercial  quantities and in
         finished dosage form, as further described in Supplement A hereto.

1.2.     The term "Field"  shall mean the  treatment  of condyloma  acuminata by
         dermatologists and OB/GYN specialists.

1.3.     The term  "Territory"  shall mean the United  States of and Puerto Rico
         for dermatology and OB/GYN markets.

1.4.     The term "Parties" shall mean Matrix and Altana.

1.5.     The  term  "Agreement"  shall  mean  this  document  and  any  and  all
         supplements, schedules and amendments hereto.

1.6.     The term "Net Sales" shall mean with respect to Product,  the aggregate
         amount  invoiced  by Altana  (including  by its  Affiliates)  for or on
         account of any sale to a  non-affiliated  purchaser  of such Product in
         the  Territory, 

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         less deductions for: a) normal and customary  trade,  quantity and cash
         discounts allowed; and b) allowances or credits to customers on account
         or return of Product.

1.7.     The term  "Distribution  Period" shall mean the period beginning on the
         date  of the  first  offer  for  commercial  sale  of  Products  in the
         Territory and ending five (5) years  thereafter.  This Agreement may be
         extended beyond the original five (5) year term as set forth in section
         11.2 below.

1.8.     The term  "Specifications"  shall  mean the  specifications  (including
         methods  package from NDA) for Products set forth and  contained in the
         FDA approval  which  authorizes the marketing of the Product for use by
         humans in the Territory.

1.9.     The term "Affiliate" shall mean any corporation,  association, company,
         organization   or  other  entity   which  is  directly  or   indirectly
         controlling,  controlled  by, or under  common  control  with Matrix or
         Altana (as applicable).  For the purpose of this  definition,  the term
         "control" means the direct or indirect  ownership of 50% or more of the
         voting power of the subject entity.

1.10.    The term "GMP" means those manufacturing practice regulations set forth
         in  Good  Manufacturing  Practices  for  Finished  Pharmaceuticals,  as
         required by the applicable regulations in the Territory.

1.11.    The term "FDA" means the United States Food and Drug  Administration or
         any successor agency.

1.12     The term "Year One" shall mean the date of product introduction through
         the end of the next calendar year.  However,  Year One shall not exceed
         18 months.

2.       GRANT OF RIGHTS.

         Altana shall have exclusive rights during the term of this Agreement to
         promote,  distribute,  sell and resell the  Product in the Field and in
         the Territory and shall purchase its requirements  therefor exclusively
         from  Matrix  in  accordance  with the  terms  and  conditions  of this
         Agreement.  Altana  shall  seek or  otherwise  solicit  orders  for the
         Product only from persons and entities  located and taking delivery and
         intending to sell within the Territory.

         Prior to granting a license to market and sell the Product in the field
         of urology to a third  party,  Matrix will grant  Altana the  exclusive
         right, for a period of 90 days, to negotiate terms and conditions under
         which Matrix would enter into such a license with Altana  provided that
         if Matrix and Altana do not agree on  mutually  satisfactory  terms and
         conditions within 

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         such 90 day period,  despite  good faith  efforts to do so, then Matrix
         shall  ultimately  be free to license  such rights to third  parties on
         such terms and conditions as it deems appropriate.

3.       PLACING OF ORDERS AND DELIVERY.

3.1.     Matrix shall supply  Altana with and Altana shall  purchase from Matrix
         all of Altana's requirements for Product for resale in the Territory in
         accordance with the terms and conditions set forth in this Agreement.

3.2.     Altana shall place orders with Matrix for the finished Product.  Matrix
         agrees to deliver the Product,  as specified in such orders,  to Altana
         at the address agreed upon at the delivery date specified in each order
         on the condition that each order is received by Matrix at least two (2)
         months prior to the delivery date in question.

3.3.     In  consideration  for the rights granted herein,  Altana shall use its
         diligent  efforts,  commensurate  with  those it would  use for its own
         products, to market, create a demand for and continuously develop sales
         of the product in the Territory throughout the life of this Agreement.

3.4.     Supplement  C sets forth  Altana's  good faith  estimate of the initial
         sales  forecast  for  quantities  of Products  that  Altana  expects to
         market,  sell and distribute during each of the first five (5) years of
         this Agreement  (the "Initial  Forecast").  The Initial  Forecast shall
         apply to the first three years of the original term of this  Agreement.
         Thereafter,  Altana shall in good faith prepare and annually provide to
         the Marketing and Sales Committee its revised estimates of Net Sales of
         Products  for the then  upcoming  three year  period.  If  accepted  by
         Matrix,  such new forecasts shall become  Accepted  forecasts and shall
         govern the Parties  responsibilities  for the period they cover. If not
         accepted by Matrix, the Initial Forecast shall control.

3.5.     All firm  orders  for  Product  placed  by  Altana  shall be  deemed to
         incorporate Matrix's standard Terms and Conditions of Purchase in force
         at the time of order  placement,  except where such terms or conditions
         are varied or  inconsistent  with this  Agreement.  In the event of any
         such  inconsistency,  this Agreement shall control.  Altana shall place
         firm orders for  Product  consistent  with the Initial  Forecast or the
         then applicable Accepted Forecast,  as applicable,  at least sixty (60)
         days prior to the scheduled  delivery dates  therefor.  Any such orders
         shall be deemed  accepted  by  Matrix as of the date of their  receipt,
         unless within  fifteen (15) days of its receipt,  Matrix advises Altana
         to the contrary, setting forth alternative delivery dates no later than
         thirty (30) days from the original  delivery  date in  accordance  with
         Matrix's then current  delivery  schedule for the Product in comparable
         volumes.

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3.6.     Matrix  warrants that it shall fill each Altana firm order submitted in
         accordance  with this  Agreement.  Matrix shall  supply  Altana with at
         least  the  quantities  of  Product  set  forth  on  Supplement  C (the
         applicable Forecasts) and shall use its commercially reasonable efforts
         to  supply  Altana  with  any  quantities  ordered  in  excess  of  the
         applicable Forecast  requirements.  If there is a shortfall in Matrix's
         ability to supply Product,  it shall immediately  notify Altana of such
         shortfall and provide an indication of the likely duration thereof.  In
         the  event  of any  shortfall,  Matrix  will  provide  Altana  with  an
         allocation of Product pro rata to its worldwide sales.

3.7.     Product  is  to  be  delivered  FOB  Matrix  manufacturing  facilities,
         California,  after which Altana will pay all charges, including without
         limitation transportation charges and insurance premiums. Title to, and
         risk of loss of, the Product shall remain with Matrix until delivery at
         the FOB point,  at which time Altana  shall assume title to and risk of
         loss of the Product.

3.8.     At the time of each Product  shipment,  Matrix shall invoice  Altana an
         amount  equal to * per unit of  finished  Product  shipped  to  Altana.
         Altana shall pay each such invoice within thirty days of its date.

4.       REVENUE SHARING AND PAYMENT.

4.1.     Within forty-five (45) days after the end of each calendar quarter, and
         starting with the first  calendar  quarter for which there are sales of
         Product  recorded,  Altana  shall  deliver to Matrix a cash payment (or
         Matrix shall deliver to Altana a cash  payment),  in U.S.  dollars,  in
         each case equal to the applicable  percentage of Altana's aggregate Net
         Sales  revenues from sales of Product during the prior quarter less the
         amount  previously  paid to Matrix for Product sold during such quarter
         (such that if the deduction for Product  payments results in a negative
         sum,  the payment  shall be made by Matrix to bring such sum to $0.00):
         (a) For year one,  fifty percent (50%) (to help defray Altana  start-up
         and  marketing  expenses;  (b) years two and three  (except as provided
         below) (i) seventy percent (70%) (to repay Matrix for its foregoing the
         upfront licensing fee) until such time as Net Sales revenue during such
         second and third years has reached $50.0 million;  (ii)  thereafter and
         for all subsequent years,  sixty percent (60%) until Net Sales for each
         such year  exceeds the Initial  Forecast or the  Accepted  Forecast Net
         Sales  amounts for such year;  and (iii) once the  Initial  Forecast or
         Accepted  Forecast Net Sales  Amount has been  exceeded  fifty  percent
         (50%) through the end of each such year.

4.2.     Matrix and Altana  agree that prior to any FDA approval for the Product
         for  use in the  treatment  of  basal  cell  cancer  and  other  future
         indications,  they  shall  develop  a  marketing  plan  (the  "Expanded
         Marketing Plan") for

*        Indicates that material has been omitted and confidential treatment has
         been  requested  therefor.  All such  omitted  material  has been filed
         separately with the Commission pursuant to Rule 24b-2.

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         such indication and shall thereafter  appropriately  revise the Minimum
         Net Sales  amounts  set forth in  Supplement  C to include  appropriate
         sales revenues therefor. Upon such agreement, the definition of Product
         shall be expanded to include the  treatment  of basal cell  cancer.  As
         part of such expanded marketing plans, Matrix and Altana shall agree to
         the  appropriate  compensation  to be paid to Matrix for its efforts in
         developing and registering  such new indications  with the objective of
         sharing the incremental costs for such indications on the same basis as
         the Parties share revenues, resulting from such new indications.

4.3.     Altana and its Affiliates shall keep and maintain detailed and accurate
         books and records with regard to Net Sales, marketing expenses, and the
         calculation  thereof.  Such  books  and  records  shall  be in at least
         sufficient  detail to permit a third  party  auditor  to verify the Net
         Sales and  marketing  expenses  for the Product and the  quantities  of
         Product shipped during each calendar quarter. An independent auditor of
         national standing shall be entitled,  on Matrix' behalf,  not more than
         once each year and during normal  business  hours,  to review and audit
         such books and records.  Such audit and review shall be contingent upon
         one  week's  advance  notice  from  Matrix to Altana and such audit and
         review  shall be at Matrix's  expense;  however,  Altana shall bear any
         such expense if the review or audit shows an  underpayment of more than
         five percent (5%) for the applicable period, in which case Altana shall
         promptly reimburse Matrix for such expenses and pay the deficiency.

4.4      Any payments made by either party for Medicare or Medicaid  rebate will
         be shared by the parties based on the then  applicable  revenue sharing
         percentage.

4.5.     All  payments  to Matrix  shall be made in U.S.  dollars  in the United
         States to such  account and bank as Matrix  shall  specify to Altana in
         writing.

5.       ALTANA  OBLIGATIONS.  Altana warrants and/or covenants,  as applicable,
         that it shall:

5.1.     Meet or  exceed at least  fifty  percent  (50%) of the then  applicable
         annual Net Sales  amounts set forth in the  Initial  Forecast or in any
         Accepted Forecast,  as then applicable.  In the event that Altana fails
         to meet such  Minimum  Net  Sales  amounts  after  Year One for any two
         consecutive  years,  Matrix  shall  have the  right to  terminate  this
         Agreement provided that Matrix materially has fulfilled its obligations
         under Section 3.6.

5.2.     Use its  diligent  efforts to promote  the sale of Product in the Field
         and in the  Territory  and will furnish a detailed  marketing and sales
         plan  with  respect  to the  Product,  three  (3)  months  prior to the
         beginning  of each  calendar  year.  Such plan shall be reviewed by the
         Marketing and Sales Committee (as described in Section 12 below).


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         In  all  instances,  the  Product  shall  be  marketed  under  Matrix's
         trademarks  therefor,  provided  that Altana  shall also be entitled to
         display  its  name and logo  thereon.  Matrix  shall  grant  Altana  an
         exclusive  license to use the trademarks  described in Supplement D, in
         the Territory, upon the terms and conditions set forth in the Trademark
         License  Agreement  entered into by the parties of even date  herewith,
         attached hereto as Supplement D and made a part hereof.  All packaging,
         labels,  labeling,  and marketing materials for the Product shall be in
         accordance  with  applicable  regulations in the Territory and shall be
         approved  in  advance  in  writing  by  Matrix  or a  Matrix  appointed
         designee.  Altana shall not distribute or have  distributed any written
         information  regarding  the Product  which  bears any Matrix  trademark
         without the prior  written  approval of Matrix.  Permission  to use the
         Matrix  trademarks  in  marketing  the  Product is  granted  solely for
         purposes  of this  Agreement  and  shall  immediately  lapse  upon  any
         termination of this Agreement.  Altana  acknowledges  that in utilizing
         such  trademarks  it shall be  Altana's  responsibility  to promote the
         goodwill  associated  with such trademarks and that Altana shall in all
         cases comply with all applicable governmental  requirements relating to
         the sale or  marketing  of  pharmaceutical  products in the  Territory.
         Nothing herein grants Altana any other rights, title or interest in any
         such  trademarks,  and Altana  recognizes that Matrix is the sole owner
         thereof  and  covenants  that it will not take any action  which  might
         prejudice  or  adversely  affect the  validity  or  Matrix's  ownership
         thereof.

5.3.     Maintain a sales force of  approximately  seventy five (75),  but in no
         event less than  sixty-five  (65),  sales persons each of whom shall be
         predominantly directed at dermatology or OB/GYN sales opportunities and
         are trained to sell the Product.

5.4.     Present  the  Product  in a  first-call  position  to  the  appropriate
         relevant target  physicians in its sales calls for at least twelve (12)
         months  after its  launch in the  Territory.  Altana  will  launch  the
         product  in  the  Territory  within  ninety  (90)  days  of  regulatory
         approval.

5.5.     Expend not less than the  amounts  set forth on Exhibit B for each year
         listed thereon in actual  out-of-pocket  marketing  expenses related to
         sales of the Product in the Field and in the Territory.

         Supplement B sets forth Altana's  Marketing  expenses that Altana shall
         incur to market, sell, and distribute during each of the first five (5)
         years  of  this  Agreement  (the  "Initial  Forecast").  The  Marketing
         expenses  shall apply to the first three (3) years of the original term
         of this Agreement.  Thereafter,  Altana shall in good faith prepare and
         annually provide to Marketing and Sales Committee its revised estimates
         of marketing  expenses for the then upcoming three (3)-year period.  If
         accepted  by 

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         Matrix,   such  new  Marketing   expenses   shall  govern  the  Parties
         responsibilities  for the period they cover. If not accepted by Matrix,
         the Initial Forecast shall control.

5.6.     Ascertain  and comply  with all  applicable  laws and  regulations  and
         standards of industry or  professional  conduct in connection  with the
         use,  distribution  or  promotion  of the  Product,  including  without
         limitation,  those applicable to product claims,  labeling,  approvals,
         registrations  and  notifications.   To  use  commercially   reasonable
         efforts,  at its sole  expense,  to obtain and maintain any  applicable
         approvals,  registrations,  notifications  or the like  with  regard to
         marketing, using (for therapeutic use), selling, reselling, labeling or
         otherwise promoting or making claims regarding the Product or its use.

5.7.     Provide  medical  affairs service for the Territory on behalf of Matrix
         with respect to the Product.  Altana's  responsibilities shall include,
         but are not limited to, the following:

         (A)      Altana shall  operate a service  that will provide  prompt and
                  accurate  responses to all inquiries.  Such responses shall be
                  made  verbally by phone or in writing by letter,  facsimile or
                  electronic  means as  appropriate.  Altana  responses  will be
                  consistent with Matrix  specifications  and standard operating
                  procedures to be mutually agreed upon.

         (B)      Matrix shall provide Altana with an initial set of anticipated
                  questions and approved responses.

         (C)      Altana  shall  be  responsible  for  ensuring   compliance  of
                  responses  with the  appropriate  requirements  of  regulatory
                  authorities.

         (D)      Altana shall follow appropriate  reasonable standard operating
                  procedures agreed by both Parties, for collecting  information
                  from calls concerning  Adverse Events (as defined below),  and
                  for reporting and transferring such information to Matrix.

         (E)      Altana shall  maintain  accurate  and complete  records of all
                  inquiries and responses,  both verbal and written. Within five
                  (5)  business  days after the end of each month.  Altana shall
                  provide  Matrix with reports  detailing the number and type of
                  responses handled during that month, as well as any additional
                  reports  agreed upon by both  Parties,  and provide these in a
                  format agreed upon by both Parties.

         (F)      Altana shall ensure that the  information  database to be used
                  in  providing  medical  affairs  services is  compatible  with

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                  specifications  as set forth in Supplement E. Upon termination
                  of this  Agreement,  Altana  shall  immediately  transfer  all
                  database records to Matrix in a useable and organized form.

5.8.     Keep for five years after  termination of this Agreement records of all
         product sales and customers  sufficient  to adequately  administer  any
         recall of the Product and to fully cooperate in any decision by the FDA
         or any other  regulatory body having  jurisdiction to recall,  retrieve
         and/or replace the Product.

5.9.     Maintain  proper  facilities  for the storage and  transport of Product
         pursuant to the Specifications,  including, without limitation, storage
         at temperatures between 2 and 8 degrees Celsius, protected from light.

5.10.    Refrain  from  establishing  or  maintaining  any branch,  warehouse or
         distribution depot for the Product outside the Territory, and shall not
         engage in any  advertising  or promotional  activities  relating to the
         Product directed  primarily to potential  customers located outside the
         Territory.

5.11.    Facility Inspection.  Upon reasonable written notice, Matrix shall have
         the right from time to time to inspect  Altana's  Product  distribution
         facility(ies)  and medical  affairs  database to verify its  compliance
         with the terms of this Agreement.

5.12.    Inspections by Government Agencies. Altana shall promptly notify Matrix
         of any inspections by any regulatory representatives of any facility at
         which the Product is being or will be  distributed,  to the extent such
         inspections  pertain to the Product or the  distribution  thereof,  and
         shall  send  Matrix  copies  of the  results  of any such  inspections,
         including  actions taken by the inspected  party or any other entity to
         remedy conditions cited in such inspections.

6.       MATRIX OBLIGATIONS.  Matrix warrants and/or covenants that it shall:

6.1.     Obtain the  registration  for commercial  sale in the Territory for the
         Product,  including  carrying  out any  clinical  studies  required  by
         regulatory  authorities  for  such  registration.  Notwithstanding  the
         foregoing,  if any new studies required by such regulatory  authorities
         are in Matrix's judgment too expensive to warrant  commercialization of
         the Product in the Territory,  then Matrix may terminate this Agreement
         without further liability.

6.2.     Supply  Altana  with  packaged,   labeled,   finished   Product  F.O.B.
         California.

6.3.     Be responsible for testing clearance to the F.O.B. point.

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6.4.     Expend not less than $1 million in year one for  marketing the product,
         $750,000 in year two for marketing the product, $600,000 in year three,
         $500,000 in year four, and $400,000 in year five.

6.5.     Be  responsible  for all Adverse  Event  reporting to the FDA and other
         government  agencies  outside  of the  Territory  with  respect  to the
         Product. Matrix shall advise Altana of any adverse event reporting done
         by Matrix on the Product outside the Territory.

6.6.     Hold and maintain the Product license  application for the registration
         for  sale  of the  Product  in the  Territory  and be  responsible  for
         establishing the Product price, after consulting with Altana.

6.7.     Supply the  Product to Altana in  accordance  with the  provisions  set
         forth in Section 3.6.

6.8      Be responsible  for disposal of Product  packaging  materials which are
         deemed  unusable due to changes  imposed by the FDA or as agreed by the
         parties.

6.9      Facility Inspection.  Upon reasonable written notice, Altana shall have
         the right from time to time to inspect Matrix's  Product  manufacturing
         facility(ies)  and medical  affairs  database to verify its  compliance
         with the terms of this Agreement.

6.10     Inspections by Government Agencies. Matrix shall promptly notify Altana
         of any inspections by any regulatory representatives of any facility at
         which the Product is being or will be  distributed,  to the extent such
         inspections  pertain to the Product or the  distribution  thereof,  and
         shall  send  Altana  copies  of the  results  of any such  inspections,
         including  actions taken by the inspected  party or any other entity to
         remedy conditions cited in such inspections.

7.       PATENTS.

7.1      Matrix  represents  and  warrants  that it has the  right to grant  the
         licenses  granted to Altana  herein,  that it has no  knowledge  of any
         rights of third parties that would  interfere  with the practice of any
         Matrix patent licensed  hereunder or require the payment of any royalty
         by Matrix or Altana to any such third party. Matrix further agrees that
         it shall indemnify and hold Altana harmless from any liability, cost or
         expense resulting from any breach of the foregoing representation.

8.       WARRANTIES/LIABILITIES.

8.1.     Matrix  warrants that the Product  delivered  hereunder shall comply in
         all material respects with the specifications set forth on Supplement A

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         hereto  and shall  comply  with Good  Manufacturing  Practices.  If the
         Product needs to meet additional  specifications  due to new government
         requirements  in the  Territory,  Altana  will  inform  Matrix  of such
         specifications and both Parties will study the best way to fulfill said
         requirements.

8.2.     Altana warrants to Matrix that all of the Product units  distributed by
         Altana  hereunder shall have been distributed and stored in conformance
         with the regulations of the applicable regulatory authority at the time
         of such distribution and storage.

8.3.     DISCLAIMER.  EXCEPT  THOSE  REPRESENTATIONS  MADE  TO  ALTANA  IN  THIS
         AGREEMENT, MATRIX MAKES NO OTHER REPRESENTATION OR WARRANTY, EXPRESS OR
         IMPLIED,  AS TO THE PRODUCT AND MATRIX HEREBY  EXPRESSLY  DISCLAIMS ANY
         WARRANTIES   IMPOSED  BY  STATUTE  OR  LAW,   SUCH  AS   WARRANTIES  OF
         MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE,  EXCEPT WHERE SUCH
         WARRANTIES  MAY NOT BE DISCLAIMED BY LAW OR STATUTE  APPLICABLE TO THIS
         AGREEMENT.

8.4.     Limited  Liability.  NEITHER  PARTY  WILL BE  LIABLE  FOR ANY  SPECIAL,
         INCIDENTAL OR CONSEQUENTIAL DAMAGES UNDER THIS AGREEMENT, EXCEPT TO THE
         EXTENT THAT APPLICABLE LAWS DO NOT PERMIT SUCH LIMITATION.

8.5.     During the term of this  Agreement,  each party  shall  within the time
         periods  prescribed  from time to time by applicable  laws,  notify the
         other party of all  information  coming into its possession  concerning
         any Adverse  Event to a Product.  In  addition,  Matrix  shall  provide
         Altana with copies of periodic or expedited  Adverse  Event,  safety or
         recall  correspondence  with  any  governmental  agency  regarding  the
         Product,  excluding any manufacturing  information  constituting Matrix
         trade secrets.  Matrix and Altana will derive a schedule for timeliness
         of  copying  routine  safety  correspondence  to  Altana.  Non-routine,
         expedited safety  correspondence  will be copied promptly by Matrix and
         sent to Altana.  Matrix and Altana shall each notify the other promptly
         if any batch or lot of Product  is alleged or proven to be the  subject
         of a recall, market withdrawal or correction; provided, however, in the
         event of any  disagreement  as to any matters  relating to such recall,
         market  withdrawal or correction,  Matrix shall have final authority on
         such  matters.  All  costs of any such  recall,  market  withdrawal  or
         correction  shall  be borne  by  Matrix,  unless  such  recall,  market
         withdrawal  or  correction  is the result of an action or  inaction  by
         Altana or its Affiliates  inconsistent  with its obligations under this
         Agreement.

8.6.     If  Altana  determines  that  the  Product  does  not  conform  to  the
         Specifications,  it shall  promptly so notify Matrix in writing  within
         sixty (60)

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         days of its receipt of such Product  shipment.  Altana and Matrix shall
         confer on the  matter  and  within  sixty  (60) days  after  receipt of
         Altana's  notice,  Matrix shall notify  Altana as to whether it concurs
         with  Altana's  determination.  If Matrix  concurs  then  Matrix  shall
         promptly  replace the  nonconforming  shipment  with a like quantity of
         conforming  Product.  If Matrix disagrees with Altana's  determination,
         the Parties  will  attempt to resolve the dispute  through a meeting of
         their  respective  Chief  Executive  Officers.  If such  dispute is not
         resolved  within  thirty  (30) days,  then the  Parties  shall agree to
         submit the  allegedly  nonconforming  Product and  original lot samples
         retained by Matrix to a mutually agreeable  independent  laboratory for
         testing.  The  determination of such laboratory shall be binding on the
         Parties,  provided that Matrix shall at any time have the right to deem
         Product  nonconforming,  which  Matrix  determination  shall be  final.
         Altana shall hold all  nonconforming  Product for  Matrix's  review and
         disposal thereof.

9.       INFRINGEMENT; INDEMNIFICATION.

9.1.     Obligations in Case of Infringing Third Party.

         9.1.1.   Matrix  and  Altana  shall  each  promptly  inform  the  other
                  following the discovery of any  infringement  or  unauthorized
                  use by a third party of any patent or other  proprietary right
                  or other  intellectual  property right  ("Proprietary  Right")
                  owned or  controlled  by  Matrix  or  Altana  relating  to the
                  manufacture,  sale or use of the Product in the Territory. The
                  Parties   shall   undertake   such   efforts   to   obtain   a
                  discontinuance of such infringement or unauthorized use as are
                  mutually agreed, and, if not successful, Matrix shall have the
                  first right but not the  obligation  to bring an  infringement
                  action or file any other appropriate  action or claim directly
                  related to the  infringement of a Matrix Patent.  The costs of
                  patent  enforcement  and related  recoveries  in the Territory
                  incurred  by  Matrix  shall be  included  as  shared  costs or
                  revenues and  allocated  between the parties on the basis then
                  applicable to revenues  pursuant to Section 4 above. If Matrix
                  does not commence a particular  infringement  action within 90
                  days after it first received  written notice thereof,  Altana,
                  after notifying Matrix in writing,  shall be entitled to bring
                  such infringement  action or any other  appropriate  action or
                  claim,  the  expense  and  recoveries  of which shall again be
                  shared as set forth  above.  Matrix and Altana  shall each pay
                  50% of any  related  out-of-pocket  costs  for any  such  suit
                  relating to infringement in the Territory,  and shall share in
                  the same proportion any sums received,  obtained, collected or
                  recovered,  whether by judgment,  settlement or otherwise as a
                  result of such suit in the same proportion.

                                       11

<PAGE>

         9.1.2.   If either Altana or Matrix elects not to  participate  in such
                  an infringement suit, then such party shall give prompt notice
                  to the other.  The other party may,  but is not  required  to,
                  obtain  a  discontinuance  of  the  alleged   infringement  or
                  unauthorized   use  or  bring  an   infringement   suit.   Any
                  infringement  suit shall be in the name of the party  electing
                  to bring  action or jointly as may be  required  by the law of
                  the forum.  The party electing not to bring suit shall execute
                  such legal papers and shall render all  reasonable  assistance
                  necessary  for  the   prosecution  of  such  suit  as  may  be
                  reasonably  required  by the other  party;  provided  that the
                  party   proceeding   with  such  suit  shall   reimburse   the
                  out-of-pocket   expenses   incurred  by  the  other  party  in
                  connection  with  such  assistance.   Any  such  expenses  and
                  compensation must be approved in advance.

         9.1.3.   It is understood that the party that institutes suit or action
                  pursuant to paragraph  9.1.2 above shall bear solely all costs
                  and expenses in connection  therewith and shall be entitled to
                  retain and keep any and all sums received, obtained, collected
                  or recovered, whether by judgment,  settlement or otherwise as
                  a result of such suit.

9.2.     Indemnification.

         9.2.1.   Subject to Altana's  compliance  with its  obligations  as set
                  forth  below,  Matrix  agrees to indemnify  and hold  harmless
                  Altana,  its Affiliates,  officers,  directors and agents from
                  and against any and all losses, claims,  damages,  liabilities
                  and expenses,  ("Liabilities")  arising out of, relating to or
                  resulting  from any action,  suit or claim  alleging  that the
                  manufacture, use or sale of Product infringes,  contributorily
                  infringes  or induces the  infringement  of any patent,  trade
                  secret or other  Proprietary  Right held by a third  party (an
                  "Infringement  Claim") or any action,  suit or claim  alleging
                  any product  liability or similar claim relating to or arising
                  out of the manufacture, use or sale of the Product (a "Product
                  Claim"  and   together   with  an   Infringement   Claim,   an
                  ("Indemnified Claim"), except to the extent any such Liability
                  arises out of Altana's or its  Affiliates'  (i)  negligence or
                  intentional   misconduct,   or  (ii)   storage,   handling  or
                  distribution  of the Product other than in compliance with the
                  Specifications  therefor or GMP  regulations.  In the event of
                  any patent  infringement,  Matrix  shall use its  commercially
                  reasonable efforts to obtain a license under any such patent.

         9.2.2.   Subject to Matrix's  compliance  with its  obligations  as set
                  forth  below,  Altana  agrees to indemnify  and hold  harmless
                  Matrix its Affiliates, officers, directors and agents from and
                  against  all  Liabilities  arising  out  of,  relating  to  or
                  resulting from any product 

                                       12
<PAGE>

                  liability  or similar  claim  relating  to or  arising  out of
                  Altana's or its  Affiliates'  (i)  negligence  or  intentional
                  misconduct,  or (ii) storage,  handling or distribution of the
                  Product or improper  training of  physicians in the use of the
                  Product,  in each  case  other  than in  compliance  with  the
                  Specifications therefor or GMP regulations.

         9.2.3.   Each party  agrees to notify the other within ten (10) days of
                  notification  of  any  Indemnified  Claim.  Each  party  shall
                  consult  with  the  other  party,  and keep  the  other  party
                  reasonably informed,  as to material developments with respect
                  to  any   Indemnified   Claim   for   which  a   party   seeks
                  indemnification  hereunder. Any related correspondence sent to
                  other  parties-in-interest  in such indemnified Claim, and any
                  documents filed or served in connection with such  Indemnified
                  Claim,  by or on behalf of a party  hereto (or the third party
                  that is the  subject  of such  Indemnified  Claim),  shall  be
                  provided  to the other  party  promptly  after  such items are
                  sent,  filed or served (as the case may be),  and any  related
                  correspondence or documents that a party (or such third party)
                  receives  in  connection  with such  Indemnified  Claim  shall
                  promptly be provided to the other party.  The defendant  named
                  in  the   Indemnified   Claim  shall  retain   decision-making
                  authority in defending the Indemnified  Claim, but in no event
                  shall  a  party  be  responsible   for  any  amounts  paid  in
                  settlement of an Indemnified  Claim unless such party approves
                  the  settlement.   Notwithstanding   anything  herein  to  the
                  contrary,  all  costs of  litigation  or  similar  proceedings
                  (including legal fees, court costs, related travel fees, etc.)
                  shall be solely and completely the obligation and liability of
                  the party which bears the risk,  and such party shall hold the
                  other party hereto harmless from and against the same.

         9.2.4.   Notwithstanding   the  foregoing,   the  obligation  to  share
                  reimbursements  or contributions  from third parties shall not
                  apply to  proceeds  under  insurance  policies  that Altana or
                  Matrix,  respectively,  receives from its  insurance  carriers
                  (including, if applicable, a captive insurance carrier).

9.3.     The  foregoing  obligation  of Matrix  does not apply  with  respect to
         Product or portions or  components  thereof (i) not supplied by Matrix,
         (ii)  which are  modified  after  shipment  by Matrix,  if the  alleged
         infringement or liability relates to such modification,  (iii) combined
         with  other   products,   processes  or  materials  where  the  alleged
         infringement  or  liability  relates  to such  combination,  (iv) where
         Altana continues allegedly the infringing or liability causing activity
         after being notified  thereof or after being informed of  modifications
         that would have avoided the alleged  infringement or liability,  or (v)
         where Altana's use of the Product is not in accordance with the License
         and the liability or infringement arises from

                                       13
<PAGE>

         such misuse; Altana will indemnify Matrix and its officers,  directors,
         agents,  and employees from all damages,  settlements,  attorneys' fees
         and expenses  related to a claim of infringement,  misappropriation  or
         liability  excluded  from  Company's   indemnity   obligation  by  this
         sentence.

9.4.     The Parties  acknowledge  that the  ultimate  liability  of the Parties
         hereto to third  parties for  Infringement  and Personal  Injury Claims
         will be decided by the court or other ruling entity having jurisdiction
         over the matter under the laws of the relevant country.  The provisions
         of this  Section 9 are not  intended to modify such finding of ultimate
         liability but, rather,  reflect an agreed upon cost sharing arrangement
         between the Parties hereto.

10.      CONFIDENTIALITY.

10.1.    All documents and information  made available by or on behalf of Matrix
         to Altana shall be kept secret and confidential by Altana and shall not
         be disclosed to any persons except  employees,  government  authorities
         and parties appointed or approved by Matrix, which are directly engaged
         in operations relating to the Product.

10.2.    Altana shall take all steps as are reasonably  necessary to ensure that
         its staff is aware of and complies with the  provisions of this Section
         10.

10.3.    The restrictions herein contained shall not extend to information that:
         (i) was already known to Altana and not directly or indirectly received
         from  Matrix;  or (ii)  was in the  public  domain  at the  time of its
         receipt,  or entered the public domain  thereafter  through no fault of
         Altana.

10.4.    The provisions of this Section 10 shall remain in force during the term
         of this Agreement and for a further period of five (5) years  following
         the termination hereof.

11.      DURATION AND TERMINATION.

11.1.    This  Agreement  shall become  effective upon signing of the Parties on
         the day first above written.

11.2.    If not earlier  terminated,  this Agreement shall remain in force for a
         period of five (5) years  after  the  first  shipments  for sale of the
         Product in the Territory. Thereafter, this Agreement may be renewed (a)
         by mutual  written  consent of the Parties or (b)  automatically  for a
         three (3)-year  periods if Altana has met eighty percent (80%) Accepted
         Forecast  sales  level for the prior  two (2) years  (with the  Parties
         agreeing to  determine  in good faith the  forecast  sales levels for a
         three (3) year period on a rolling  annual  basis  beginning  after the
         third year of the  original  five year term.  Once  accepted by Matrix,
         such  new or  revised  forecasts  shall  be  referred  to as  "Accepted
         Forecasts").

                                       14
<PAGE>

11.3.    Either party shall be entitled to terminate  this Agreement at any time
         in the event of a material  breach of any terms or  conditions  of this
         Agreement by the other Party which has not been remedied  within thirty
         (30) days after written notice thereof.

11.4     In the event of the  insolvency  or  adjudication  in bankruptcy or the
         making of an  assignment  for the benefit of creditors by either Party,
         this  Agreement  may be  terminated  immediately,  at the option of the
         other Party, by providing written notice.

11.5.    Upon  expiration  or  termination  of this  Agreement  each Party shall
         ensure that all Information  disclosed to the other Party by it and any
         documentation or duplications  thereof in its possession shall promptly
         be returned to the other Party.

12.      MARKETING AND SALES COMMITTEE.

         Within  thirty  (30)  days of the date of this  Agreement,  Altana  and
         Matrix shall each appoint two (2) persons to an AccuSite(TM)  marketing
         and sales advisory committee (the "Committee") for the Territory.  This
         Committee will make  recommendations  regarding the Product launch plan
         including  marketing  introduction,  the sales plan for specific target
         audiences in the Field (i.e., dermatologists, or OB / GYN). The role of
         the Committee  will be advisory  only to review the marketing  plan and
         clinical program designed to support marketing and sales efforts.  With
         respect to the advice given by the  Committee,  the party  charged with
         the  obligation to which such advice  applies shall  reasonably  and in
         good faith  consider  such  advice,  but such party  shall be  entitled
         ultimately to proceed as it reasonably deems appropriate in view of its
         obligations under this Agreement.

         The Marketing and Sales Committee will be responsible for reviewing and
         making recommendations to Matrix on matters relating to sales forecasts
         and   marketing   expenses  as  set  forth  in  Sections  3.4  and  5.1
         respectively.

13.      FORCE MAJEURE.

         A party shall be excused from performing its obligations (other than an
         obligation  for  paying  sums when due)  under  this  Agreement  if its
         performance is restricted or prevented by any cause beyond its control,
         including but not limited to, Acts of God,  fire,  explosion,  weather,
         war  insurrection,  riots, or government  action.  Performance shall be
         excused only to the extent of and during the reasonable  continuance of
         such disability.

                                       15
<PAGE>

14.      INSURANCE.

         Both Parties shall  maintain  comprehensive  insurance  policies in the
         Territory  covering  Product  liability  in an amount  customary in the
         industry for Products  competing  with or similar to the Products.  The
         Parties agree to exchange  Certificates  of Insurance  each year during
         the term of the Agreement.

15.      ASSIGNABILITY.

         This  agreement  shall be binding  upon and inure to the benefit of the
         Parties and their respective  successors and assigns.  Altana shall not
         assign,  delegate,  sublicense  or  otherwise  transfer  its  rights or
         obligations  hereunder or any interest herein (including any assignment
         or transfer  occurring by  operation of law) without the prior  written
         consent  of  Matrix  except  that this  agreement  and the  rights  and
         obligations  hereunder may be freely  transferable  in the Territory by
         Altana  to  companies  under  the  control  of Altana or under the same
         control as Altana.

         Matrix  may  freely  assign  or  transfer  any or  all  of its  rights,
         obligations or interest herein in connection with the sale, assignment,
         or transfer of all or substantially  all of Matrix's  business or to an
         Affiliate   provided,   however,   that  Matrix  may  only  assign  its
         manufacturing   obligations   hereunder   to   another   FDA   approved
         manufacturing facility.

16.      NOTICES.

         Notices and other  communications  provided for  hereunder  shall be in
         writing and mailed by registered  mail or sent by facsimile or telex to
         the address set forth below or at such address as the  receiving  party
         shall have previously  notified the sending party,  and shall be deemed
         received (i) fifteen (15)  business  days after  mailing  (with postage
         prepaid) or (ii) upon  transmission  if sent by  facsimile or telex and
         promptly confirmed in writing by mail:

         MATRIX                             ALTANA
         ------                             ------
         Matrix Pharmaceutical, Inc.        Altana, Inc.
         34700 Campus Dr.                   60 Baylis Road
         Fremont, California 94555          Melville, New York 11747

17.      REFORMATION AND SEVERABILITY.

         If any provision of this Agreement is declared  invalid by any tribunal
         of  competent  jurisdiction,   then  such  provision  shall  be  deemed
         automatically  adjusted to conform to the  requirements for validity as

                                       16

<PAGE>

         declared at such time, and, as so adjusted, shall be deemed a provision
         of this Agreement as though  originally  included herein.  In the event
         that the provision  invalidated  is of such nature that it cannot be so
         adjusted,  the provision shall be deemed deleted from this Agreement as
         though the provision had never been  included  herein.  In either case,
         the remaining provisions of this Agreement shall remain in effect.

18.      COUNTERPARTS AND HEADINGS.

         This  Agreement may be executed in any number of copies,  each of which
         when so executed  and  delivered  shall be deemed to be an original and
         all of  which  taken  together  shall  constitute  but one and the same
         instrument.   Headings  in  this  Agreement  are  included  herein  for
         convenience  of reference  only and shall not constitute a part of this
         Agreement  for any  other  purpose  and will not  affect in any way the
         meaning or interpretation of this Agreement.

19.      WAIVER.

         If any party  should at any time  refrain  from  enforcing  its  rights
         arising  from a breach  or  default  by the  other  party of any of the
         provisions of this  Agreement,  such waiver shall not be construed as a
         continuing waiver regarding that breach or default or other breaches or
         defaults of the same or other provisions of the Agreement.

20.      GOVERNING LAW.

         This  Agreement  shall be governed by and construed in accordance  with
         the laws of California and the United States of America  without regard
         to conflicts of laws principles thereof. At any time during the Term of
         this Agreement the applicable laws in the Territory will be respected.

21.      RELATION OF PARTIES.

         The parties are  independent  contractors and nothing in this Agreement
         shall  imply  any  principal  or  agent  relationship  or  other  joint
         relationship  and neither  party shall have the power or  authority  to
         expressly or impliedly obligate the other party.

22.      ENTIRE AGREEMENT.

         Each of the Parties  hereto agrees that there are no other  agreements,
         understandings, or representations,  oral or written, other than as set
         forth herein,  and that this Agreement  supersedes and replaces any and
         all   prior    and    contemporaneous    agreements,    understandings,
         representations,  statements,  or other communications  relating to the
         subject  matter  hereof.  The Parties  hereto  further  agree that this

                                       17

<PAGE>

         Agreement constitutes the sole and entire agreement between the Parties
         relating to the subject matter hereof.



         In witness whereof,  the Parties have duly executed the Agreement as of
         the date first above set forth.

         MATRIX PHARMACEUTICAL, INC.            ALTANA, INC.



         By:  /s/ JAMES R. GLYNN                By:  /s/ GEORGE W. COLE
             --------------------------             ------------------------
                James R. Glynn                           George W. Cole

         Title:   COO, CFO                      Title:  President
             --------------------------             ------------------------

                                       18
<PAGE>


                                    Exhibit A

                          IDENTIFICATION OF THE PRODUCT


AccuSite(TM)  Injectable  Gel is a new  combination  of previously  known active
ingredients, fluorouracil (5-FU) and epinephrine.

AccuSite(TM)   (fluorouracil  /  epinephrine)  Injectable  Gel  is  a  clear  to
opalescent,  colorless to slightly yellow, sterile gel containing  fluorouracil,
an antineoplastic agent and epinephrine, a vasoconstrictor, in a purified bovine
collagen  matrix.  The drug product is provided in a kit containing two sterile,
nonpyrogenic,  prefilled  syringes:  one syringe contains a fluorouracil gel and
the other syringe  contains an epinephrine  solution.  The drug product kit also
includes  a  mixing  adapter.  The  contents  of the  syringes  should  be mixed
immediately before use. Each kit will provide on milliliter after mixing.

Each  milliliter of  AccuSite(TM)  Injectable Gel contains 30 mg of fluorouracil
and 0.1 mg of  epinephrine.  Each milliliter also contains 20 mg purified bovine
collagen, 0.05 mg edetate disodium dihydrate, 1.2 mg monobasic sodium phosphate,
2.9 mg  dibasic  sodium  phosphate,  1.6 mg sodium  chloride,  and up to 0.15 mg
sodium  metabisulfite  in water for  injection,  with sodium  hydroxide and / or
hydrochloric acid to adjust the pH.

AccuSite(TM)  Injectable  Gel is  designed  for direct  intralesional  injection
(intradermal  injection  under  target  lesions and  surrounding  tissues).  The
chemotherapeutic  agent,  5-FU, is delivered in a viscous collagen  matrix.  The
addition  of the  vasoconstrictor  epinephrine  assists  in the  extent of local
retention of 5-FU.

Fluorouracil Gel: Fluorouracil gel contains 33.3 mg / mL fluorouracil,  purified
bovine collagen, monobasic sodium phosphate, dibasic sodium phosphate and sodium
chloride in water for injection with sodium hydroxide and / or hydrochloric acid
to adjust the pH. Fluorouracil (5-fluoro-2,4-(1H,3H)-pyrimidinedione, C4H3FN2O2)
is a white to practically white crystalline  powder that is sparingly soluble in
water. The molecular weight of fluorouracil is 130.08.

Fluorouracil is a cytotoxic drug which is believed to act through  inhibition of
DNA  synthesis by means of blockade of  thymidylate  synthetase  involved in the
formation of thymidine monophosphate.  It may also become incorporated into RNA,
and may inhibit  uracil  utilization in RNA  biosynthesis.  The activity of 5-FU
against  a  wide  variety  of  tumors  and  the  expected  toxicities  following
intravenous administration are well established.

                                       1
<PAGE>

Epinephrine  Solution:  Epinephrine  solution  contains  1 mg / mL  epinephrine,
edetate disodium  (dihydrate) and sodium metabisulfite with sodium hydroxide and
/ or  hydrochloric  acid to adjust pH, in water for  injection.  Epinephrine  is
(R)-4-[1-hydroxy-2(methylamino)ethyl]-1-1-benzenediol,    C9H13NO3    (molecular
weight: 183.21). Epinephrine is very slightly soluble in water and in alcohol.

The  AccuSite(TM)  Injectable Gel formulation is designed to retain  therapeutic
concentrations of 5-FU in the tumor, thereby minimizing systemic exposure to the
drug.



AccuSite(TM)   Injectable  Gel  is  indicated  for  the  treatment  of  external
condylomata  acuminata (genital warts) by intradermal / intralesional  injection
once a week for up to six weeks, or to complete response.



(Other  specifications and details to be mutually agreed upon in accordance with
applicable regulatory requirements)


                                       2
<PAGE>
                                   Exhibit B

                                Marketing Expense


                                      (000)



   1998           1999              2000               2001               2002
   ----           ----              ----               ----               ----

    *              *                 *                  *                  *

*        Indicates that material has been omitted and confidential treatment has
         been  requested  therefor.  All such  omitted  material  has been filed
         separately with the Commission pursuant to Rule 24b-2.


                                       1

<PAGE>

                                    Exhibit C

                             Initial Sales Forecast


                                      (000)



        1998        1999          2000          2001          2002
        ----        ----          ----          ----          ----

Sales    *            *             *            *              *

Units    *            *             *            *              *

*        Indicates that material has been omitted and confidential treatment has
         been  requested  therefor.  All such  omitted  material  has been filed
         separately with the Commission pursuant to Rule 24b-2.

                                        1


<PAGE>


                                    Exhibit D

                           TRADEMARK LICENSE AGREEMENT


         This Trademark License Agreement  ("Agreement") is effective as of this
4th day of August 1997 ("Effective Date"), by and between Matrix Pharmaceutical,
Inc. ("Matrix"),  a Delaware corporation,  having offices at 34700 Campus Drive,
Fremont,  California  94555,  U.S.A.,  and Altana,  Inc., a New York corporation
("Altana"), having offices at Melville, New York.

         In consideration of the mutual covenants and promises contained herein,
the parties hereto agree as follows:

1.       Definitions.

         The following terms shall have the meanings set forth below:

         a. "Distribution  Agreement" shall mean the Distribution  Agreement, of
even date herewith, entered into by the parties hereto.

         b.  "Licensed  Mark"  shall  mean  the  trademark  AccuSite(TM)  or its
successor;   provided   however,   that  the  appearance  and/or  style  of  the
AccuSite(TM)  mark may change from time to time in Matrix's sole discretion.  As
of the Effective Date, the Licensed Mark is the subject of the following pending
trademark registration application: RM95C005680 filed on 10/6/95.

         c.  "Product"  shall  have the  meaning  set forth in the  Distribution
Agreement.

         d. "Territory" shall mean the United States of America and Puerto Rico.

2.       License Right Granted.

         a. In  partial  consideration  of the  consideration  set  forth in the
Distribution Agreement, Matrix hereby grants to Altana, and Altana accepts, upon
the terms and  conditions  set forth  herein,  an  exclusive,  non-transferable,
non-sublicensable,  royalty-free  license  to  use  the  Licensed  Mark  in  the
Territory solely in connection with the Product.

         b. Altana  hereby  acknowledges  and agrees  that,  except as set forth
herein,  Altana has no rights,  title or interest in or to the Licensed Mark and
that all use of the  Licensed  Mark by  Altana  shall  inure to the  benefit  of
Matrix.  Altana  covenants that it will not take any action that might prejudice
or adversely affect Matrix's rights in the Licensed Mark.  Altana shall not have
the right to use the Licensed Mark as a trade name, company name, trade style or
fictitious business name.


                                       1
<PAGE>

         c. Altana understands and agrees that it does not have the right to use
the  Licensed  Mark in any manner  that  conflicts  with the rights of any third
party. If, in Matrix's  reasonable  determination,  Altana's use of the Licensed
Mark  infringes  the rights of any third  party or  weakens or impairs  Matrix's
rights in the Licensed  Mark,  then Altana  agrees to  immediately  terminate or
modify such use in accordance  with Matrix's  instructions.  In the event Altana
fails to  terminate  or  modify  such use as  directed  by  Matrix,  Matrix  may
terminate this Agreement.

         d. Matrix  agrees to defend,  indemnify  and hold Altana  harmless from
liability  resulting  from  infringement  by the Licensed Mark of any trademark,
service mark or trade name right of a third party,  provided  that (i) Matrix is
promptly  notified  of any and  all  threats,  claims  and  proceedings  related
thereto,  (ii) Matrix shall have sole control of the defense and / or settlement
thereof  at  its  costs  and  expenses,  (iii)  upon  Matrix's  request,  Altana
immediately  ceases use of the  Licensed  Mark and (iv) upon  Matrix's  request,
Altana provides Matrix with reasonable  assistance and information  available to
Altana for such defense.  The  foregoing  obligation of Matrix does not apply if
(a) Altana continues allegedly  infringing activity after being notified thereof
or after being  informed of  modifications  that would have  avoided the alleged
infringement  or (b)  Altana's  use of the  Licensed  Mark  is not  strictly  in
accordance with the terms and provisions of this Agreement.

3.       Quality Standards.

         a. All  packaging,  labels,  labeling and  marketing  materials for the
Product shall be in accordance with applicable regulations and shall be approved
in advance in writing by Matrix or a Matrix appointed designee. Altana shall not
distribute or have  distributed  any written  information  regarding the Product
that bears the Licensed  Mark without the prior written  approval of Matrix.  If
Matrix  believes  that the  Licensed  Mark is being used in a manner  that could
diminish  Matrix's rights in or protection of the Licensed Mark,  Altana agrees,
at Altana's sole cost and expense, to make whatever changes and / or corrections
Matrix deems necessary to protect the Licensed Mark.

         b. Altana  agrees that it shall not engage,  participate  or  otherwise
become  involved  in any  activity or course of action  that  diminishes  and/or
tarnishes the image and/or reputation of the Licensed Mark.

         c.  Matrix  shall have the right to  inspect  Altana's  operations  and
facilities  during normal business hours upon reasonable prior notice,  with the
sole purpose of any such inspection being to verify that Altana is in compliance
with the terms of this Agreement in maintaining the good will of the trademarks.

         d. Altana agrees to conduct its  activities  under this  Agreement in a
lawful manner.

         e. Altana agrees to use the Licensed  Mark in accordance  with and only
on or in connection with the Product.

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<PAGE>

4.       Use and Display of Licensed Mark.

         a. All usage by Altana of the Licensed Mark shall include the trademark
symbol and shall be in the following  form, as  appropriate:  AccuSite(TM).  All
literature and materials printed,  distributed or electronically  transmitted by
Altana and containing the Licensed Mark shall include the following notice:

           AccuSite(TM) is a trademark of Matrix Pharmaceutical, Inc.

5.       Term and Termination.

         a.  This  Agreement  shall  commence  on the  Effective  Date and shall
continue in effect for a period  coterminous  with the term of the  Distribution
Agreement, unless earlier terminated in accordance with the terms and conditions
set forth herein.

         b. This Agreement shall  automatically  terminate upon termination (for
whatever reason) of the Distribution Agreement.

         c. This  Agreement and the license  granted herein may be terminated by
Matrix if Altana  fails to perform or comply with a material  provision  of this
Agreement  and such breach or default is not cured by Altana  within thirty (30)
days after written notice of termination is received by Altana.

6.       Cooperation and Protection.

         a. Altana  agrees to  reasonably  cooperate  with and assist  Matrix in
protecting and defending the Licensed Mark and shall  promptly  notify Matrix in
writing of any  infringements,  claims or actions by others  (which  come to the
attention of Altana) in derogation of the Licensed Mark; provided, however, that
Matrix  shall have the initial  right to  determine  whether any action shall be
taken on account of any such infringement, claim or action. If Matrix elects not
to pursue such infringement by written notice to Altana,  Altana may, but is not
required  to, seek to obtain a  discontinuance  of the alleged  infringement  or
unauthorized  use or bring an  infringement  suit.  The party not bringing  such
action or suit shall  execute such legal papers and shall render all  reasonable
assistance  necessary  for the  prosecution  of such  suit as may be  reasonably
required by the other party;  provided that the party  proceeding with such suit
shall  reimburse  the  out-of-pocket  expenses  incurred  by the other  party in
connection  with such  assistance.  Any such expenses and  compensation  must be
approved in advance.  It is understood  that the party that  institutes  suit or
action  shall bear solely all costs and  expenses in  connection  therewith  and
shall be  entitled  to  retain  and keep  any and all sums  received,  obtained,
collected or recovered, whether by judgment, settlement or otherwise as a result
of such suit.

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<PAGE>

         b. Altana agrees not to apply for registration of the Licensed Mark (or
any mark confusingly similar thereto) anywhere in the Territory.

7.       Assignment.

         Altana  may  not  assign  this  Agreement  or  any  of  its  rights  or
obligations  under this Agreement  without the prior written  consent of Matrix,
other than to an Affiliate (as defined in Distribution  Agreement) provided that
Altana shall remain liable for its obligations hereunder.

8.       Notices.

         All notices,  requests,  demands and other  communications  required or
permitted  to be given  under this  Agreement  shall be in writing  and shall be
deemed to have been duly  given only if  personally  delivered,  delivered  by a
major  commercial  rapid  delivery  courier  service or mailed by  certified  or
registered mail, return receipt  requested,  postage prepaid,  to a party at the
address set forth on the first page hereof or such other address as a party last
provided to the other by written notice.

9.       General.

         a. Amendment,  Modification and Waiver.  The failure of either party to
enforce its rights or to require  performance  by the other party of any term or
condition of this Agreement shall not be construed as a waiver of such rights or
of its  right to  require  future  performance  of that term or  condition.  Any
amendment or  modification  of this Agreement or any waiver of any breach of any
term or condition of this  Agreement must be in a writing signed by both parties
in order to be effective, and any such waiver shall not be construed as a waiver
of any  continuing or succeeding  breach of such term or condition,  a waiver of
the term or condition itself or a waiver of any right under this Agreement.

         b.  Governing  Law. This  Agreement  shall be governed and  interpreted
under the laws of the State of  California,  United  States of America,  without
regard to the conflicts of law provisions thereof.

         c.  Severability.  In the event that any  provision  of this  Agreement
shall be  determined  by a court of  competent  jurisdiction  to be  illegal  or
unenforceable,  that  provision  will be limited or  eliminated  to the  minimum
extent necessary so that this Agreement shall otherwise remain in full force and
effect and enforceable.

         d. Survival.  Sections 7 and 10(b) hereof shall survive the termination
of this Agreement.

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<PAGE>



         IN WITNESS WHEREOF,  the parties hereto have each caused this Agreement
to be executed by their  authorized  representatives  as of the date first above
written.


MATRIX PHARMACEUTICAL, INC.                       ALTANA, INC.




By:  /s/ JAMES R. GLYNN                         /s/ GEORGE W. COLE              
   ---------------------------------            -------------------------------
     James R. Glynn                                 George W. Cole
     COO, CFO                                   Title:  President
 

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<PAGE>
                                    Exhibit E

           Safety Reporting and Exchange of Safety Information Between
                   Matrix Pharmaceutical, Inc. and Altana Inc.

Altana Inc. (Altana) will be marketing and selling  AccuSite(TM)  Injectable Gel
in the United  States of America,  as outlined  in the  Distribution  Agreement.
Matrix  Pharmaceutical,   Inc.  (Matrix),   either  directly  or  through  other
licensees,  will  coordinate   pharmacovigilance   activities  for  AccuSite  in
allcountries where AccuSite may be commercialized.  The purpose of this document
is to outline pharmacovigilance responsibilities between Matrix and Altana.

The following  definitions will be used to insure consistency between Altana and
Matrix.

Definitions:

     Adverse Event:  An adverse event (AE) is any adverse event  associated with
     the  use of a drug in  humans,  whether  or not  considered  drug  related,
     including the  following:  an adverse event  occurring in the course of the
     use of a drug product in professional  practice; an adverse event occurring
     from drug overdose,  whether  accidental or  intentional;  an adverse event
     occurring from drug abuse; an adverse event occurring from drug withdrawal;
     and any significant failure of expected pharmacological action.

     An AE can therefore be any  unfavorable  and unintended  sign (including an
     abnormal laboratory  finding),  symptom,  or disease temporally  associated
     with the use of a drug product, whether or not related to the drug product.

     Adverse Drug  Reaction:  An adverse drug  reaction  (ADR) refers to adverse
     events for which there is a causal relationship  between a drug product and
     the event.  The causality is at least a reasonable  possibility,  i.e., the
     relationship cannot be ruled out.

     All  spontaneous  AE  reports  should  be  considered  ADRs for  regulatory
     reporting purposes.

     Serious  adverse  event or adverse  drug  reaction:  Any  untoward  medical
     occurrence (or event) that at any dose:

         o Is  fatal:  This  serious  criterion  applies  if  the  subject's  or
         patient's  death is suspected as being a direct outcome of the reported
         AE.

         o Is life threatening: This serious criterion applies if the subject or
         patient, in the view of the treating physician,  is at substantial risk
         of  dying  from  the  ADR/AE  as  it  occurs  (e.g.,   gastrointestinal
         hemorrhage,  bone  

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<PAGE>

         marrow  suppression).  It does not apply if an AE hypothetically  might
         have caused death if it were more severe.

         o  Requires  or  prolongs  inpatient   hospitalization:   This  serious
         criterion  applies  if the  reported  AE  requires  at least a  24-hour
         inpatient  hospitalization or prolongs an existing  hospitalization.  A
         hospitalization  for  an  elective  procedure  or  routinely  scheduled
         treatments  is not a serious AE because a procedure  and/or a treatment
         is not an untoward medical occurrence.

         o Results in  persistent  or  significant  disability/incapacity:  This
         serious criterion applies if the "disability" caused by the reported AE
         results in a  substantial  disruption  of the  subject's  or  patient's
         ability to carry out normal life functions (e.g.,  blindness  secondary
         to a  cerebrovascular  accident).  Any disability  that is permanent is
         also serious.

         o Is a congenital  anomaly/birth defect: This serious criterion applies
         if a subject or patient exposed to a medicinal product gives birth to a
         child with a congenital anomaly or birth defect.

         o Is a new cancer:  This  serious  criterion  applies if the patient is
         diagnosed with a cancer. If the patient is known to have a cancer prior
         to treatment with a Matrix product,  then this criterion applies if the
         patient develops a new cancer of a different type.

         o Is associated with an overdose:  This serious criterion applies if an
         overdose of the product was associated with an adverse event.

         o Necessitates  medical or surgical  intervention to preclude permanent
         impairment of a body function or permanent  damage to a body structure:
         This serious criterion applies if the reported AE requires treatment to
         prevent   significant   damage  to  the   subject  or  patient   (e.g.,
         administration of acetylcysteine to prevent permanent liver damage from
         Tylenol(R)   overdose-induced  liver  toxicity).   Changes  in  dosage,
         discontinuation  of therapy,  and routine treatment with a prescription
         medication are not in themselves considered serious by this criterion.

     Nonserious  adverse event or adverse drug  reaction:  Any untoward  medical
     occurrence  (or  event)  that at any dose  does not  meet the  criteria  as
     serious will be classified as nonserious.



Scope of Responsibilities

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<PAGE>

         Altana Inc.:  Altana will be responsible for the following activities:


         o Receipt  and  follow-up  of adverse  event  information  from  health
           professionals (including physicians,  surgeons, pharmacists,  nurses,
           etc.) and consumers in the U.S. and submission to Matrix.
         o Medical  verification  of any  consumer  report  describing a serious
           adverse event.  This means  contacting  the  consumer's  physician to
           verify any report of a serious adverse event and obtaining additional
           information, as needed.
         o Transfer of  individual  case  information  for all reported  serious
           adverse  events to Matrix  Pharmaceutical  as soon as possible and no
           later than 2 calendar days of initial receipt and subsequent  receipt
           of additional information,  if any. Information can be transferred by
           paper (via fax) or electronically.
         o Transfer of individual case  information for all reported  nonserious
           adverse  events to  Matrix  Pharmaceutical  within 5 days of  initial
           receipt and  subsequent  receipt of additional  information,  if any.
           Information can be transferred by paper (via fax) or electronically.
         o Transfer of individual case  information  for all product  complaints
           that may be associated with an adverse event to Matrix Pharmaceutical
           as soon as  possible  and no later  than 5  calendar  days of initial
           receipt and  subsequent  receipt of additional  information,  if any.
           Information can be transferred by paper (via fax) or electronically.
         o Communication  of ideas to improve the efficient and economical  flow
           of adverse event information between Altana and Matrix.

                                       3
<PAGE>


         Matrix  Pharmaceuticals,  Inc.  Matrix  will  be  responsible  for  the
         following activities:

         o Compliance  with local  pharmacovigilance  laws or regulations in the
           United States of America.
         o Assessment  of  individual   case  reporting   responsibilities   and
           coordination   of  submission  to  regulatory   health   authorities,
           including FDA and other countries.
         o Providing  summaries and patient  information  on reported  cases and
           facilitating  Altana's  understanding of safety and pharmacovigilance
           information.
         o Entry of  reports  into and  maintenance  of a  safety  database  for
           spontaneous  and  other   postmarketing   adverse  events   collected
           worldwide.
         o Preparation of periodic  safety update  reports  (e.g.,  FDA Periodic
           Report, CIOMS-II) for submission to multiple regulatory authorities.
         o Providing  assistance  as necessary to answer  questions,  etc.  from
           Altana.  This  includes both  assistance  to understand  and complete
           safety reporting responsibilities and providing information that will
           allow Altana to answer questions from health professionals, etc.
         o Providing  assistance,  education  and  guidance for  collecting  and
           processing adverse event reports with AccuSite(TM).
         o Coordinating the collection of and providing analysis, processing and
           reporting  for  any  clinical  trial  safety  information   involving
           AccuSite.
         o Maintenance  of  AccuSite   package   insert  and  other   regulatory
           documents.

Transfer of Information

         o Information can be transferred by paper (via fax) or electronically.



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