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                                                                    EXHIBIT 10.1

                                AMENDMENT NO. 3
                                      TO
                       LICENSE AND DEVELOPMENT AGREEMENT

     This Amendment No. 3 to License and Development Agreement  (this
"Amendment") is made as of the 25th day of March, 1997 (the "Effective Date") by
and between Aronex Pharmaceuticals, Inc., a Delaware corporation ("Aronex"), and
Genzyme Corporation, a Massachusetts corporation ("Genzyme"). Capitalized terms
used without definition in this Amendment shall have the meanings given to such
terms in the Development Agreement (as defined below).

                                    RECITALS

     WHEREAS, Aronex (f/k/a Argus Pharmaceuticals, Inc.) and Genzyme entered
into a License and Development Agreement dated September 10, 1993 (as
subsequently amended by amendments dated September 8, 1995 and September 10,
1996, the "Development Agreement") relating to the development, license,
manufacture, marketing and sale of pharmaceutical compositions incorporating
"AR-623" (also known as "Atragen/(TM)/"); and

     WHEREAS, Aronex and Genzyme desire to amend the Development Agreement (i)
to release Genzyme from any obligation to perform further development work for
AR-623 and (ii) to convert the license granted to Genzyme in the Development
Agreement to an option to market and sell Products as provided herein; and

     WHEREAS, Aronex is willing to assume certain responsibility for further
development work for AR-623 and marketing and sales as provided herein;

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein, Aronex and Genzyme agree as follows:

     1.   TERMINATION OF LICENSE; GRANT OF MARKETING RIGHTS OPTION TO GENZYME.
The license granted to Genzyme pursuant to Article 2 of the Development
Agreement is hereby terminated and shall be of no further force and effect.
Article 2 of the Development Agreement is hereby amended and restated to read in
its entirety as follows:

          2.   MARKETING RIGHTS.

          2.1  Genzyme Option.  Subject to the terms and conditions of this
     Agreement, Genzyme shall have the option (the "Option"), exercisable in its
     sole discretion, to obtain (i) the exclusive right (with the right to
     sublicense) to use, market, import, export and sell any Product in the
     Field throughout the world excluding the United States and its territories
     and possessions and (ii) the right to co-promote with Aronex pursuant to
     Section 5.3 any Product in the Field in the United States and its
     territories and possessions (the "Marketing Rights").

          2.2  Exercise of Option; Royalties.  Genzyme may exercise the Option
     at any time prior to the date that is six months after the filing of an NDA
     for a Product for any indication (the "Option 
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     Expiration Date") by (i) giving Aronex written notice of its exercise of
     the Option and (ii) paying Aronex Three Million Dollars ($3,000,000.00). If
     Genzyme exercises the Option, Genzyme shall pay Aronex a royalty equal to
     [*] of Net Sales by Genzyme, its Affiliates and its sublicensees throughout
     the world. If Genzyme does not exercise the Option within six months after
     the filing of an NDA for the Product for any indication, the Option shall
     expire and may not thereafter be exercised with respect to the Product for
     which the NDA is filed or any subsequent Product or indication.

          2.3 Aronex Right to Re-Acquire Marketing Rights. Notwithstanding the
     foregoing, Aronex shall have the right, exercisable at any time before the
     end of the twelve-month period following the filing of an NDA, to re-
     acquire the Marketing Rights and to terminate Genzyme's rights thereunder
     by (i) giving Genzyme written notice of its exercise of such right, (ii)
     paying Genzyme Two Million Dollars ($2,000,000.00) and (iii), if such right
     is exercised after Genzyme's exercise of the Option, additionally returning
     to Genzyme the Three Million Dollars ($3,000,000.00) received from Genzyme
     in connection with Genzyme's exercise of the Option. If Aronex terminates
     Genzyme's rights to use, market, import, export and sell Products pursuant
     to this Section 2.3, Aronex shall pay Genzyme a royalty equal to (i) [*] of
     Net Sales by Aronex and its Affiliates throughout the world and (ii) [*] of
     Sublicensee Royalties received by Aronex and its Affiliates; provided that
     Aronex shall pay a minimum of $500,000 of royalties within the first twelve
     months following the due date of the $2,000,000 payment provided for above
     (which amount shall be credited against the percentage royalties
     contemplated hereby). Aronex's obligation to pay such royalties shall
     terminate once Aronex has paid a total of Thirteen Million Dollars
     ($13,000,000.00) in royalties.

          2.4 Failure to Exercise or Termination by Genzyme. If Genzyme does not
     exercise the Option, or if Genzyme terminates the Option prior to the
     Option Expiration Date as provided below, Aronex shall pay Genzyme Two
     Million Dollars ($2,000,000.00) within thirty (30) days after the Option
     Expiration Date or such earlier termination. In addition, Aronex shall pay
     Genzyme a royalty equal to (i) [*] of Net Sales by Aronex and its
     Affiliates throughout the world and (ii) [*] of Sublicensee Royalties
     received by Aronex and its Affiliates; provided that Aronex shall pay a
     minimum of $500,000 of royalties within the first twelve months following
     the due date of the $2,000,000 payment provided for above (which amount
     shall be credited against the percentage royalties contemplated hereby).
     Aronex's obligations to pay such royalties shall terminate once Aronex has
     paid a total of Eight Million Dollars ($8,000,000.00) in royalties. Genzyme
     may terminate the Option and relinquish its rights thereunder at any time
     prior to the Option Expiration Date, but no earlier than the earlier of (i)
     March 24, 1999 and (ii), if applicable, Aronex's termination of all
     clinical development of AR-623, by giving Aronex written notice of such
     termination.

          2.5  Reports and Payments.  Any party obligated to pay royalties
     hereunder (the "Paying Party") shall keep, and shall require all Affiliates
     and sublicensees to keep, for a period of three years after a payment is
     due, accurate records in sufficient detail to enable the amounts due
     hereunder to be determined.  Within sixty (60) days after the end of each
     calendar quarter, the Paying Party shall deliver to the other party a
     written accounting, including quantities and monetary amounts of sales of
     each Product by the Paying Party and its Affiliates and any sublicensees,
     on a country-by-country basis, and the amount of royalty payments, if any,
     due for such quarter.  The Paying Party, upon delivery of such accounting,
     shall pay all royalties shown to be due thereunder.


* Confidential treatment requested

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          2.6  Audit Rights.  A Paying Party shall permit the other party or its
     representatives to have access to the Paying Party's books and records for
     the sole purpose of verifying the royalties payable hereunder.  Such review
     may be conducted no more than once during each year royalties are due
     hereunder and twice during the three years following termination of this
     Agreement.  The review shall be conducted after reasonable notice and
     during reasonable business hours.  If such review reveals that royalties
     have been understated for any calendar year, such underpayment shall be
     immediately paid by the Paying Party; provided that if such examination was
     not conducted by an independent accountant, the Paying Party shall have the
     right to engage an independent accountant reasonably acceptable to the
     other party to verify the results of such review.  The fees and expenses of
     such accountant shall be paid by the party alleging an error unless the
     error is more than ten percent (10%) of the actual amount due, in which
     case the party who made the error shall pay all reasonable costs and
     expenses incurred by the investigating party in the course of making such
     determination.  Any sublicense granted by either party shall contain audit
     provisions as set forth in this subsection 2.6.

          2.7  Payment Currency.  All payments to be made under this Agreement
     shall be made in United States dollars.  In the case of sales in foreign
     currencies, the rate of exchange to be used in computing the amount of
     currency equivalent in United States dollars due hereunder shall be made at
     the rate of exchange prevailing on the last day of the calendar quarter
     published by the money center bank designated by the Paying Party which it
     uses for currency conversion in the preparation of its public financial
     reports.

          2.8  Payment Mechanics.  All payments under this Agreement shall be
     made by wire transfer of immediately available funds to such account as the
     receiving party shall specify or by other payment method acceptable to the
     parties.  If royalties are due for Net Sales in a country where, for
     reasons of currency, tax or other regulations, transfer of foreign currency
     out of such country is prohibited, the Paying Party may pay such royalties
     by placing them in a bank account in such country in the name of and under
     the sole control of the receiving party; provided, however, that the bank
     selected be reasonably acceptable to the receiving party and that the
     Paying Party inform the receiving party of the location, account number,
     amount and currency of money deposited therein.

          2.9  Acquisition of Third Party Rights.  Aronex shall use all
     commercially reasonable efforts to obtain any rights from any Third Party
     that are necessary for the manufacture, use or sale of the Product in
     accordance with this Agreement and upon such acquisition by Aronex, such
     rights shall be automatically included in the Option granted in Section 2.1
     without any further action of the parties.  The costs of obtaining such
     rights shall be borne as follows:

          (a) Aronex Costs.  Aronex shall bear all costs associated with (i)
     Third Party rights necessary for the manufacture or sale of both the
     Product and other products under development or being sold by Aronex or its
     Affiliates or sublicensees and (ii) Third Party rights with respect to
     Product sales by Aronex or its Affiliates or sublicensees (other than
     Genzyme).

          (b) Genzyme Costs.  Genzyme shall bear all costs associated with Third
     Party rights with respect to Product sales by Genzyme or its Affiliates or
     sublicensees.

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          (c) Shared Costs.  In the event Aronex and Genzyme co-promote sales of
     the Product in the United States, Aronex and Genzyme shall share costs
     associated with third party rights in proportion to their relative shares
     of Net Profit.

     2.   DEVELOPMENT PROGRAM.  Aronex and Genzyme agree that the research and
development being conducted by Genzyme in accordance with the current Work Plan
shall be terminated as promptly as practicable, and that Genzyme shall have no
obligation to perform any further research or development under the Development
Agreement.  Notwithstanding the foregoing, Genzyme shall provide Aronex with an
NDA quality report with accompanying table summaries and case reports of the
phase II/III Kaposi's sarcoma clinical trial no later than August 1, 1997.
Aronex presently intends to continue certain research and development work for
AR-623, and to file an NDA and a PLA for the use of AR-623 for treatment of APL,
but shall have the right to discontinue all such research and development, in
its sole discretion, for any reason.  Except as expressly set forth in this
Amendment, Article 3 of the Development Agreement is hereby amended and restated
to read in its entirety as follows:

          3.1  Project Representatives.  The parties have each designated a
     Project Representative to facilitate as a liaison between it and the other
     party, and to oversee and review the progress of the Development Program
     and other relevant matters under this Agreement.

          3.2  Progress Reports.  Within 45 days following the end of each
     calendar year, the Aronex Project Representative shall deliver to the
     Genzyme Project Representative a reasonably detailed written report which
     shall describe the progress of the Development Program performed by it
     during the year.

          3.3  Records and Data.  Each party shall maintain records in
     sufficient detail and in good scientific manner appropriate for patent and
     FDA purposes and so as to properly reflect all work done and results
     achieved in the performance of the Development Program.  Such records shall
     include books, records, reports, research notes, charts, graphs, comments,
     computations, analyses, recordings, photographs, computer programs and
     documentation thereof, computer information storage means, samples of
     materials and other graphic or written data generated in connection with
     the Development Program, including any data required to be maintained
     pursuant to applicable governmental regulations.  Each party shall provide
     the other the right to inspect records, and shall provide copies of all
     requested records, to the extent, reasonably related to the performance of
     the other's obligations under this Agreement.

     3.   ALLOCATION OF COSTS; TERMINATION OF MILESTONE AND OTHER PAYMENTS.  All
expenses incurred by either party pursuant to the Development Agreement through
the Effective Date shall be determined within thirty (30) days of the Effective
Date and responsibility for such costs and any resulting reimbursements shall be
made according to the terms of the Development Agreement as in effect prior to
this Amendment.  Except for the foregoing allocation of costs, the Development
Agreement is hereby amended by deleting Article 4 thereof in its entirety.

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     4.   COMMERCIALIZATION RIGHTS.  Article 5 of the Development Agreement is
hereby amended and restated to read in its entirety as follows:

          5.  COMMERCIALIZATION.  In the event the Option is exercised:

          5.1.  Manufacturing.  Aronex shall be responsible for manufacturing or
     subcontracting the manufacture of all of Genzyme's requirements for
     Product, subject to customary forecast and order procedures.  If Aronex or
     its subcontractor is manufacturing, Aronex's (or its subcontractor's)
     responsibilities shall include all aspects of the manufacturing process,
     including maintenance of manufacturing inventory, quality control and
     shipment of Product in accordance with orders placed by Genzyme.  As
     compensation for such manufacturing services, Aronex shall be entitled to
     receive payment of its fully burdened COGS.

          5.2  Sales.  Following regulatory approval in any country, Genzyme
     shall use commercially reasonable efforts to market and sell the Product in
     such country.  All terms of sale, including pricing policies, credit terms,
     cash discounts and returns and allowances, as well as the nature of
     marketing efforts, shall be set by Genzyme.  Genzyme shall be responsible
     for invoicing the customers for Product and collecting payment therefor.
     The Product shall be sold under the trademark "Atragen" (for which purpose
     Genzyme shall have a royalty-free license to use such trademark) or such
     other trademark as the parties may agree.

          5.3  Co-Promotion.  Aronex and Genzyme shall co-promote the Product in
     the United States, subject to the following principles of agreement and
     such other terms and conditions as the parties may agree upon at that time:

          (a) Sales and Marketing.  The parties shall select one party by
     agreement which shall retain management responsibility for sales and
     marketing of the Product (the "Marketing Manager"). All marketing decisions
     will be made by the Marketing Manager, including but not limited to pricing
     and other terms of sale, distribution channels, sales personnel,
     advertising, promotion and marketing programs.  All customer orders will be
     received, executed and invoiced by the Marketing Manager. If the other
     party receives any orders, it will refer the customer to the Marketing
     Manager or appropriate drug wholesalers as designated by the Marketing
     Manager.  The parties shall agree upon the responsibilities and scope of
     the party that is not selected to be the Marketing Manager, with the
     expectation that such other party shall substantively participate in the
     marketing and "technical detailing" of the Product.

          (b) Profit Sharing.  Aronex and Genzyme will each be entitled to [*]
     of Net Profit on sales by the Marketing Manager and its Affiliates of
     Products in the United States in any calendar year.  All royalties with
     respect to such sales shall be deducted from Net Sales before the foregoing
     allocation of Net Profit is made.

          (c) Trademark.  The Product shall be sold under the trademark
     "Atragen/(TM)/" or such other a trademark as the parties may agree.

          (d) Co-Promotion Rights Not Assignable.  Neither party's co-promotion
     rights under this Section 5.3 may be assigned or transferred to any Third
     Party, including an assignment as a result of a merger or consolidation of
     such party, without the prior written consent of the other party, which
     shall not be unreasonably withheld or delayed.


* Confidential treatment requested
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     5.   TERM OF DEVELOPMENT AGREEMENT.  Section 10.1 of the Development
Agreement is hereby amended and restated to read in its entirety as follows:

          10.1  Term of Agreement.  This Agreement and any License granted
     hereunder shall remain in effect on a country-by-country basis until the
     later of (i) the expiration of the last-to-expire Patent relating to any
     Product in such country or (ii) the date that is 10 years after the First
     Commercial Sale in such country.  If Genzyme has exercised the Option (and
     Aronex has not reacquired the Marketing Rights), Genzyme shall thereafter
     have a fully paid-up license to use the Patents and the Subject Technology
     in such country.

Article 10 of the Development Agreement is further amended by deleting Section
10.3 thereof in its entirety.

     6.   DEFINITIONS.  Article 1 of the Development Agreement is hereby amended
by replacing Sections 1.19 and 1.20 in their entirety and adding new 
Section 1.30, as follows:

          1.19  "Net Profit" means the difference between (a) Net Sales and (b)
     the sum of (i) Cost of Goods Sold and (ii) 30% of Net Sales (for the
     Marketing Manager's and its Affiliates' sales and marketing expense
     relating to the Product regardless of the actual expenses incurred).

          1.20  "Net Sales" means the gross amount billed for Product sold
     pursuant to this Agreement to a Third Party, less discounts, rebates,
     returns, credits, contractual allowances, sales deemed uncollectible,
     shipping and insurance charges, sales taxes, duties, other governmental
     charges measured by the amount billed and any royalties payable to Third
     Parties; provided that, for purposes of the royalties payable under
     Sections 2.3 or 2.4, Net Sales shall not include sales by sublicensees, if
     any, of Aronex and its Affiliates.

          In the event a Product is sold in a combination product with other
     pharmacologically active components, Net Sales, for purposes of royalty
     payments on the combination product, shall be calculated by multiplying the
     Net Sales of that combination product by the fraction A/B, where A is the
     gross selling price of the Product sold separately and B is the gross
     selling price of the combination product.  In the event that no such
     separate sales are made by Aronex or Genzyme or their respective Affiliates
     or sublicensees, the parties shall negotiate in good faith the meaning of
     Net Sales for purposes of royalty payments on the combination product.

          1.30  "Sublicensee Royalties" means all royalties paid to Aronex and
     its Affiliates by sublicensees, if any, of Aronex and its Affiliates with
     respect to such sublicensees' rights to and sales of the Product.

     7.   ADDITIONAL AMENDMENTS.  Article 11 of the Development Agreement is
hereby terminated and shall be of no further force and effect.

     8. "ATRAGEN/(TM)/" TRADEMARK. Genzyme hereby assigns and transfers to
Aronex, all right, title and interest it may have in the trade name "Atragen"
and the associated trademark and all related goodwill.

     9.   NO OTHER AMENDMENTS.  Except as specifically amended hereby, the
Development Agreement shall continue in full force and effect.

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     IN WITNESS WHEREOF the parties hereto have executed this Amendment in one
or more copies effective as of the Effective Date.

                                       ARONEX PHARMACEUTICALS, INC.


                                       By: /s/ James M. Chubb
                                           ------------------------------------
                                           James M. Chubb, Ph.D., President


                                       GENZYME CORPORATION


                                       By: /s/ Richard Douglas
                                           ------------------------------------
                                           Richard Douglas
                                           Vice President-Corporate Development

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