<PAGE>   1
                                                                   EXHIBIT 10.18


                          SPONSORED RESEARCH AGREEMENT





                                     between





                                  SPECTRUMEDIX

                                    (SPONSOR)



                                       and



                 THE TRUSTEES OF THE UNIVERSITY OF PENNSYLVANIA

                                     (PENN)


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

        This Sponsored Research Agreement ("AGREEMENT") is made by and between
The Trustees of the University of Pennsylvania, a Pennsylvania nonprofit
corporation ("PENN"), with offices located at Suite 300, 133 South 36th Street,
Philadelphia, PA 19104-3246, and SpectruMedix a corporation organized and
existing under the laws of Delaware ("SPONSOR"), having a place of business at
2124 Old Gatesburg Road, State College, PA 16803.

        This AGREEMENT is effective as of March 15, 1998 ("EFFECTIVE DATE").


BACKGROUND

        A.      SPONSOR desires to fund the research of Drs. James Baumgardner
and Bryan Marshall relating to a means of measuring pulmonary function;

        B.      SPONSOR desires to support such research conducted by PENN under
the terms and conditions of this AGREEMENT;

        C.      The research program described in this AGREEMENT is of mutual
interest to SPONSOR and PENN and furthers the educational and research
objectives of PENN as a nonprofit, tax-exempt educational institution, and may
benefit both SPONSOR and PENN through the creation of new inventions;

        NOW, THEREFORE, in consideration of the promises and covenants contained
in this AGREEMENT and intending to be legally bound, the parties agree as
follows:

1.      DEFINITIONS

        1.1     PENN INTELLECTUAL PROPERTY means and includes all technical
information, inventions, developments, discoveries, software, know-how, methods,
techniques, formulae, data, processes and other proprietary ideas, whether or
not patentable or copyrightable, that are first conceived, discovered, developed
or reduced to practice in the conduct of the SPONSORED RESEARCH during the term
of this AGREEMENT, provided that PENN INTELLECTUAL PROPERTY is either (i)
dominated by PENN PATENT PATENT RIGHTS as defined in the LICENSE AGREEMENT or
(ii) derived, developed from or used in conduction with equipment supplied by
SPONSOR to PENN pursuant to his AGREEMENT, and will include work performed by
collaborators of PENN working on the SPONSORED RESEARCH provided such
collaborators agree to assign their rights to PENN.

        1.2     PRINCIPAL INVESTIGATOR is Dr. James Baumgardner and Dr. Bryan
Marshall, who are responsible for supervision and administration of the
SPONSORED RESEARCH.

        1.3     SPONSORED RESEARCH which may include work performed by
collaborators, means the research program described in Attachment A to this
AGREEMENT.

        1.4     LICENSE AGREEMENT means the agreement entered into between PENN
and SPONSOR with an effective date of March 15, 1998 attached as Attachment C.

2.      SPONSORED RESEARCH

        2.1     PENN agrees to begin the SPONSORED RESEARCH after the EFFECTIVE
DATE and upon payment by SPONSOR of any funds owed. PENN agrees to use
reasonable efforts to conduct the SPONSORED RESEARCH substantially in accordance
with the terms and conditions of this AGREEMENT. SPONSOR


*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   3
acknowledges that PENN and the PRINCIPAL INVESTIGATOR shall have the freedom to
conduct and supervise the SPONSORED RESEARCH in a manner consistent with PENN's
educational and research missions.

        2.2     If the services of the PRINCIPAL INVESTIGATOR become unavailable
to PENN for any reason, PENN is entitled to designate another member of its
faculty who is acceptable to both parties to serve as the PRINCIPAL INVESTIGATOR
of the SPONSORED RESEARCH. If a substitute PRINCIPAL INVESTIGATOR acceptable to
both parties has not been designated within sixty (60) days after the original
PRINCIPAL INVESTIGATOR ceases his or her services under this AGREEMENT, either
party may terminate this AGREEMENT upon written notice to the other party,
subject to the provisions of ARTICLE 9.

3.      TERM OF AGREEMENT

        3.1     The term of this AGREEMENT shall begin on the EFFECTIVE DATE of
this AGREEMENT and shall end one year after the EFFECTIVE DATE unless terminated
sooner pursuant to Sections 2.2, 9.1 or 9.2 hereof This AGREEMENT may be
extended or renewed only by mutual written agreement executed by duly authorized
representatives of the parties.

4.      REIMBURSEMENT OF COSTS, PAYMENT

        4.1     SPONSOR shall reimburse PENN (REIMBURSEMENTS) for direct and
indirect costs incurred in the conduct of the SPONSORED RESEARCH by (i) a cash
payment from SPONSOR not to exceed * * * (*) as set forth in Attachment A; (ii)
subject to Section 9.3, certain services, equipment and related support from
SPONSOR valued at * * * (*) such as set forth in Attachment A; and (iii) grants
of funds, equipment or other assets awarded to PENN from any third party for the
SPONSORED RESEARCH (including but not limited to research or development of PENN
LICENSED PRODUCTS as defined in the LICENSE AGREEMENT or any intellectual
property created under this AGREEMENT) where PENN agrees that such funds,
equipment or other assets would not have been awarded to PENN but for the
contributions or efforts of SPONSOR and such third party agrees to the terms of
this AGREEMENT in its entirety. PENN may also receive grants of funds, equipment
or other assets awarded to PENN from any third party which PENN may, in its sole
discretion, apply to the conduct of the SPONSORED RESEARCH but such support
shall not be included in REIMBURSEMENTS. PENN agrees that funds from * * * * * *
* * * shall be applied to the conduct of the SPONSORED RESEARCH and SPONSOR
agrees that such funds shall not be included in REIMBURSEMENTS. SPONSOR
acknowledges that these amounts are a good faith estimate only and not a
guarantee of the cost to conduct the SPONSORED RESEARCH If at any time PENN
determines that it will require additional funds for the SPONSORED RESEARCH it
shall notify SPONSOR and provide an estimate of the additional amount. SPONSOR
shall not be responsible for any costs in excess of the amount of * * as set
forth in Attachment A unless it has agreed in writing to provide additional
funds.

        4.2     SPONSOR shall make payments in advance to PENN in accordance
with the payment schedule set forth in Attachment A. All payments are to be made
by check payable in United States dollars, to "The Trustees of the University of
Pennsylvania", and sent to the address in Section 11.4.

        4.3     Title to any equipment, laboratory animals, or any other
materials made or acquired with funds provided under this AGREEMENT shall vest
in PENN, and such equipment, animals, or materials shall remain the property of
PENN following termination of this AGREEMENT. Equipment and material provided
under this AGREEMENT to PENN by SPONSOR shall vest in PENN subject to terms and
conditions of Section 9.3.

5.      RECORDS AND REPORTS

        5.1     PRINCIPAL INVESTIGATOR shall maintain records of the results of
the SPONSORED RESEARCH and shall provide SPONSOR with reports of the progress
and results of the SPONSORED RESEARCH in accordance with Attachment A. PENN
shall maintain records of the use of the fiends provided by SPONSOR and shall
make such records available to


*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   4

SPONSOR upon reasonable notice during PENN's normal business hours, but not more
frequently than once each calendar year.

        5.2     In order to preserve the patentability of PENN INTELLECTUAL
PROPERTY, SPONSOR shall maintain PENN INTELLECTUAL PROPERTY and information
provided pursuant to Section 6.1 (whether oral or written) as confidential and
shall use best efforts not disclose such information to any third party except
with PENN's prior written approval. The foregoing obligation shall not apply to:

                5.2.1   information that is known to COMPANY or independently
developed by COMPANY prior to the time of disclosure, in each case, to the
extent evidenced by written records;

                5.2.2   information disclosed to COMPANY by a third party that
has a right to make such disclosure;

                5.2.3   information that becomes patented, published or
otherwise part of the public domain as a result of acts by PENN or a third
person obtaining such information as a matter of right; or

                5.2.4   information that is required to be disclosed by order of
United States governmental authority or a court of competent jurisdiction;
provided that COMPANY must use best efforts to obtain confidential treatment of
such information by the agency or court.

6.      INTELLECTUAL PROPERTY

        6.1     PRINCIPAL INVESTIGATOR shall provide to PENN and SPONSOR a
complete written disclosure of any PENN INTELLECTUAL PROPERTY reasonably
considered patentable or reasonably considered to be of commercial utility.
SPONSOR shall advise PENN in writing, no later than thirty (30) days after
receipt of such disclosure, whether it requests PENN to file and prosecute
patent applications related to such PENN INTELLECTUAL PROPERTY. If SPONSOR does
not request PENN to file and prosecute such patent applications, then such PENN
INTELLECTUAL PROPERTY shall be excluded from SPONSOR's option under ARTICLE 7.

        6.2     PENN shall control the preparation and prosecution of all patent
applications and the maintenance of all patents related to PENN INTELLECTUAL
PROPERTY. PENN shall endeavor to assign responsibility for such preparation,
prosecution and maintenance to a patent law firm mutually agreeable to PENN and
SPONSOR. PENN and SPONSOR hereby agree that the patent counsel of Pennie &
Edmonds is a mutually agreeable law firm for such preparation, prosecution and
maintenance. SPONSOR shall reimburse PENN upon receipt of invoice for all
documented expenses incurred in connection with the filing and prosecution of
the patent applications and maintenance of the patents that SPONSOR has
requested PENN to prosecute under Section 6. 1.

        6.3     Patent counsel mutually agreeable to PENN and SPONSOR shall take
instructions only from PENN unless otherwise expressly authorized in writing by
PENN. PENN shall promptly provide SPONSOR with copies of all relevant
prosecution documentation so that SPONSOR may be currently and promptly informed
and apprised of the continuing prosecution. SPONSOR may comment upon such
documentation, provided that if SPONSOR has not commented upon such
documentation prior to the initial deadline for filing a response with relevant
government patent office, PENN shall be free to respond appropriately without
consideration of SPONSOR's comments. SPONSOR agrees to keep this documentation
confidential.

        6.4     PENN shall use all reasonable efforts to prepare or amend any
U.S. or foreign patent application to include claims reasonably requested by
SPONSOR to protect PENN INTELLECTUAL PROPERTY included in SPONSOR's option under
ARTICLE 7.

        6.5     The preparation, prosecution, and maintenance of copyright,
trademark and other intellectual property applications for the PENN INTELLECTUAL
PROPERTY shall be subject to the provisions of Section 6.1.


*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   5
        6.6     PENN shall retain all right, title and interest in and to the
PENN INTELLECTUAL PROPERTY and any patents, copyrights and other intellectual
property protections related thereto.

7.      OPTION

        7.1     In consideration of SPONSOR's funding of the SPONSORED RESEARCH
and payment for intellectual property expenses as provided for in Article 6,
PENN grants SPONSOR an exclusive option to negotiate to obtain a world-wide
right and license, with the right to grant sublicenses, to practice PENN
INTELLECTUAL PROPERTY to make, have made, use, import sell and offer for sale
products of SPONSOR under the terms and conditions as set forth hereunder
("OPTION").

                7.1.1   The period during which the OPTION may be exercised by
SPONSOR shall commence from the date of written disclosure of PENN INTELLECTUAL
PROPERTY to SPONSOR under Section 6.1 and continue for a period of six (6)
months with an automatic renewal of an additional six (6) months unless SPONSOR
and PENN earlier terminate the OPTION with respect to such disclosed PENN
INTELLECTUAL PROPERTY by mutual written agreement ("OPTION PERIOD"). Thereafter
the OPTION may be renewed only as mutually agreed upon by PENN and SPONSOR in
writing.

                7.1.2   During the OPTION PERIOD, PENN shall not have
discussions with, negotiate with, or enter into any agreement with a third party
with respect to PENN INTELLECTUAL PROPERTY as to which Section 6.1 applies. If
SPONSOR elects in writing not to exercise the OPTION for a particular disclosure
of PENN INTELLECTUAL PROPERTY, PENN shall be free to license such disclosed PENN
INTELLECTUAL PROPERTY to any party upon such terms as PENN deems appropriate,
without any further obligation to SPONSOR.

                7.1.3   SPONSOR shall notify PENN in writing during the OPTION
PERIOD if it wishes to exercise the OPTION with respect to a particular
disclosure of PENN INTELLECTUAL PROPERTY under Section 6.1.

                7.1.4   If SPONSOR exercises the OPTION with respect to a
particular disclosure of PENN INTELLECTUAL PROPERTY then PENN and SPONSOR shall
negotiate in good faith concerning commercially fair and reasonable terms and
conditions of a license to such disclosure. PENN and SPONSOR currently expect
that commercially fair and reasonable terms and conditions would be:

                        7.1.4.1 If such disclosed PENN INTELLECTUAL PROPERTY is
dominated by PENN PATENT RIGHTS as defined in the LICENSE AGREEMENT so that most
products incorporating such disclosed PENN INTELLECTUAL PROPERTY would infringe
at least one claim of PENN PATENT RIGHTS as defined in the LICENSE AGREEMENT,
then such disclosed PENN INTELLECTUAL PROPERTY would (a) be included within the
definitions of PENN PATENT RIGHTS or PENN TECHNICAL INFORMATION, as defined in
the LICENSE AGREEMENT as appropriate; and (b) be licensed to SPONSOR under the
terms and conditions of the LICENSE AGREEMENT.

                        7.1.4.2 If such disclosed PENN INTELLECTUAL PROPERTY (1)
is based upon or related to but not covered by at least one claim in a patent or
patent application under PENN PATENT RIGHTS as defined in the LICENSE AGREEMENT
or (2) uses a process or machine related to but not covered by a claim in a
patent or patent application under PENN PATENT RIGHTS as defined in the LICENSE
AGREEMENT or (3) uses, incorporates, is based upon, or is related to PENN
TECHNICAL INFORMATION as defined in the LICENSE AGREEMENT, but is not subject to
Paragraph 7.1.4.1 (all of the foregoing collectively referred to as "Related
PENN INTELLECTUAL PROPERTY"), such Related PENN INTELLECTUAL PROPERTY will be
included within the definitions of PENN PATENT RIGHTS or PENN TECHNICAL
INFORMATION, as defined in the LICENSE AGREEMENT as appropriate subject to
agreement upon modified terms and conditions set forth in Article 3 (Fees and
Royalties and Diligence) of the LICENSE AGREEMENT which PENN and SPONSOR shall
promptly and in good faith renegotiate.


*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   6
                        7.1.4.3 If such disclosed PENN INTELLECTUAL PROPERTY is
not Paragraph 7.1.4.1 or 7.1.4.2 then the terms and conditions shall be
negotiated in good faith.

                        7.1.4.4 In the event that such a particular disclosure
would substitute for or supersede previously licensed technology, the parties
acknowledge that such a particular disclosure may require an appropriate
modification in the schedule of the DEVELOPMENT PLAN as defined in the LICENSE
AGREEMENT.

                7.1.5   If despite the good faith negotiations on the part of
both parties, SPONSOR and PENN fail to execute a license agreement consistent
with the foregoing provisions within twelve (12) months after disclosure of such
PENN INTELLECTUAL PROPERTY to SPONSOR or if SPONSOR fails to make payment for
intellectual property expenses as provided for in Article 6 within thirty (30)
days of notification in writing that such expenses are past due, PENN shall be
free to license the PENN INTELLECTUAL PROPERTY to any party upon such terms as
PENN deems appropriate, without any further obligation to SPONSOR.

        7.2     Any license granted to SPONSOR pursuant to Section 7.1 hereof
shall be subject, if applicable, to the rights of the United States government
reserved under Public Laws 96-517, 97-256 and 98-620, codified at 35 U.S.C.
200-212, and any regulations issued thereunder.

8.      PUBLICATION, USE OF NAME

        8.1     PENN shall be free to publish the results of the SPONSORED
RESEARCH; except that PENN agrees to submit a copy of the complete draft of such
proposed publication to SPONSOR at least forty five (45) days prior to
publication. N SPONSOR reasonably determines that patentable subject matter is
disclosed in such proposed publication, SPONSOR shall notify PENN in writing
within thirty (30) days of receiving such complete draft If SPONSOR so notifies
PENN such publication shall thereafter be delayed until (i) PENN files a patent
application covering such patentable subject matter, or (ii) SPONSOR reasonably
determines after further investigation that no patentable invention is
disclosed, whichever comes first In no event, however, shall such publication be
delayed for longer than ninety (90) days after a copy of the complete draft of
such publication is delivered to SPONSOR by PENN.

        8.2     PENN shall not use SPONSOR's name without SPONSOR's prior
written consent except that PENN may acknowledge Sponsor's funding of the
SPONSORED RESEARCH in scientific publications and in listings of sponsored
research projects. SPONSOR shall not use PENN's name, or the name of any
trustee, officer, faculty member, student or employee thereof, except for use in
scientific publications, listings of sponsored research projects, as required by
law, or as consented to by PENN.

9.      TERMINATION

        9.1     In addition to the termination right set forth in Section 2.2
hereof, either party may terminate this AGREEMENT effective upon written notice
to the other party, if the other party breaches any of the terms or conditions
of this AGREEMENT and fails to cure such breach within thirty (30) days after
receiving written notice of the breach. In the event of an incurable breach, the
non-breaching party may terminate this AGREEMENT effective immediately upon
written notice to the breaching party.

        9.2     In addition, either party may terminate this AGREEMENT for any
reason upon ninety (90) days prior written notice to the other party.

        9.3     In the event of termination of this AGREEMENT prior to its
stated term, whether for breach or for any other reason whatsoever, PENN shall
be entitled to retain from the cash payments made by SPONSOR prior to
termination PENN's reasonable costs of concluding the work in progress.
Allowable costs include, without limitation, all costs or noncancellable
commitments incurred prior to the receipt or issuance, by PENN of the notice of
termination, and the full cost of each employee, student and faculty member
supported hereunder through the end of such commitments. In the event of
termination, PENN shall submit a final report of all costs incurred and all
funds received under this AGREEMENT within sixty (60) days after the effective
termination date. The 


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


<PAGE>   7
report shall be accompanied by a check in the amount of any excess cash payments
made by SPONSOR advanced over costs and allowable commitments incurred. In the
case of termination of this AGREEMENT by PENN under Paragraph 9.2 or by SPONSOR
for material breach by PENN, PENN shall, within ten (10) days of such
termination, return all equipment or other material delivered to PENN by SPONSOR
if such termination is made less than one year after receipt by PENN of such
equipment or other material.

        9.4     Termination of this AGREEMENT shall not affect the rights and
obligations of the parties accrued prior to termination. The provisions of
ARTICLE 6, entitled INTELLECTUAL PROPERTY-, ARTICLE 7, entitled OPTION, ARTICLE
10, entitled DISCLAIMER OF WARRANTIES, INDEMNIFICATION; and ARTICLE 1.1,
entitled ADDITIONAL PROVISIONS, shall survive termination.

10.     DISCLAIMER OF WARRANTS, INDEMNIFICATION

        10.1    PENN MAKES NO WARRANTIES, EXPRESS OR IMPLIED, AS TO ANY MATTER
WHATSOEVER, INCLUDING, WITHOUT LIMITATION, WARRANTIES WITH RESPECT TO THE
CONDUCT, COMPLETION, SUCCESS OR PARTICULAR RESULTS OF THE SPONSORED RESEARCH OR
THE CONDITION, OWNERSHIP, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE
OF THE SPONSORED RESEARCH OR ANY PENN INTELLECTUAL PROPERTY. PENN SHALL NOT BE
LIABLE FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, PUNITIVE OR OTHER DAMAGES
SUFFERED BY SPONSOR OR ANY OTHER PERSON RESULTING FROM THE SPONSORED RESEARCH OR
THE USE OF ANY PENN INTELLECTUAL PROPERTY PRODUCT.

        10.2    SPONSOR shall defend, indemnify and hold harmless PENN, the
PRINCIPAL INVESTIGATOR and any of PENNs faculty, students, employees, trustees,
officers, affiliates and agents (hereinafter referred to collectively as the
"INDEMNIFIED PERSONS") from and against any and all liability, claims, lawsuits,
losses, damages, costs or expenses(including attorney fees), which the
INDEMNIFIED PERSONS may hereafter incur, or be required to pay as a result of
Sponsor's use of the results of SPONSORED RESEARCH or any PENN INTELLECTUAL
PROPERTY or as a result of any breach of this AGREEMENT or any act or emission
of SPONSOR, its employees, affiliates, contractors, licensees or agents. PENN
shall notify SPONSOR upon learning of the institution or threatened institution
of any such liability, claims, lawsuits, losses, damages, costs and expenses and
PENN shall cooperate with SPONSOR in every proper way in the defense or
settlement thereof at Sponsor's request and expense.

11.     ADDITIONAL PROVISIONS.

        11.1    No rights hereunder may be assigned by SPONSOR, directly or by
merger or other operation of law, without the express written consent of PENN.
Any prohibited assignment of this AGREEMENT or the rights hereunder shall be
null and void. No assignment shall relieve SPONSOR of responsibility for the
performance of any accrued obligations which it has prior to such assignment.

        11.2    A waiver by either party of a breach or violation of any
provision of this AGREEMENT will not constitute or be construed as a waiver of
any subsequent breach or violation of that provision or as a waiver of any
breach or violation of any other provision of this AGREEMENT.

        11.3    Nothing herein shall be deemed to establish a relationship of
principal and agent between PENN and SPONSOR, nor any of their agents or
employees, nor shall this AGREEMENT be construed as creating any form of legal
association or arrangement which would impose liability upon one party for the
act or failure to act of the other party. Nothing in this AGREEMENT, express or
implied, is intended to confer on any person other than the parties hereto or
their permitted assigns, any benefits, rights or remedies.

        11.4    Notices, payments, statements, reports and other communications
under this AGREEMENT shall be in writing and shall be deemed to have been
received as of the date dispatched if sent by -public overnight courier (e.g.,
Federal Express) and addressed as follows:


*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   8
If to PENN:                            with a copy to:

Office of Research Administration      Office of the General Counsel
University of Pennsylvania             University of Pennsylvania
133 South 36th Street, Suite 300       221 College Hall
Philadelphia, PA 19104-3246            Philadelphia, PA 19104-6303
Attn: Managing Director                Attn: General Counsel


If to SPONSOR:

SpectruMedix Corporation               J. Stephan Dolezalek
2124 Old Gatesburg Road                Brobeck Phleger & Harrison LLP
State College, PA  16803               2200 Geng Road
Attn:  Joseph Adlerstein Ph.D.         Two Embarcadero Place
           Bernard Sonnenschein        Palo Alto, CA 94303

        11.5    This AGREEMENT shall be construed and governed in accordance
with the laws of the Commonwealth of Pennsylvania, without giving effect to
conflict of law provisions. The parties hereby submit to the exclusive
jurisdiction of and venue in any state or federal courts located within the
Eastern District of Pennsylvania with respect to any and all disputes concerning
the subject of this AGREEMENT.

        11.6    PENN and SPONSOR shall not discriminate against any employee or
applicant for employment because of race, color, sex, sexual preference, age,
religion, national origin, disability, or because he or she is a disabled
veteran or veteran of the Vietnam Era.

        11.7    Neither party shall be liable for any failure to perform as
required by this AGREEMENT to the extent such failure to perform is due to
circumstances reasonably beyond such party's control, including, without
limitation, labor disturbances or labor disputes of any kind, accidents, failure
of any governmental approval required for full performance, civil disorders or
commotion's, acts of aggression, acts of God, energy or other conservation
measures imposed by law or regulation, explosions, failure of utilities,
mechanical breakdowns, material shortages, disease, or other such occurrences.

        11.8    SPONSOR shall comply with all laws, regulations and other legal
requirements applicable to SPONSOR in connection with this AGREEMENT, including
but not limited to any legal requirements applicable to Sponsor's use of the
results of the SPONSORED RESEARCH or any PENN INTELLECTUAL PROPERTY and laws
controlling the export of technical data, computer software, laboratory
prototypes, and all other export controlled commodities.

        11.9    If any provision of this AGREEMENT is held to be illegal or
unenforceable, that provision shall be limited or eliminated to the minimum
extent necessary so that this AGREEMENT shall otherwise remain in full force and
effect and enforceable.

        11.10   This AGREEMENT and the LICENSE AGREEMENT (Attachment C hereto)
are being entered into simultaneously and each is related to the other in
setting forth the entire agreement of the parties relating to the subject matter
hereof and supersedes all prior understandings and agreements, whether written
or oral. Any modification of this AGREEMENT must be in writing and signed by an
authorized representative of each party.

                            (Signatures on next page)


*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   9
        IN WITNESS WHEREOF, the duly authorized representatives of the parties
hereby execute this AGREEMENT as of the date first written above.

THE TRUSTEES OF THE                    SPECTRUMEDIX
UNIVERSITY OF PENNSYLVANIA

By:  /s/ Anthony Merritt               By:  /s/ Joseph K. Adlerstein
     ------------------------------         -------------------------------


Name:  Anthony Merritt                 Name:  Joseph K. Adlerstein
       ----------------------------           -----------------------------

Title:  Executive Director,
        Sponsored Programs             Title:  Chief Executive Officer
        ---------------------------            ----------------------------

Date:  March 20, 1998                  Date:  March - 18 - 1998
       ----------------------------           -----------------------------



I have read and agreed to abide by the terms of this AGREEMENT and to the
responsibilities of the PRINCIPAL INVESTIGATOR:



By:    /s/ James Baumgardner           Date:     3/26/98
       ----------------------------           -----------------------------
         James Baumgardner

By:    /s/ Bryan Marshall              Date:     3/26/98
       ----------------------------           -----------------------------
         Bryan Marshall


*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   10
                                  Attachment A
                          SUMMARY OF SPONSORED RESEARCH




                                      * * *
                               ATTACHMENT REDACTED
                                      * * *













*       Indicates that material has been omitted and confidential treatment has
been requested therefor. All such omitted material has been filed separately
with the Commission pursuant to Rule 24b-2.
<PAGE>   11
                                  ATTACHMENT B


Sponsored Research Proposal



                                      * * *
                               ATTACHMENT REDACTED
                                      * * *









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