<PAGE>   1
                                                                   EXHIBIT 10.55
                                                     CONFIDENTIAL EXECUTION COPY




                                LICENSE AGREEMENT

                                     BETWEEN

                               ZYMOGENETICS, INC.

                                       AND


                         AURORA BIOSCIENCES CORPORATION

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                                LICENSE AGREEMENT

This License Agreement (the "Agreement") is made this 17th day of December 1999
(the "Effective Date"), by and between ZYMOGENETICS, INC. ("ZymoGenetics"), a
Washington corporation with principal offices at 1201 Eastlake Avenue East,
Seattle, WA 98102 and AURORA BIOSCIENCES CORPORATION ("Aurora"), a Delaware
corporation with principal offices at 11010 Torreyana Road, San Diego,
California 92121 to license certain technology.

                                    RECITALS

WHEREAS, Aurora has the right to sublicense the Aurora Patents and Stanford
Patents (both defined herein) relating to fluorescent proteins further described
herein, and desires to license the same to ZymoGenetics;

WHEREAS, ZymoGenetics seeks to obtain certain Materials, license rights under
the Aurora Patents and Stanford Patents *** according to the terms contained
herein (the "Agreement");

Now, therefore, in consideration of the foregoing and the covenants and premises
contained herein the parties agree as follows:

1. DEFINITIONS

As used herein, the following terms shall have the following meanings:

1.1     "Aurora Mutant GFP" means ***.

1.2     "Aurora Patents" means U.S. Patent Nos. 5,625,048, 5,777,079 and the
        patent applications listed on Exhibit A and *** U.S. patents issuing
        therefrom.

1.3     "Aurora Technology" means the *** listed in Exhibit C and Aurora's
        proprietary technical manual for the same.

1.4     "Confidential Information" means all information, data, and
        documentation received by either party from the other party pursuant to
        this Agreement, subject to the exceptions set forth in Section 8.


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1.5     "Control" or "Controlled" means, in the context of intellectual
        property, right of a party to grant a license or sublicense in
        accordance with the terms of this Agreement, and without violating the
        terms of any agreement by such party with any Third Party.

1.6     "Excluded Fields" means any activities outside the Field, including, but
        not limited to: (i) services to Third Parties; (ii) Fluorescent
        Resonance Energy Transfer (FRET); (iii) diagnostics; (iv) testing small
        molecule compounds (i.e. non-protein, non-peptide, or non-nucleotide
        substances) in an effort to identify therapeutic entities; (v) quality
        control, quality assurance or manufacture of products (e.g. cell lines
        or antibodies) for sale or clinical use; (vi) use of polynucleotides in
        gene trap, enhancer trap and promoter trap vectors for integration into
        a genome (e.g. random integration) (vii) use in plants or plant cells;
        (viii) no right to sublicense; and (ix) the subject matter of the
        Stanford Patents may not be practiced in the field of anti-infectives.

1.7     "Field" means:

               (1) use of Aurora Mutant GFP for *** solely for pharmaceutical
               research;

               (2) use of Aurora Mutant GFP for the *** and *** solely for
               pharmaceutical research, and use of Aurora Mutant GFP for *** as
               described in Section 1.7(1);

               (3) use of Aurora Mutant GFP for *** applications solely for
               pharmaceutical research, such applications including but not
               limited to: the *** and *** and in the *** described in Section
               1.7(2); the evaluation of *** and *** of Targets ***;

               (4) use of Aurora Mutant GFP for in vitro Screening; and

               (5) use of Aurora Mutant GFP as a *** assays. Such use as a ***
               is limited to Screening of *** including *** Target ***.

               Items (1)-(5) are limited to activities that occur at
               ZymoGenetics.


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1.8     "Materials" means any reagents, promoters, enhancers, vectors, plasmids,
        genes, polynucleotides, cells, proteins and fragments thereof, peptides,
        antigens, antibodies, antagonists, agonists, inhibitors and chemicals.

1.9     ***.

1.10    "Screening" means ***.

1.11    "Stanford Agreement" means that certain exclusive license agreement
        between Aurora and The Board of Trustees of the Leland Stanford Junior
        University ("Stanford"), dated as ***.

1.12    "Stanford Licensed Product(s)" means any product or process, or part
        thereof, in the Field, the manufacture, use or sale of which is covered
        by a valid claim of an issued, unexpired Stanford Patent and shall be
        presumed to be valid unless and until it has been held to be invalid by
        a final judgment of a court of competent jurisdiction from which no
        appeal can be or is taken.

1.13    "Stanford Patents" means U.S. Patent No. 5,807,387, 5,968,738 and the
        patent applications listed on Exhibit B and *** U.S. patents issuing
        therefrom.

1.14    "Target" means ***.

1.15    "Territory" means the United States.

1.16    "Third Party" means any entity other than (i) Aurora and (ii)
        ZymoGenetics.

1.17    "Term" has the meaning set forth in Section 9.1.

1.18    "ZymoGenetics Product" means ***.


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2.      LICENSES AND SUPPLY


2.1     Grant Under the Aurora Patents, Stanford Patents and Aurora Technology

        2.1.1  Non-exclusive License to Aurora Patents. Aurora hereby grants to
               ZymoGenetics, subject to ZymoGenetics' obligations described in
               Sections 3, 4 and 5, a non-exclusive, non-transferable, license
               to make, use and import Aurora Mutant GFP under the Aurora
               Patents solely in the Field in the Territory during the Term.



        2.1.2  Non-exclusive License to Stanford Patents. Aurora hereby grants
               to ZymoGenetics, subject to ZymoGenetics' obligations described
               in Sections 3, 4 and 5, a non-exclusive, non-transferable,
               license to make, use and import Aurora Mutant GFP under the
               Stanford Patents solely in the Field in the Territory during the
               Term.

        2.1.3  Non-exclusive License to Aurora Technology. Aurora hereby grants
               to ZymoGenetics, subject to ZymoGenetics' obligations described
               in Sections 3, 4 and 5, a non-exclusive, non-transferable,
               license to make and use Aurora Mutant GFP under the Aurora
               Technology solely in the Field in the Territory during the Term.

        2.1.4  Limitations. Except as otherwise expressly provided in this
               Agreement, nothing in this Agreement is intended to convey or
               transfer ownership by one party to the other of any rights, title
               or interest in any Confidential Information, technology (e.g.
               know-how), copyrights or patent rights owned or Controlled by a
               party. Except as expressly provided for in this Agreement,
               nothing in this Agreement shall be construed as a license or
               sublicense by one party to the other of any rights in any
               technology, copyrights, or patent rights owned or Controlled by a
               party. All rights not expressly licensed by Aurora are retained
               by Aurora. The Aurora Mutant GFP within the scope of license
               grants of Sections 2.1.1, 2.1.2 and 2.1.3 are limited to Aurora
               Mutant GFP within the scope *** (i) ***; (ii) ***; or (iii) ***.
               The license rights granted to ZymoGenetics in Section 2.1 do not
               include: (a) the right to sublicense such rights; (b) the right
               to conduct any activities outside the Field under the Aurora
               Patents or Stanford Patents or with Aurora Technology; or (c) the
               right to conduct activities inside the Excluded Fields under the
               Aurora Patents or Stanford Patents or with Aurora Technology.


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2.2     Supply. Aurora shall deliver the Aurora Technology to ZymoGenetics
        within *** business days after the Effective Date in the quantities
        described on Exhibit C.

3.      COMPENSATION

3.1     Technology Access Fee. As consideration for the Aurora Technology
        provided to ZymoGenetics pursuant to section 2.2, ZymoGenetics shall pay
        to Aurora within *** after the Effective Date, a *** Dollars ($***).

3.2     Settlement Fee. As consideration for the covenant provided to
        ZymoGenetics pursuant to Section 5.1, ZymoGenetics shall pay to Aurora
        within *** after the Effective Date, *** settlement fee of *** Dollars
        ($***). Such payment by Zymogenetics is made solely ***.


3.3     Annual Maintenance Fee. As consideration for the rights granted in
        Section ***, ZymoGenetics will pay to Aurora a *** fee as payment for
        the upcoming year *** Dollars ($***) on the first anniversary of the
        Effective Date and then each anniversary of the Effective Date
        thereafter.


4.      PAYMENTS AND MILESTONES

4.1     Currency of Payment. All payments to be made under this Agreement shall
        be paid in U.S. dollars by wire transfer or other mutually acceptable
        means to a bank account designated by Aurora. Wiring instructions for
        payments are as follows:

                                       ***



4.2     Milestones. When any ZymoGenetics Product reaches any of the following
        milestones, ZymoGenetics shall pay to Aurora the corresponding
        non-creditable, non-refundable milestone payment; ***

<TABLE>
           Milestone                                 Payment
           ---------                                 -------
           <S>                                       <C>
           1.  ***                                   $ ***
           2.  ***                                   $ ***
</TABLE>
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<TABLE>
          <S>                                       <C>
           3.  ***                                   $ ***
           4.  ***
</TABLE>


        4.2.1  Payment and Reporting. The milestones due under this Section 4
               shall be paid within *** days after the end of each calendar
               quarter period in which such milestones are reached for each
               ZymoGenetics Product or for a ZymoGenetics Product earned and not
               previously reported.



        4.2.2  Tracking. ZymoGenetics Products will be recorded and stored by
               ZymoGenetics using its customary means and in a computer
               searchable database on a storage device. Records of any ***
               (including, ***) that would *** subject to additional *** will be
               *** file or database that ***. ZymoGenetics shall keep
               appropriate records of ZymoGenetics Products discovered,
               identified or profiled under the rights granted herein ***. All
               the records described in this Section are collectively referred
               to as tracking records (the "Tracking Records"). ***
               ZymoGenetics, and subject to a confidential relationship with
               ZymoGenetics *** Tracking Records once per year upon reasonable
               prior written request *** milestone under ***. The Tracking
               Records shall be securely retained according to ZymoGenetics' ***
               for no less than *** from the date a ***. Until all of the
               milestones have been paid, *** that may be used to calculate
               milestones. Such reports shall be sent to the attention of SVP,
               Intellectual Property via first class mail, overnight courier or
               facsimile.


        4.2.3  Trade Secret Milestones. The parties acknowledge that a
               significant value contributed by Aurora under this Agreement is
               the enhanced probability of identifying products, such as human
               pharmaceutical products (or other products having commercial
               value), and the potential to generate multiple cell lines or
               leads, either or both of which the parties reasonably believe
               will lessen the time required to bring pharmaceutical products to
               market and increase the efficiency of drug discovery and
               development processes and technologies. Additionally, the parties
               acknowledge that Aurora may not own or Control patent
               applications or

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               patents covering the manufacture, offer for sale, sale, use or
               importation of a particular product. ZymoGenetics acknowledges
               and agrees that the value it receives hereunder is in the access
               and use of Aurora Technology, Aurora Patents or Stanford Patents.
               *** a patent application or patent within the Aurora Patents or
               Stanford Patents.

4.3     ***. If ZymoGenetics makes a payment to *** under such Third Party
        patent rights, biological materials or know-how, *** ZymoGenetics, ***
        payments in annual maintenance fees or milestones, described in Sections
        3.3 and 4.2 respectively, to Aurora totaling *** dollars ($***),
        ZymoGenetics *** made to *** amount payable under Section *** dollars
        ($***) ***.


5.      COVENANTS

5.1     Aurora's Covenant. Subject to ZymoGenetics' obligations in accordance
        with Section 3, the first paragraph of Section 4.2 and Sections 4.2.1,
        5.2.1 and 5.2.2, Aurora covenants *** by ZymoGenetics under the Aurora
        Patents or Stanford Patents, and such *** making or using Aurora Mutant
        GFP's ***. Such covenant *** any ZymoGenetics' successors in interest,
        ***, in part or in whole.

5.2     Covenants of ZymoGenetics:


        5.2.1  ***




        5.2.2  ***




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        5.2.3  Except as expressly licensed herein, ZymoGenetics covenants not
               to make or use Aurora Technology or polynucleotides or proteins
               under the Aurora Patents or Stanford Patents. ***


6. REPRESENTATIONS AND WARRANTIES


6.1     Representations and Warranties of Aurora and ZymoGenetics

        Each Party hereby represents and warrants:

               Corporate Power. Such party is duly organized and validly
               existing and in good standing under the laws of the state of its
               incorporation and has all requisite corporate power and authority
               to enter into this Agreement and to carry out the provisions
               hereof.


               Due Authorization. Such party is duly authorized to execute and
               deliver this Agreement and to perform its obligations hereunder.


               Binding Agreement. This Agreement is a legal and valid obligation
               binding upon it and enforceable in accordance with its terms. The
               execution, delivery and performance of this Agreement by such
               party does not conflict with any agreement, instrument or
               understanding, oral or written, to which it is a party or by
               which it may be bound, nor violate any law or regulation of any
               court, governmental body or administrative or other agency having
               jurisdiction over it.


6.2     Representations and Warranties of Aurora. To the best knowledge of
        Aurora, as of the Effective Date, Aurora represents and warrants to
        ZymoGenetics, except as otherwise provided or disclosed herein: (i) it
        Controls under valid licenses or by virtue of ownership all right, title
        and interest in and to the Aurora Patents and Stanford Patents and
        Aurora Technology licensed hereunder; (ii) *** (iii) ***; and (iv) ***.



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7. NEGATION OF WARRANTIES

7.1     Except as expressly set forth in this Agreement, Aurora MAKES NO
        REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR
        IMPLIED. THERE ARE NO EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY
        OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE OF THE AURORA
        TECHNOLOGY WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, OR OTHER
        RIGHTS OR ANY OTHER EXPRESS OR IMPLIED WARRANTIES.

8. CONFIDENTIALITY

8.1     Confidential Information. Except as expressly provided herein, the
        parties agree that, for the Term and five (5) years thereafter, the
        receiving party shall keep completely confidential and shall not publish
        or otherwise disclose to another party and shall not use for any purpose
        other than to perform the purposes contemplated by this Agreement any
        Confidential Information furnished to it by the disclosing party hereto
        pursuant to this Agreement, except that to the extent that it can be
        established by the receiving party by written evidence that such
        Confidential Information:

               was already known to the receiving party, other than under an
               obligation of confidentiality, at the time of disclosure;

               was generally available to the public or otherwise part of the
               public domain at the time of its disclosure to the receiving
               party;

               became generally available to the public or otherwise part of the
               public domain after its disclosure and other than through any act
               or omission of the receiving party in breach of this Agreement;
               or

               was lawfully disclosed to the receiving party by a person other
               than a party hereto,

               or

               was independently developed by the receiving party.

8.2     Permitted Use and Disclosures. Each party hereto may use or disclose
        Confidential Information disclosed to it by the other party to the
        extent such use or disclosure is reasonably necessary in filing or
        prosecuting patent applications, prosecuting or defending litigation,
        complying with applicable law, governmental regulation or court order,
        submitting information to tax or other governmental authorities, making
        a permitted sublicense or otherwise exercising its rights hereunder,
        provided that if a party is required to make any such disclosure of
        another party's Confidential Information, other than

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        pursuant to a confidentiality agreement, it will give reasonable advance
        notice to the latter party of such disclosure and, save to the extent
        inappropriate in the case of patent applications, will use reasonable
        efforts to secure confidential treatment of such information prior to
        its disclosure (whether through protective orders or otherwise).

8.3     Confidential Terms. Except as expressly provided herein, each party
        agrees not to disclose *** to another party without the consent of the
        other party, not to be unreasonably withheld; provided, however, each
        party reserves the right to make reasonable disclosures (including the
        mutually agreed redaction of material or financial terms) as required by
        securities or other applicable laws, or to actual or prospective
        investors or corporate partners, or to accountants, attorneys and other
        professional advisors on a need-to-know basis under circumstances that
        reasonably ensure the confidentiality thereof, or to the extent required
        by law. A party shall have the further right to disclose the material
        financial terms of this Agreement under strictures of confidentiality to
        any potential acquirer, bona fide potential strategic partner or
        collaborator, merger partner, bank, venture capital firm, or other
        financial institution to obtain financing. If any Confidential
        Information is to become public information by disclosure of the
        disclosing party (except by way of issuance of a patent), the disclosing
        party must obtain the written consent of the non-disclosing party in
        order to disclose the information or allow the non-disclosing party to
        obtain protection of the Confidential Information, if necessary.


9. TERMINATION

9.1     Term. This Agreement shall continue until the date the last patent of
        the Aurora Patents or Stanford Patents expires ("Term").

9.2     Termination for Material Breach. Either party shall have the right to
        terminate this Agreement at any time for a material breach of this
        Agreement by the other party, provided that the non-breaching party
        shall have first given thirty (30) days prior written notice (ten (10)
        days in the event of non-payment of any amounts due under this
        Agreement) to the breaching party describing such breach and stating the
        non-breaching party's intention to terminate this Agreement if such
        breach remains uncured, and the breaching party thereafter fails to cure
        same within a reasonable time. In no case will a party be liable for
        punitive or consequential damages.

9.3     Termination by ZymoGenetics. ZymoGenetics may, at anytime after the date
        of the seventh (7th) anniversary of the Effective Date, terminate the
        license rights granted in Section 2.1 upon *** days written notice to
        Aurora and ***.


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9.4     Any termination pursuant to Section 9.2 or 9.3 shall not relieve
        ZymoGenetics of any obligation or liability accrued hereunder prior to
        such termination, including the obligation to pay applicable license
        fees and milestones. The licenses granted to ZymoGenetics under this
        Agreement shall terminate in the event the Agreement is terminated or
        otherwise expired. Upon termination of the Agreement all licenses
        granted will thereby terminate and Materials with an Aurora Mutant GFP
        will be destroyed or returned to Aurora at the direction of Aurora
        within sixty (60) days.

10. MISCELLANEOUS

10.1    Binding Effect; Assignment. This Agreement shall be binding upon the
        parties' respective successors and permitted assigns. ZymoGenetics may
        not assign or otherwise transfer this Agreement or any of its rights or
        obligations hereunder without the prior written consent of Aurora ***
        and any such attempted assignment or other transfer shall be void.
        Aurora may assign this Agreement, upon notice to ZymoGenetics.

10.2    Effect of Waiver. No waiver of any default, condition, provisions or
        breach of this Agreement shall be deemed to imply or constitute a waiver
        of any other like default, condition, provision or breach of this
        Agreement.

10.3    Limitation of Liability. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR
        ANY SPECIAL, CONSEQUENTIAL, INCIDENTIAL, OR INDIRECT DAMAGES ARISING OUT
        OF THIS AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY.

10.4    Indemnification. ZymoGenetics shall indemnify, hold harmless and defend
        Aurora, its officers, employees, and agents (collectively, the
        "Indemnities") against any and all claims, suits, losses, liabilities,
        damages, costs, fees, and expenses resulting from or arising out of
        exercise of this license described herein. This indemnification
        includes, but is not limited to, any product liability. ZymoGenetics
        shall have no obligation under this Section 10.4 to the extent any such
        claim, suit, loss, liability, damages, cost, fee or expense was the
        result of the willful misconduct or gross negligence of any Indemnitee.
        ZymoGenetics shall have no obligation under this Section 10.4 unless:
        (i) Aurora gives ZymoGenetics prompt written notice of any such claim,
        suit, loss, liability, damages, cost, fee or expense; (ii) ZymoGenetics
        is granted full authority and control over the defense as well as any
        settlement of such claims, suit, losses, liability, damages, costs, fees
        and expenses; and (iii) Aurora and all Indemnitees seeking
        indemnification reasonably cooperate with

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        ZymoGenetics and its agents in such defense.

10.5    Force Majeure. Neither party shall lose any rights hereunder or be
        liable to the other party for damages or losses on account of failure of
        performance by the defaulting party if the failure is occasioned by war,
        strike, fire, act of God(s), el nino, la nina, earthquake, flood,
        lockout, embargo, governmental acts or orders or restrictions, failure
        of suppliers, or any other reason where failure to perform is beyond the
        reasonable control and not caused by the gross negligence or intentional
        conduct or misconduct of the nonperforming party, and such party has
        exerted all reasonable efforts to avoid or remedy such force majeure;
        provided, however, that in no event shall a party be required to settle
        any labor dispute or disturbance.

10.6    Amendment. No modification, supplement to or waiver of this Agreement or
        any Addendum hereto or any of their provisions shall be binding upon a
        party hereto unless made in writing and duly signed by an authorized
        representative of both ZymoGenetics and Aurora. In no event may the
        terms of this Agreement be changed, deleted, supplemented or waived by
        any notice, purchase order, receipt, acceptance, bill of lading or other
        similar form of document. A failure of either party to exercise any
        right or remedy hereunder, in whole or in part, or on one or more
        occasions, shall not be deemed either a waiver of such right or remedy
        to the extent not exercised, or of any other right or remedy, on such
        occasion or a waiver of any right or remedy on any succeeding occasion.

10.7    Entire Agreement. This Agreement, and each Exhibit attached hereto, and
        each supplemental written agreement contemplated hereunder, sets forth
        the entire understanding and agreement of the parties as to the subject
        matter thereof, and there are no other understandings, representations
        or promises, written or verbal, not set forth herein or on which either
        party has relied. If any provisions of any such addendum or supplemental
        written agreement conflict with any provisions set forth in this
        Agreement, the provisions of this Agreement shall take precedence,
        unless such addendum or supplemental written agreement expressly refers
        to the specific provision(s) of this Agreement that it is intended to
        replace or modify (and which shall be limited in force and effect to
        such addendum or supplemental written agreement only).

10.8    Notices. All Notices under this Agreement shall be given in writing and
        shall be addressed to the parties at the following addresses:

                      For ZymoGenetics:
                             Senior Director, Legal Affairs
                             ZymoGenetics, Inc.
                             1201 Eastlake Avenue East

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                             Seattle, WA  98102
                             Facsimile (206)442-6678

                             Copies to:
                             Bruce Carter, Ph.D.
                             CEO and President
                             ZymoGenetics, Inc.
                             1201 Eastlake Avenue East
                             Seattle, WA  98102
                             Facsimile: (206)442-6678

                      For Aurora:
                             Stuart J. M. Collinson, Ph.D., M.B.A.
                             CEO and President
                             Aurora Biosciences Corporation
                             11010 Torreyana Road
                             San Diego, CA.  92121

                             Copies to:
                             John D. Mendlein
                             Chief Knowledge Officer
                             Aurora Biosciences Corporation
                             11010 Torreyana Road
                             San Diego, CA.  92121

        Notices shall be in writing and shall be deemed delivered when received,
        if delivered by a courier, or if by facsimile, with confirmation copy or
        on the second business day following mailing, if sent by first-class
        certified or registered mail, postage prepaid. Notice delivered upon
        receipt of fax (confirmation copy follows to support date of notice).

10.9    Arbitration. The parties recognize that disputes as to certain matters
        may from time to time arise during the term of this Agreement which
        relate to either party's rights and/or obligations hereunder, including,
        but not limited to attempted termination of the Agreement. It is the
        objective of the parties to establish procedures to facilitate the
        resolution of disputes arising under this Agreement in an expedient
        manner by mutual cooperation and without resort to arbitration. The
        parties agree that prior to any arbitration concerning this Agreement,
        Zymogenetics' CEO and Aurora's CEO will meet in person or by
        video-conferencing in a good faith effort to resolve any disputes
        concerning this Agreement. Within *** days of a formal request by either
        party to the other, any party

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        may, by written notice to the other, have such dispute referred to their
        respective officers designated or their successors, for attempted
        resolution by good faith negotiations, such good faith negotiations to
        begin within *** days after such notice is received and not to be
        continued for more than *** days after initiation of such negotiations
        unless the parties mutually agree to an extension thereto. Except as
        otherwise provided specifically herein, any controversy or claim under
        this Agreement shall be solely settled by arbitration by one arbitrator
        pursuant to the Commercial Arbitration Rules of the American Arbitration
        Association (the "Association"); provided that the parties shall first
        use their best efforts to resolve such dispute by negotiation.
        Arbitration shall be initiated by a written request for arbitration
        proceedings by one party to the other after such *** day good faith
        negotiation period. The arbitration shall be conducted ***. The
        arbitrator shall be selected by the joint agreement of the parties, but
        if they do not so agree within *** days of the date of a request for
        arbitration, the selection shall be made pursuant to the rules of the
        Association. The decision reached by the arbitrator shall be conclusive
        and binding upon the parties hereto and may be filed with the clerk of
        any court of competent jurisdiction, and a judgment confirming such
        decision may, if desired by any party to the arbitration, be entered in
        such court. Each of the parties shall pay its own expenses of
        arbitration and the expenses of the arbitrator(s) shall be equally
        shared; provided, however, that if in the opinion of the arbitrator(s)
        any claim hereunder or any defense or objection thereto was
        unreasonable, the arbitrator(s) may assess, as part of the award, all or
        any part of the arbitration expenses (including reasonable attorneys'
        fees) against the party raising such unreasonable claim, defense or
        objection. Nothing herein set forth shall prevent the parties from
        settling any dispute by mutual agreement at any time. Notwithstanding
        anything to the contrary in this Section 10, either party may seek
        immediate injunctive or other interim relief from any court of competent
        jurisdiction with respect to enforcement and protection of the patent
        rights, copyrights, trademarks, or other intellectual property rights
        owned or Controlled by such party. For clarity, this arbitration
        provision, Section 10.12, shall not apply to any claim of infringement
        or a lawsuit to determine the enforceability or validity of intellectual
        property, including patents. In no event shall a demand for arbitration
        be made after the date when the institution of a legal or equitable
        proceeding based on such claim, dispute or other matter in question
        would be barred by the applicable statute of limitations.

10.10   Governing Law. This Agreement shall be governed by and construed in
        accordance with the laws of the State of California.

10.11   Severability and Survival. This Agreement is intended to be severable.
        If any provision(s) of this Agreement are or become invalid, are ruled
        illegal by a court of competent jurisdiction or are deemed unenforceable
        under the current applicable law from time to time in effect during the
        term hereof, it is the intention of the parties that the remainder of
        the Agreement shall not be affected thereby and shall continue to be
        construed to the

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<PAGE>   16

        maximum extent permitted by law at such time. It is further the
        intention of the parties that in lieu of each such provision which is
        invalid, illegal, or unenforceable, there shall be substituted or added
        as part of this Agreement by mutual agreement of the parties or
        arbitration, a provision which shall be as similar as possible, in
        economic and business objectives as intended by the parties to such
        invalid, illegal or unenforceable provision, but shall be valid, legal
        and enforceable. Unless expressly stated otherwise, the provision of
        Sections 4, 5, 6, 7, 8, and 10 and any other provision intended by its
        meaning to survive, will survive the expiration or any other termination
        of this Agreement.

10.12   Headings. Captions and paragraph headings are for convenience only and
        shall not form an interpretative part of this Agreement. Unless
        otherwise specifically provided, all references to a Section incorporate
        all Sections or subsections thereunder. This Agreement shall be
        construed without regard to the drafting or non-drafting party hereto
        and may be executed in two or more counterparts, each of which will be
        deemed an original and the same instrument. Counterparts may be signed
        and delivered by facsimile, each of which shall be binding when sent,
        and in each case an original shall be sent via overnight courier. This
        Agreement will not be enforceable and shall have no effect if this
        Agreement is not executed by Zymogenetics on or before December 17,
        1999.

IN WITNESS WHEREOF, Aurora and ZymoGenetics have executed, by duly authorized
representatives, this Agreement.

For ZymoGenetics, Inc.

By:  /s/  Bruce Carter                      Date: 12/17/99
   -------------------------------               -------------------------------
Name: Bruce Carter
     -----------------------------

Title: President
      ----------------------------

For Aurora Biosciences Corporation

By:  /s/  John Mendlein                     Date: 12/16/99
   -------------------------------               -------------------------------

Name: John Mendlein
     -----------------------------

Title: CKO
      ----------------------------

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<PAGE>   17



                                    EXHIBIT A
                                 AURORA PATENTS

                                       ***


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                                    EXHIBIT B
                                STANFORD PATENTS





                                       ***





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<PAGE>   19









                                       ***





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                                    EXHIBIT C
                                       ***



                                       ***


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