<PAGE>   1
                                SUPPLY AGREEMENT



         THIS AGREEMENT is made as of the 7th day of February 1997 by and
between BIOMATRIX, INC., a Delaware corporation, having its principal office at
65 Railroad Avenue, Ridgefield, New Jersey 07657, U.S.A. ("Biomatrix") and
American Home Products Corporation, a Delaware corporation having its principal
office at Five Giralda Farms, Madison, New Jersey 07940, U.S.A, acting on behalf
of itself and its unincorporated and wholly-owned Wyeth-Ayerst Laboratories
division ("Wyeth").

         WHEREAS, Biomatrix and Wyeth have entered into a certain License
Agreement dated as of the 7th day of February 1997 with respect to Products (as
hereinafter defined) in the United States of America and its possessions (as
amended from time to time, the "US Agreement");

         WHEREAS, Biomatrix and Wyeth have entered into a certain International
License Agreement dated as of the 7th day of February 1997 with respect to
Products in certain countries in Europe and the Middle East (as amended from
time to time, the "International Agreement" and, together with the US Agreement,
the "License Agreements"); and

         WHEREAS, Wyeth desires to purchase from Biomatrix Wyeth's requirements
of the Products in the Territory (as defined below), and Biomatrix is willing to
supply such requirements upon the terms and conditions set forth herein;

         NOW, THEREFORE, in consideration of the premises and of the mutual
covenants of the parties hereto, it is hereby agreed as follows:

         1. DEFINITIONS. In this Agreement, the following words and expressions
shall have the following meanings:

         1.1. "Affiliate" shall mean, with respect to any party, any Person
that, directly or indirectly, is controlled by, controls or is under common
control with such party, but only for so long as such relationship exists.

         1.2. "Applicable Currency" shall mean, with respect to a country in the
Territory, the lawful currency of such country.

         1.3. "Contract Quarter" shall mean for any country in the Territory the
three (3) month period commencing on the first day of the first fiscal quarter
beginning immediately after the Launch Date in such country, (unless the Launch
Date is the first day of a fiscal quarter, in which case the first Contract
Quarter
<PAGE>   2
                                      -2-


shall commence on such day) and ending on the last day of the fiscal quarter and
each fiscal quarter thereafter throughout the term of this Agreement.

         1.4. "Contract Year" shall mean, with respect to a country in the
Territory, the twelve (12) month period commencing on the first day of the first
fiscal quarter beginning immediately after the date of the first commercial sale
(the "Launch Date") of the Initial Product in such country (unless such Launch
Date is the first day of a fiscal quarter, in which case the first Contract Year
shall commence on such day) and each separate successive twelve (12) month
period thereafter.

         1.5. "Effective Date" shall mean the date of this Agreement.

         1.6. "Extended Product" shall mean any Extended Product (as defined in
the U.S. Agreement.

         1.7. "Formula Price Percentage" shall mean that term as defined in
Section 4.1(c).

         1.8. "Improvements" shall mean extensions of the label claims for the
Initial Product, including new dosage and presentation forms and packaging
improvements for the Initial Product, within the Field.

         1.9. "Initial Product" shall mean hylan gel-fluid 20 (hylan G-F 20)
Synvisc currently approved as a device with a CE mark for the intra-articular
treatment by viscosupplementation of osteoarthritis of the knee, to be supplied
in pre-filled syringes packaged ready for use complying with applicable product
approvals as a device.

         1.10. "Initial Product Specifications" shall mean the specifications
for the Initial Product set forth on Exhibit A in each of the International and
U.S. License Agreements.

         1.11. "Initial Term" shall mean that term as defined in Section 2.1.

         1.12. "Long Range Forecast" shall mean that term as defined in Section
5.1.

         1.13. "Manufacturing Costs" shall mean the  *  in accordance with
generally accepted accounting principles and Biomatrix's standard  *  Such costs
shall include, but not be limited to, all  *  Products and Extended Products and
the appropriate allocation of all costs  *  of Products and Extended Products.
The costs associated with  *  by Biomatrix. Schedule 1.13 attached hereto sets
forth items not directly associated with, but related to, the production of
Products and Extended Products.









         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   3
                                      -3-




                                        *

         1.14. "Minimum Price" shall mean that term as defined in Section
4.1(b).


         1.15. "Net Revenues" shall mean for a specified period the total gross
invoice price received from the sale of all Units by Wyeth and its Affiliates in
the Territory during such period to non-Affiliated wholesalers, hospitals,
retail pharmacies, patients and other third party purchasers,

                                       *

Such amounts shall be determined from the books and records of Wyeth and its
Affiliates maintained in accordance with generally accepted accounting
principles, consistently applied.


         1.16. "Patents" shall mean Letters Patent or similar statutory rights
relating to any Product (including any continuation-in-part, continuation or
division thereof or substitute thereof), patent applications which are pending
as of the Effective Date, patent term extensions and Supplementary Protection
Certificates, in each case as set forth on Exhibit B hereto, together with any
supplementary or complementary protection certificates therefor if and when such
are granted.


         1.17. "Person" or "person" shall mean an individual, a corporation, a
partnership, a trust, an unincorporated organization or a government or any
agency or political subdivision thereof.


         1.18. "Per Unit Formula Price" shall mean that term as defined in
Section 4.1(c).


         1.19. "Product(s)" shall mean the Initial Product, together with any
Improvements (as defined in Section 1.8) to the Initial Product.


         1.20. "Region" shall mean any one of the following groups of countries

                                        *







         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   4
                                      -4-




         1.21. "Syringe" shall mean a pre-package 2.0 ml syringe of the Product.

         1.22. "Supply Forecast" shall mean that term as defined in Section 5.2.

         1.23. The "Supply Price" in effect at any time shall mean the supply
price per unit of a Product or Extended Products to be paid by Wyeth under this
Agreement for resale in the Territory, as determined at such time in accordance
with the provisions of Section 4.1 or, as the case may be, Section 4.2 hereof.

         1.24. "Territory" shall mean, collectively, the Territory as defined in
the US License Agreement and the Territory as defined in the International
License Agreement.

         1.25. "Trademarks" shall mean (i) the trademark Synvisc(R) and each
other mark, trademark or service mark described on Exhibit B hereto, and (ii)
any other marks, trademarks or service marks, as may be agreed upon in writing
from time to time by the parties hereto for use by Wyeth in connection with the
promotion, marketing and sale of the Products and Extended Products under this
Agreement.

         1.26. "Treatment Pack" shall mean a quantity of the Initial Product
sufficient for one treatment course, consisting of three Syringes.

         1.27. "Unit" shall mean, with respect to the Initial Product, a 2.0 ml
syringe of the Initial Product.

         1.28. "U.S. Dollars" and "US$" shall mean the lawful currency of the
United States of America.

         2. TERM AND TERMINATION.

         2.1. Term. Unless this Agreement is sooner terminated in accordance
with its provisions, the initial term of this Agreement shall, on a
country-by-country basis commence on the Effective Date and shall end, with
respect to Products or Extended Products, as applicable, on the later to occur
of (i) the fifteenth (15th) anniversary of the Launch Date (as defined in the
applicable License Agreement) in such country or (ii) the date of the expiration
of the last to expire of the Patents in each country (the "Initial Term").
Thereafter, this Agreement shall continue until terminated by either party in
accordance with its provisions.

         2.2. Termination.

         (a) Breach. This Agreement may be terminated by either party if the
other party shall commit a material breach of any provision hereof and shall not
cure such breach within

                                        *

after a written notice by the other party to


         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   5
                                      -5-




cure the breach; provided, that in the case of a payment breach such cure period
shall be equal to

                                        *

after written notice.

                                        *


         (b) Insolvency. This Agreement may be immediately terminated, whether
during the Initial Term or any Additional Period (as defined below), by either
party, upon giving written notice to the other party, in the event that the
other party shall become insolvent or be declared bankrupt by a court of
competent jurisdiction or shall be the subject of any reorganization (other than
a corporate reorganization effected in the ordinary course of business and not
arising out of any insolvency) or winding up, receivership or dissolution,
bankruptcy or liquidation proceeding, or any proceeding or action similar to one
or more of the above, in which case termination shall be effective upon such
written notice. The failure of either party to give notice of termination upon
obtaining knowledge of any such event shall not be interpreted as a waiver of
such party's rights under this Section 2.2(b), and such party reserves the right
to exercise any such rights at any time after the occurrence of any such event.

         3.  SUPPLY OF PRODUCT.

         3.1. Initial Term. (a) During the Initial Term, on a country-by-country
basis, Biomatrix agrees to sell, or to cause an Affiliate to sell, Product to
Wyeth, on the terms and subject to the conditions set forth herein, for resale
by Wyeth within a given country in the Territory, and Wyeth shall obtain the
Product for resale in the Territory only from Biomatrix or such Affiliate of
Biomatrix.

         (b) The parties agree that Extended Products shall be encompassed
within the terms of this Agreement as it relates to Products. The parties agree
that there shall be

                                        *

relating to any such Extended Products and that the Minimum Prices and Transfer
Prices applicable to any such Extended Products would be substantially
equivalent to

                                        *

In addition,

                                        *

The parties agree to negotiate in good faith with respect to the establishment
of the Initial Term and Additional Periods, Minimum Purchases, and any other
necessary terms relating to the manufacture and sale of Extended Products which
are not contemplated in this Agreement,

                                        *

         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   6
                                      -6-




        (c) If the supply of Products becomes non-exclusive with respect to a
country pursuant to Section 2.3(a) of the US Agreement or International
Agreement then the Supply Pricing for Products for such country shall be
determined in accordance with Section 4.2(b).

         3.2.     Additional Periods.

         (a) Within three years prior to the end of each Initial Term and each
Additional Period (as defined below), the parties shall mutually determine in
writing whether the supply of Product during any three year period following the
Initial Term (each an "Additional Period") shall be on an exclusive basis (i.e.
a decision with respect to year sixteen must be made prior to the commencement
of year thirteen and decision with respect to year nineteen, and must be made
prior to the commencement of year sixteen.)

         (b) If any Additional Period supply arrangement is determined by the
parties to remain on an exclusive basis in a country in the Territory, then
Biomatrix shall supply Wyeth exclusively and Wyeth shall purchase all of its
requirements for the Product for such country from Biomatrix.

         (c) If any Additional Period supply arrangement is determined by either
party to be on a non-exclusive basis in a country in the Territory, then
Biomatrix may supply other parties with the Product for sale in the Territory
(excluding the right to use the Trademark, provided that Wyeth still has the
exclusive right to use the Trademark in any applicable country under either of
the License Agreements) and Wyeth may purchase all or part of its requirements
for the Product from third parties.

         3.3 Production Capacity. (a) Biomatrix and its Affiliates shall use
commercially reasonable efforts to ensure that they shall have the manufacturing
capacity to produce quantities of Products in amounts equal to (i) during the
first three years after the Effective Date one hundred fifty percent (150%) of
the amounts in the Long Range Forecast set forth on Exhibit C hereto and (ii)
during each year thereafter one hundred twenty-five percent (125%) of the
amounts in the then current Long Range Forecast.

         (b) Biomatrix shall prepare and deliver to Wyeth a Management Plan
within thirty (30) days after the Effective Date. The Management Plan shall
describe in reasonable detail the activities that Biomatrix proposes to
undertake in establishing a second facility in the United States to manufacture
the Initial Product, and shall include information regarding the expected timing
of completion and capacity of the facility. 

Thereafter, Biomatrix shall prepare and deliver to Wyeth not less than quarterly
commencing with the quarter ending March 31, 1997,


         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   7
                                      -7-



         (c) Biomatrix represents and warrants that, as of the Effective Date,
(i) it has sufficient capacity to manufacture Wyeth's launch stocks of the
Initial Product for delivery for sales under the International Agreement on or
before June 30, 1997 as set forth on Exhibit C; (ii) it has sufficient capacity
to manufacture 200,000 Units of the Initial Product for delivery for sales under
the U.S. Agreement on or before September 1, 1997; and (iii) as of March 31,
1997 it will have sufficient manufacturing capacity to produce 500,000 Units of
the Initial Product annually.


                4.  PRICE AND PAYMENT.

         4.1      Supply Price During Initial Term.

         (a) Transfer Price. On a country-by-country basis, the "Transfer Price"
per Syringe for sales of the Initial Product

                                        *


         (b) Minimum Price. The "Minimum Price" for the

                                        *


         (c) Formula Price Percentage. The Formula Price Percentage in the
Initial Term and thereafter will be as follows:

         (i) Initial Term Formula Price Percentage. The "Formula Price
Percentage" applicable during the Initial Term shall be determined according to
the following formula for sales of the Products (and Extended Products):




         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   8
                                      -8-





                                        *

         (ii) Post Initial Term Formula Price Percentage. The "Formula Price
Percentage" applicable during any Contract Year after the Initial Term shall be
determined according to the following Formula for sales of the Products (and
Extended Products):

                                        *


         (iii)    The "Per Unit Formula Price" for any period shall equal

                                        *


--------------------

         */ As used in this table "Annual Net Revenues" shall be based on U.S.
dollar equivalents using the exchange rates determined in accordance with -
Section 15.

         **/  Rates set forth in this table are marginal rates.




























         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   9
                                      -9-




         (d) Annualized Formula Price Percentage Calculation. Within

                                        *

after the close of each Contract Quarter of the Initial Term after the first
Contract Year, the

                                       *

for such Contract Quarter shall be determined. The annualized Formula Price
Percentage applicable to any Contract Quarter of the Initial Term after the
first Contract Year shall be determined by

                                       *

         (e)      Reconciliation of Transfer Price and Per Unit Formula Price.

                  (i)     Quarterly Reconciliation.  Within
                                       *

                          after the close of each Contract Quarter, the parties
                          shall calculate the extent to which the

                                       *

                          for such Contract Quarter exceeds or is below the
                          Transfer Price paid by Wyeth for the Units used in
                          calculating

                                        *

                          with respect to such Contract Quarter. A reconciling
                          adjustment which equals

                                        *

                          shall be made and paid by the appropriate party within

                                        *

                          thereafter.

                  (ii)    Annual Reconciliation.  Within

                                        *

                          after the close of each Contract Year, the parties
                          shall calculate the extent to which the

                                        *

                          for such Contract Year exceeds or is below the
                          Transfer Price paid by Wyeth for the Units used in
                          calculating

                                        *

                          with respect to such Contract Year. A reconciling
                          adjustment which equals

                                        *

                          shall be made and paid by the appropriate party within

                                        *

                          thereafter.

         (f) Supply Price. On a Contract Year basis, the Supply Price per
Syringe due to Biomatrix from Wyeth during the Initial Term shall be

                                       *


         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   10
                                      -10-




         4.2 Supply Price During the Additional Period.

         (a) If Supply is Exclusive. During any Contract Year following the
Initial Term in which the supply of the Product is required to be exclusive to
Wyeth, the Supply Price shall be

                                        *


         (b) If Supply is Non-Exclusive. (i) If Biomatrix determines

                                        *

to convert the supply of Product to a non-exclusive arrangement in a country,
then the parties shall mutually agree in writing upon a price for Product for
such country which shall not be greater than the

                                        *

(ii)


                                        *


prior to the commencement of any such Contract Year setting forth

                                        *

Wyeth shall be obligated to

                                        *

of Products from Biomatrix. At any time during a non-exclusive supply period
that the Percentage Amount is

                                        *



         4.3 Currency of Payments. All payments by Wyeth to Biomatrix for the
purchase of Products or Extended Products hereunder shall be made in U.S.
Dollars at the exchange rate set forth in Section 15.2 hereof within

                                       *

of the invoice date relating thereto.

         4.4      Reporting by Wyeth.

         (a)      Monthly reports.  Within

                                        *

following the end of each calendar month in each Agreement Year, Wyeth shall
submit to Biomatrix written reports detailing (i) the Units and value of Wyeth's
and its Affiliates' Unit sales and (ii) Net Revenues of the Products and
Extended Products during the immediately preceding calendar month in a manner
consistent with Wyeth's internal sales reporting.

         (b)      Yearly reports.  Within
                                        *
following the end of each Contract Year, Wyeth shall submit to Biomatrix written
reports detailing Wyeth's and its Affiliates' sales of the Products and Extended
Products during the immediately preceding Contract Year, which reports shall set
forth the Net Revenues from Products and Extended Products in each country in
the Territory from sales during the applicable year to third party purchasers
who are not




         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   11
                                      -11-



Affiliates of Wyeth, and the aggregate number of Units sold in the Territory
during the applicable Contract Year.

        5.  SUPPLY FORECASTS; MINIMUM PURCHASES; RECORDS AND AUDITS.

         5.1      Forecasts.  Exhibit C attached hereto sets forth

                                        *

sales forecasts for sales of Units of Products in each country in the Territory
for each of the

                                        *

Contract Years.  Within

                                        *

after the expiration of each of the

                                        *

during any Contract Year, Wyeth shall provide to Biomatrix a forecast of Units
of Products and Extended Products in each country in the Territory for the

                                        *

period (including a year-by-year breakdown) following the delivery of such
report. Such forecasts shall be prepared by Wyeth in good faith, using
reasonable assumptions applicable to each country in the Territory, regarding
the patient population, market penetration, competition, product label and the
price to third parties resulting from Reimbursement Approvals (as defined in the
License Agreements) in the countries in the Territory. Each such sales forecast
described above is referred to herein as a "Long Range Forecast." Such Sales
Forecast may be

                                        *


         5.2      Supply Forecasts.  Within

                                        *

after the expiration of each Contract Quarter Wyeth shall provide to Biomatrix
an updated

                                        *

supply forecast (the "Supply Forecast") and the

                                        *

shall be consistent with the firm purchase orders previously delivered pursuant
to Section 7, provided that commencing in

                                        *

after the U.S. Launch Date Biomatrix's obligation to supply Products under the
Supply Forecasts shall not increase

                                        *

The Supply Forecast shall supersede the Long Range Forecast for any applicable
period.

         5.3 Minimum Purchases. Wyeth hereby agrees that

                                        *

it shall purchase

                                        *

no less than

                                        *

for Syringes in each Region in the Territory as set forth on Exhibit C as of the
Effective Date.

         5.4 Failure to Reach Minimum Purchases. If Wyeth fails to reach any of
the aggregate minimum purchase requirements in a Region in the Territory in any
Contract Year (other than as a result of a failure by Biomatrix to supply the
Product in accordance with the terms hereof), then, notwithstanding such failure
and subject to Wyeth not being in breach of any other provisions of the
applicable agreements, Wyeth shall have the right, in its sole discretion, to
maintain this Agreement, the License Agreements, and the Trademark License
Agreement by paying to Biomatrix within thirty (30) days after the end of such
Contract Year $12 U.S. Dollars for each Unit of Product by which Wyeth failed to
meet the applicable minimum purchase requirement but Biomatrix shall not be
required to deliver any Product in exchange for any such payment. If Wyeth fails
to meet a minimum purchase requirement and, in its sole discretion, chooses not
to make the payment to Biomatrix contemplated by this Section 5.4, then
Biomatrix may at its option upon thirty (30) days prior written notice to Wyeth,
terminate this Agreement and the applicable License Agreement as it applies to
such Region.
          
         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   12
                                      -12-



                                        *

         5.5 Records and Audits. Wyeth shall maintain books of account with
respect to its sales of the Products and Extended Products in each country in
the Territory. Biomatrix shall have the right, not more than once during each
calendar year, to have an independent accountant selected and retained by
Biomatrix to inspect and examine such books of Wyeth during regular business
hours for the purpose of verifying the statements of the aggregate Net Revenues
resulting from sales of Products and Extended Products and determining the
correctness of the Formula Price Percentages and Per Unit Formula Prices. The
cost of each such audit shall be borne by Biomatrix unless a material error is
discovered in the course of such audit, in which case the cost shall be borne by
Wyeth. As used herein, a "material" error is one which results in an
underpayment to Biomatrix greater than five percent (5%) actually due. Any
additional payments required as a result of such inspection and examination
shall be immediately paid to Biomatrix and shall bear interest from the date
such amount would otherwise have been paid until the date of actual payment at
the rate per annum set forth in Section 23 hereof.


         6. SHIPMENT AND DELIVERY. Biomatrix shall arrange for shipment and
invoicing to Wyeth of Product and Extended Products ordered by Wyeth via common
carrier,

                                        *

Wyeth shall pay all customs duties, sales taxes and other governmental charges
relating to the importation and sale of Product and Extended Products, and shall
have all responsibility for storing and clearing Product and Extended Products
through customs and for all other importation requirements. No VAT or customs
duty number shall be assigned to any Product or Extended Products without the
prior written consent of Biomatrix.


         7. FIRM ORDERS. Wyeth shall submit a firm purchase order setting forth
the quantities, delivery date and shipping instructions with respect to each
shipment of Product or Extended Product, such purchase orders to be received by
Biomatrix at least


                                        *


prior to the requested delivery date. Such firm purchase orders shall be for
quantities of Product or Extended Product equal to

                                        *

Wyeth shall not submit



         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   13
                                      -13-




any purchase order for fewer than

                                        *

Treatment Packs of Products or Extended Products.

         8. RISK OF LOSS. Biomatrix shall bear all risk of loss, or damage to,
all units of Products and Extended Products until such Products and Extended
Products have been delivered to the port of entry within the Territory. Wyeth
shall bear all risk of loss of, or damage to, all units of Products after
delivery by Biomatrix to the port of entry.

         9. ACCEPTANCE. Biomatrix shall complete a certificate of analysis for
each product batch contained in a shipment to Wyeth in accordance with the test
requirements set forth in the applicable Product Specifications. Biomatrix shall
include each certificate of analysis with the respective shipment to Wyeth.
Should Wyeth notify Biomatrix within

                                       *

of the receipt of any shipment of Product or Extended Product that such Product
or Extended Product does not conform to the applicable Product Specifications
therefor, Biomatrix and Wyeth agree to consult with each other in order to
resolve the discrepancy between each other's determinations regarding any
possible defect. If such consultation does not resolve the discrepancy, the
parties agree to nominate a reputable independent laboratory, acceptable to both
parties, that shall carry out tests on representative samples taken from such
shipment, and the results of such tests shall be binding on the parties, and the
party whose determination was in error as determined by such laboratory shall
pay all costs associated with such testing. Biomatrix shall at its expense
replace any such shipment to the extent that it does not conform to applicable
Product Specifications. All defective Units shall be returned to Biomatrix at
the address set forth above, accompanied or preceded by a reasonably detailed
statement of the claimed defect or non-conformity and proof of date of purchase,
and packed and shipped according to instructions provided by Biomatrix. The
shipping costs of any such returned Units shall be borne by Biomatrix, unless
such Units are determined not to be defective under the terms of this Agreement,
in which case such shipping costs shall be borne by Wyeth.

         10. PURCHASE ORDERS. The provisions of this Agreement shall prevail
over any inconsistent statement or provisions contained in any document related
to this Agreement passing between the parties hereto including, but not limited
to, any purchase order, acknowledgment, confirmation or notice.

         11. LIMITED WARRANTY; LIMITATION ON LIABILITY; INDEMNIFICATION.

         11.1 Limited Warranty. Biomatrix represents and warrants that each
Product and Extended Product supplied to Wyeth hereunder shall:


         (i) conform to the applicable Product Specifications; and


         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   14
                                      -14-


         (ii) be manufactured, labeled, packaged and tested (while in the
         possession or control of Biomatrix) in accordance with applicable laws
         and regulations in the respective countries in Territory relating to
         the manufacture, labeling, packaging and testing of the Product or
         Extended Product.

         THE FOREGOING WARRANTY IS THE SOLE AND EXCLUSIVE WARRANTY GIVEN BY
BIOMATRIX WITH RESPECT TO PRODUCTS AND EXTENDED PRODUCTS, AND BIOMATRIX GIVES
AND MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED,
OTHER THAN THE FOREGOING. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, NO
IMPLIED WARRANTY OF MERCHANTABILITY, NO IMPLIED WARRANTY OF FITNESS FOR ANY
PARTICULAR PURPOSE, AND NO IMPLIED WARRANTY ARISING BY USAGE OF TRADE, COURSE OF
DEALING OR COURSE OF PERFORMANCE IS GIVEN OR MADE BY BIOMATRIX OR SHALL ARISE BY
OR IN CONNECTION WITH ANY SALE OR PROVISION OF PRODUCTS OR EXTENDED PRODUCTS BY
BIOMATRIX, OR WYETH'S USE OR SALE OF PRODUCT, OR BIOMATRIX'S AND/OR WYETH'S
CONDUCT IN RELATION THERETO OR TO EACH OTHER. NO REPRESENTATIVE OF BIOMATRIX IS
AUTHORIZED TO GIVE OR MAKE ANY OTHER REPRESENTATION OR WARRANTY OR TO MODIFY THE
FOREGOING WARRANTY IN ANY WAY.

         The limited warranty set forth in this Section 11 does not apply to any
non-conformity of Products or Extended Products resulting from (a) repair,
alteration, misuse, negligence, abuse, accident, mishandling or storage in an
improper environment by any party other than Biomatrix, or (b) use, handling,
storage or maintenance other than in accordance with Product Specifications.

         Biomatrix's sole obligation with respect to Units of Products or
Extended Products which do not meet the warranty contained herein is limited to
replacement of such Units of the Products or Extended Products, provided that
such Units of Products or Extended Products are returned to Biomatrix in the
manner set forth in Section 9, and only if, as determined by the procedures set
forth in Section 9, such Units of Products or Extended Products are determined
to have been defective under the terms of this Agreement.

         11.2. Limitation on Liability. BIOMATRIX'S LIABILITY, AND THE EXCLUSIVE
REMEDY, IN CONNECTION WITH THE SALE OR USE OF PRODUCTS OR EXTENDED PRODUCTS
(WHETHER BASED ON CONTRACT, NEGLIGENCE, BREACH OF WARRANTY, STRICT LIABILITY OR
ANY OTHER LEGAL THEORY), SHALL BE STRICTLY LIMITED TO BIOMATRIX'S OBLIGATIONS AS
SPECIFICALLY AND EXPRESSLY PROVIDED IN THIS SECTION 11 AND THE LIMITED
INDEMNITIES SET
<PAGE>   15
                                      -15-



FORTH IN SECTION 11.3. EXCEPT AS SPECIFICALLY PROVIDED IN THIS SECTION 11 AND IN
SUCH LIMITED INDEMNITIES, BIOMATRIX SHALL HAVE NO LIABILITY, OBLIGATION OR
RESPONSIBILITY OF ANY KIND, IN ANY WAY OR TO ANY EXTENT, FOR ANY DAMAGES,
LOSSES, COSTS, EXPENSES OR LIABILITIES FOR ANY REPRESENTATION OR WARRANTY OF ANY
KIND WITH RESPECT TO PRODUCTS OR EXTENDED PRODUCTS OR THE PERFORMANCE THEREOF,
OR ARISING IN ANY WAY IN CONNECTION WITH THE PURCHASE OR USE OR INABILITY TO USE
PRODUCTS OR EXTENDED PRODUCTS EVEN IF BIOMATRIX HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES. IN NO EVENT WHATSOEVER SHALL BIOMATRIX HAVE ANY
LIABILITY, OBLIGATION OR RESPONSIBILITY FOR ANY INDIRECT, INCIDENTAL,
CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES ARISING IN ANY WAY IN
CONNECTION WITH PRODUCTS OR EXTENDED PRODUCTS OR THEIR SALE OR USE.


        11.3    Indemnification.

        (a) Biomatrix shall indemnify and hold Wyeth and its officers,
directors, shareholders, agents and employees harmless against any and all
liability, damage, loss, cost or expense resulting from any third party claim
made or suit brought against Wyeth or such persons to the extent such claim

                                        *

Upon the filing of any such claim or suit, Wyeth shall immediately notify
Biomatrix thereof, and shall permit Biomatrix at its cost to handle and control
such claim or suit. Wyeth shall have the right to participate in the defense of
such claim or suit at its own expense.

        (b) Wyeth shall indemnify and hold Biomatrix and its officers,
directors, shareholders, agents and employees harmless against any and all
liability, damage, loss, cost or expense resulting from any third party claim
made or suit brought against Biomatrix or such persons to the extent such claim

                                        *

Upon the filing of any such claim or suit, Biomatrix shall immediately notify
Wyeth thereof and shall permit Wyeth at its cost to handle and control such
claim or suit. Biomatrix shall have the right to participate in the defense of
such claim or suit at its own expense.







         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   16
                                       -16-

         12. *

       12.1  * If either party in good faith determines that a * such party
shall immediately notify the other party in writing and shall advise such other
party of the * The parties shall consult with each other as to any action to be
taken * 

       12.2  Corrections. Except as otherwise provided in Section 12.3, * of a
Product or Extended Product, * relating to its manufacturing, packaging,
testing, labeling, storing or handling of the Product or Extended Product for
which * 

       12.3  * by Wyeth as a result of  * Wyeth to * Biomatrix and its
Affiliates as a * 


         13. LICENSING AND COMPLIANCE; NOTICES; INSPECTION. (a) Wyeth shall, at
its expense, obtain any and all import licenses that may be necessary to permit
the sale by Biomatrix and the purchase by Wyeth of Products or Extended Products
hereunder, comply with all registration requirements in the Territory and comply
with any and all governmental laws, regulations, and orders that may be
applicable to Wyeth by reason of its execution of this Agreement including all
laws, regulations or orders that govern or affect the ordering, shipment,
import, sale (including government procurement), delivery, or redelivery of
Products and Extended Products in the Territory. Wyeth shall furnish Biomatrix
with such documentation as Biomatrix may request to confirm Wyeth's compliance
with this Section 13 and agrees that it shall not engage in any course of
conduct that, in Biomatrix's reasonable belief, would cause Biomatrix to be in
violation of the laws of any jurisdiction.

         (b) The manufacturing standards and ingredients for Products will
conform to U.S. Pharmacopoeia Standards, where applicable. All other methods
shall be suitably validated according to acceptance by the FDA, for the approved




























         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   17
                                      -17-



PMA for Synvisc, or where applicable, according to the standards accepted by the
notified body for the CE mark in the European Economic Area.

         (c) Wyeth shall have the right, on reasonable prior notice to
Biomatrix, to inspect Biomatrix's manufacturing, packaging and storage
facilities used in the manufacture, packaging, storage, testing, shipping and
receiving of Products and Extended Products and their components and any Person
conducting any such inspection shall be bound by the confidentiality provisions
of Section 7 of the U.S. Agreement and Section 8 of the International Agreement.

         14. LOCAL LAWS. Each party shall notify the other party of the
existence and content of any provision of law in the Territory or any other
applicable law that conflicts with any provision of this Agreement at the time
of its execution or thereafter.

         15. PAYMENTS; EXCHANGE RATE.

         15.1 Payments. All payments hereunder shall be made in U.S. Dollars and
at the exchange rates set forth in Section 15.2 and paid within

                                        *

unless otherwise agreed by the parties. Payments to Biomatrix shall be wired to
an account in a bank designated by Biomatrix and the costs of any such
remittance shall be borne by Wyeth.

         15.2 Exchange Rate. All amounts denominated in an Applicable Currency
shall be converted to U.S. Dollars using the consistently applied method of
conversion utilized by Wyeth at the corporate level for financial reporting
purposes.

         16. WITHHOLDING. All payments to be made by Wyeth under this Agreement
shall be made in full, free and clear of and without any deduction of or
withholding for or on account of any taxes levied in any country of the
Territory or elsewhere; provided that if Wyeth shall be required by law to make
any deduction or withholding from any payment to Biomatrix then:

         (i) Wyeth shall ensure that such deduction or withholding does not
exceed the minimum legal liability therefor;

         (ii) at least thirty (30) days prior to the first deduction or
withholding, Wyeth shall notify Biomatrix thereof, and the parties shall
negotiate in good faith adjustments to the payments hereunder in order to
minimize or eliminate such deduction or withholding, provided that the total
payments by Wyeth shall not increase; and






         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   18
                                      -18-




         (iii) Wyeth shall forward to Biomatrix such documentary evidence as may
be available in respect of each deduction, withholding or payment together with
each payment or promptly thereafter.

         17. QUESTIONABLE PAYMENTS. Wyeth shall not, directly or indirectly, in
the name of, on behalf of, or for the benefit of Biomatrix offer, promise or
authorize to pay, or pay any compensation or give anything of value to, any
official, agent or employee of any government or governmental agency, or to any
political party or officer, employee or agent thereof in connection with the
promotion or sale of Products or Extended Products.

         18. FURTHER ASSURANCES. The parties hereto agree to execute such
further or other documents and assurances as are necessary from time to time in
order to give effect to the provisions of this Agreement.

         19. ASSIGNMENT. The rights and obligations of the parties hereto shall
inure to the benefit of and shall be binding upon the authorized successors and
permitted assigns of each party. Neither party may, without the prior written
consent of the other party, take any of the following actions (collectively
referred to herein as an "Assignment"): (i) assign or transfer its rights or
obligations under this Agreement, (ii) license or sublicense any of its rights
or obligations under this Agreement, or (iii) designate another person to
perform all or part of its obligations under this Agreement or have all or part
of its rights and benefits under this Agreement; provided, however, that a party
may make Assignments to Affiliates of such party or to a successor, by merger,
and provided, further that in the case of an Assignment to an Affiliate the
assigning party shall promptly notify the other party in writing of such
Assignment and shall remain liable (both directly and as guarantor) with respect
to all obligations so assigned. In the event of any permitted Assignment or in
the event that an Affiliate of either party shall exercise rights and/or perform
obligations hereunder pursuant to the terms of this Agreement, the assignee or
Affiliate, as the case may be, shall specifically assume and be bound by the
provisions of the Agreement by executing and agreeing to an assumption agreement
satisfactory to the other party hereto.

         20. GOVERNING LAW; INJUNCTIVE RELIEF.

         20.1 Governing Law and Dispute Resolution. This Agreement and the
respective rights and obligations of the parties shall be governed by and
construed in accordance with the internal and substantive laws of the State of
New Jersey, United States of America (without regard to principles of conflicts
of laws). The parties hereby agree that the United Nations Convention on
Contracts for the International Sale of Goods shall not apply to this Agreement
or any other document contemplated hereby. In the event of any dispute touching
or concerning this Agreement, the parties hereby agree to submit such dispute to
their respective chief
<PAGE>   19
                                      -19-



executive officers or their designees by notice delivered in accordance with the
provisions of Section 25 hereof. Each of the parties agrees that any suit
relating to this Agreement may be brought in the courts of the State of New
Jersey or any federal court and service of process in any such suit being made
by mail at the address specified in Section 25. Each party hereby waives any
objection that it may now or hereafter have to the venue of any such suit or any
such court or that such suit is brought in an inconvenient court.

         20.2 Injunctive Relief. Each of the parties hereto acknowledges and
agrees that damages will not be an adequate remedy for any material breach or
violation of this Agreement if such material breach or violation would cause
immediate and irreparable harm (an "Irreparable Breach"). Accordingly, in the
event of a threatened or ongoing Irreparable Breach, each party hereto shall be
entitled to seek, in any state or federal court in the State of New Jersey,
equitable relief of a kind appropriate in light of the nature of the ongoing
threatened Irreparable Breach, which relief may include, without limitation,
specific performance or injunctive relief; provided, however, that if the party
bringing such action is unsuccessful in obtaining the relief sought, the moving
party shall pay the non-moving party's reasonable costs, including attorney's
fees, incurred in connection with defending such action. Such remedies shall not
be the parties' exclusive remedies, but shall be in addition to all other
remedies provided in this Agreement.

         21. SEVERABILITY. In the event that any provision of this Agreement
shall be held by a court of competent jurisdiction or by any governmental body
to be invalid or unenforceable, such provision shall be deemed severable and the
remaining parts and provisions of this Agreement shall remain in full force and
effect.

         22. FORCE MAJEURE. Each of the parties shall be excused from the
performance of its obligations hereunder in the event such performance is
prevented by force majeure, and such excuse shall continue as long as the
condition constituting such force majeure continues. For the purpose of this
Agreement, force majeure is defined as contingencies beyond the reasonable
control of either party, including, without limitation, acts of God, judicial or
regulatory action, war, civil commotion, destruction of production facilities or
materials by fire, earthquake or storm and labor disturbances (whether or not
any such labor disturbance is within the power of the affected party to settle).
The party affected by force majeure shall provide the other party with full
particulars thereof as soon as it becomes aware of the same (including its best
estimate of the likely extent and duration of the interference with its
activities), and will use its best endeavors to overcome the difficulties
created thereby and to resume performance of its obligations as soon as
practicable.

         23. INTEREST. Any overdue amounts payable by either party hereunder
shall bear interest compounded monthly at the prime lending rate for U.S.
Dollars
<PAGE>   20
                                      -20-




published from time to time in The Wall Street Journal plus

                                        *

per annum, or, if lower, the highest rate permissible by applicable law, from
the due date until the date of payment.

         24. NO PARTNERSHIP OR AGENCY. This Agreement and the relations hereby
established by and between Biomatrix and Wyeth do not constitute a partnership,
joint venture, agency or contract of employment between them.

         25. NOTICES. All communications in connection with this Agreement shall
be in writing and sent by postage prepaid first class mail, courier, or telefax,
and if relating to default, late payment or termination, by certified mail,
return receipt requested, telefax or courier, addressed to each party at the
address above, in the case of Biomatrix, Attn: Chief Executive Officer, with a
copy to: Justin P. Morreale, Esq., Bingham, Dana & Gould LLP, 150 Federal
Street, Boston, Massachusetts 02110, U.S.A., and in the case of Wyeth, 555 East
Lancaster Avenue, St. Davids, Pennsylvania 19087, Attn: Senior Vice President,
Global Business Development, with a copy to American Home Products Corporation,
Five Giralda Farms, Madison, New Jersey 07990, Attn: Senior Vice President and
General Counsel or to such other address as the addressee shall last have
designated by notice to the communicating party. The date of giving any notice
shall be the date of its actual receipt.

         26. EU REGULATIONS. It is the intention of the parties hereto that this
Agreement shall at all times qualify for the exemption from the provisions of
Article 85(1) of the Treaty of Rome dated 25 March 1957, as amended, which
either (a) is available under EEC Regulation Number 1983/83, or (b) may
otherwise be available under any other regulations or successor regulation
thereto. In the event that any provision of this Agreement is deemed to violate
the conditions for qualifying for the exemption, set out in whichever of those
regulations may be in effect at the relevant time, or if any such regulation is
amended after the date of this Agreement so as to cause this Agreement to fail
to qualify for the exemption, the parties hereto agree that they will, as soon
as it is practicable to do so, enter into good faith negotiations to amend this
Agreement as necessary in order to re-qualify for the exemption or notify the
Agreement.

         27. SURVIVAL. The provisions of Sections 11 and 12 of this Agreement
shall survive the termination or expiration of this Agreement (as the case may
be) and shall remain in full force and effect. The provisions of this Agreement
that do not survive termination or expiration hereof (as the case may be) shall,
nonetheless, be controlling on, and shall be used in construing and interpreting
the rights and obligations of the parties hereto with regard to, any dispute,
controversy or claim which may arise under, out of, or in connection with this
Agreement.



         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   21
                                      -21-



         28. MISCELLANEOUS. This Agreement, the Trademark License Agreement and
the License Agreements set forth the entire agreement between the parties with
respect to the transactions and arrangements contemplated hereby and thereby and
supersede all prior oral or written arrangements between the parties. This
Agreement may be modified or amended only by a written instrument executed and
delivered by both parties. None of the provisions of this Agreement shall be
deemed to have been waived by any act or acquiescence on the part of either
party except by an instrument in writing signed and delivered by the party
executing the waiver. This Agreement may be executed in several identical
counterparts, each of which shall be an original, but all of which constitute
one instrument, and in making proof of this Agreement it shall not be necessary
to produce or account for more than one such counterpart. The English language
version of this Agreement shall govern and control any translations of this
Agreement into any other language. References herein to Sections and Exhibits
are to Sections of and Exhibits to this Agreement. The title of this Agreement
and the section headings contained herein are for convenience of reference only
and shall not define or limit the provisions hereof.

        IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date and year first above written.


AMERICAN HOME PRODUCTS                       BIOMATRIX, INC.
   CORPORATION



By:  /s/ Fred Hassan                         By:  /s/ Endre A. Balazs
     ----------------------------                 -----------------------------
Name:   Fred Hassan                          Name:     Endre A. Balazs
Title:   Executive Vice President            Title:    Chief Executive Officer

<PAGE>   22
                                      -22-



                                    EXHIBITS

Exhibit A         -       Initial Product Specifications

Exhibit B         -       Patents and Trademarks

Exhibit C         -       Long Range Forecast



                                    SCHEDULES

1.13              -       Manufacturing Costs
<PAGE>   23


                                                                      EXHIBIT A

                         Initial Product Specifications

                      U.S. AGREEMENT PRODUCT SPECIFICATIONS

                           SPECIFICATION OF SYNVISC(R)
                                 (HYLAN G-F 20)


Test                                                 Specifications
----                                                 --------------

                                                            *



































         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   24
                                                                       EXHIBIT B


                             Patents and Trademarks


I.       SYNVISC RELATED UNITED STATES PATENTS

                    *



II.      SYNVISC(R)

     Country         Registration No.         Term           Expiration Date
     -------         ----------------         ----           ---------------






































         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   25
                        Exhibit B Patents and Trademarks


I.       SYNVISC RELATED GERMAN, SPANISH AND AUSTRIAN PATENTS(1)/

                                        *


































         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   26
                                      -2-
II.      SYNVISC(R)

     Country         Registration No.         Term           Expiration Date
     -------         ----------------         ----           ---------------






                                        *










































         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   27
                                      -3-

     Country         Registration No.         Term           Expiration Date
     -------         ----------------         ----           ---------------




                                        *










































         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   28
                                                                       EXHIBIT C


                         UNIT (SINGLE SYRINGE) FORECAST


                                        *









































         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   29
                                                                   SCHEDULE 1.13


                                        *









































         *Confidential portions have been omitted and filed separately with the
Commission.
<PAGE>   30
                                      -2-



                                        *













































         *Confidential portions have been omitted and filed separately with the
Commission.