<PAGE>
 
EXHIBIT 10.1

THE CONFIDENTIAL PORTIONS OF THIS CONTRACT HAVE BEEN OMITTED PURSUANT TO
REGULATION 240.25B-2B OF THE SECURITIES EXCHANGE ACT OF 1934, AND HAVE BEEN
FILED SEPARATELY WITH THE COMMISSION.



                  Research Collaboration and License Agreement

                                    between

              Roche Bioscience, a division of Syntex (U.S.A.) Inc.

                                      and

                         Ribozyme Pharmaceuticals Inc.



                                  May 19, 1998
<PAGE>
 
                               Table of Contents
<TABLE>
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1. DEFINITIONS.............................................................1

2. TARGET DISCOVERY PROGRAM................................................9
   2.1 Target Discovery Programs...........................................9
   2.2 Number of Target Discovery Programs.................................9
   2.3 Participation by RBS Affiliates.....................................9
   2.3 Process for New Target Discovery Programs..........................10
       2.4.1 Initial Proposal.............................................10
       2.4.2 Proposed Disease Phenotype...................................10
       2.4.3 Withdrawing/Declining a Proposed Target Discovery Program....10
   2.5 Term of a Target Discovery Program.................................10
   2.7 Exclusivity re Disease Phenotype...................................10

3. CONDUCT OF TARGET DISCOVERY PROGRAM....................................11
   3.1 Research Plan......................................................11
   3.2 Research Efforts...................................................11
   3.3 Availability of Resources..........................................11
   3.4 Reports............................................................11
   3.5 Research Efforts...................................................11
       3.5.1 Excluded RPI Targets.........................................11
       3.5.2 Pre-Existing Roche Targets...................................12
   3.6 Early Termination of Target Discovery Program......................12

4. MANAGEMENT OF COLLABORATION............................................12
   4.1 Formation of Collaboration Management Committee....................12
   4.2 Meetings of Collaboration Management Committee.....................12
   4.3 Decision-Making Process............................................13
   4.4 Dissolution........................................................13

5. MANAGEMENT OF A TARGET DISCOVERY PROGRAM...............................13
   5.1 Formation of Program Management Committee..........................13
   5.2 Meetings of Program Management Committee...........................13
   5.3 Decision-Making Process............................................14
   5.4 Dissolution........................................................14

6. EXCLUSIVITY............................................................14
   6.1 Roche's Exclusive Rights to Develop Products.......................14
   6.2 Unavailable Ribozyme Products......................................14
   6.3 RPI's Rights to Non-Ribozyme Products..............................14
   6.4 RPI's Rights to Ribozyme Products..................................14

</TABLE>


                                       i
<PAGE>

<TABLE>
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       6.4.1 In Vitro Validated Targets....................................15
       6.4.2 Roche Elects Not To Develop a Ribozyme Product................15
       6.4.3 Due Diligence Failure.........................................15
       6.4.4 Termination of a Ribozyme Product.............................15
       6.4.5 Roche Technology License......................................15
   6.5 Roche's Rights to Ribozyme Products Developed by RPI................15
       6.5.1 Inclusion Option..............................................15
       6.5.2 Right of First Negotiation....................................15

7. DEVELOPMENT AND COMMERCIALIZATION.......................................15
   7.1 Development Decisions...............................................15
   7.2 Development Updates.................................................16
   7.3 No Obligation to Develop a Product..................................16
   7.4 Regulatory Work.....................................................16
   7.5 Pre-Existing Roche Targets..........................................16

8. DIAGNOSTIC PRODUCTS.....................................................16
   8.1 Other Diagnostic Products...........................................16
   8.2 Therapeutic Drug Monitoring Products................................16

9. PAYMENTS................................................................16
   9.1 FTE Support.........................................................16
       9.1.1 In Vitro Target Validation Studies............................16
       9.1.2 In Vivo Target Validation Studies.............................17
       9.1.3 Payment.......................................................17
   9.2 Reagent Costs.......................................................17
       9.2.1 In Vitro Target Validation Studies............................17
       9.2.2 In Vivo Target Validation Studies.............................17
   9.3 Milestones..........................................................17
       9.3.1 Exploratory Milestones........................................17
       9.3.2 Clinical Milestones for Non-Ribozyme Products.................17
       9.3.3 Clinical Milestones for Ribozyme Products.....................17
       9.3.4 [      ]......................................................18
             9.3.4.1 [      ]..............................................18
             9.3.4.2 [      ]..............................................18
       9.3.5 [      ]......................................................18
   9.4 Royalties...........................................................18
       9.4.1 Non-Ribozyme Product..........................................18
             9.4.1.1 Base Royalty..........................................18
             9.4.1.2 De-Blocking License...................................18
       9.4.2 Ribozyme Product..............................................18
             9.4.2.1 Base Royalty..........................................18
             9.4.2.2 Royalty Reduction - Ribozyme Product..................18
       9.4.3 [     ].......................................................18
</TABLE>

                                      ii
<PAGE>

<TABLE>
<S>                                                                     <C>
         9.4.4 [      ]....................................................18
         9.4.5 No Patent Protection........................................18

10. RECORDS; AUDITS; AND REPORTS...........................................19
    10.1 Records...........................................................19
    10.2 Audit.............................................................19
    10.3 Payment; Reports..................................................19
    10.4 Exchange Rate.....................................................19
         10.4.1 Roche Exchange Rate........................................19
         10.4.2 RPI Exchange Rate..........................................20
         10.4.3 Restrictions on Conversion.................................20
                10.4.3.1 Product Manufactured in a Blocked Country.........20
                10.4.3.2 Product Not Manufactured in a Blocked Country.....20
         10.4.4 Prohibited Royalty Rates...................................20
    10.5 Manner and Place of Payment.......................................21
    10.6 Late Payments.....................................................21
    10.7 Taxes.............................................................21

11. PATENT RIGHTS AND INFRINGEMENT.........................................21
    11.1 Inventorship......................................................21
    11.2 Ownership.........................................................21
         11.2.1 Targets....................................................21
         11.2.2 Ribozymes..................................................22
         11.2.3 Ribozymes..................................................22
    11.3 Patent Management.................................................22
         11.3.1 Filing Party...............................................22
         11.3.2 Ribozymes..................................................22
         11.3.3 Targets....................................................22
    11.4 Patent Costs......................................................23
    11.5 Cooperation of the Parties........................................23
    11.6 Infringement by Third Parties.....................................23
    11.7 Third Party Patent Rights.........................................24

12. LICENSES AND OTHER COMMERCIAL RIGHTS...................................24
    12.1 Ribozyme Technology...............................................24
         12.1.1 RPI License to Roche.......................................24
         12.1.2 Roche License to RPI.......................................24
    12.2 Ribozyme Technology...............................................24
         12.2.1 Ribozyme Products..........................................24
         12.2.2 Non-Ribozyme Products......................................24
    12.3 License to Other Inventions and Non-Patented Technology...........25
    12.4 Future Licenses...................................................25
    12.5 Covenant of Non-Use...............................................25
    12.6 Manufacturing Ribozyme Products...................................25
</TABLE>

                                      iii
<PAGE>

<TABLE>
<S>                                                                     <C>
13. CONFIDENTIALITY........................................................31
    13.1 Nondisclosure.....................................................31
    13.2 Exceptions........................................................31
    13.3 Publications......................................................32

14. REPRESENTATIONS, WARRANTIES AND COVENANTS..............................32
    14.1 By Both Parties...................................................33
         14.1.1 Duly Organized.............................................33
         14.1.2 Due Authorization..........................................33
         14.1.3 Binding Agreement..........................................33
    14.2 Representations and Warranties by RPI.............................33
         14.2.1 Patent Infringement........................................33
         14.2.2 Sufficient Rights..........................................33
         14.2.3 Licenses to the Cech Patents and Ribozyme Technology.......33
    14.3 Disclaimer of Warranties..........................................33

15. INDEMNIFICATION........................................................33
    15.1 Indemnification by RPI............................................34
    15.2 Indemnification by RBS............................................34
    15.3 Indemnification Notice............................................34
    15.4 Participation in Defense..........................................35
    15.5 Settlements.......................................................35

16. TERM AND TERMINATION...................................................35
    16.1 Term..............................................................35
    16.2 Termination Without Cause.........................................35
    16.3 Termination for Cause.............................................35
    16.4 Effect of Expiration or Termination...............................36
         16.4.1 Survival...................................................36
         16.4.2 RBS Terminates For Cause...................................36
         16.4.3 Roche Terminates For Cause.................................36

17. PUBLICITY..............................................................36
    17.1 Publicity Review..................................................36
    17.2 Standards.........................................................37

18. DISPUTE RESOLUTION.....................................................37
    18.1 Disputes..........................................................37
    18.2 Dispute Resolution Procedures.....................................37
    18.3 Arbitration.......................................................37

19. ASSIGNMENT AND DELEGATION..............................................38
    19.1 Third Parties.....................................................38

</TABLE>

                                      iv
<PAGE>
<TABLE>
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    19.2 Affiliates........................................................38
    19.3 Merger............................................................38
    19.4 Miscellaneous.....................................................38

20. ADDITIONAL TERMS.......................................................39
    20.1 Force Majeure.....................................................39
    20.2 Notices...........................................................39
    20.3 Waiver............................................................40
    20.4 Severability......................................................40
    20.5 Independent Contractors...........................................40
    20.6 Counterparts......................................................40
    20.7 Entire Agreement..................................................40
</TABLE>

                                       v
<PAGE>
 
                 RESEARCH COLLABORATION AND LICENSE AGREEMENT


        THIS RESEARCH COLLABORATION AND LICENSE AGREEMENT is entered into on May
19, 1998 (the "Effective Date"), by and between SYNTEX (U.S.A.) INC., a Delaware
corporation, through its ROCHE BIOSCIENCE division, 3401 Hillview Avenue, Palo
Alto, California 94304 ("RBS"), and RIBOZYME PHARMACEUTICALS INC., a Delaware
corporation, 2950 Wilderness Place, Boulder, Colorado, 80301 ("RPI"). RBS (and
its Affiliates) and RPI may be referred to herein as a "Party" or, collectively,
as "Parties."

        WHEREAS, RPI Controls certain technology relating to ribozymes as
described herein;

        WHEREAS, RBS and its Affiliates wish to collaborate with RPI to use such
technology to discover and validate proprietary Targets.

        WHEREAS, RBS and its Affiliates wish to use Validated Targets to 
identify proprietary compounds and Ribozymes for development into Products.

        NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements expressed herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound, the Parties agree as follows:

1. DEFINITIONS

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

        1.1 "ADDITIONAL REVIEW PERIOD" has the meaning set forth in Section
6.5.2.

        1.2 "ADJUSTED GROSS SALES" means the amount of gross sales invoiced by a
Party, its Affiliates, or sublicensees for a Product to Third Parties less
deductions of returns (including withdrawals and recalls), rebates (price
reductions, including Medicaid and similar types of rebates, e.g. chargebacks),
volume (quantity) discounts, discounts granted at the time of invoicing, sales
taxes and other taxes (other than income taxes), all to the extent directly
linked to and included in the gross sales amount as computed on a product by
product basis for the countries concerned.

        1.3 "AFFILIATE" means a business entity that owns, is owned by or is
under common ownership with a Party. For the purposes of this definition, the
term "owns" (including, with correlative meanings, the terms "owned by" and
"under common ownership with") as used with respect to any Party, shall mean the
possession (directly or indirectly) of more than fifty percent (50%) of the
outstanding voting securities of a corporation or comparable equity interest in
any other type of entity; provided, however, that Genentech, Inc., with offices
located at One DNA

                                       1

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
Way, South San Francisco, California, 94080, shall not be considered an
Affiliate of RBS unless a duly authorized officer of RBS notifies RPI in writing
that Genentech shall be deemed an Affiliate.

        1.4 "AGREEMENT" means the present agreement together with all appendices
and schedules.

        1.5 "BLOCKED COUNTRY" has the meaning set forth in Section 10.4.3.

        1.6 "CGLP" means the then-current Good Laboratory Practices promulgated
by the FDA, published in 21 CFR Part 58, as amended from time to time, or
equivalent foreign laws or regulations.

        1.7 "COLLABORATING ROCHE SITE" OR "CRS" has the meaning set forth in
Section 2.3.

        1.8 "COLLABORATION MANAGEMENT COMMITTEE" OR "CMC" has the meaning set
forth in Section 4.1.

        1.9 "COMBINED PRODUCT" has the meaning set forth in Section ERROR!
REFERENCE SOURCE NOT FOUND.

        1.10 "COMMENCEMENT DATE" means, for each Target Discovery Program, the
date set forth in the Research Plan as the date that such Target Discovery
Program shall begin.

        1.11 "CONFIDENTIAL INFORMATION" means, subject to the limitations
contained in Section 13.2, (i) all information and materials received by either
Party from the other Party pursuant to this Agreement or pursuant to the
Confidentiality Agreement between the Parties dated May 5, 1997, (ii) all
information relating to Validated Targets (which shall be deemed Confidential
Information of the CRS), and (iii) the Disease Phenotype of a Target Discovery
Program (which shall be deemed Confidential Information of the CRS).

        1.12 "CONTROL" OR "CONTROLLED" shall refer to possession of the ability
to grant a license or sublicense of Patent Rights, know-how or other intangible
rights as provided for herein without violating terms of any agreement or other
arrangement with any Third Party.

        1.13 "COVER" (including variations thereof such as "Covered",
"Coverage", or "Covering") means that the making, having made, using, offering
for sale, selling or importing of a particular Product would infringe a Valid
Claim of an issued Patent in the absence of rights granted under such Patent.
The determination of whether a Product is Covered by particular Patent Rights
shall be made on a country by country basis.

        1.14 "DISEASE PHENOTYPE" means a change in Phenotype that is inherent in
a particular disease or indication or caused by such disease or indication or
related disease or indication of

                                       2

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
the same etiology.

        1.15 "DRUG APPROVAL APPLICATION" means an application for Regulatory
Approval required to be approved before marketing and commercial sale of a
Ribozyme Product or Non-Ribozyme Product in humans as a biologic or a drug in a
regulatory jurisdiction, including but not limited to NDA and ELA/PLA for the
United States and their counterparts in other countries.

        1.16 "EFFECTIVE DATE" has the meaning set forth in the first paragraph
hereof.

        1.17 "EXCLUDED RPI TARGET" means [       ]

        1.18 "FDA" means the United States Food and Drug Administration of the
Department of Health and Human Services, and any successor entities.  References
herein to the FDA shall include to the extent applicable any comparable foreign
regulatory authority that has the authority to grant full Regulatory Approval.

        1.19 "FILING PARTY" has the meaning set forth in Section 11.3.1.

        1.20 "FIRST COMMERCIAL SALE" of a Product shall mean the first regular
sale for use or consumption of such Product in a country after required
marketing and pricing approval has been granted by the governing health
regulatory authority of such country; provided that where such a First
Commercial Sale has occurred in a country for which pricing or reimbursement
approval is necessary for widespread sale, then such sale shall not be deemed a
First Commercial Sale until such pricing or reimbursement approval has been
obtained.

        1.21 "FTE" means one full time-equivalent research employee.

        1.22 "IN VITRO VALIDATED TARGET" means a Target that has been validated
in vitro as part of a Target Discovery Program under this Agreement using a
Target Specific Ribozyme or comparable technology that results in a
statistically significant reduction of a Disease Phenotype, as more specifically
described in the Research Plan for the applicable Target Discovery Program.

        1.23 "IN VIVO VALIDATED TARGET" means a Target that has been validated
in vivo as part of a Target Discovery Program under this Agreement using a
Target Specific Ribozyme or comparable technology that results in a
statistically significant reduction of a Disease Phenotype, as more specifically
described in the Research Plan for the applicable Target Discovery Program.

        1.24 "IND" means an Investigational New Drug application as defined in
the rules and regulations of the FDA, as may be amended from time to time. For
purposes of this Agreement, an investigator held Investigational New Drug
application shall not be deemed an IND.

        1.25 "INCLUSION OPTION" has the meaning set forth in Section 6.5.1.

                                       3

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
        1.26 "INITIAL ROYALTY PAYMENT" has the meaning set forth in Section
10.4.3.2.

        1.27 "INVENTION" means any possibly patentable discovery or invention
made under this Agreement during the course of a Target Discovery Program and
within the scope of the Research Plan.

        1.28 "JOINT INVENTION" has the meaning set forth in Section 11.1.

        1.29 "NEGOTIATION PERIOD" has the meaning set forth in Section 6.5.2.

        1.30 "NET SALES" means the amount calculated by subtracting from the
amount of Adjusted Gross Sales a lump sum deduction of [      ]of Adjusted Gross
Sales, in lieu of those sales related deductions which are not accounted for on
a product-by-product basis (e.g. outward freights, transportation insurance,
packaging materials for dispatch of goods, custom duties, discounts granted
later than at the time of invoicing, cash discounts and other direct sales
expenses).

        1.31 "NON-PATENTED TECHNOLOGY" means know-how, trade secrets or other
information or materials that are not patentable or, for a possibly patentable
discovery or invention, on which the parties choose not to file a patent, made
under this Agreement during the course of a Target Discovery Program and within
the scope of the Research Plan, including but not limited to Targets.

        1.32 "NON-RIBOZYME PRODUCT" means any substance that (i) is sold or is
intended to be sold commercially, and (ii) is not a Ribozyme Product, and (iii)
was developed against an In Vivo Validated Target that is not a Pre-Existing
Roche Target; provided, however, that Non-Ribozyme Product does not include any
nucleic acid molecules that are Covered by Patent Rights of RPI (other than
Patent Rights developed or invented pursuant to this Agreement).

        1.33 "NON-ROYALTY BEARING COMPONENT(S)" has the meaning set forth in
Section ERROR! REFERENCE SOURCE NOT FOUND..

        1.34 "PATENT" means (i) patents (including inventor's certificates) that
include one or more Valid Claims, including without limitation any substitution,
extension (including supplemental protection certificate), registration,
confirmation, reissue, reexamination or renewal thereof and (ii) pending
applications, including provisional applications, continuations, divisionals,
and continuations-in-part of any of the foregoing.

        1.35 "PATENT MANAGEMENT" has the meaning set forth in Section 11.3.1.

        1.36 "PATENT COSTS" means the fees and expenses paid to outside legal
counsel and other Third Parties, and filing, prosecution and maintenance
expenses, incurred in connection with the establishment and maintenance of
Patent Rights.

                                       4

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
        1.37 "PATENT RIGHTS" means all rights under Patents.

        1.38 "PHASE II" means that portion of the clinical development program
which provides for the initial trials of a product on a limited number of
patients for the primary purpose of evaluating safety, dose ranging and efficacy
in the proposed therapeutic indication, as more precisely defined by the rules
and regulations of the FDA and corresponding rules and regulations in other
countries.

        1.39 "PHASE III" means that portion of the clinical development program
which provides for the continued trials of a Product on sufficient numbers of
patients to establish the safety and efficacy of a product for the desired
claims and indications, as more precisely defined by the rules and regulations
of the FDA and corresponding rules and regulations in other countries. Any trial
designed to support a NDA without further clinical studies will be considered a
Phase III trial for purposes of this Agreement.

        1.40 "PHENOTYPE" means the entire physical, biochemical, and
physiological makeup of an individual as determined both genetically or
environmentally and any one or any group of such traits.

        1.41 "PIVOTAL" means a clinical trial upon the completion of which a
decision is made to move forward to the next phase of development.

        1.42 "PRE-EXISTING ROCHE TARGETS" means [      ]

        1.43 "PRODUCT" means either or both of a Ribozyme Product or a Non-
Ribozyme Product.

        1.44 "PROGRAM MANAGEMENT COMMITTEE" OR "PMC" has the meaning set forth
in Section 5.1.

        1.45 "PROPOSED DISEASE PHENOTYPE" has the meaning set forth in Section
2.4.2.

        1.46 "REGULATORY APPROVAL" means any approvals, product and/or
establishment licenses, registrations or authorizations of any federal, state or
local regulatory agency, department, bureau or other governmental entity,
necessary for the manufacture, use, storage, importation, export, transport, or
sale of the Products in a regulatory jurisdiction.

        1.47 "RESEARCH COLLABORATION" means the overall collaboration between
the Parties including each Target Discovery Program.

        1.48 "RESEARCH PLAN" means a research plan pursuant to this Agreement
describing the Target Discovery Program and which contains relevant information
with respect to such Target
                                       5

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
Discovery Program, including but not limited to the following information: (i)
the Commencement Date; (ii) a definition of the Disease Phenotype; (iii) the key
goals and target dates to accomplish each goal; (iii) the requirements for
success for both In Vitro Validated Target and In Vivo Validated Target; and
(iv) the level of FTE support.

        1.49 "RESPONSIBLE PARTY" means the Party responsible for Patent
Management.

        1.50 "REVIEW PERIOD" has the meaning set forth in Section 6.5.2.

        1.51 "RIBOZYME" means a ribonucleic acid-based molecule able to cause
catalytic cleavage of itself or another molecule independently of protein(s).

        1.52 "RIBOZYME APPLICATION(S)" has the meaning set forth in Section
11.3.2.

        1.53 "RIBOZYME INVENTION(S)" has the meaning set forth in Section
11.3.2.

        1.54 "RIBOZYME PRODUCT" means any substance that (i) is or is intended
to be sold commercially, (ii) contains a Ribozyme, and (iii) was developed
against a Validated Target.

        1.55 "RIBOZYME TECHNOLOGY" means all inventions, improvements or other
developments relating to Ribozymes, including the identification, manufacture,
synthesis, delivery, use, enhancement and control of Ribozymes which is a work
product of or relating to Ribozymes Controlled as of the Effective Date and
during the Term by Thomas Cech, Ph.D., University of Colorado, or University of
Colorado Foundation or RPI and the work product of the various collaborations
through the Term of this Agreement among Thomas Cech, Ph.D., University of
Colorado, or University of Colorado Foundation, United States Biochemical
Corporation, RPI and Thomas Cech, Ph.D., and all foreign equivalents,
counterparts, patents and patent applications throughout the world that may
issue thereon, including any extensions, renewals, divisions, continuations,
continuations-in-part, patents of addition and reissues thereof. Ribozyme
Technology shall also include all inventions, improvements or other developments
relating to Ribozymes, including the identification, manufacture, synthesis,
delivery, use, enhancement and control of Ribozymes Controlled by RPI.

        1.56 "RIGHT OF FIRST NEGOTIATION" has the meaning set forth in Section
6.5.2.

        1.57 "ROCHE" means RBS and/or any Affiliates of RBS.

        1.58 "ROCHE INDEMNITEES" has the meaning set forth in Section 15.1.

        1.59 "ROCHE INVENTION(S)" has the meaning set forth in Section 11.1.

        1.60 "ROCHE LOSSES" has the meaning set forth in Section 15.1

                                       6

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
        1.61 "ROCHE PATENT RIGHTS" means all Patents claiming a Roche Invention
except those Patents owned by RPI in accordance with Section 11.2.2.

        1.62 "ROCHE TECHNOLOGY" means the Invention and/or Non-Patented
Technology for a specific In Vitro Validated Target or In Vivo Validated Target
owned by Roche in accordance with Section 11.2.1.

        1.63 "ROCHE TECHNOLOGY LICENSE" means a license granted hereunder
pursuant to which Roche shall grant a non-exclusive, worldwide, royalty-bearing
(in accordance with Section ERROR! REFERENCE SOURCE NOT FOUND.) license (without
the right to sublicense) under the Roche Technology to RPI for purposes of
developing a Ribozyme Product against a Validated Target.

        1.64 "ROYALTY BEARING COMPONENT(S)" has the meaning set forth in Section
ERROR! REFERENCE SOURCE NOT FOUND..

        1.65 "ROYALTY PAYING PARTY" has the meaning set forth in Section 10.1.

        1.66 "ROYALTY RECEIVING PARTY" has the meaning set forth in Section 
10.1.

        1.67 "ROYALTY TERM" means, in the case of any Product, in any country,
the period of time commencing on the First Commercial Sale of such Product and
ending upon the later of (i) ten (10) years from the date of First Commercial
Sale of such Product in such country or (ii) the expiration of the last to
expire of the Patent Rights held by either RPI or Roche Covering such Product in
such country. Royalty Term shall be determined on a Product by Product, country
by country basis. Notwithstanding the foregoing, if a country is a member of the
European Union and the Patent Rights Covering a Product were filed with the
European Patent Office, the Royalty Term for each country in the European Union
shall be the period of time commencing on the First Commercial Sale of such
Product in the European Union and ending upon the later of (i) ten (10) years
from the date of First Commercial Sale of such Product in the European Union or
(ii) the expiration of the last to expire of the Patent Rights held by either
RPI or Roche Covering such Product in the European Union.

        1.68 "RPI BACKGROUND PATENT RIGHTS" means all rights under Patents
existing as of the Effective Date that RPI owns or to which it has a license
(with rights to sublicense as provided herein), including Patent Rights for the
Ribozyme Technology.

        1.69 "RPI INVENTION(S)" has the meaning set forth in Section 11.1.

        1.70 "RPI LOSSES" has the meaning set forth in Section 15.2.

        1.71 "RPI PATENT RIGHTS" means RPI Background Patent Rights and all
Patent Rights claiming an RPI Invention except those owned by Roche in
accordance with Section 11.2.1.

                                       7

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
        1.72 "SCIENTIFICALLY REASONABLE AND DILIGENT EFFORTS" means, unless the
Parties agree otherwise, those efforts consistent with the exercise of prudent
scientific and business judgment, as applied to other research programs or
products of similar scientific and commercial potential within the relevant
product lines of the Party developing the Product and its Affiliates.

        1.73 "SUBSTANTIAL COMPETITION" [          ]

        1.74 "SUCCESSFUL COMPLETION" means that a Toxicity Study or clinical
trial has been completed and has met the criteria established by Roche at the
beginning of the study for what would be deemed a successful result of such
Toxicity Study or clinical trial.

        1.75 "TARGET" means a gene or partial sequence thereof, and those
elements necessary for its expression or regulation, or its transcription,
translation, or replication product or intermediates or portions thereof.

        1.76 "TARGET APPLICATION" has the meaning set forth in Section 11.3.3.

        1.77 "TARGET DISCOVERY PROGRAM" has the meaning set forth in Section
2.1.

        1.78 "TARGET DISCOVERY TECHNOLOGY" means the use of RPI's combinatorial
ribozyme libraries to identify a Target(s) which, when combined with a Target
Specific Ribozyme, inhibits such Target's expression. The Target can then be
assessed in in vitro and in vivo models for its efficacy in affecting the
Disease Phenotype for a Target Discovery Program.

        1.79 "TARGET INVENTION(S)" has the meaning set forth in Section 11.3.3.

        1.80 "TARGET SPECIFIC RIBOZYME" means a ribozyme that specifically
inhibits the function of a Target(s) or the Target RNA resulting in a
statistically significant reduction in Target gene expression.

        1.81 "THIRD PARTY" means any entity other than RPI or RBS or an
Affiliate of RPI or RBS.

        1.82 "THIRD PARTY MILESTONES" has the meaning set forth in Section
6.4.5.

        1.83 "TOXICITY STUDIES" means those cGLP toxicity studies that are
necessary to open an IND, i.e. which includes two animal species.

        1.84 "VALID CLAIM" means a claim of an issued Patent which claim has not
lapsed, expired, been canceled or become abandoned and has not been declared
invalid by an unreversed and unappealable decision or judgment of a court or
other appropriate body of competent jurisdiction, and which has not been
admitted to be invalid or unenforceable through reissue or

                                       8

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240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
disclaimer.

        1.85 "VALIDATED TARGET" means either an In Vitro Validated Target and/or
an In Vivo Validated Target.

2. TARGET DISCOVERY PROGRAM

        2.1 TARGET DISCOVERY PROGRAMS. RPI shall use the Ribozyme Technology to
identify Target(s) that affect a Disease Phenotype in a manner that can be
measured using both in vitro and in vivo models resulting in Validated Targets
pursuant to a Research Plan (a "TARGET DISCOVERY PROGRAM").

        2.2 NUMBER OF TARGET DISCOVERY PROGRAMS.  For [        ]years following 
the Effective Date, Roche may collaborate with RPI in up to [       ] Target 
Discovery Programs under the terms and conditions set forth herein.  [       ]

        2.3 PARTICIPATION BY RBS AFFILIATES. Any Roche entity may enter into a
Target Discovery Program with RPI under this Agreement; provided, however that
such Roche entity (other than RBS) must agree in writing to be bound by the
terms and conditions of this Agreement prior to the Commencement Date for such
Target Discovery Program. The Roche entity collaborating with RPI on a Target
Discovery Program shall be called the COLLABORATING ROCHE SITE or CRS. When
"Roche" is used in this Agreement, the CRS for the applicable Target Discovery
Program shall be responsible for ensuring Roche's compliance under this
Agreement.

                                       9

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<PAGE>
 
        2.4 PROCESS FOR NEW TARGET DISCOVERY PROGRAMS.

                2.4.1 INITIAL PROPOSAL. Any Roche entity may submit in writing
to RPI a written proposal for a Target Discovery Program. The Collaboration
Management Committee shall meet to discuss the proposal. Such discussion shall
include, among other points of discussion, the prioritization of the new
proposal with the Target Discovery Programs underway at RPI and the issues set
forth in Sections 2.4.2 and 2.4.3. If after such review, it is determined to
move forward with such proposal, the Research Plan shall be prepared and
approved by the CMC in accordance with Section 3.1.

                2.4.2 PROPOSED DISEASE PHENOTYPE. Roche shall submit in writing
to RPI a proposed Disease Phenotype for a Target Discovery Program (the
"PROPOSED DISEASE PHENOTYPE"). [          ]

                2.4.3 WITHDRAWING/DECLINING A PROPOSED TARGET DISCOVERY PROGRAM.
Once the definition of the Proposed Disease Phenotype is finalized or currently
therewith if the Parties so agree, the Collaboration Management Committee shall
discuss in good faith whether such proposed Target Discovery Program is likely
to yield a certain number of Pre-Existing Roche Targets or Excluded RPI Targets.
Prior to such CMC meeting, RPI shall submit to Roche a list of Excluded RPI
Targets. The Parties acknowledge that as of the Effective Date, the Parties are
uncertain as to how many too many Pre-Existing Roche Targets or Excluded RPI
Targets would be. The Parties estimate that approximately [          ] 
Pre-Existing Roche Targets or [          ]Excluded RPI Targets would be too
many, but this number may be revised in the future if the Parties agree, after a
good faith negotiation, that such number is either too high or too low.  If the 
CMC concludes that there is a high probability that there may be too many 
Excluded RPI Targets or Pre-Existing Roche Targets, then [         ]Under no 
circumstances shall Roche be required to disclose to RPI the identity of any 
Pre-Existing Roche Targets, only whether Roche thinks that a number of 
Pre-Existing Roche Targets may exist in the Proposed Disease Phenotype.

        2.5 TERM OF A TARGET DISCOVERY PROGRAM. Each Target Discovery Program 
shall last approximately [        ]depending on such variables as the Proposed 
Disease Phenotype, the complexity of the screening to be done and the reasonable
expectation for the Ribozyme Technology to deliver an In Vitro Validated Target
within a clearly defined time line. The Program Management Committee may
terminate a Target Discovery Program if the PMC concludes that the Ribozyme
Technology does not appear to be working in a Target Discovery Program or that
the Target Discovery Program appears unlikely to yield Validated Targets. As
noted in the definition thereof, the Research Plan for a Target Discovery
Program shall contain the proposed term for such Target Discovery Program.

        2.6 EXCLUSIVITY RE DISEASE PHENOTYPE. Once the parties agree in writing
upon the Proposed Disease Phenotype, RPI shall work with Roche exclusively to
identify Targets against the Proposed Disease Phenotype for [         ]from the 
Commencement Date for the Target Discovery Program for such Proposed Disease
Phenotype unless such Target Discovery Program

                                       10

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<PAGE>
 
is terminated earlier pursuant to Section 0. As noted in the definition thereof,
the Research Plan for a Target Discovery Program shall expressly state the
Commencement Date for such Target Discovery Program.

3. CONDUCT OF TARGET DISCOVERY PROGRAM

        3.1 RESEARCH PLAN. The research shall be conducted in accordance with
the Research Plan. The Research Plan must be approved by the CMC prior to
commencement of a Target Discovery Program. Such Research Plan shall be amended
from time to time in writing by the PMC when significant changes occur in the
goals of a Target Discovery Program and target dates to accomplish such goals,
which amendment need not be approved by the CMC, but a copy of such Research
Plan shall be given to the CMC. If there is a conflict between the provisions of
the body of this Agreement and the Research Plan, then the provisions of the
body of this Agreement shall govern.

        3.2 RESEARCH EFFORTS. Each Party shall use Scientifically Reasonable and
Diligent Efforts to perform its respective responsibilities as set forth in the
Research Plan. Except as expressly provided in Section 9.1 or as otherwise
agreed from time to time by the Parties, the CRS and RPI shall each bear all of
its own expenses incurred in connection with each Target Discovery Program.

        3.3 AVAILABILITY OF RESOURCES. Each Party shall maintain laboratories,
offices and all other facilities reasonably necessary to carry out the Target
Discovery Program. Each Party agrees to make its employees and non-employee
consultants reasonably available at their respective places of employment to
consult with the other Party on issues arising in the course of a Target
Discovery Program and in connection with any request from any regulatory agency,
including, without limitation, regulatory, scientific, technical and clinical
testing issues. Representatives of RPI and Roche may, upon reasonable notice and
at times reasonably acceptable to the other Party (i) visit the facilities where
the research is being conducted; and (ii) consult informally, during such visits
and by telephone and electronic mail, with personnel of the other Party
performing work on the Target Discovery Program.

        3.4 REPORTS. Each Party shall make summary presentations of research
progress at each meeting of the PMC pursuant to a pre-determined agenda. Each
Party will also communicate informally and through the PMC to inform the other
of research done under a Target Discovery Program.

        3.5 RESULTS OF RESEARCH.

                3.5.1 EXCLUDED RPI TARGETS. If a Target Discovery Program
results in an Excluded RPI Target to which a Third Party does not have exclusive
rights, the CRS may request that RPI negotiate in good faith with Roche to enter
into an agreement to permit Roche to develop a Ribozyme Product against such 
Excluded RPI Target[          ]

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<PAGE>
 
        3.5.2 PRE-EXISTING ROCHE TARGETS. If a Target Discovery Program results
in a Validated Target that is a Pre-Existing Roche Target, Roche shall have no
obligation to pay milestones or royalties on any Non-Ribozyme Product that is
developed against a Pre-Existing Roche Target even if such Pre-Existing Roche
Target is also an In Vivo Validated Target, that is to say, if a Pre-Existing
Roche Target was validated using the Ribozyme Technology. If a Target Discovery
Program results in an In Vitro Validated Target (i) that is in the public domain
and (ii) on which Roche has a current research program or against which a
compound is either in development at or marketed by Roche, the PMC shall discuss
whether to take such In Vitro Validated Target into in vivo validated studies
under this Agreement. If the PMC decides to move forward with such In Vitro
Validated Target, milestones and royalties shall be due only on Products
developed under this Agreement and no milestones or royalties shall be due on
any compounds developed outside of this Agreement. [      ]Nothing in this 
Agreement, however, either explicit or implicit, shall be deemed to grant Roche
any license or right to any Ribozyme Technology to commercialize a Product
against any Pre-Existing Roche Target(s) except to the extent such Ribozyme
Technology was used to validate such Pre-Existing Roche Target under this
Agreement.

        3.6 EARLY TERMINATION OF TARGET DISCOVERY PROGRAM. If RPI is in breach
of the Agreement with respect to any Target Discovery Program and fails to cure
such breach within thirty (30) days after written notification by the CRS that
RPI is in breach of the Agreement, the CRS may terminate such Target Discovery
Program without terminating the Agreement. In such situation, RPI shall refund
to the CRS any FTEs costs paid by the CRS to RPI for such Target Discovery
Program on a pro-rated basis and the CRS shall have no obligation to pay
milestones and royalties for any Non-Ribozyme Product developed from Targets
arising from a Target Discovery Program terminated under this Section 3.6,
provided the Target is not an In Vivo Validated Target.


4. MANAGEMENT OF COLLABORATION

        4.1 FORMATION OF COLLABORATION MANAGEMENT COMMITTEE. The Research
Collaboration shall be managed by a group of key senior research executives from
RPI and Roche who will direct and oversee all of the Target Discovery Programs
(the "COLLABORATION MANAGEMENT COMMITTEE" or "CMC"). The CMC shall be comprised
of an equal number of members (unless a Party chooses to have fewer members)
appointed by each of Roche and RPI; provided that the size of the CMC shall not
exceed a total of six (6) members. Either Party may appoint substitute or
replacement members of the CMC to serve as their representatives. The initial
members of the CMC shall be appointed by the Parties within thirty (30) days
following the Effective Date. The CMC shall have the responsibility and 
authority to: [          ]

        4.2 MEETINGS OF COLLABORATION MANAGEMENT COMMITTEE. The Collaboration

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<PAGE>
 
Management Committee shall initially meet at least four (4) times per year at
locations and times to be determined by the CMC, with the intent of meeting at
alternating locations in Boulder, Colorado and Palo Alto, California, with each
Party to bear all travel and related costs for its members. Roche has the right
to substitute another Roche research site in the United States for Palo Alto,
California. In addition to regular CMC meetings, either Party may schedule a
special meeting at the other Party's offices on twenty-one (21) days prior
written notice. Under special circumstances, the CMC is also authorized to
conduct meetings by telephone or video conference. In addition, there shall be
regular contact by telephone, e-mail or other communication between meetings.

        4.3 DECISION-MAKING PROCESS. All decisions made or actions taken by the
CMC shall be made unanimously by its members with the RPI members cumulatively
having one vote and the RBS members cumulatively having one vote. Any
disagreement which cannot be resolved by the vote of the CMC shall be referred
to the Chief Executive Officer of RPI and the global head of Roche Discovery
Research. If the dispute remains unresolved, the global head of Roche Discovery
Research shall resolve the dispute in his or her sole discretion.

        4.4 DISSOLUTION. The CMC shall dissolve when [        ]or as otherwise 
agreed to in writing between the Parties.


5. MANAGEMENT OF A TARGET DISCOVERY PROGRAM

        5.1 FORMATION OF PROGRAM MANAGEMENT COMMITTEE. Each Target Discovery
Program will have a group of key scientists from RPI and the Collaborating Roche
Site who will direct and oversee the Target Discovery Program (the "PROGRAM
MANAGEMENT COMMITTEE" or "PMC"). The Program Management Committee shall be
comprised of members appointed by each of the CRS and RPI; provided that the
size of the PMC shall not exceed a total of three (3) members from each Party.
Either Party may appoint substitute or replacement members of the PMC to serve
as their representatives. At the time the Target Discovery Program is proposed,
the Parties shall appoint the initial members of the PMC for the proposed Target
Discovery Program. The final members of the PMC shall be confirmed by the
Parties within thirty (30) days following the Commencement Date for such Target
Discovery Program. The PMC shall have the responsibility and authority to:  
[          ]

        5.2 MEETINGS OF PROGRAM MANAGEMENT COMMITTEE. The Program Management
Committee shall meet with such frequency as the Parties may deem appropriate
(but shall be at least quarterly), at locations and times to be determined by
the PMC, with the intent of meeting at alternating locations in Boulder,
Colorado and the CRS with each Party to bear all travel and related costs for
its members. Unless the Parties agree otherwise, the first such meeting shall be
held at RPI. The host Party shall act as chair of the meeting and the other
Party shall act as secretary. The PMC shall keep formal minutes of its meetings.
Any member of the PMC may be

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separately with the Commission.
<PAGE>
 
represented at any meeting by another member of the PMC or by a deputy. In
addition to regular PMC meetings, either Party may schedule a special meeting at
the other Party's offices on twenty-one (21) days prior written notice. Under
special circumstances, the PMC is also authorized to conduct meetings by
telephone or video conference. In addition, there shall be regular contact by
telephone, e-mail or other communication between meetings.

        5.3 DECISION-MAKING PROCESS. All decisions made or actions taken by the
Program Management Committee shall be made unanimously by its members with the
RPI members cumulatively having one vote and the Roche members cumulatively
having one vote. Any disagreement which cannot be resolved by the vote of the
Program Management Committee shall be referred to senior research management of
RPI and the CRS. If the senior research management of RPI and the CRS cannot
resolve the matter, the dispute shall be referred to the CMC for resolution in
accordance with Section 4.3.

        5.4 DISSOLUTION. The Program Management Committee for a Target Discovery
Program shall dissolve when [       ]or as otherwise agreed to in writing 
between the Parties.


6. RIGHTS TO DEVELOP PRODUCTS

        6.1 ROCHE'S EXCLUSIVE RIGHTS TO DEVELOP PRODUCTS. Subject to the
exceptions set forth below, Roche shall have the exclusive right to develop
Ribozyme and Non-Ribozyme Products against Validated Targets. If Roche wishes to
commercialize any other nucleic acid molecule covered by Patent Rights of RPI
(other than Patent Rights developed or invented pursuant to this Agreement), the
Parties shall negotiate in good faith and under commercially reasonable terms, a
license agreement pursuant to which RPI shall license to Roche such Patent
Rights of RPI as needed to allow Roche to commercialize such molecule.

        6.2 UNAVAILABLE RIBOZYME PRODUCTS. Roche shall have no rights to develop
a Ribozyme Product against a Validated Target if such Validated Target is also
an Excluded RPI Target (except as set forth in Section 3.5.1).

        6.3 RPI'S ACCESS TO NON-RIBOZYME PRODUCTS. If Roche terminates
development or commercialization of a Non-Ribozyme Product against a specific In
Vivo Validated Target and Roche is no longer developing any Non-Ribozyme Product
against such In Vivo Validated Target, then RPI shall have the option to request
a license from Roche to the Roche Technology with respect to such In Vivo
Validated Target to develop a Non-Ribozyme Product against such In Vivo
Validated Target independently or with a Third Party; provided however, that
Roche shall decide in its sole discretion whether or not to enter into such
negotiations with RPI and shall have no obligation to grant such license to RPI
if Roche and RPI cannot agree on commercially reasonable terms and conditions of
a license after such good faith negotiation.

        6.4 RPI'S ACCESS TO RIBOZYME PRODUCTS.

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<PAGE>
 
                6.4.1 IN VITRO VALIDATED TARGETS. RPI shall have the right to
develop a Ribozyme Product against an In Vitro Validated Target that Roche does
not move forward into In Vivo validation studies within [          ] of such In 
Vitro Validated Target being validated, subject to the terms and conditions of
this Agreement, including but not limited to Sections 6.4.5 and 6.5.

                6.4.2 ROCHE ELECTS NOT TO DEVELOP A RIBOZYME PRODUCT.  Upon 
[          ]the Collaborating Roche Site shall send RPI written notice stating
whether it will proceed with a Ribozyme Product and/or Non-Ribozyme Product
against such Validated Target. If the CRS elects to develop only a Non-Ribozyme 
Product, [          ]

                6.4.3 DUE DILIGENCE FAILURE. If Roche (i) fails to use
Scientifically Reasonable and Diligent Efforts in developing at least one
Product against an In Vivo Validated Target and such failure continues for 
[          ]subject to the terms and conditions of this Agreement, including but
not limited to Sections 6.4.5 and 6.5.  Roche shall retain the exclusive right 
to develop a [          ]against such In Vivo Validated Target.

                6.4.4 TERMINATION OF A RIBOZYME PRODUCT. If Roche terminates
development or commercialization of a Ribozyme Product against a specific In
Vivo Validated Target and Roche is no longer developing any Ribozyme Product
against any Validated Target identified through the same Target Discovery 
Program, [          ] subject to the terms and conditions of this Agreement,
including but not limited to Section 6.4.5 and 6.5.

                6.4.5 ROCHE TECHNOLOGY LICENSE. If RPI develops a Ribozyme
Product against a Validated Target pursuant to this Section 6.4, RPI must obtain
a Roche Technology License from Roche which shall be royalty-bearing in
accordance with Section ERROR! REFERENCE SOURCE NOT FOUND..  [          ]

        6.5 ROCHE'S RIGHTS TO RIBOZYME PRODUCTS DEVELOPED BY RPI.

                6.5.1 INCLUSION OPTION. Roche may include any Ribozyme Product
that RPI is developing against a Validated Target (other than an Excluded RPI
Target) in this Agreement (the "INCLUSION OPTION") upon written notice to RPI at
any time during the term of this Agreement except [          ] 

                6.5.2 RIGHT OF FIRST NEGOTIATION. If RPI is developing a
Ribozyme Product against a Validated Target (other than an Excluded RPI Target),
[          ]


7. DEVELOPMENT AND COMMERCIALIZATION

        7.1 DEVELOPMENT DECISIONS. Roche will solely determine whether or not to
develop a Ribozyme Product, Non-Ribozyme Product, or no Product against a
Validated Target.

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<PAGE>
 
        7.2 DEVELOPMENT UPDATES. Roche shall keep RPI informed of its
development activities with respect to Products by semi-annually providing RPI
with a written report stating the status of development of each such Product.
Roche shall notify RPI of the achievement of milestones within [        ]thereof
and shall promptly inform RPI when Roche terminates development or 
commercialization of any Product. Upon commencement of clinical development of a
Ribozyme Product, [          ]

        7.3 NO OBLIGATION TO DEVELOP A PRODUCT. With respect to any Product,
Roche (i) is under no obligation to obtain the following (a) an approval or
consent to market, (b) any other consent or approval from any regulatory
authority, (c) to reach particular Net Sales thresholds, (ii) shall not be
prohibited from withdrawing any such Product from the market for any reason, and
(iii) shall have no liability to RPI if any of the following occur: (a) any such
consents or approvals are not obtained or are withdrawn, or (b) if obtaining or
reaching such consents or approvals are delayed.

        7.4 REGULATORY WORK. Roche is solely responsible for the preparation and
filing of all Drug Approval Applications and all activities necessary for such
Drug Approval Applications relating to the manufacture, marketing and sale of
any Product being developed by Roche. Such Drug Approval Applications will be
filed in the name of Roche or Roche's designee.

        7.5 PRE-EXISTING ROCHE TARGETS. Notwithstanding anything contained
herein, RPI shall not have and shall not obtain in the future any rights to any
Pre-Existing Roche Target and Roche shall have no obligation to pay milestones
or royalties on any Non-Ribozyme Product that is developed against a 
Pre-Existing Roche Target even if such Pre-Existing Roche Target is also a 
Validated Target.


8. DIAGNOSTIC PRODUCTS

        8.1 DIAGNOSTIC PRODUCTS. Roche has the exclusive right to develop, make
and commercialize diagnostic Products based upon the Validated Targets [       ]
RPI shall retain the exclusive right to make or have made a diagnostic Product
that is a Ribozyme Product for Roche.

        8.2 ROYALTY-FREE DIAGNOSTIC PRODUCTS. If Roche wishes to develop, make
and commercialize a therapeutic drug monitoring or 
pharmacogenomics/pharmacogenetics diagnostic Product under Section 8.1 [       ]
Otherwise such Products shall be royalty-bearing in accordance with Section 8.1.


9. PAYMENTS

        9.1 FTE SUPPORT.

                9.1.1 IN VITRO TARGET DISCOVERY AND VALIDATION STUDIES. The
Collaborating Roche Site shall provide funding of each Target Discovery Program 
at up to [          ]to support 

                                       16

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separately with the Commission.
<PAGE>
 
RPI research in accordance with the Research Plan for a particular Target
Discovery Program.

                9.1.2 IN VIVO TARGET VALIDATION STUDIES. If RPI performs the In
Vivo Target Validation studies based on the recommendations of the Program 
Management Committee, [          ]

                9.1.3 PAYMENT. The first payment for FTEs shall provide the
first [         ]

        9.2 REAGENT COSTS.

                9.2.1 IN VITRO TARGET VALIDATION STUDIES. The Collaborating
Roche Site [          ]

                9.2.2 IN VIVO TARGET VALIDATION STUDIES. If RPI performs the In
Vivo Target Validation studies based on the recommendations of the Project Team,
[          ]

        9.3 MILESTONES.

                9.3.1 EXPLORATORY MILESTONES. Roche shall pay RPI the following
amounts within [        ]days after each occurrence of the following events. 
[          ]

        Payment               Milestone

        [          ]
        [          ]
        [          ]

                9.3.2 CLINICAL MILESTONES FOR NON-RIBOZYME PRODUCTS. Roche shall
pay RPI the following amounts within [         ]after each occurrence of the 
following events. [          ]

        Payment               Milestone

        [          ]
        [          ]
        [          ]
        [          ]
        [          ]
        [          ]
        [          ]

                9.3.3 CLINICAL MILESTONES FOR RIBOZYME PRODUCTS.  Roche shall 
pay RPI the following amounts within [          ]after each occurrence of the 
following events.  [          ]

                                       17

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<PAGE>
 
        Payment               Milestone

[          ]
[          ]
[          ]
[          ]
[          ]
[          ]
[          ]

                9.3.4 [          ].

                        9.3.4.1 [          ]

                        9.3.4.2 [          ]

                9.3.5 [          ]

        9.4 ROYALTIES

                9.4.1 NON-RIBOZYME PRODUCT

                        9.4.1.1 BASE ROYALTY. Roche shall pay RPI a royalty of 
[       ]on the Net Sales of each Non-Ribozyme Product.

                        9.4.1.2 DE-BLOCKING LICENSE.  [          ]

                9.4.2 RIBOZYME PRODUCT.

                        9.4.2.1 BASE ROYALTY. Roche shall pay RPI a royalty of 
[       ]on the Net Sales of each Ribozyme Product.

                        9.4.2.2 ROYALTY REDUCTION - RIBOZYME PRODUCT. [        ]

                9.4.3 [          ]

                9.4.4 [          ]

                9.4.5 NO PATENT PROTECTION. During the Royalty Term, if a
Product is not Covered by a Valid Claim of a Patent and there is Substantial
Competition in a country with respect to such Product in a calendar year, each 
Royalty Rate shall be reduced to [      ]of the total royalties otherwise due 
under this Agreement for know-how and any other technology necessary to
commercialize the Product.

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<PAGE>
 
10. RECORDS; AUDITS; AND REPORTS

        10.1 RECORDS. During the term of this Agreement and for a period of 
[       ]thereafter, the Party paying royalties (the "ROYALTY PAYING PARTY")
shall keep (and shall require its Affiliates and sublicensees to keep,) full,
true and accurate books of account containing all particulars that may be
necessary for the purpose of calculating all royalties payable to the other
Party (the "ROYALTY RECEIVING PARTY"). Such books of accounts shall be kept at
the Royalty Paying Party's principal place of business.

        10.2 AUDIT. At the Royalty Receiving Party's expense, Royalty Receiving
Party or its authorized independent public accountant has the right to engage
Royalty Paying Party's independent public accountant to perform, on behalf of
its independent public accountant, an audit, conducted in accordance with
generally accepted auditing standards in the United States of America, of such
books and records of Royalty Paying Party that are deemed necessary by Royalty
Paying Party's independent public accountants to report on Net Sales of the
Product for the period or periods requested by Royalty Receiving Party. Such
audit shall not be performed more frequently than once per calendar year nor
more frequently than once with respect to records covering any specific period
of time, upon at least thirty (30) working days' prior written notice, and shall
be conducted during regular business hours in such a manner as to not
unnecessarily interfere with Royalty Paying Party's normal business activities.
All information, data documents and abstracts herein referred to shall be used
only for the purpose of verifying royalty statements or compliance with this
Agreement, shall be treated as the Royalty Paying Party's Confidential
Information subject to the obligations of this Agreement and need neither be
retained more than one (1) year after completion of an audit hereof, if an audit
has been requested; nor more than two (2) years from the end of the calendar
year to which each shall pertain; nor more than one (1) year after the date of
termination of this Agreement. The failure of the Royalty Receiving Party to
request verification of any royalty calculation during the period when records
must be retained shall be deemed acceptance of the accuracy of such reporting.

        10.3 PAYMENT; REPORTS. All royalty payments due to either Party under
this Agreement shall be paid in United States dollars within sixty (60) days of
the end of each calendar quarter, unless otherwise specifically provided herein.
Each payment of royalties shall be accompanied by a report of Net Sales in
sufficient detail to permit confirmation of the accuracy of the royalty payment
made.

        10.4 EXCHANGE RATE. Royalty payments and reports for the sale of
Products shall be calculated and reported for each calendar quarter. With
respect to each quarter, for countries other than the United States, whenever
for the purpose of calculating royalties conversion from any foreign currency
shall be required, such conversion shall be made as follows:

                10.4.1 ROCHE EXCHANGE RATE. When calculating the Adjusted Gross
Sales for Roche, the amount of such sales in foreign currencies shall be
converted into Swiss Francs as

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<PAGE>
 
computed in the central Roche's Swiss Francs Sales Statistics for the countries
concerned, using the average monthly rate of exchange at the time for such
currencies as retrieved from the Reuters System.  When calculating the royalties
on Net Sales for Roche, such conversion shall be at the average rate of the
Swiss Franc to the United States dollar as retrieved from the Reuters System for
the applicable calendar quarter. With respect to royalties due on Net Sales in
the United States, Roche shall report and have paid to RPI such royalties in
United States currency directly from one of its Affiliates in the United States.

                10.4.2 RPI EXCHANGE RATE. When calculating the Adjusted Gross
Sales for RPI, the amount of such sales in foreign currencies shall be converted
into United States dollars for the countries concerned, using the average
monthly rate of exchange for such currencies as retrieved from the Reuters
System or such other exchange mechanism as Roche shall approve, which approval
shall not be unreasonably withheld or delayed.

                10.4.3 RESTRICTIONS ON CONVERSION. If a Product is sold in a
country in which legal restrictions prohibit the transfer of United States
Dollars or Swiss Francs outside such country or the conversion of the local
currency to United States Dollars or Swiss Francs (a "BLOCKED COUNTRY") the
following provisions shall apply to the payment of the corresponding royalty,
depending on where the Product is manufactured.

                        10.4.3.1 PRODUCT MANUFACTURED IN A BLOCKED COUNTRY. If
such Product is manufactured in the same or another Blocked Country, the Royalty
Paying Party shall have the option to make such payment by depositing the amount
thereof in the currency of either the Blocked Country where the Product is sold
or the Blocked Country where the Product is manufactured, at the Royalty
Receiving Party's election, to the Royalty Receiving Party's account in a bank
designated by the Royal Receiving Party in such Blocked Country.

                        10.4.3.2 PRODUCT NOT MANUFACTURED IN A BLOCKED COUNTRY.
If such Product is manufactured in a country that is not a Blocked Country, then
the payment shall be made as follows. The applicable royalty rate shall be
multiplied by the Transfer Price (the "INITIAL ROYALTY PAYMENT"). The Transfer
Price is the price at which the Product is sold to the entity selling such
Product in the Blocked Country. The Royalty Paying Party or its Affiliates shall
(i) pay the Royalty Receiving Party in United States Dollars the Initial Royalty
Payment and (ii) deposit the difference between the royalty payment due and the
Initial Royalty Payment to the Royalty Receiving Party's account in a bank
designated by the Royalty Receiving Party in such Blocked Country in the
currency of such Blocked Country.

                10.4.4 PROHIBITED ROYALTY RATES. If rates of royalties provided
for herein are prohibited by law or regulation in any country where a Product is
sold, the Royalty Paying Party shall pay to the Royalty Receiving Party a
royalty at the highest rate permitted in that country for a license of the type
herein granted, provided that such rate is less than the rate applicable under
this Agreement.

                                       20

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
        10.5 MANNER AND PLACE OF PAYMENT. All payments owed under this Agreement
shall be made by wire transfer, unless otherwise specified by the receiving
Party.

        10.6 LATE PAYMENTS. In the event that any payment, including royalty,
milestone and research payments, due hereunder is not made when due, the payment
shall accrue interest from the date due until the date paid at the rate of 
[          ]per month; provided that in no event shall such rate exceed the
maximum legal annual interest rate. The payment of such interest shall not limit
any Party from exercising any other rights it may have as a consequence of the
lateness of any payment.

        10.7 TAXES. All turnover and other taxes levied on account of the
royalties and other payments accruing to each Party under this Agreement shall
be paid by the Party receiving such royalty or other payment for its own
account, including taxes levied on income of the Royalty Receiving Party. If
provision is made in law or regulation for withholding, such tax shall be
deducted from the royalty or other payment made by the Party making such payment
to the proper taxing authority and a receipt of payment of the tax secured and
promptly delivered to the Royalty Receiving Party. Each Party agrees to assist
the other Party in claiming exemption from such deductions or withholdings under
any double taxation or similar agreement or treaty from time to time in force.


11. PATENT RIGHTS AND INFRINGEMENT

        11.1 INVENTORSHIP. Any Invention that is made (i) solely by one or more
representatives of RPI shall be deemed invented solely by RPI (a "RPI
INVENTION"); (ii) solely by one or more representatives of Roche shall be deemed
invented solely by Roche (a "ROCHE INVENTION"); and (iii) jointly by one or more
representatives of RPI and one or more representatives of Roche shall be deemed
invented jointly by RPI and Roche (a "JOINT INVENTION"). Any Non-Patented
Technology that is made (i) solely by one or more representatives of RPI shall
be deemed invented solely by RPI, (ii) solely by one or more representatives of
Roche shall be deemed invented solely by Roche; and (iii) jointly by one or more
representatives of RPI and one or more representatives of Roche shall be deemed
invented jointly by RPI and Roche. Determination of inventorship shall be made
in accordance with the patent laws of the United States of America. If the
parties cannot agree on inventorship, determination of inventorship shall be
made by mutually agreed upon patent counsel in accordance with the patent laws
of the United States of America.

        11.2 OWNERSHIP.

                11.2.1 NON-RIBOZYME. Regardless of inventorship, Roche shall own
all rights to all Inventions and Non-Patented Technology relating to 
Non-Ribozyme Products under this Agreement, including but not limited to rights
to Targets and to novel functions identified for known Target(s).

                                       21

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
                11.2.2 RIBOZYMES. Regardless of inventorship, RPI shall own all
rights to all Inventions and Non-Patented Technology for Ribozymes under this
Agreement, including but not limited to specific Target sites cleaved by a
Ribozyme.

                11.2.3 OTHER INVENTIONS AND NON-PATENTED TECHNOLOGY. All
Inventions and Non-Patented Technology ownership of which is not determined in
accordance with Sections 11.2.1 and 11.2.2 shall be owned by the Party who
invented it or, if a Joint Invention or Joint Non-Patented Technology, jointly
as the case may be.

        11.3 PATENT MANAGEMENT.

                11.3.1 FILING PARTY. The Party owning the Invention shall be
responsible for the preparation, filing, prosecution, and maintenance (the
"PATENT MANAGEMENT") of a Patent (the "FILING PARTY"), subject to the provisions
of Sections 11.3.2 and 11.3.3. For all Joint Inventions, other than those
covered by Sections 11.3.2 and 11.3.3, the Parties shall discuss in good faith
which Party shall be the Filing Party; provided, however, that notwithstanding
Section 11.4, Patent Costs for such Joint Inventions shall be shared equally
unless the Parties agree otherwise in writing.

                11.3.2 RIBOZYMES. Except as set forth below, RPI shall take any
and all actions necessary with respect to the Patent Management of Patents,
including those Roche Inventions or Joint Inventions, claiming Ribozymes
discovered or identified as a result of any Target Discovery Program ("RIBOZYME
INVENTIONS"). For a given priority patent application claiming a Ribozyme
Invention, RPI shall provide to Roche no later than eight (8) months after the
priority filing date, a list of countries in which it intends to perform
corresponding foreign filings. Prosecution will be at RPI's sole expense with
Roche having the right to pursue prosecution or filing of those Ribozyme
Inventions RPI chooses not to pursue at Roche's expense, including foreign
filing in countries not elected by RPI. The Filing Party shall provide the other
Party with its final draft of any priority patent application directed towards
or claiming such Ribozyme Inventions (the "RIBOZYME APPLICATION") at least
thirty (30) days prior to filing the Ribozyme Application for review and comment
by the other Party. The Filing Party shall endeavor in good faith to incorporate
such comments. If the other Party fails to respond within such thirty (30) day
time period, the Filing Party shall not be obligated to delay the filing of such
Ribozyme Application. In addition, the Filing Party shall promptly provide the
other Party with copies of all substantive communications to and from the patent
offices of the United States, Canada, Mexico, Japan, or the European Patent
Office regarding such Ribozyme Applications and resulting Patents, within ten
(10) business days of filing with or receipt from the patent office. If RPI
decides to abandon a Ribozyme Application or resulting Patent, RPI shall provide
written notice of its decision to Roche at least ninety (90) days before any 
non-extendible deadline and offer to transfer Patent Management to the other
Party, who may accept such transfer in its sole discretion and cost.

                11.3.3 TARGETS. Roche shall take those actions it deems
appropriate to file and

                                       22

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
prosecute patent applications, including those RPI Inventions or Joint
Inventions claiming Target(s) inventions resulting from a Target Discovery
Program ("TARGET INVENTIONS") in those countries that Roche determines in its
sole judgment to be appropriate countries for filing a patent claiming a Target
Invention. Roche shall provide RPI with its final draft of any priority patent
application directed towards or claiming such Target Invention (the "TARGET
APPLICATION") at least thirty (30) days prior to filing the Target Application
for review and comment by the other Party. Roche shall endeavor in good faith to
incorporate such comments. If RPI fails to respond within such thirty (30) day
time period, Roche shall not be obligated to delay the filing of such Target
Application. In addition, Roche shall promptly provide RPI with copies of all
substantive communications to and from the patent offices of the United States,
Canada, Mexico, Japan, or the European Patent Office regarding such Target
Applications and resulting Patents, if Roche has filed a Target Application in
such country or countries, within ten (10) business days of filing with or
receipt from the patent office.

        11.4 PATENT COSTS. The Filing Party shall be responsible for all Patent
Costs for the Patent Rights unless and until transferred to the other Party.

        11.5 COOPERATION OF THE PARTIES. Each Party agrees to cooperate fully in
the Patent Management of any Patent Rights under this Agreement. Such
cooperation includes, but is not limited to: (i) turning over to the Filing
Party copies of all files, papers and documents relating to such Patent; (ii)
executing all papers and instruments, or requiring its employees or agents, to
execute such papers and instruments, so as to effectuate the ownership of Patent
Rights set forth in Section 11.1 and to enable the other Party to apply for and
to prosecute Applications in any country; and (iii) promptly informing the other
Party of any matters coming to such Party's attention that may affect the Patent
Management of any such Application.

        11.6 INFRINGEMENT BY THIRD PARTIES. Each Party shall promptly notify the
other Party in writing of any alleged or threatened infringement by a Third
Party of any RPI Patent Rights or Roche Patent Rights of which they become aware
and provide the other Party with all evidence in its possession demonstrating
said infringement. The Parties agree to cooperate in taking commercially
reasonable legal actions to protect the commercial interests of the Parties in
any Target Discovery Program or a Product against infringement by Third Parties.
The Filing Party shall take the lead in any such action. If, within three (3)
months following learning of the infringement by a Third Party and after a
written request by the other Party, such Party fails to take commercially
reasonable action against the Third Party to halt such alleged infringement, the
other Party shall, in its sole discretion, have the right to take such action in
such country as it deems warranted in the name of the other Party; the Party
maintaining such action shall be responsible for the costs of maintaining the
action and shall be entitled to receive all damages recovered from the action
for the past infringement. Each Party shall join in the action, but shall be
under no obligation to participate except to the extent that such participation
is required as a result of its being a named party to the action. If more than
one Party wishes to participate in taking action to protect the commercial
interests of the Parties in the Product against infringement, then an authorized
representative of each Party shall control such action; the costs

                                       23

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
of maintaining such action shall be shared equally by the Parties, and the
damages recovered from such action for the past infringement shall be shared
equally by the both Parties. Each Party shall render such reasonable assistance
as the prosecuting Party may request. Notwithstanding the foregoing, RPI shall
handle in its sole discretion and expense any oppositions, interferences, or
litigation relating to the Ribozyme Technology/Cech patents and shall keep Roche
informed on a regular basis, but no less than quarterly, of the status of any
such oppositions, interferences, or litigation, and shall promptly provide Roche
with copies of all substantive communications relating thereto.

        11.7 THIRD PARTY PATENT RIGHTS. Each Party shall promptly notify the
other if it receives any notice that activities involving the Research
Collaboration or the development or commercialization of Product allegedly
infringe a Third Party's proprietary rights. The Parties shall consult
concerning the action(s) to be taken. The Royalty Paying Party shall have the
sole right and responsibility for addressing such alleged infringement regarding
Products, and bearing the cost thereof, subject to Article 15.


12. LICENSES AND OTHER COMMERCIAL RIGHTS

        12.1 RESEARCH LICENSES.

                12.1.1 RPI LICENSE TO ROCHE. RPI hereby grants Roche a
non-exclusive, worldwide, royalty free license, without the right to sublicense,
to all RPI intellectual property, including but not limited to Ribozyme
Technology, necessary for Roche to conduct research under this Agreement.

                12.1.2 ROCHE LICENSE TO RPI. Roche hereby grants RPI a
non-exclusive, worldwide, royalty free license, without right to sublicense, to
Roche intellectual property necessary for RPI to perform its obligations under
this Agreement during a Target Discovery Program.

        12.2 RIBOZYME TECHNOLOGY LICENSE.

                12.2.1 RIBOZYME PRODUCTS. RPI hereby grants Roche a sole and
exclusive, worldwide, royalty bearing (in accordance with Section 9.4) license
(without the right to sublicense except to Affiliates) under Ribozyme Technology
and RPI Inventions to develop, use, offer to sell, sell or import Ribozyme
Products against a Validated Target during the term of this Agreement. Such
license does not include the right to develop, use, offer to sell or import
Ribozyme Product(s) against an Excluded RPI Target unless the Parties negotiate
a separate agreement in accordance with Section 3.5.1.

                12.2.2 NON-RIBOZYME PRODUCTS. To the extent not covered by
provisions of Section 12.1.1 and to the extent necessary to develop, make, have
made, use, offer to sell, sell or import Non-Ribozyme Products, RPI hereby
grants Roche a sole and exclusive, worldwide, 

                                       24

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
royalty bearing license (with the right to sublicense) under Ribozyme Technology
and RPI Inventions to develop, make, have made, use, offer to sell, sell or
import Non-Ribozyme Products during the term of this Agreement.

        12.3 LICENSE TO OTHER INVENTIONS AND NON-PATENTED TECHNOLOGY. RPI hereby
grants Roche a non-exclusive, worldwide, royalty free license, without the right
to sublicense, to use the Inventions and Non-Patented Technology owned by RPI
pursuant to Section 11.2.3 that are not covered by Section 12.2 for research and
commercialization of Products developed under this Agreement..

        12.4 FUTURE LICENSES.  Upon the successful completion of [          ]
Target Discovery Programs, Roche will have the option to license the Target
Discovery Technology (and any technology necessary to practice such Target
Discovery Technology) from RPI for use in Roche's internal target discovery 
programs. [          ]Nothing in this Section shall be deemed to grant Roche any
license or right to use the Ribozyme Technology for any other purpose than as
reflected in the terms and conditions of this Agreement.

        12.5 COVENANT OF NON-USE. Neither Party shall practice the Patent Rights
and/or Non-Patented information and materials of the other Party other than as
expressly licensed under this Article 11.

        12.6 MANUFACTURING RIBOZYME PRODUCTS. RPI has the right to manufacture
Ribozyme Products and shall manufacture Ribozymes for research pursuant to the
Research Plan. [          ].


13. CONFIDENTIALITY

        13.1 NONDISCLOSURE. During the term of this Agreement and for a period
of five (5) years after termination hereof, neither Party shall disclose any
Confidential Information received from the other Party to any Third Party, or
use any such Confidential Information for any purpose other than accomplishing
the purposes of this Agreement, except as expressly authorized by this Agreement
or as required by any regulatory agency or by any governmental rule, regulation,
law or court order. Each Party may disclose such Confidential Information to its
Affiliates, employees, agents, consultants, collaborators, and other
representatives with a need to know such Confidential Information to accomplish
the purposes of this Agreement. Each Party may disclose the financial terms of
this Agreement and any other necessary Confidential Information to a Third Party
for purposes of obtaining financing. In addition, RPI shall use its best efforts
to disclose only non-Confidential Information to a prospective Third Party
collaborator but should such prospective Third Party collaborator request
additional information, RPI may disclose to a prospective Third Party
collaborator certain Confidential Information relating to the success of this
Collaboration and of the Target Discovery Technology but only with the prior
written consent of RBS and the Roche Collaborating Site, which may not be
unreasonably withheld. RPI acknowledges that the identification of the Validated
Targets is highly Confidential Information to Roche and that Roche will be under
no obligation to permit

                                       25

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
RPI to disclose such Confidential Information to any Third Party. Any disclosure
by either Party to a Third Party shall be pursuant to a Confidentiality
Agreement containing terms and conditions no less stringent than those contained
herein. Each Party shall promptly notify the other upon discovery of any
unauthorized use or disclosure of such Confidential Information. Upon
termination of a Target Discovery Program, each Party shall return to the other
Party promptly upon request any tangible embodiment of such Confidential
Information provided by the other Party; provided, however, that one copy shall
be kept by the receiver Party's legal department for purposes of interpreting
this Agreement.

        13.2 EXCEPTIONS. Confidential Information shall not include any
information which the receiving Party can prove by competent evidence:

                13.2.1 is now, or hereafter becomes, through no act or failure
to act on the part of the receiving Party, generally known or available;

                13.2.2 is known by the receiving Party at the time of receiving
such information, as evidenced by its records;

                13.2.3 is hereafter furnished to the receiving Party by a Third
Party, as a matter of right and without restriction on disclosure;

                13.2.4 is independently developed by the receiving Party without
the aid, application or use of Confidential Information; or

                13.2.5 is the subject of a written permission to disclose
provided by the disclosing Party.

        13.3 PUBLICATIONS. Each Party to this Agreement recognizes that the
publication of papers regarding results of the Research Collaboration, including
oral presentations and abstracts, may be beneficial to both Parties provided
such publications are subject to reasonable controls to protect Confidential
Information. In particular, it is the intent of the Parties to maintain the
confidentiality of any information regarding the Targets and the Products
included in any patent application until such patent application has been 
published. [          ]


14. REPRESENTATIONS, WARRANTIES AND COVENANTS

        14.1 BY BOTH PARTIES.

                14.1.1 DULY ORGANIZED. Each Party hereby represents and warrants
that such Party is duly organized and validly existing under the laws of the
state of its incorporation and has full corporate power and authority to enter
into this Agreement and to carry out the provisions hereof.

                                       26

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
                14.1.2 DUE AUTHORIZATION. Each Party hereby represents and
warrants that such Party is duly authorized to execute and deliver this
Agreement and to perform its obligations hereunder.

                14.1.3 BINDING AGREEMENT. Each Party hereby represents and
warrants that this Agreement is a legal and valid obligation binding upon it and
is 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 authority over it.

        14.2 REPRESENTATIONS AND WARRANTIES BY RPI

                14.2.1 PATENT INFRINGEMENT. To the best of RPI's knowledge, as
of the Effective Date and except as disclosed to Roche as of the Effective Date
it is not aware of any patent or other intellectual property right of any other
person that would be infringed by the research contemplated under the Research
Plan.

                14.2.2 SUFFICIENT RIGHTS. RPI owns or possesses adequate
licenses or other rights to use all patents, patent rights, inventions, and 
know-how including an exclusive license to the Cech Patents and Ribozyme
Technology to conduct research, to grant rights and licenses granted herein to
Roche, and to fulfill its other duties and obligations pursuant to this
Agreement.

                14.2.3 LICENSES TO THE CECH PATENTS AND RIBOZYME TECHNOLOGY. RPI
has fully complied, and will use its best efforts to remain in material
compliance with, and is not in breach of, and this Agreement will not materially
breach, any terms, conditions or obligations of all the RPI licenses to the Cech
Patents and Ribozyme Technology.

        14.3 DISCLAIMER OF WARRANTIES. Neither Party guarantees the safety or
usefulness of any Target, Research Compound or Product. EXCEPT AS EXPRESSLY SET
FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY TO
THE OTHER PARTY OF ANY NATURE, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION
ANY WARRANTY OF NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.


15. INDEMNIFICATION

        15.1 INDEMNIFICATION BY RPI. RPI shall defend, indemnify and hold RBS,
its Affiliates and their respective officers, directors, stockholders,
employees, agents, and representatives (collectively, the "ROCHE INDEMNITEES")
harmless on an after-tax basis from and against any and all claims, liabilities,
losses, damages, costs and expenses in respect of claims against the Roche
Indemnities by parties other than the Roche Indemnitees, including fees and
disbursements of counsel and expenses of reasonable investigation (collectively,
"ROCHE LOSSES"), arising out of,

                                       27

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
based upon or caused by: (i) the inaccuracy of any representation or the breach
of any warranty, covenant or agreement of RPI contained in this Agreement; (ii)
any negligence or intentional wrongdoing in the research conducted by RPI, its
Affiliates or designees; or (iii) any act, method, or other technology employed
by RPI in producing, using, or researching that violates any Third Party Patent
Rights or any licenses to the Cech Patents and Ribozyme Technology entered by
RPI prior to the Effective Date or during the term of this Agreement, (iv) the
development, pre-clinical testing, and clinical testing, manufacture, sale
and/or use (including, but not limited to product liability claims) of any
Ribozyme Product or Non-Ribozyme Products made, used or distributed by RPI, its
Affiliates, or its licensees in the event RPI proceeds with the development and
marketing of any Ribozyme or Non-Ribozyme Product (except in each case to the
extent that any Roche Loss is due to the gross negligence or willful misconduct
of Roche Indemnitees)

        15.2 INDEMNIFICATION BY RBS. RBS shall defend, indemnify and hold RPI,
its Affiliates, subcontractors and their respective officers, directors,
stockholders, employees, agents, and representatives (collectively, the "RPI
INDEMNITEES") harmless on an after-tax basis from and against any and all
claims, liabilities, losses, damages, costs and expenses in respect of claims
against the RPI Indemnitees by parties other than the RPI Indemnitees, including
fees and disbursements of counsel and expenses of reasonable investigation
(collectively, "RPI LOSSES"), arising out of, based upon or caused by: (i) the
inaccuracy of any representation or the breach of any warranty, covenant or
agreement of RBS contained in this Agreement or in any other agreement or
instrument delivered by RBS pursuant to this Agreement; (ii) any negligence or
intentional wrongdoing in the research conducted by RBS, its Affiliates or
designees; or (iii) the development, pre-clinical and clinical testing,
manufacture, sale and/or use (including but not limited to product liability
claims) of any Ribozyme Product or Non-Ribozyme Product made, used or
distributed by RBS, its Affiliates or its licensees (except in each case to the
extent that any RPI Loss is due to the gross negligence or willful misconduct of
RPI Indemnitees).

        15.3 INDEMNIFICATION NOTICE. A Party seeking indemnification pursuant to
Section 15.1 or 15.2 (an "INDEMNIFIED PARTY") shall give prompt written notice
to the Party from whom such indemnification is sought (the "INDEMNIFYING PARTY")
of the assertion of any claim, or the commencement of any action, suit or
proceeding, in respect of which indemnity is or may be sought hereunder and will
give the Indemnifying Party such information with respect thereto as the
Indemnifying Party may reasonably request, but no failure to give such notice
shall relieve the Indemnifying Party of any liability hereunder (except to the
extent the Indemnifying Party has suffered actual prejudice thereby).

        15.4 PARTICIPATION IN DEFENSE. The Indemnifying Party may, at its
expense, participate in or assume exclusive control of the defense or management
(including all decisions relating to litigation, settlement and appeal) of any
such action, suit or proceeding involving a Third Party and it is a condition
precedent to the Indemnifying Party's indemnification obligations hereunder that
the Indemnified Party permit the Indemnifying Party to exercise this right. In
such case the Indemnified Party shall have the right (but not the duty) to
participate in the defense thereof, and to employ counsel, at its own expense,
separate from counsel employed by the Indemnifying

                                       28

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
Party in any such action and to participate in the defense thereof. The
Indemnifying Party shall be liable for the fees and expenses of one firm as
counsel (and appropriate local counsel) employed by the Indemnified Party if the
Indemnifying Party has not assumed the defense thereof. Whether or not the
Indemnifying Party chooses to defend or prosecute any claim involving a Third
Party, all the parties hereto shall cooperate in the defense or prosecution
thereof and shall furnish such records, information and testimony, and attend
such conferences, discovery proceedings, hearings, trials and appeals, as may be
reasonably requested in connection therewith; provided, that, the Indemnifying
Party shall reimburse the Indemnified Party for all out-of-pocket costs and
expenses incurred at the Indemnifying Party's request in connection with the
foregoing.

        15.5 SETTLEMENTS. The Indemnifying Party shall not be liable under this
Article 15 for any settlement effected without its prior written consent of any
claim, litigation or proceedings in respect of which indemnity may be sought
hereunder, unless the Indemnifying Party refuses to acknowledge liability for
indemnification under this Article 15 and/or declines to defend the Indemnified
Party in such claim, litigation or proceeding, and such claim is one for which
the Indemnifying Party is responsible under this Article 15. 


16. TERM AND TERMINATION

        16.1 TERM. The term of this Agreement shall begin on the Effective Date
and terminate at the end of the Royalty Term for the last Product in the country
with the last to expire royalty obligation, unless terminated earlier in
accordance with the provisions of Section 16.2.

        16.2 TERMINATION WITHOUT CAUSE. RBS may terminate this Agreement at any
time and for any reason upon six (6) months' prior written notice.

        16.3 TERMINATION FOR CAUSE. Either Party may terminate this Agreement
upon [          ]written notice upon the occurrence of any of the following:

                16.3.1 Upon or after the bankruptcy, dissolution or winding up
of the other Party (other than dissolution or winding up for the purposes of
reconstruction or amalgamation); or

                16.3.2 Upon or after the material breach of this Agreement by
the other Party if the breaching Party has not cured such breach within the 
[          ]following written notice of such termination by the other Party.

        16.4 EFFECT OF EXPIRATION OR TERMINATION

                16.4.1 SURVIVAL. Expiration or termination of this Agreement
shall not relieve the Parties of any obligation accruing prior to such
expiration or termination. Except as otherwise specifically set forth in this
Section 16 or elsewhere in this Agreement, the obligations and rights of the
Parties under Sections 3.5, 9.3, 9.4, and 16.4 and Articles 6, 8, 10, 11, 12,
13,

                                       29

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
14, 15, 17, and 18 shall survive termination or expiration of this Agreement.
Should this Agreement expire in accordance with its terms, Section 11.3 shall
not survive expiration of the Agreement.

                16.4.2 RBS TERMINATES FOR CAUSE.  Without limiting any remedies
otherwise available to RBS, if RBS terminates this Agreement for cause pursuant 
to Section 16.2, [          ]

                16.4.3 RPI TERMINATES FOR CAUSE. Without limiting any remedies
otherwise available to RPI, if RPI terminates this Agreement for cause pursuant 
to Section 16.2, [          ]


17. PUBLICITY

        17.1 PUBLICITY REVIEW. RBS and RPI shall jointly discuss and agree,
based on the principles of Section 17.1, on any statement to the public
regarding the execution and the subject matter of this Agreement or any other
aspect of this Agreement, except with respect to disclosures required by law or
regulation. Within fifteen (15) days following the Effective Date, the Parties
shall issue a joint press release. Except with respect to information disclosed
in the joint press release, neither Party shall (i) disclose the material terms
of this Agreement, or (ii) use the name of the other Party, in any public
statement, prospectus, annual report, or press release without the prior written
approval of the other Party, which may not be unreasonably withheld or delayed,
provided, however, that both parties shall endeavor in good faith to give the
other Party a minimum of five business days to review such press release,
prospectus, annual report, or other public statement; provided, further, that
either Party may (i) disclose the material terms of this Agreement or (ii) use
the name of the other Party in any public statement, prospectus, annual report,
or press release without the prior written approval of the other Party, if such
Party is advised by counsel that such disclosure is required to comply with 
applicable law.

        17.2 STANDARDS. In the discussion and agreement referred to in Section
17.1, the principles observed by RBS and RPI will be accuracy, the requirements
for confidentiality under Article 13, the advantage a competitor of RBS or RPI
may gain from any public or Third Party statements under Section 17.1, the
requirements of disclosure under any securities laws or regulations of the
United States, including those associated with public offerings, and the
standards and customs in the pharmaceutical industry for such disclosures by
companies comparable to RBS and RPI.


18. DISPUTE RESOLUTION

        18.1 DISPUTES. 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
disputes arising under Sections 8.1, 12.4 and 12.6. 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 litigation. To accomplish this objective, the Parties agree to follow
the procedures set

                                       30

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
forth in this Section 0 if and when a dispute arises under this Agreement
between the Parties. Notwithstanding the foregoing, the Parties recognize that
disputes relating to the Target Discovery Programs, and particularly matters
within the authority of the CMC and/or the PMC and issues to be resolved by the
CMC and/or the PMC shall be resolved in accordance with the decision making
process provisions set forth in Sections 4.3 and 5.3 and such matters shall not
be resolved through the provisions of this Article 18.

        18.2 DISPUTE RESOLUTION PROCEDURES. If the Parties cannot resolve the
dispute within twenty (20) days of formal request by either Party to the other,
any Party may, by written notice to the other, have such dispute referred to
their respective officers designated below or their successors, for attempted
resolution by good faith negotiations within forty-five (45) days after such
notice is received. Said designated officers are as follows: 


        For Roche: Roche Head of Global Discovery Research 

        For RPI:   Chief Executive Officer


        18.3 ARBITRATION. Any such dispute arising out of or relating to this
Agreement which is not resolved between the Parties or the designated officers
of the Parties pursuant to the foregoing shall be resolved by final and binding
arbitration conducted in Palo Alto, California if RPI initiates and in Boulder,
Colorado, if Roche initiates, under the then current Commercial Arbitration
Rules of the American Arbitration Association ("AAA") at the request of either
Party; provided, however, that depositions shall be permitted as follows: each
Party may take no more than three depositions with a maximum of six hours of
examination time per deposition, and each such deposition shall take place in
Palo Alto, California if RPI initiates and in Boulder, Colorado, if Roche
initiates, unless otherwise agreed by the Parties. The arbitration shall be
conducted by one arbitrator who is knowledgeable in the subject matter which is
at issue in the dispute and who is selected by mutual agreement of the Parties
or, failing such agreement, shall be selected according to the AAA rules. In
conducting the arbitration, the arbitrator shall apply the California Evidence
Code, and shall be able to decree any and all relief of an equitable nature,
including but not limited to such relief as a temporary restraining order, a
preliminary injunction, a permanent injunction, or replevin of property. The
arbitrator shall also be able to award actual or general damages, but shall not
award any other form of damage (e.g., consequential, punitive damages). The
Parties shall share equally the arbitrator's fees and expenses pending the
resolution of the arbitration unless the arbitrator, pursuant to its right but
not its obligations, requires the non-prevailing Party to bear all or any
portion of the costs of the prevailing Party. The decision of the arbitrator
shall be final and may be sued on or enforced by the Party in whose favor it
runs in any court of competent jurisdiction at the option of such Party. This
Agreement shall be governed by the laws of the State of California, as such laws
are applied to contracts entered into and to be performed within such state.

                                       31

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
19. ASSIGNMENT AND DELEGATION

        19.1 THIRD PARTIES. Neither Party may assign or delegate any or all of
its rights or obligations under this Agreement to any Third Party without the
prior written permission of the other Party, except pursuant to Section 20.3

        19.2 AFFILIATES. Neither Party may assign or delegate any or all of its
rights or obligations under this Agreement without the prior written consent of
the other Party; provided, however, that either Party may assign or delegate any
or all of its rights or obligations under this Agreement to any Affiliate
without the consent of the other Party.

        19.3 MERGER. Either Party may also assign all of its rights or
obligations under this Agreement (but not a portion thereof) in connection with
the sale of all or substantially all of its assets relating to the subject
matter hereof, or may otherwise assign all of its rights or obligations under
this Agreement (but not a portion thereof) with the prior written consent of the
other Party. This Agreement shall survive any merger of either Party with or
into another Party and no consent for a merger or similar reorganization shall
be required hereunder; provided, that in the event of such merger or in the
event of a sale of all assets, no intellectual property rights of the acquiring
corporation shall be included in the technology licensed hereunder.

        19.4 MISCELLANEOUS. This Agreement shall be binding upon and inure to
the benefit of the successors and permitted assigns of the Parties; provided,
however, that any such permitted assignment or delegation shall not relieve the
assigning Party of its responsibilities for performance of its obligations under
this Agreement. Any assignment not in accordance with this Agreement shall be
void.


20. ADDITIONAL TERMS

        20.1 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 government
action, war, fire, explosion, flood, strike, lockout, embargo, act of God, or
any other similar cause beyond the control of the defaulting Party, provided
that the Party claiming force majeure has exerted all reasonable efforts to
avoid or remedy such force majeure.

        20.2 NOTICES. Any notices or communications provided for in this
Agreement to be made by either of the Parties to the other shall be in writing,
in English, and shall be made by prepaid air mail with return receipt or
overnight courier or facsimile addressed to the other at its address set forth
below. Any such notice or communication may also be given by hand, or facsimile
to the appropriate designation. Either Party may by like notice specify an
address to which notices and communications shall thereafter be sent. Notices
sent by mail, facsimile or courier shall be effective upon receipt and notices
given by hand shall be effective when delivered.

                                       32

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
If to RPI: 

        Ribozyme Pharmaceuticals Inc.
        2950 Wilderness Place    
        Boulder, Colorado, 80301    
        Fax: 303/449-6995
        Attention: General Manager, Target Identification & Validation Division

If to RBS:    

        Roche Bioscience    
        3401 Hillview Avenue    
        Palo Alto, CA 94304    
        Fax: (650) 354-2595    
        Attention: President  

with a copy to         

        Roche Bioscience
        3401 Hillview Avenue    
        Palo Alto, CA 94304   
        Fax: (650) 354-7574
        Attention: Head, Inflammatory Disease Unit

and a copy to    
        Roche Bioscience
        3401 Hillview Avenue    
        Palo Alto, CA 94304    
        Fax: (650) 852-1338
        Attention: Legal Affairs



        20.3 WAIVER. Except as specifically provided for herein, the waiver from
time to time by either of the Parties of any of their rights or their failure to
exercise any remedy shall not operate or be construed as a continuing waiver of
same or of any other of such Party's rights or remedies provided in this 
Agreement.

        20.4 SEVERABILITY. If any term, covenant or condition of this Agreement
or the application thereof to any Party or circumstance shall, to any extent, be
held to be invalid or unenforceable, then (i) the remainder of this Agreement,
or the application of such term,

                                       33

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
covenant or condition to Parties or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby and each
term, covenant or condition of this Agreement shall be valid and be enforced to
the fullest extent permitted by law; and (ii) the Parties hereto covenant and
agree to re-negotiate any such term, covenant or application thereof in good
faith in order to provide a reasonably acceptable alternative to the term,
covenant or condition of this Agreement or the application thereof that is
invalid or unenforceable, it being the intent of the Parties that the basic
purposes of this Agreement are to be effectuated.

        20.5 INDEPENDENT CONTRACTORS. It is expressly agreed that RPI and RBS
shall be independent contractors and that the relationship between the two
Parties shall not constitute a partnership or agency of any kind. Neither RPI
nor RBS shall have the authority to make any statements, representations or
commitments of any kind, or to take any action, which shall be binding on the
other, without the prior written authorization of such other Party to do so.

        20.6 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

        20.7 ENTIRE AGREEMENT. This Agreement, together with its exhibits and
each Research Plan when approved by the CMC, sets forth all of the covenants,
promises, agreements, warranties, representations, conditions and understandings
between the Parties hereto and supersedes and terminates all prior agreements
and understanding between the Parties, including the Confidentiality Agreement
dated May 5, 1997. Information disclosed under the Confidentiality Agreement
shall be treated as "Confidential Information" of the disclosing Party subject
to this Agreement. There are no covenants, promises, agreements, warranties,
representations conditions or understandings, either oral or written, between
the Parties other than as set forth herein and therein. No subsequent
alteration, amendment, change or addition to this Agreement shall be binding
upon the Parties hereto unless reduced to writing and signed by the respective
authorized officers of the Parties.

                                       34

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
        IN WITNESS WHEREOF, the Parties have executed this Agreement in
duplicate originals by their proper officers as of the Effective Date.

Syntex (U.S.A.) Inc.,                   Ribozyme Pharmaceuticals Inc.
through its Roche Bioscience division 


By: /s/ James N. Woody                  By: /s/ Alene A. Holzman
   ------------------------                ---------------------      
   James N. Woody, MD, Ph.D.               Alene A. Holzman     
   President                               General Manager, Target 
                                           Identification & Validation Division


                                       35

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
                                   Exhibit 1


                               Expense for COGS


Expenses included in, but not limited to, the Party's manufacturing cost:

1.  Direct materials


2.  Salaries, wages and benefits of personnel directly engaged in manufacturing 
the product.


3.  Overhead associated with direct production, including, but not limited to:  
    a.  Depreciation, leasehold improvements and equipment leases  
    b.  Repair and maintenance  
    c.  Manufacturing supplies


4.  Reasonable allocable general manufacturing overhead,

    a.  Manufacturing Administration  
    b.  Materials Management  
    c.  Validation and Calibration  
    d.  Documentation and Compliance  
    e.  Quality Assurance/Quality Control    
    f.  Technical Services  
    g.  Regulatory Compliance


5.  Reasonable allocable General facilities overhead, including, but not limited
to:

    a.  Rent, utilities, property tax, insurance and other assigned general
         facilities' costs
    b.  Purchasing  
    c.  Environmental Health and Safety  
    d.  Management Information Systems  
    e.  Engineering  
    f.  Accounting  
    g.  Human Resources

                                       36

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.
<PAGE>
 
                                   Exhibit 2

            RPI's Royalty Obligations Under the Ribozyme Technology

I.  SYNTHETIC RIBOZYMES:  

        a.  Free Ribozymes:    
            --------------                                                   

            [          ]    
            [          ]    
            [          ]
            [          ]          
                                TOTAL:    [          ]  

        b.  Formulated Ribozymes:    
            --------------------               

            [          ]    
            [          ]    
            [          ]
            [          ]          
                                TOTAL:    [          ]  

II.  VECTOR RIBOZYMES  

        a.  Retrovirus Ribozymes    

            [          ]    
            [          ]    
            [          ]
            [          ]          
            [          ]          
                                TOTAL:    [          ]  


                                       37

Confidential portions ([ ]) have been omitted pursuant to regulation 
240.25b-2(b) of the Securities Exchange Act of 1934 and have been filed 
separately with the Commission.