EXHIBIT 10.16


                          LICENSE AND SUPPLY AGREEMENT

         This License and Supply Agreement (the "Agreement") made and entered
into as of this 20th day of May 1999 by and between Columbia Laboratories
(Bermuda) Limited, a Bermuda corporation having its principal place of business
at Rosebank Center, 14 Bermudiana Road, Pembroke, HM08 Bermuda ("Licensor"), and
Ares Trading S.A., a Swiss company with its principal place of business at
Chateau de Vaumarcus, 2028 Vaumarcus, Switzerland ("Licensee");

                                   WITNESSETH:

         WHEREAS, Licensor and American Home Products Corporation of Five
Giralda Farms, Madison, New Jersey 07940-0874, a Delaware corporation,
represented by its Wyeth-Ayerst Laboratories Division ("AHPC") entered into a
License and Supply Agreement dated as of May 21, 1995, as amended;

         WHEREAS, pursuant to an Assignment and Royalty Agreement (the
"Assignment Agreement") AHPC will assign its right, title and interest in, to
and under such License and Supply Agreement to Licensee;

         WHEREAS, this Agreement is an amended and restated version of such
License and Supply Agreement;

         WHEREAS, this Agreement will become effective upon the completion of
Closing under the Assignment Agreement (as such term is defined therein);

         WHEREAS, Licensor is the owner or exclusive licensee of, and has the
right to grant licenses with respect to, certain Technology, Patents and the
Trademarks (as hereinafter defined); and

         WHEREAS, Licensor wishes to grant to Licensee an exclusive license
(subject only to Licensor's retained use and manufacturing rights) to the
Technology, Patents and the Trademarks for use and sale of the Product (as
hereinafter defined) in the Territory (as hereinafter defined), and Licensee
wishes to receive such a license, on the terms and subject to the conditions set
forth herein;

         NOW, THEREFORE, for and in consideration of the mutual promises and
covenants herein contained, the parties hereto agree as follows.

         1. Definitions. As used in this Agreement, the following terms (except
as otherwise expressly provided or unless the context otherwise requires) shall
have the respective meanings set forth below ( it being understood that the
terms defined in this Agreement shall include the singular number in the plural,
and the plural number in the singular):

         (a) "Affiliate" shall mean any corporation or other business entity
that either directly or indirectly controls a party to this Agreement, is
controlled by such party, or is under common control

<PAGE>

of such party. As used herein, the term "control" means possession of the power
to direct or cause the direction of the management and policies of a corporation
or other entity whether through the ownership of voting securities, by contract
or otherwise.

         (b) "Assignment Agreement" shall mean the Assignment and Royalty
Agreement by and between AHPC and Licensee.

         (c) "Base Price" shall mean Direct Cost plus 20%. On a country by
country basis, Licensor shall notify Licensee of the Base Price if the Base
Price becomes relevant in calculating the Purchase Price.

         (d) "Confidential Information" shall mean all information and/or
technical data which is disclosed by one party hereto to the other party hereto
pursuant to this Agreement which the disclosing party treats as confidential and
identifies as such, other than (i) information known to the receiving party or
its Affiliates prior to the disclosure of such information to such party,
provided said prior knowledge is supportable by documentary evidence, (ii)
information which at the time of the disclosure is, or thereafter becomes,
generally known to the public, provided that such public knowledge does not
result from any act or disclosure by the receiving party or one of its
Affiliates in violation of the terms of this Agreement, (iii) information which
can be shown to be independently discovered, after the date hereof, by a party,
or one of its Affiliates, without the aid, application or use of the disclosed
information, or (iv) information obtained by the receiving party from a third
party which is determined to be in lawful possession of such information,
provided such third party is not in violation of any contractual or legal
obligation to the disclosing party or one of its Affiliates with respect to such
information.

         (e) "Direct Cost" shall mean the following direct costs of
manufacturing the Product: raw material/ingredient costs, packaging costs,
direct labor and direct overhead.

         (f) "Effective Date" shall mean the date of the completion of Closing
under the Assignment Agreement (as such term is defined therein).

         (g)      "FDA" shall mean the U.S. Food and Drug Administration.

         (h) "Field" shall mean the vaginal delivery of progesterone or
progestational agents alone or in combination or co-administered with other
active substances directed toward use in hormone replacement therapy as well as
in the indications of secondary amenorrhea, in vitro fertilization, and
prevention of endometrial hyperplasia and other indications where progesterone
or progestational agents are commonly used except in a locally acting -
non-systemic - contraceptive where progesterone or a progestational agent may be
useful.

         (i) "Finished Package Form" shall mean applicators wrapped in aluminum
foil with required leaflet printed in two colors and inserted into an
appropriate box with customary trade dress printed in up to four colors. The
boxes will be placed into appropriate outer cartons which will be printed in one
color with required labeling and UPC codes.

                                       2
<PAGE>

         (j) "Forecast" shall mean the official Licensee forecast as required by
paragraphs 4 (i) and 4 (j).

         (k) "GMP" shall mean current good manufacturing practice regulations
promulgated by the FDA and other regulatory agencies.

         (l) "Intellectual Property Rights" shall mean trade secrets,
trademarks, tradenames, logos, trade dress, graphics, designs, patents,
copyrights or other proprietary rights.

         (m)      "NDA" shall mean a New Drug Application as defined by the FDA.

         (n) "Net Sales" shall mean the aggregate equivalent of gross revenue
received by Licensee, its Affiliates or sublicensees from or on account of the
sale of the Product to non affiliated third parties on which payments are due
under this Agreement, less (i) reasonable credits or allowances, if any,
actually granted on account of cash or trade discounts, recalls, rebates,
rejection or return of the Product previously sold, (ii) excises, sales taxes,
value added taxes, consumption taxes, duties or other taxes imposed upon and
paid with respect to such sales (excluding income or franchise taxes of any
kind) and (iii) separately itemized insurance and transportation costs incurred
in shipping the Product to such third parties. No deduction shall be made for
any item of cost incurred by Licensee or its Affiliates in preparing,
manufacturing, shipping or selling the Product except as permitted pursuant to
clauses (i), (ii) or (iii) of the foregoing sentence. Net Sales shall not
include any transfer between Licensee and any of its Affiliates or sublicensees
for resale. No transfer of the Product for test or development purposes or as
free samples shall be considered a sale hereunder for accounting and payment
purposes,

         (o) "Patents" shall mean the patents and/or patent applications filed
in the Territory owned by the Licensor or its Affiliates or with respect to
which Licensor or its Affiliates may now or hereafter have the right to grant
licenses in the Territory, the claims of which may be infringed, absent a
license, by the manufacture, use or sale of the Product within the Territory,
including, without limitation, the patents and applications set forth in
Schedule A hereto and any and all patents issued pursuant thereto, as well as
any patents to be applied for or issued to Licensor or its Affiliates in the
future during the term of this Agreement, which future patents and patent
applications shall be added to Schedule A by written notice of Licensor to
Licensee within thirty (30) days of such application and/or issuance.

         (p) "Product" shall mean progesterone/COL-1620 vaginal gel.

         (q) "Purchase Price" shall have the meaning set forth in Section 5 of
this Agreement.

         (r) "Technology" shall mean all pharmacological, toxicological,
preclinical, clinical, technical and other information, data and analysis and
know-how relating to the registration, manufacture, packaging, use, marketing
and sale of the Product (including, without limitation, all works copyrighted by
Licensor) and all proprietary rights relating thereto owned by Licensor or its
Affiliates or to which Licensor or its Affiliates has rights so as to be able to
license, whether prior to or after the Effective Date, and relating or
pertaining to the Product.

                                        3
<PAGE>

         (s) "Territory" shall mean all countries and territories of the world
except for sub-Saharan Africa, which is comprised of the following countries:
The Republic of South Africa, Lesotho, Botswana, Zimbabwe, Namibia, Mozambique,
Zaire, Kenya, Malawi, Mauritius, Seychelles, Madagascar, Zambia and Swaziland.

         (t) "Trademarks" shall mean the trademark "Crinone" or the trademark
"Perlence" for use on cosmetic and pharmaceutical products used primarily for
progesterone supplementation as set forth in Schedule B.

         (u)      "Unit" shall mean a single applicator.

         (v) "Valid Claim" shall mean a claim which is contained in an
unexpired, issued Patent which has not been held invalid or unenforceable by a
decision of a court or patent office of competent jurisdiction, unappealable or
unappealed within the time allowed for appeal, and which has not been admitted
to be invalid by the owner through reissue or disclaimer.

         2.       Grant of License.
                  ----------------

         (a) Licensor grants to Licensee, and Licensee accepts from Licensor, on
the terms and conditions stated herein, an exclusive (even as to Licensor and
Licensor's Affiliates) right and license, with the right to sublicense, under
the Patents and Technology to market, use and sell the Product in the Territory;
provided, however that Licensee will only sublicense Product containing
progesterone in a concentration of eight percent (8%) after prior consultation
with Licensor. Licensor grants to Licensee, and Licensee accepts from Licensor,
on terms and conditions stated herein, a nonexclusive right and license with the
right to sublicense its Affiliates under the Patents and Technology to make
and/or have made the Product anywhere in the world, but only for use or sale in
the Territory.

         (b) Licensor grants to the Licensee, and Licensee accepts from
Licensor, on the terms and conditions contained herein (i) an exclusive right
and license, with the right to sublicense, to use the Trademarks in the
distribution, advertising, marketing, use and sale of the Product (and any line
extension to the Product as to which Licensee has obtained Licensor's prior
written consent, not to be unreasonably withheld) in the Territory, and (ii) a
nonexclusive right and license with the right to sublicense its Affiliates to
use the Trademarks in the manufacture, labeling and packaging of the Product
(and any line extensions to the Product as to which Licensee has obtained
Licensor's prior written consent, not to be unreasonably withheld) anywhere in
the world. Licensor shall not use, nor permit any of its Affiliates or other
licensees to use, the Trademarks on any other product marketed, used or sold in
the Territory.

         (c) Licensor's retained rights in the Territory in connection with the
Product shall include only those rights under the Patents, the Trademarks and
Technology to make, have made and use the Product as necessary for Licensor to
fulfill its commitments now or in the future with respect to this Agreement and
with respect to its licensees who market the Product outside the Territory, to
otherwise operate its business (it being understood that Licensor, its
Affiliates and other licensees shall not sell, use or market the Product within
the Territory), and to make, have made, use, market and sell the Product, itself
or through its Affiliates or licensees, outside the Territory.

                                       4
<PAGE>

         (d) Licensor will use its best efforts to convince its licensee outside
the Territory not to use the Trademarks.

         (e) Licensee may, at any time, request from Licensor, and Licensor
agrees to grant directly to any party in any country of the Territory exclusive
license rights consistent with those granted to Licensee herein. Accordingly,
upon receipt of Licensee's request, Licensor shall enter into and sign a
separate direct license agreement or agreements with the companies designated by
Licensee in the request. All direct agreements shall be prepared by Licensee. In
the absence or upon the expiration of laws and regulations to the contrary, the
terms and conditions thereof shall not be less favorable by Licensor than those
contained in this Agreement and shall be similar to the terms and conditions
contained in this Agreement. Such agreements must be approved by Licensor, which
approval shall not be unreasonably withheld. In those countries in which the
validity of such a direct license agreement requires prior governmental approval
or registration, such direct license agreement shall not be binding or have any
force or effect until the required governmental approval or registration has
been granted. Incidental out of pocket costs incurred by Licensor in the
renegotiation of this Agreement, the execution of direct license agreements and
matters pertaining thereto shall be for the account of Licensee, when prior
approved by Licensee.

         (f) In the event that any local government would request or local
regulations would require that the regulatory approval for the Product be held
in the name of Licensee or should it reasonably appear that ownership of the
registration for the Product by Licensee would facilitate regulatory approval,
then Licensor, upon the request of Licensee, shall transfer to Licensee
ownership of the regulatory approval for the Product for such country or
countries.

         (g) Licensor shall make reasonable efforts to obtain from its licensee
outside the Territory any right such licensee may have to market, use, sell,
make and have made the Product and to use the Trademarks. Upon Licensor
obtaining such rights, "Territory" under this Agreement shall be automatically
redefined to mean "the world." Any incidental out of pocket costs incurred by
Licensor in obtaining such rights shall be for the account of Licensee, when
prior approved by Licensee.

         3.       License Fees.
                  ------------

         In consideration of the services by Licensor to research and develop
the Product and to obtain respective local approvals for the Product, all to the
benefit of Licensee pursuant to the license and other rights granted to Licensee
hereunder, Licensee shall pay to Licensor the following (all dollars mean U.S.
dollars):

         (a) Five hundred thousand dollars ($500,000) upon Licensee, its
Affiliates or sublicensees filing a NDA for the Product for the treatment of
hyperplasia.

         (b) Five million dollars ($5 million) upon FDA approval of the
promotable claim made via NDA or other FDA procedure that the Product can be
used concomitantly with estrogen in Hormone Replacement Therapy (HRT).

                                       5
<PAGE>

         (c) Five million dollars ($5 million) when Net Sales of the Product in
the United States reach sixty million dollars ($60 million) during two
consecutive calendar years, provided that this level of Net Sales is achieved
within seven (7) years of the Product launch in the United States.


                                       6
<PAGE>

         4.       Supply.
                  ------

         (a) During the term of the Agreement, Licensor shall supply, unless
otherwise agreed, Licensee, its Affiliates and sublicensees with the Product on
an exclusive basis in the Territory. All such Product shall be delivered in
Finished Package Form. Also, during the term of the Agreement, Licensor shall
not develop, license, manufacture nor sell to another party in the Territory any
product in the Field. Licensor is not restricted from developing, licensing
manufacturing or selling other hormones or drugs. Licensor represents that as of
the Effective Date it has not entered into any arrangement which would
contravene the intentions of this paragraph.

         (b) Although Licensor is responsible for production and quality
control, Licensee has the right of inspection to ensure Licensor meets all
appropriate standards set by the FDA or other appropriate regulatory
authorities.

         (c) Licensor shall be obliged to maintain the registration of the
manufacturing facilities with the appropriate regulatory authorities and to
allow inspection of such facilities by regulatory authorities insofar as
necessary or advisable in order to facilitate the supply to Licensee, its
Affiliates or sublicensees of the Product, and promptly to notify Licensee of
any inspection of its own or its contract supplier's manufacturing facilities by
the regulatory authorities and promptly to provide Licensee with copies of any
correspondence received from the regulatory authorities setting forth the
results of any such inspection insofar as the Product is concerned. Furthermore,
as may be required for regulatory purposes, Licensor grants Licensee the right
to refer to, and shall cause its contract supplier to grant to Licensee access
to, contract supplier's master file relating to the Product and undertakes to
notify Licensee and provide Licensee with specific details of any changes to
said master file or other filings by the contract supplier with the regulatory
authorities relative to the Product. Licensor shall consult with Licensee before
it or its contract supplier makes any material change in any manufacturing
process for the Product. Licensor shall be kept duly informed without any delay
by copy letter of any correspondence between Licensee and the contract supplier,
in the event that any such communication should occur.

         (d) Upon reasonable prior notice given by Licensee to Licensor in
writing, Licensor shall permit and shall cause its contract supplier to permit
representatives of Licensee or designees of Licensee acceptable to Licensor
and/or contract supplier to inspect any manufacturing, quality control or
testing facilities used by or in connection with the manufacture or testing of
the Product and annual GMP audits provided that such representatives or
designees of Licensee shall conduct such inspections in a manner which shall
cause the least possible interruption to Licensor's or the contract supplier's
operations under the particular circumstances. Such inspection shall take place
in a timely manner and shall be permitted to take place during any or all phases
of manufacturing, quality control and testing, and shall provide for Licensor
and/or the contract supplier's granting to Licensee access to information in its
possession relevant to determining whether GMP are likely to be met with respect
to manufacture of the Product.

         (e) Personnel of Licensee or Licensee's designee shall be entitled to
witness the manufacturing of test batches, scale-up batches and full-size
production batches which in each case will be used as NDA support batches filed
by Licensee or in regulatory authority presentations. These batches would be
prepared by the intended commercial process for the Product or prepared to


                                       7
<PAGE>

demonstrate the quality of the entire process (validation) or any single aspect
of a critical manufacturing parameter. Licensee may witness and/or review the
analytical laboratory testing of any of the above cited batches or of the
methodology which will be used to support a regulatory authority presentation.
Licensee may prospectively review, to the extent necessary for compliance with
applicable GMP and for scheduling purposes, the protocols and actual study data
and results (process, cleaning, sterilization, validation) as related to such
batches.

         (f) Licensee shall keep all information disclosed to or obtained by
Licensee under paragraphs 4 (c) (d) and (e) strictly confidential and not
disclose the same to any other person, except to the extent reasonably necessary
or appropriate under applicable regulations for Licensee to register the Product
with the regulatory authorities or otherwise comply with applicable law.

         (g) The information disclosed shall be used only to check the
compliance of the contract supplier with GMP or any other applicable regulation
or any other purpose agreed by Licensor and the contract supplier. In no case,
shall Licensee use such information to manufacture the Product, except in the
case where such rights have been acquired from Licensor or transferred to
Licensee.

         (h) Product in Finished Packaged Form shall be delivered by Licensor so
as to comply with the packaging and labeling requirements set forth by the FDA
or other appropriate regulatory agencies.

         (i) Licensee will supply Licensor with a sales Forecast between the
time of submission of a registration file in any country of the Territory and
the approval of such file by the appropriate regulatory authority in such
country, so that Licensor can plan production. If Licensee or one of its
Affiliates or sublicensees does not market the Product in a country within the
later of (i) six (6) months after the Effective Date or (ii) six (6) months
after approval for both marketing and price, where applicable (e.g. France,
Spain and Italy), Licensee will pay to Licensor twenty percent (20%) of the
first year Forecast for the Product in such country for each year of delay in
marketing the Product in such country. It is additionally provided that such
payment will be reduced in the event Licensee or one of its Affiliates or
sublicensees introduces the Product in such country within the twelve (12) month
period from the date of regulatory approval therein (including price approval)
to the extent of thirty (30%) of Net Sales for such country during said twelve
(12) month period.

         (j) Licensee will give Licensor, on the first business day of each
calendar quarter, a Forecast of Licensee's, its Affiliates' and sublicensees'
requirements of Product for each country in which the Product is marketed for
the six (6) month period that begins three (3) months later. The first three (3)
months of each six (6) month Forecast will be a firm order, and the Product
described in the order will be delivered to Licensee, its Affiliates and
sublicensees in accordance with the terms of the order, but not less than three
(3) months from the date of the order. Licensor is obliged to supply the amount
of Product requested in the firm order except to the extent that such amount is
more than fifteen percent (15%) higher than the amount that had been forecasted
for that period in the last Forecast received by Licensor. With respect to any
amount ordered in excess of the fifteen percent (15%) limit, Licensor is
obligated to use commercially reasonable efforts to supply the requested amount
to Licensee, its Affiliates and sublicensees.

         (k) Licensor shall use reasonable commercial efforts to notify Licensee
within thirty (30) days after the Effective Date and thereafter thirty (30) days
prior to the end of each calendar year, of


                                       8
<PAGE>

factory vacation schedules for the coming year, and if Licensee receives notice
of such vacation schedules, they will be incorporated into Licensee's Forecasts.

         (l) Licensor bears the expense and responsibility for transportation
and insurance for the Product to the Licensee's choice of airport or seaport
(FOB port) nearest to the manufacturing site where the Product is manufactured;
thereafter, transportation, insurance and duties for the Product are the
responsibility of Licensee. Each shipment of the Product shall be accompanied by
a Certificate of Analysis for each lot within each shipment signed by authorized
quality control/quality assurance personnel of Licensor or its contract
manufacturer.

         (m) All Product manufactured and supplied hereunder shall meet the
quality control specifications and the specifications in the applicable
regulatory filing through the expiration date stated on that Product package.
Such Product when delivered to Licensee, its Affiliates and sublicensees shall
also not be adulterated or misbranded within the meaning of the U.S. Food, Drug
and Cosmetic Act, as amended. In accordance with GMPs and other applicable laws
and regulations, Licensor or its contract manufacturer will test each shipment
of the Product to be supplied to Licensee, its Affiliates and sublicensees
pursuant to this Agreement before delivery of such shipment to Licensee, its
Affiliates and sublicensees to ensure that the Product meets these standards.
Licensor or its contract manufacturer shall retain sufficient quantities of each
shipment of the Product to verify on an on-going basis that such Product meets
quality control specifications and the specifications in the applicable
regulatory filing through its stated expiration date. Such Product shall be
retained through its stated expiration date plus one year, or such longer period
of time as may be required by GMPs and other applicable laws and regulations.

         (n) Licensee, its Affiliates and sublicensees shall have the right to
reject any delivered Product that does not meet quality control specifications
and the specifications in the applicable regulatory filing. Licensee must notify
Licensor in writing of any such rejection within thirty (30) days (except as to
latent defects), and Licensor has thirty (30) days to replace the rejected
shipment with Product that meets the agreed upon specifications in the
regulatory filings. The expense of return, manufacture of replacement Product
and shipment of replacement Product are Licensor's.

         (o) Licensor will use its best efforts to provide Licensee, its
Affiliates and sublicensees with its ordered amounts (up to fifteen percent
(15%) over Licensee's Forecast) and with respect to any amount ordered in excess
of the fifteen percent (15%) above Forecast, Licensor will use commercially
reasonable efforts to supply the requested amounts.

         (p) In the event Licensor is unable, due to reasons beyond its control,
to provide Licensee, its Affiliates and sublicensees the amount of Product set
forth in any firm order, Licensor shall be obligated to provide such amount of
Product to Licensee, its Affiliates and sublicensees through third parties with
which Licensor contracts, and Licensor shall be responsible for any additional
costs, including without limitation additional costs of manufacturing the
Product, caused thereby, provided that the provisions of this sentence shall not
apply to the extent that the amount of Product set forth in such firm order
exceeds the Forecast by more than fifteen percent (15%).

         (q) In countries (e.g. in some countries in South America or in India)
where the Purchase Price of thirty percent (30%) of Net Sales for Finished
Package Form of the Product is below the Base


                                       9
<PAGE>

Price, Licensor will provide Licensee finished Product in tubes with reusable
applicators or other appropriate presentation, at a negotiated second base
price. In countries where import duties make it impractical to import Product in
Finished Package Form (e.g. Argentina), Licensor will grant Licensee the right
to manufacture the Product locally if requested by Licensee for such country and
will be paid a royalty on Net Sales for such country, provided such royalty can
be legally expatriated from any such country, equal to the difference between
thirty percent (30%) of Net Sales in such country and Licensee's cost of
manufacturing the Product for such country.

         This royalty shall be payable for such country until the expiration of
any Valid Claims in such country or until a third-party vaginally-administered
progesterone product captures fifteen percent (15%) or more of the sales of the
Product in such country. Subsequent to either event taking place in any such
country, the royalty payable to Licensor on Net Sales in such country shall be
reduced to seven percent (7%) in consideration of rights to the Trademarks and
Technology until May 21, 2015, and thereafter the royalty payable on Net Sales
in such country shall be two percent (2%) in consideration of rights to the
Trademarks until May 21, 2020. Thereafter Licensee shall have an irrevocable
fully paid up license to the Product under the Technology and shall own the
Trademarks and related goodwill (subject to the condition set forth in Section
13 hereto).

         (r) If after the ten (10) year period defined in Section 13, the
parties cannot agree upon mutually acceptable terms for supply, Licensee has the
option of converting this Agreement into a license agreement and Licensee will
be free to manufacture, or have manufactured, the Product, provided that
Licensee pays to Licensor on a quarterly basis a royalty for the license of the
Patents, Technology and Trademarks of fifteen (15%) of Net Sales.

         The royalty pursuant to this paragraph (r) shall remain at fifteen
(15%) of Net Sales for any country until the expiration of any Valid Claims in
such country or until a third-party vaginally-administered progesterone product
captures fifteen percent (15%) or more of the sales of the Product in such
country. Subsequent to either event taking place in any country of the
Territory, the royalty payable to Licensor on Net Sales in such country shall be
reduced to seven percent (7%) in consideration of rights to the Trademarks and
Technology until May 21, 2015, and thereafter the royalty payable on Net Sales
in such country shall be two percent (2%) in consideration of right to the
Trademarks until May 21, 2020. Thereafter Licensee shall have an irrevocable
fully paid up license to the Product under the Technology and shall own the
Trademarks and related goodwill (subject to the condition set forth in Section
13 hereto).

         (s) The procedure for communication and processing of customer
complaints with respect to the Product shall be as set forth on Schedule D.
During the term of this Agreement, each party shall make available to the other
party information about the Product as may be necessary to carry out the
provisions and purposes of this Agreement, including without limitation general
medical information relating to the Product's storage, use and safety. Licensor
shall provide prompt written notice to Licensee, including relevant references,
of any information which Licensor believes in its reasonable judgment is
material for medical information services. Material information shall include,
but not be limited to, published or unpublished reports or other clinical or
laboratory data received by Licensor about Product safety, contraindications,
treatment programs in the indications specified by the approved Product insert,
stability, storage and shipping, pharmacology, and other information Licensor
believes in its reasonable judgment is relevant to safe and effective Product
use. Licensor shall


                                       10
<PAGE>

provide reasonable follow-up information and prompt written replies to verbal or
written questions from Licensee pertinent to medical information services about
the Product. On a periodic basis as agreed by both parties, but no less than
annually, Licensor shall provide a written summary of information about the
Product, which Licensor believes in its reasonable judgment is material for the
medical information services provided by Licensee.

         (t) In the event any regulatory authority having jurisdiction shall so
request or order, or if either party has reason to believe that any corrective
action should be taken with respect to the Product supplied hereunder, including
without limitation any Product recall, customer notice, restriction, change, or
market action, then such party shall immediately inform the other in writing. If
the party owning the relevant registration file for such Product, after
consultation with the other party, deems it necessary to effect a Product
corrective action then such party shall effect such corrective action in
accordance with procedures agreed upon by the parties.

         If the Product defect causing the corrective action shall be found to
result solely from the manufacture and supply of the Product hereunder, then
Licensor shall either supply a quantity of the Product without charge sufficient
to enable Licensee and/or its Affiliates or sublicensees to replace all Product
subject to the corrective action, or render a credit to Licensee, its Affiliates
or sublicensees for such Product, at Licensee's option. Such replacement Product
shall be delivered at Licensor's expense within thirty (30) days of the date on
which the corrective action was effected, as Licensee may direct. In such event
Licensor also agrees to reimburse Licensee, its Affiliates or sublicensees for
other costs and expenses incurred with respect to such corrective action. If the
Product defect causing the corrective action shall be found to result solely
from Licensee's, its Affiliates' or sublicensees' marketing, use or sale of the
Product hereunder, then the costs and expenses of such corrective action shall
be paid by Licensee. If the Product defect causing the corrective action shall
be found to result from a joint act or omission of the parties, then the parties
shall negotiate in good faith an appropriate allocation of the costs and
expenses of the corrective action.

         5.       Price and Payment Terms.
                  -----------------------

         (a) The Purchase Price to be paid by Licensee for the Product in
Finished Package Form shall be the Base Price or thirty percent (30%) of Net
Sales, whichever is greater, unless otherwise agreed as contemplated in
paragraph 4(q). If the Base Price were to exceed thirty percent (30%) of Net
Sales, the parties shall meet to discuss how to resolve the high cost of goods.
The parties hereby acknowledge that the Base Price for the Product is
contemplated for six (6) Units - twelve (12) days therapy in Finished Package
Form. If Licensee orders the Product in Finished Package Form containing fewer
than six (6) Units the Base Price shall be reduced. This reduction will reflect
a pro rata reduction in the cost of the Product based on the number of Units
specified as well as any reduction in the cost of packaging. If Licensee wishes
to order the Product in Finished Package Form that contains more than six (6)
Units the Base Price will be adjusted accordingly.

         (b) The following quantity discounts will be applied to annual
purchases of the Product by Licensee, its Affiliates, or sublicensees:

                  (i) Over ten (10) million Units - 3.33% - which would reduce
the Purchase Price to twenty-nine percent (29 %) of Net Sales or the Base Price,
whichever is greater.

                                       11
<PAGE>

                  (ii) Over twenty (20) million Units - 6.66% - which would
reduce the Purchase Price to twenty-eight percent (28%) of Net Sales or the Base
Price, whichever is greater.

                  (iii) Over thirty (30) million Units - 10% - which would
reduce the Purchase Price to twenty-seven percent (27%) of Net Sales or the Base
Price, whichever is greater.

         (c) At Licensee's request, Licensor will supply promotional samples of
the Product in Finished Package Form at a Purchase Price equal to Licensor's
Direct Cost.

         (d) Licensee's invoice price for the Product purchased from Licensor
shall be paid in U.S. dollars thirty (30) days after the later of (A) receipt by
Licensee of an invoice for such Product, or (B) the shipment by Licensor of the
corresponding Product.

                  (i) Licensor's invoice price to Licensee and Licensee's
payment to Licensor shall both be in U.S. dollars and shall be established for
each Product pack for each country of the Territory at the commencement of each
calendar year. For each country, the basis for the invoice price shall be the
in-market local currency price from Licensee, its Affiliates or sublicensees to
third parties converted into U.S. dollars at the exchange rate published in the
Wall Street Journal prevailing at the close of business on the first working day
of the applicable calendar year.

                  (ii) Any necessary adjustments to such payments to reflect the
actual Purchase Price for the Product shall be made forty-five (45) days after
the end of each calendar quarter in the report described in paragraph 16 (a), by
converting local currency Net Sales into U.S. dollars based on the local
currency - U.S. dollar exchange rate published in the Wall Street Journal on the
last working day of the applicable calendar quarter and calculating the Purchase
Price on this basis.

                  (iii) Underpayments or overpayments shall be calculated based
on the Net Sales value of Units of the Product sold by Licensee, its Affiliates
or sublicensees during the calendar quarter. Purchases by Licensee in excess of
actual Unit sales by Licensee, its Affiliates or sublicensees during a given
calendar quarter shall be carried over to the next calendar quarter for
reconciliation. Volume discounts, as defined by paragraph 5(b), shall be taken
into account in the last reconciliation of each calendar year. A credit for
Licensee's out-of-pocket costs and expenses of conducting clinical trials and
registering the Product in Japan, as defined by paragraph 7(c), shall also be
taken into account in the last reconciliation of each calendar year, by each
year offsetting the amount of such costs and expenses against the total annual
amount due for purchases of the Product until all such costs and expenses have
been offset.

         (e) If a vaginally administered progesterone-containing product is
approved in any country of the Territory subsequent to the Effective Date which
product captures fifteen percent (15%) or more of the sales of the Product in
such country the parties shall renegotiate price based on the economic impact
upon the Licensee for any such country or countries.


                                       12
<PAGE>
         6.       Marketing.
                  ---------

         (a) Licensee will be responsible for marketing and sales of the Product
in the Territory. Licensee will use its diligent efforts to make the Product a
commercial success by making a commitment throughout the term of the Agreement,
financial and otherwise, to the Product that is no less than its commitment to
those of its own brands and products in similar circumstances that it actively
and aggressively promotes, in accordance with the life cycle of such products,
provided, however, that Licensee shall have no such obligations with respect to
the Product containing progesterone in a concentration of four percent (4%).
Licensee will ensure that any sublicense it makes under the Patents and
Technology to market, use and sell the Product in the Territory will contain
appropriate obligations of commercial diligence.

         (b) Licensee will provide quarterly sales and other marketing
information useful to the Licensor in monitoring sales progress.

         (c) Licensor hereby authorizes Licensee to communicate directly with
regulatory authorities with respect to regulatory files for the Product owned by
Licensor to the extent necessary to fulfill Licensee's responsibilities for
marketing and sales of the Product in the Territory. Licensor agrees, at
Licensee's request, to execute any documents or take any other actions as may be
necessary or desirable to obtain authorization for Licensee so to communicate
directly with such regulatory authorities.

         7.       Clinical Trials and Registration

         (a) Licensor will be responsible for clinical trials and registration
filings related to the Product throughout the world. All clinical trials
contemplated and completed are attached in Schedule C together with their
completion or estimated completion dates. These studies are designed to register
the Product for the following indications:

                  In-Vitro Fertilization (IVF)
                  Secondary Amenorrhea
                  Treatment of Hyperplasia
                  Hormone Replacement Therapy

         The parties shall consult from time to time regarding the scope,
details and timing of the clinical trials and registration filings. The parties
may agree to allocate resources currently allocated to clinical trials and
registration filings for the Product for the treatment of hyperplasia and for
hormone replacement therapy (prevention of hyperplasia) to other indications.
Licensor will use diligent efforts to conduct and complete the clinical trials
and to prepare and submit the registration filings.

         In some countries additional approvals may be obtained based on the
clinical trials enumerated in Schedule C for indications that are not at the
moment approvable in the United States, specifically, benign mastopathies and
premenstrual syndrome.

         (b) Licensee shall have the right to monitor and audit the clinical
trials and/or other tests required by the protocols described in Schedule C for
the Product.

                                       13
<PAGE>

         (c) To the extent Licensee seeks to amend the labeling or support
additional advertising claims for the Product beyond that which is contemplated
in paragraph 7(a), at its sole discretion and expense it may design, conduct and
control such additional clinical trials necessary to obtain FDA or other
regulatory approval, provided, that Licensee shall give Licensor prior written
notice of its intention to do so. In addition to the Phase I clinical trial for
the Product in Japan described in Schedule C, Licensee shall also conduct
clinical trials and register the Product in Japan. Licensor shall reimburse
Licensee for all out-of-pocket costs and expenses incurred in conducting such
clinical trials and registering the Product by providing Licensee a credit for
this amount against the Purchase Price for the Product in accordance with the
terms and conditions of paragraph 5(d). It is anticipated that the out-of-pocket
costs and expenses for such clinical trials may include, without limitation,
costs and expenses associated with clinical investigators, contract
laboratories, and data analysis, but shall not include any incremental costs and
expenses associated with retaining a contract research organization. Product and
placebo necessary for the conduct of such clinical trials shall be supplied by
Licensor free of charge, appropriately packaged and labeled and in accordance
with the terms of paragraphs 4 (j), (l)-(p) and (t) hereof.

Licensee shall own and have unrestricted rights to the clinical data generated
as a result of clinical trials conducted by Licensee; provided that the results
of such clinical trials shall be made available to Licensor free of charge to be
filed in connection with Licensor's regulatory submissions outside the
Territory.

         (d) Each party will immediately notify the other of any adverse or
unexpected reaction or results or any actual or potential government action
relevant to clinical trials of the Product and the parties will discuss with
each other measures to be undertaken to resolve any such problem.

         8.       Maintenance of Patents and Trademarks.
                  -------------------------------------

         (a) Licensor shall keep Licensee currently advised of all steps taken
or to be taken in the prosecution of all applications for Patents. Licensor
shall have full and complete control over any reissue or reexamination or other
proceedings relating to the Patents, the Trademarks and/or Technology and of any
disclaimers thereof. Licensor shall bear all costs for the maintenance and
enforcement of the Patents and Trademarks, as well as all costs for the filing,
maintenance and enforcement of all additional Patents which may be filed by the
Licensor during the term hereof. If Licensor fails to carry out such obligations
set forth in this Section 8, Licensee may carry out such obligations on
Licensor's behalf at Licensor's cost and may set off such cost against amounts
due to Licensor hereunder provided that such action is commercially reasonable.

         (b)      Trademark Use and Quality Control

                  (i) Licensee agrees to list the Trademarks in accordance with
good customary trademark practice, and to avoid taking any action that would in
any manner impair or detract from the value of the Trademarks, or the goodwill
and reputation of Licensor. Licensee acknowledges Licensor's ownership of the
Trademarks and related goodwill, both in the Territory and outside the
Territory.

                                       14
<PAGE>

                  (ii) Licensee agrees to use the Trademarks only in the form
and manner and with appropriate legends as approved from time to time by
Licensor, and not to use any other trademark or service mark in combination with
the Trademarks without the prior written approval of Licensor, provided that
such approval shall be granted unless Licensor reasonably objects on the basis
that the proposed use would impair the value of the Trademarks.

         9        Infringement of Patents, Technology and/or Trademarks.
                  -----------------------------------------------------

         (a) Licensee and Licensor shall each promptly notify the other
following the discovery of any alleged infringement or unauthorized use of the
Patents, Technology and/or Trademarks which may come to their attention.
Licensor shall promptly undertake, at Licensor's expense, reasonable efforts to
obtain a discontinuance of the infringement or unauthorized use and, if not
successful, Licensor may, at its sole option, bring suit against such infringer.

         (b) If Licensor fails to obtain a discontinuance of such infringement
and/or elects not to bring an infringement suit, then Licensor shall give notice
in writing to Licensee within thirty (30) days of such failure or election and
Licensee may, but is not required to, obtain a discontinuance of the alleged
infringement or unauthorized use or bring an infringement suit; provided, that
without the prior written consent of Licensor, Licensee shall not agree to any
settlement with respect to such infringement or unauthorized use that
compromises the value of the license granted hereunder. Any infringement suit by
Licensee shall be in the name of Licensee, or in the name of Licensor, or
jointly by both Licensee or Licensor, as may be required by the law of the
forum. Licensor shall execute such documentation as may be reasonably required
by Licensee with respect to such suit.

         (c) It is understood and agreed that the party to this Agreement that
institutes suit shall bear solely all costs and expenses in connection therewith
and shall be entitled to recover all costs first and then share 50/50 with the
other party the balance of any sums received, obtained, collected or recovered
whether by judgement, settlement or otherwise as a result of such suit;
provided, however, that if a settlement by Licensee (with the prior written
consent of Licensor to the extent required above) includes the granting by
Licensee of rights hereunder to a third party, amounts received by Licensee from
such settlement shall not be shared with Licensor and sales of Product by such
third party pursuant to such rights shall not be included in Net Sales. In
addition, with respect to any suit for infringement or unauthorized use of the
Patents, Technology and/or Trademarks, the party that did not institute suit
shall render all reasonable assistance to the party that did institute suit at
the latter's expense, including, but not limited to, executing all documents as
may be reasonably requested by the party that did institute the suit. The party
that did institute suit shall keep the other party informed of, and shall from
time to time consult with the other party regarding, the status of any such suit
and shall provide the other party with copies of all pleadings filed in such
suit.

         10.      Infringement of Third-Party Intellectual Property Rights.
                  --------------------------------------------------------

         (a) Each party hereto shall notify the other promptly of the receipt of
notice of any action, suit or claim alleging infringement by the Patents, the
Technology, the Trademarks or the Product of any Intellectual Property Rights of
a third party.

                                       15
<PAGE>

         (b) In no event shall Licensee settle any such allegation of
infringement without the prior written consent of Licensor, which consent shall
not be unreasonably withheld or delayed. In the event that the Licensor agrees
in writing or Licensee in good faith determines that is necessary for Licensee
to make royalty or other payments to a third party in order for Licensee to
make, have made, use or sell or to continue making, having made, using or
selling the Product, Licensee shall be entitled to offset such amounts so paid
to any third party against any amounts which may become due to Licensor under
this Agreement.

         11.      Confidentiality.
                  ---------------

         Each party hereto shall hold all Confidential Information in
confidence, use it only in connection with the performance of its obligations
pursuant to this Agreement and use its diligent efforts (consistent with those
which it uses to safeguard its own confidential information) to safeguard
Confidential Information and to prevent the unauthorized use or disclosure of
any Confidential Information. Each party hereto shall ensure that its Affiliates
or employees who have access to any Confidential Information shall be made aware
of and subject to these obligations. The receiving party may disclose
Confidential Information to regulatory authorities for the purpose of seeking
marketing approval of the Product pursuant to this Agreement and may also
disclose Confidential Information to individuals who have a need to know to
effectuate the development and commercialization of the Product pursuant to this
Agreement, provided each such individual is bound by a confidentiality
obligation comparable to the obligation set forth in this Section 11. The
obligations of the parties hereto under this Section 11 shall survive for five
(5) years after the expiration or termination of this Agreement.

         12.      Representations, Warranties and Covenants and Indemnification.
                  -------------------------------------------------------------

         (a) Licensor hereby represents, warrants and covenants the following:

                  (i) Licensor is a corporation duly organized, existing and in
good standing under the laws of Bermuda, with full right, power and authority to
enter into and perform this Agreement and to grant all of the rights, powers and
authorities herein granted.

                  (ii) The execution, delivery and performance of this Agreement
do not conflict with, violate or breach any agreement to which Licensor is a
party, or Licensor's articles of incorporation or bylaws.

                  (iii) This Agreement has been duly executed and delivered by
Licensor and is a legal, valid and binding obligation enforceable against
Licensor in accordance with its terms.

                  (iv) Licensor shall comply with all applicable laws, consent
decrees and regulations of any federal, state or other governmental authority in
performing this Agreement.

                  (v) To the best of Licensor's knowledge and belief as of the
Effective Date, there are no issued or pending patents, trademarks or patent or
trademark applications relating to the Product that would prevent Licensee from
using or selling the Product in the Territory.

                                       16
<PAGE>

                  (vi) To the best of Licensor's knowledge and belief as of the
Effective Date, there are no outstanding, pending or threatened product
liability or breach of warranty or other similar claims, actions, suits,
demands, investigations, arbitrations, administrative or other proceedings, or
orders, injunctions, judgments or decrees of any court or government agency in
connection with the Product in the Territory.

                  (vii) To the best of Licensor's knowledge and belief as of the
Effective Date, there are no outstanding, pending or threatened violations,
notices of noncompliance, warning letters, orders, injunctions, judgements or
decrees of any court or government agency, investigations, claims, actions,
suits, demands, administrative or other proceedings that have resulted or might
result in the revocation, suspension or modification of any regulatory approval
for the Product in the Territory.

         (b) Licensee hereby represents, warrants and covenants the following:

                  (i) Licensee is a corporation duly organized, existing and in
good standing under the laws of Switzerland, with full right, power and
authority to enter into and perform this Agreement.

                  (ii) The execution, delivery and performance of this Agreement
do not conflict with, violate or breach any agreement to which Licensee is a
party, or Licensee's articles of organization or bylaws.

                  (iii) This Agreement has been duly executed and delivered by
Licensee and is a legal, valid and binding obligation enforceable against
Licensee in accordance with its terms.

                  (iv) Licensee shall comply with all applicable laws, consent
decrees and regulations of any federal, state or other governmental authority in
performing this Agreement.

         (c)      Indemnification

                  (i) Licensor agrees to indemnify and hold harmless Licensee,
its Affiliates and sublicensees and their respective employees, agents, officers
and directors from and against any claims, losses, liabilities, damages, costs
and expenses (including reasonable attorneys' fees) incurred by Licensee, its
Affiliates or sublicensees arising out of or in connection with any (A) breach
by Licensor of any representation, warranty, covenant or obligation hereunder,
(B) claim or demand of any kind for injury to a person or property arising from
Licensor's or its contract manufacturer's manufacturing, packaging, or labeling
of the Product; provided, that this indemnification shall not apply to the
extent such claim or demand has resulted from manufacturing, packaging, or
labeling conducted by or at the direction of Licensee, its Affiliates or
sublicensees or from any negligent act or omission with respect to such Product
by Licensee, its Affiliates, or sublicensees or their employees or agents, (C)
act or omission on the part of Licensor or any of its employees, agents or
contract manufacturers in the performance of this Agreement, and (D) payments,
commissions or fees of any kind due to consultants or brokers retained by
Licensor relating to the Product.

                  (ii) Licensee agrees to indemnify and hold harmless Licensor
and its Affiliates and their respective employees, agents, officers and
directors from and against any claims, losses, liabilities, damages, costs and
expenses (including reasonable attorneys' fees) incurred by Licensor or


                                       17
<PAGE>

its Affiliates arising out of or in connection with any (A) breach by Licensee
of any representation, warranty, covenant or obligation hereunder, (B) claim or
demand of any kind for injury to person or property arising from Licensee's, its
Affiliates' or sublicensees' marketing, distribution and sale of the Product;
provided, that this indemnification shall not apply to the extent such claim or
demand has resulted from any negligent act or omission with respect to such
Product by Licensor, its Affiliates, their employees, agents or contract
manufacturers, (C) act or omission on the part of Licensee or any of its
employees or agents in the performance of this Agreement, (D) third party claims
alleging infringement of such third parties' Intellectual Property Rights as a
result of the advertisement, promotion or marketing materials created by or at
the direction of Licensee, its Affiliates or sublicensees and used in connection
with the sale of the Product hereunder, and (E) payments, commissions or fees of
any kind due to consultants or brokers retained by Licensee relating to the
Product.

                  (iii) A party seeking indemnification under this paragraph 12
(c) (the "Indemnified Party") must give prompt written notice thereof to the
other party (the "Indemnifying Party"). The Indemnifying Party shall have the
right to defend any such claim or demand subject to the right of the Indemnified
Party to participate with counsel of its choice in such defense, but the fees
and expenses of such additional counsel shall be at the expense of the
Indemnified Party. The Indemnified Party shall cooperate fully in all respects
with the Indemnifying Party in any such compromise, settlement or defense,
including, without limitation, by making available all pertinent information and
personnel under its control to the Indemnifying Party. The Indemnifying Party
will not compromise or settle any claim or demand (other than, after
consultation with Indemnified Party, a claim or demand to be settled by the
payment of money damages and/or the granting of releases) without the prior
written consent of the Indemnified Party, which consent shall not be
unreasonably withheld.

                  (iv) Each party shall maintain and keep in force for the term
of this Agreement comprehensive general liability insurance including
Products/Completed Operations, Contractual and Broad Form Property Damage
covering its indemnification obligations hereunder with a minimum limit of
Fifteen Million United States Dollars(U.S. $15,000,000) per annum combined
single limit for Bodily Injury and Property Damage, to be increased as
appropriate, consistent with prudent business practices prevailing in the
pharmaceutical business. Such insurance shall be placed with a first class
insurance carrier with at least a BBB rating by Standard & Poors. Promptly after
execution and delivery of this Agreement, each party shall furnish a certificate
of insurance to the other party evidencing the foregoing endorsements, coverage
and limits, and providing that such insurance shall not expire or be canceled or
modified without at least thirty (30) days prior notice to the other party.

         13.      Term of License.
                  ---------------

         Except as otherwise provided for herein, and subject to the provisions
of paragraph 4 (r), the duration of the Agreement shall be for ten (10) years
from the Effective Date, renewable upon mutual agreement of the parties for five
(5) year periods at commercial terms to be agreed upon. It is understood that if
after the ten-year period or any subsequent five-year period the parties cannot
agree upon mutually acceptable terms, Licensee will have the option of
converting this Agreement into a license agreement and Licensee will be free to
manufacture, or have manufactured, the Product. Under such circumstances,
Licensor shall continue to supply the Product in Finished Package Form under the
then current terms and conditions of this Agreement for as long as is necessary
and will assist Licensee


                                       18
<PAGE>

as necessary, including without limitation by transferring to Licensee all
Technology necessary or useful to give Licensee the capability of manufacturing
the Product in such a way as to communicate such Technology to Licensee
promptly, effectively and economically, so that Licensee can undertake
manufacture of the Product and continue the sale of the Product without
interruption. In the event that Licensee shall continue to market the Product
under the terms of this Agreement for twenty-five (25) years from the Effective
Date in each of the European Economic Community, Canada and the United States,
Licensee shall thereafter own the Trademarks and related goodwill.

         14.      Termination.
                  -----------

         (a) This Agreement may be terminated upon the mutual written agreement
of the parties.

         (b) Either party may terminate this Agreement forthwith by written
notice to the other, if the other party commits a material breach of any part of
this Agreement and such breach has not been remedied by the breaching party
within sixty (60) days after written notice of such breach has been given by the
other party. If the breach cannot be remedied within sixty (60) days, the
breaching party may submit a plan within this sixty (60) day period, reasonably
acceptable to the other party, outlining the steps that it intends taking to
cure the breach and then must cure the breach in accordance with the terms of
such plan or be subject to an action by the other party for termination of this
Agreement pursuant to this paragraph 14 (b) for breach of such plan.

         (c) This Agreement may also be terminated by written notice of one
party, if the other party shall be involved in financial difficulties as
evidenced:

                  (i) by its commencement of a voluntary case under any
applicable bankruptcy code or statute, or by its authorizing, by appropriate
proceedings, the commencement of such voluntary case; or

                  (ii) by its failing to receive dismissal of any involuntary
case under any applicable bankruptcy code or statute within sixty (60) days
after initiation of such action or petition; or

                  (iii) by its seeking relief as a debtor under any applicable
law of any jurisdiction relating to the liquidation or reorganization of debtors
or to the modification or alteration of the rights of creditors, or by
consenting to or acquiescing in such relief, or

                  (iv) by the entry of an order by a court of competent
jurisdiction finding it to be bankrupt or insolvent, or ordering or approving
its liquidation, reorganization or any modification or alteration of the rights
of its creditors or assuming custody of, or appointing a receiver or other
custodian for, all or a substantial part of its property or assets; or

                  (v) by its making an assignment for the benefit of, or
entering into a composition with its creditors, or appointing or consenting to
the appointment of a receiver or other custodian for all or a substantial part
of its property.

         (d) Licensee may terminate this Agreement at any time after three (3)
years with one (1) year's written notice if the Product is not a commercial
success, as determined by Licensee in its sole


                                       19
<PAGE>

discretion, and on ninety (90) days' notice at any time during the Agreement for
reasons of safety or efficacy of the Product.

         (e) The failure by a party to exercise its rights to terminate this
Agreement pursuant to this Section (14) in the event of any occurrence giving
rise thereto shall not constitute a waiver of such rights in the event of any
subsequent occurrence.

         (f) Termination of this Agreement shall not release either party from
its obligations accrued prior to the effective date of termination nor deprive
either party from any rights that this Agreement provides shall survive
termination. The provisions of paragraphs 4 (q), (r), (s) and (t), Sections 11,
13, 16, 17, 24 and 29, and paragraph 12 (c) shall remain in full force and
effect and shall survive the termination of this Agreement to the extent
necessary to effect the express purposes of such paragraphs and Sections.

         15.      Publicity.
                  ---------

         The parties hereto shall coordinate the preparation and issuance of any
public announcement of this Agreement. Any such announcement shall comply with
relevant Securities and Exchange Commission requirements and shall take into
account any reasonable concern regarding the trade. The wording of such
announcement shall be agreed upon by the parties before release.

         16.      Audits.
                  ------

         (a) Licensee shall keep accurate records of all Product sales and other
relevant data concerning the Product for a period of two (2) years following the
year in which such records were created and Licensee shall provide Licensor
quarterly reports thereof forty-five (45) days after the end of the applicable
calendar quarter. Such reports shall state the number of Units of Product
manufactured by Licensee, its Affiliates or sublicensees and the number of Units
of Product sold by Licensee, its Affiliates or sublicensees during the
applicable quarter as well as the number of free samples of Product distributed
and any Product returns made during such calendar quarter together with an
accounting of any other applicable components of the amounts paid or to be paid
hereunder with respect to such calendar quarter. Simultaneous with the delivery
such report, Licensee shall make, or cause to be made, any additional payment
due with respect to the Purchase Price for Product sold during such calendar
quarter. Once a year, upon reasonable notice, at times mutually agreed upon and
during business hours, Licensor at Licensor's cost may have the accounts of
Licensee, its Affiliates or sublicensees for the preceding two (2) calendar
years relating to the Product reviewed by independent certified public
accountants appointed by Licensor and reasonably approved by Licensee, solely in
order to verify amounts due under this Agreement. Licensor and Licensee shall
mutually determine a general strategy for such audit in advance of its conduct.
Said accountant shall not disclose to Licensor any information except that which
should properly be contained in a quarterly report required under this
Agreement. Licensee shall promptly pay any underpayment evidenced by such audit,
and Licensor shall promptly refund any overpayment evidenced by such audit. In
the event such an audit evidences an underpayment of more than five percent (5%)
with respect to the amounts actually paid, Licensee shall promptly pay such
underpayment to Licensor with interest at the prime rate as set by Citibank,
from the time when such underpayment accrued, and shall reimburse Licensor for
the reasonable costs and expenses (including fees) of such audit.

                                       20
<PAGE>

         (b) Licensor shall keep accurate records of its Direct Costs of
manufacturing the Product for a period of two (2) years following the year in
which such records were created. Once a year, upon reasonable notice, at times
mutually agreed upon and during business hours, Licensee at Licensee's cost may
have the accounts of Licensor for the preceding two (2) calendar years relating
to the Direct Costs of manufacturing the Product reviewed by independent
certified public accountants appointed by Licensee and reasonably approved by
Licensor, solely in order to verify amounts due under this Agreement. Licensor
and Licensee shall mutually determine a general strategy for such audit in
advance of its conduct. Said accountant shall not disclose to Licensee any
information except that relating to the Direct Costs of manufacturing the
Product. Licensor shall promptly refund any overpayment evidenced by such audit,
and Licensee shall promptly pay any underpayment evidenced by such audit. In the
event such audit evidences an overpayment of more than five percent (5%) with
respect to the amounts actually paid, Licensor shall promptly refund such
overpayment to Licensee with interest at the prime rate as set by Citibank, from
the time when such overpayments accrued, and shall reimburse Licensee for the
reasonable costs and expenses (including fees) of such audit.

         17.      Notices.
                  -------

         All notices required hereunder shall be in writing and shall be deemed
to be properly given if sent by air courier to the party to be notified at the
address set forth on page 1 hereof, or at such other latest address as either
party may hereafter designate in writing to the other; provided that a copy of
each notice to be sent to Licensor hereunder shall also be sent by the same
means to William J. Bologna, Chairman of the Board, Columbia Laboratories Inc.,
2875 N.E. 191st Street, Suite 400, Aventura, Florida 33180, U.S.A.; and further
provided that a copy of each notice sent to Licensee hereunder shall also be
sent by the same means to General Counsel, Ares-Serono International S.A., 15
bis chemin des Mines, 1202, Geneva, Switzerland. The date of service of any
notice so sent by air courier shall be the date of receipt.

         18.      Ownership Change: Assignment; Successors.
                  ----------------------------------------

         This Agreement shall be binding on and inure to the benefit of the
successors and assigns of the parties, including any Affiliate, subsidiary,
division or any entity controlled by either party. Except as provided herein,
Licensee may not sublicense or assign this Agreement, in whole or in part,
without the consent in writing of Licensor, and any purported assignment without
such consent (which may be withheld without reason) shall be void; provided,
that Licensee may upon notice to Licensor assign all or any portion of this
Agreement to any of its Affiliates, but may not then sell such Affiliate without
Licensor's prior written consent unless this Agreement is first assigned back
from such Affiliate to Licensee. Licensor may not assign its rights under this
Agreement, in whole or in part, without consent in writing of Licensee; and any
purported assignment without such consent (which may be withheld without reason)
shall be void; provided, that Licensor may upon notice to Licensee assign all or
any portion of this Agreement to any of its Affiliates, but may not then sell
such Affiliate without Licensee's prior written consent unless this Agreement is
first assigned back from such Affiliate to Licensor.

         If any person, individually, or in concert with others, shall acquire
directly or indirectly, through one or more intermediaries, the beneficial
ownership of fifty percent or more of the equity or


                                       21
<PAGE>

assets of Licensor or Licensee during the term of this Agreement, the party not
being acquired may require from the new owners of the acquired party a written
affirmation of its intent and capability to comply with all the terms of this
Agreement. Under no circumstances shall such action by Licensor interfere with
or compromise the continued supply of the Product to Licensee, provided however,
that should such interference or compromise occur, Licensee in such event shall
have the option of terminating this Agreement.

         Nothing in this Agreement, express or implied, is intended to confer on
any person other than the parties hereto, or their respective permitted
successors and assigns, any benefits, rights or remedies.

                                       22
<PAGE>

         19.      Tax.
                  ---

         All taxes levied on account of any payments accruing under this
Agreement which constitute income to Licensor, shall be the obligation of
Licensor, and if provision is made in law or regulation for withholding, such
tax shall be deducted from any payment then due, paid to the proper taxing
authority, and receipt for payment of the tax secured and promptly sent to
Licensor.

         20.      Independent Contractors.
                  -----------------------

         The relationship of the parties under this Agreement is that of
independent contractors. Neither party shall be deemed to be the agent of the
other and neither is authorized to take any action binding upon the other.

         21.      Entire Agreement; Modification.
                  ------------------------------

         This Agreement, including the Schedules hereto, contains the entire
understanding between the parties hereto relating to the subject matter hereof,
there being no terms and conditions other than those set forth herein, and it
supersedes all prior agreements, written or oral, between the parties hereto
with respect to the matters covered hereunder. This Agreement may not be
modified, altered or otherwise changed other than by an instrument in writing,
duly executed by each of the parties hereto.

         22.      Severability.
                  ------------

         If any provision of this Agreement should be or becomes fully or partly
invalid or unenforceable for any reason whatsoever or should be adjudged to
violate any applicable law, this Agreement is to be considered divisible as to
such provision and such provision is deemed to be deleted from this Agreement,
and the remainder of this Agreement shall be valid and binding as if such
provision were not included herein; provided, however, that this Agreement is
not rendered fundamentally different in its content or effect.

         23.      Effect of Headings.
                  ------------------

         The headings for the sections and paragraphs of this Agreement are to
facilitate reference only, do not form a part of this Agreement, and shall not
in any way affect the interpretation hereof.

         24.      Choice of Law.
                  -------------

         This Agreement and performance hereof shall be construed and governed
by the laws of the Commonwealth of Massachusetts and the United States. Any
dispute, controversy, claim or difference arising between the parties out of,
relating to, or in connection with this Agreement shall be submitted to the
jurisdiction of the courts sitting in the Commonwealth of Massachusetts.

         25.      No Waiver.
                  ---------

         No delay or omission or failure to exercise any right or remedy
provided for herein shall be deemed to be a waiver thereof or acquiescence in
the event giving rise to such right or remedy.

                                       23
<PAGE>

         26.      Counterparts.
                  ------------

         This Agreement may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed shall be deemed an original, but all such counterparts shall constitute
but one and the same instrument.

         27.      Further Assurances.
                  ------------------

         Licensor and Licensee each agree to produce or execute such other
documents or agreements as may be necessary or desirable for the execution and
implementation of this Agreement and the consummation of the transactions
contemplated hereby.

         28.      Schedules.
                  ---------

         The terms and provisions of the Schedules attached to this Agreement
are hereby incorporated herein as if fully set forth herein.

         29.      Bankruptcy.
                  ----------

         All Trademark, Patent and Technology rights and licenses granted to the
Product under or pursuant to this Agreement by Licensor to Licensee are, and
shall otherwise be deemed to be, for purposes of Section 365(n) of the United
States Bankruptcy Code, as amended from time to time (the "Bankruptcy Code"),
licenses of rights to "intellectual property" as defined under Section 101 (35A)
of the Bankruptcy Code. The parties hereto agree that so long as Licensee, as a
licensee of such rights under this Agreement, makes all payments to Licensor
required under this Agreement, Licensee shall retain and may fully exercise all
of its rights and elections under the Bankruptcy Code. The parties further agree
that, in the event that any proceeding shall be instituted by or against
Licensor seeking to adjudicate it as bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking an entry of an
order for relief or the appointment of a receiver, trustee or other similar
official for it or any substantial part of its property or it shall take an
action to authorize any of the foregoing actions, Licensee, as a licensee of
such rights under this Agreement, shall retain and may fully exercise all of its
rights and elections under the Bankruptcy Code. The parties further agree that,
in the event of the commencement of a bankruptcy proceeding by or against
Licensor under the Bankruptcy Code, Licensee shall be entitled to a complete
duplicate of (or complete access to, as appropriate) any such intellectual
property and all embodiment of such intellectual property, and the same, if not
already in its possession, shall be promptly delivered to Licensee (i) upon any
such commencement of a bankruptcy proceeding upon written request therefor by
Licensee, unless Licensor elects to continue to perform all of its obligations
under this Agreement, or (ii) if not delivered under (i) above, upon the
rejection of this Agreement by or on behalf of Licensor, upon written request
therefor by Licensee. In addition the parties agree that in such event the
intellectual property delivered to Licensee shall include all Technology
necessary or useful to give Licensee the capability of manufacturing the Product
and such Technology shall be delivered to Licensee in such a way as to
communicate it to Licensee promptly, effectively and economically

                                       24
<PAGE>

         30.      Force Majeure.
                  -------------

         No failure or omission by a party hereto in the performance of any
obligation of this Agreement shall be deemed a breach of this Agreement nor
shall it create any liability if the same shall arise from any cause or causes
beyond the control of the party, including, but not limited to, the following,
which, for the purposes of this Agreement, shall be regarded as beyond the
control of the party in question: acts of God, acts or omissions of any
government, any rules, regulations, or orders issued by any governmental
authority or any officer, department, agency, or instrumentality thereof, fire,
storm, flood, earthquake, accident, war, rebellion, insurrection, riot,
invasion, strikes, lockouts; provided however, that the party so affected shall
promptly advise the other party of the existence of such causes of
nonperformance, shall use its best efforts to avoid or remove such causes of
nonperformance and shall continue performance hereunder with the utmost dispatch
whenever such causes are removed.

         31.      Performance by Affiliates.
                  -------------------------

         The parties agree that certain of their rights and obligations under
this Agreement may be carried out by one or more of their Affiliates; provided,
however, that each party shall remain responsible for the acts and omission of
its Affiliates. The parties further understand and agree that no such Affiliate
is a party to this Agreement, and, except as contemplated by this Agreement, is
not the agent of such party for purposes hereof, is not authorized to bind such
party and cannot enter into amendments to this Agreement, which can only be made
in accordance with the terms of Section 21 hereof.

         IN WITNESS WHEREOF, the parties hereto have set their hands as of the
day and year first above written,

Columbia Laboratories (Bermuda) Ltd.

By:      /s/ William J. Bologna
         ----------------------------
(Title)  Chairman of the Board

Ares Trading S.A.

By:      /s/ Ernesto Bertarelli
         ----------------------------
(Title)  Authorized Representative


                                       25