<PAGE>

                                                                EXHIBIT 10.29

                               ESCROW AGREEMENT


ESCROW AGREEMENT, dated as of January 26, 2000, among PROSPECTIVEPIERCING
LIMITED, to be known as FEMCARE UROLOGY LIMITED, corporation organized under the
laws of the United Kingdom and Wales, having its principal place of business at
St. Peters Street, Nottingham NG7 3EN, United Kingdom ("FEMCARE"), and PROTEIN
POLYMER TECHNOLOGIES, INC., a corporation with its principal office at 10655
Sorrento Valley Road, San Diego, California 92121 ("PPTI"), and the party
identified on Exhibit A attached hereto ("Escrow Agent").

     WHEREAS, in connection with the License and Development Agreement between
FEMCARE and PPTI ("License Agreement") and Supply Agreement between PPTI and
FEMCARE ("Supply Agreement"), each dated as of the date of this Escrow
Agreement, PPTI has agreed to enter into this Escrow Agreement pursuant to which
PPTI shall deposit into escrow, when required (i) aliquotes of the Master Cell
Bank and Working Cell Bank for the Product (as such term is defined under the
License Agreement) ("Sample", herein), and (ii) the current manufacturing and
quality control procedures with respect to the Sample being deposited, as well
as such other Know-How (as defined in the License Agreement), technical
specifications, instructions, processes and other intellectual property and
information as PPTI shall possess and as shall be necessary in order to allow
FEMCARE to manufacture and/or have manufactured for it the Product so licensed
(a "Process Description") and (iii) any written agreement  between PPTI and any
contract manufacturer engaged by PPTI to manufacture Product and a related
assignment and assumption agreement and letter of direction as provided in
Section 2 (c) below ("Toll Manufacturing Materials" and together with the
Process Descriptions and the Sample, collectively, the "Escrow Material");

     NOW, THEREFORE, the parties hereto agree as follows:

     1.    APPOINTMENT OF ESCROW AGENT. Within thirty (30) days after the
execution of this Agreement, FEMCARE shall select and appoint an Escrow Agent,
which appointment shall be subject to the consent of PPTI, such consent not to
be unreasonably withheld or delayed. The Escrow Agent must certify to the
parties that it has and will at all times during the term of the escrow liquid
nitrogen storage capabilities and that it will use such capabilities to hold the
Samples. Upon such appointment, the Escrow Agent shall execute a copy of Exhibit
A (duly filled in with the information specified thereon), whereupon the Escrow
Agent shall become a party to this Agreement.

     2.    DEPOSIT BY PPTI.

     (a)   Within ten (10) days after the appointment of the Escrow Agent, PPTI
will deposit in escrow with the Escrow Agent a sealed receptacle containing a
copy of the Process Description, which receptacle shall be held subject to the
terms and conditions of this Escrow Agreement.  The Process Description shall be
sufficiently clear and detailed that it can be readily followed and carried

                                       1
<PAGE>

out by a trained scientist and PPTI shall, upon placing the Process Description
into escrow, so notify FEMCARE of such deposit in writing, and provide to
FEMCARE a schedule of Process Description information so deposited. A FEMCARE
representative on the Advisory Board appointed under the License Agreement may
verify the Process Description information being deposited against the schedule.
The schedule shall constitute PPTI Know-How (as defined in the License
Agreement) and shall be kept confidential. PPTI agrees to update and keep
current, accurate and complete the Process Description on an annual basis or
more frequently if required to reflect procedures embodied in Regulatory
Approvals (as that term is defined in the License Agreement) or required to
assist in the manufacture of Product (and where appropriate, the term "Process
Description" shall include any such updated materials from time-to-time). PPTI
shall, upon each updating of the Process Description, so notify FEMCARE of such
fact in writing, and give it the same verification opportunity as is provided
above. FEMCARE may, at its sole cost and expense, obtain such insurance as it
deems reasonable and necessary regarding the Escrow Materials.

     (b)   Within ten (10) days after the appointment of the Escrow Agent, PPTI
will also deposit in escrow with the Escrow Agent a sealed receptacle containing
the Sample, which receptacle shall be held subject to the terms and conditions
of this Escrow Agreement.  PPTI shall, upon placing each Sample into escrow, so
notify FEMCARE of such deposit in writing.  PPTI agrees to replace the deposited
Sample with a newly-generated set of Sample if PPTI, based on quality control
testing of Product manufactured from cognate cells shall determine that the
cells in the Sample are not viable, in which case FEMCARE shall give its written
instructions pursuant to Article 4.  PPTI shall, upon each replacement of the
Sample, so notify FEMCARE of such deposit in writing and such replacement shall
be deemed the Sample for purposes of this Agreement.

     (c)   Within ten (10) days after the engagement by PPTI of a contract
manufacturer of Product, if any, PPTI will also deposit into escrow with the
Escrow Agent a sealed receptacle containing any written agreement for the
manufacture of Product between PPTI and such contract manufacturer, an
assignment and assumption of said written agreement by and between PPTI and
FEMCARE duly executed by PPTI (but not FEMCARE), and a letter of direction
addressed to the contract manufacturer informing it of the assignment of the
written agreement to FEMCARE and authorizing it to manufacture Product on behalf
of, and supply such Product directly to FEMCARE under said assigned written
agreement (the "Toll Manufacturing Materials"). Any deposit of Toll
Manufacturing Materials notwithstanding, PPTI shall not be obligate to continue
the engagement of any contract manufacturer or to keep in effect any written
agreement for the contract manufacture of Product, or fully comply with the
terms and conditions of any such written agreement. PPTI shall promptly notify
FEMCARE of any change in the Toll Manufacturing Materials and, when necessary,
shall replace Toll Manufacturing Materials with new, amended or additional Toll
Manufacturing Materials, and shall so notify FEMCARE in writing.

     3.    REPRESENTATION. PPTI represents that the Process Description will be
accurate and complete in all material respects, that in its reasonable opinion
the Process Description is sufficiently clear and detailed so that they can be
readily followed and carried out by a trained scientist to

                                       2
<PAGE>

manufacture the Product, and that the deposited Sample(s) (including any
replacement Sample deposited pursuant to Article 2) will be free of defects and
will be viable at the time of deposit.

     4.    CUSTODY; ACCESS. Escrow Agent agrees to accept deposit of the Escrow
Materials and to act as its custodian until the escrow is terminated pursuant to
the terms of this Escrow Agreement. Except as otherwise provided in this Escrow
Agreement, Escrow Agent shall not permit (i) any party access to the Escrow
Materials and (ii) any copies to be made of the Escrow Materials deposited
hereunder. Escrow Agent shall not open the sealed recepticals containing the
Escrow Materials, except upon receipt of mutual written instructions from PPTI
and FEMCARE.

     5.    RELEASE OF ESCROW MATERIALS.

     (a)   TO FEMCARE. Escrow Agent shall release and deliver any or all of the
Escrow Materials to FEMCARE upon the occurrence of any of the following events:

           (i)     Upon the written instructions of PPTI;

           (ii)    Upon delivery to the Escrow Agent of (A) a copy of an order,
judgment or decree adjudicating PPTI bankrupt or insolvent; (B) written notice
that PPTI has commenced any case, proceeding or other action relating to it in
bankruptcy or seeking reorganization, liquidation, dissolution, winding-up,
arrangement, composition or readjustment of its debts, or for any other relief,
under any bankruptcy, insolvency, reorganization, liquidation, dissolution,
arrangement, composition, readjustment of debt or other similar act or law of
any jurisdiction, domestic or foreign, now or hereafter existing; (C) PPTI has
applied for a receiver, custodian or trustee of it or for all or a substantial
part of its property, made an assignment for the benefit of its creditors; (D)
written notice that a case, proceeding or other action has been commenced
against PPTI in bankruptcy, or seeking reorganization, liquidation, dissolution,
winding-up, arrangement, composition or readjustment of its debts, or any other
relief, under any bankruptcy, insolvency, reorganization, liquidation,
dissolution, arrangement, composition, readjustment of debt or other similar act
or law of any jurisdiction, domestic or foreign, now or hereafter existing; or
if a receiver, custodian or trustee of PPTI or for all or substantially all of
its properties shall be appointed; or if a warrant of attachment, execution or
distraint, or similar process, shall be issued against any substantial part of
the property of PPTI; and if in each such case in this clause (D) such condition
shall continue for a period of ninety (90) days undismissed, undischarged or
unbonded; (E) written notice along with reasonable evidence that shows that PPTI
has failed to deliver to FEMCARE at least *** of the quantities of Product
ordered on at least *** of acceptable purchase orders within the deliver periods
allowed in the Supply Agreement; or (F) written notice along with reasonable
evidence that shows that in two consecutive Marketing Years for which Minimum
Purchases are required under the Supply Agreement and in which FEMCARE has had
sales of Product equal to or in excess of the


------------------------
***  Material is confidential and has been omitted and filed separately with the
     Securities and Exchange Commission.

                                       3
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Minimum Purchases for such Marketing Years, PPTI has reduced FEMCARE's original
Annual Estimate (as defined in the Supply Agreement) by more than twenty percent
***.

           (iii)   Ten (10) business days after FEMCARE delivers to both Escrow
Agent and PPTI a letter or certificate signed by a director of FEMCARE
indicating that it is entitled to the Escrow Materials as a result of a material
breach by PPTI of the License Agreement (which breach was not cured in
accordance with the applicable provisions thereof).

     (b)   TO PPTI. Escrow Agent shall release and deliver all of the Escrow
Materials to PPTI within ten (10) business days after PPTI delivers to both
Escrow Agent and FEMCARE a letter or certificate signed by the President of PPTI
indicating that it is entitled to the Escrow Materials as a result of (1) a
breach by FEMCARE of the License Agreement (which breach was not cured in
accordance with the applicable provisions thereof) or (2) termination or
expiration of FEMCARE's license under Section 2.1 of the License Agreement.

     6.    LICENSE TO ESCROW MATERIALS. If the Escrow Materials are released and
delivered to FEMCARE, PPTI shall retain title to such Escrow Materials and
FEMCARE shall have a license to use such Escrow Materials in accordance with the
rights set out in the License Agreement.

     7.    TERMINATION OF ESCROW.

     (a)   The escrow shall terminate upon the earliest to occur of the
following events:

           (i)     mutual written agreement of the parties; or

           (ii)    delivery of a Process Description and related Sample and the
Toll Manufacturing Materials to FEMCARE or PPTI, as the case may be, in
accordance with the terms of Section 5.

     (b)   The parties agree that if the escrow is terminated pursuant to
Section 7(a)(i) above, the relevant Escrow Materials shall be delivered to
whichever party is designated in the written agreement among the parties.

     8.    ESCROW AGENT FEES. In consideration for performing its function as
escrow agent, Escrow Agent shall be paid solely by FEMCARE the charge for any
duties required in connection with this Escrow Agreement.

     9.    ESCROW AGENT.

     (a)   The obligations of the Escrow Agent are those specifically provided
in this Escrow Agreement, and the Escrow Agent shall have no liability under, or
duty to inquire into the terms and provisions of, any other agreement including,
without limitation, the License Agreement. The duties of the Escrow Agent are
purely ministerial in nature, and it shall not incur any liability whatsoever,
except for willful misconduct, gross negligence or breach of Article 9(d).


------------------------
***  Material is confidential and has been omitted and filed separately with the
     Securities and Exchange Commission.

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<PAGE>

     (b)   The Escrow Agent shall not have any responsibility for the
genuineness or validity of any document or other item deposited with it or of
any signature thereon and shall not have any liability for acting in accordance
with any written instructions or certificates given to it hereunder and believed
by it to be signed by the proper parties. If the Escrow Agent shall receive
conflicting instructions, it shall advise FEMCARE and PPTI of such fact. FEMCARE
and PPTI shall have thirty (30) days to resolve the conflicting instructions and
jointly notify the Escrow Agent. If the Escrow Agent is not timely jointly
notified, it may at any time thereafter submit such conflict to arbitration in
accordance with the provisions of Section 10(c).

     (c)   The Escrow Agent may resign and be discharged from its duties
hereunder at any time by giving at least 30 days' notice of such resignation to
FEMCARE and PPTI, specifying a date upon which such resignation shall take
effect; provided, however, that the Escrow Agent shall continue to serve until
its successor accepts the appointment as new Escrow Agent. Upon receipt of such
notice, a successor escrow agent shall be appointed by FEMCARE and PPTI, such
successor escrow agent to become the Escrow Agent hereunder on the resignation
date specified in such notice. If an instrument of acceptance by a successor
escrow agent shall not have been delivered to the Escrow Agent within 40 days
after the giving of such notice of resignation, the resigning Escrow Agent may
at the expense of FEMCARE request that an arbitrator appoint a successor escrow
agent in accordance with the provisions of Section 10(c). FEMCARE and PPTI,
acting jointly, may at any time substitute a new escrow agent by giving 10 days'
notice thereof to the current Escrow Agent then acting and paying all expenses
of the current Escrow Agent.

     (d)   The Escrow Agent hereby agrees:

           i.      to maintain the Escrow Material and all information and/or
                   documentation coming into its possession or to its knowledge
                   under this Escrow Agreement in strictest confidence and
                   secrecy;

           ii.     not to make use of the Escrow Materials other than for the
                   performance of its obligations under this Escrow Agreement
                   and shall not disclose or release the same to any party other
                   than in accordance with the terms hereof; and

           iii.    that the obligations imposed hereunder shall continue,
                   notwithstanding release of the Escrow Materials or
                   termination of this Escrow Agreement, until or unless as the
                   Escrow Materials falls within the public domain, through no
                   fault of the Escrow Agent.

     10.   MISCELLANEOUS.

     (a)   NOTICES. All notices, claims, certificates, requests, demands and
other communications hereunder shall be in writing and shall be delivered
personally or sent by facsimile

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transmission, air courier, or registered or certified mail, return receipt
requested, addressed as follows:

      IF TO PPTI TO:

              Protein Polymer Technologies, Inc.
              10655 Sorrento Valley Road
              San Diego, California 92121
              Fax:  (619) 558-6477
              Attention: President;

      with a copy to:

              Piper Marbury Rudnick & Wolfe
              203 North LaSalle Street
              Suite 1800
              Chicago, IL 60601
              Fax:  (312) 630-5322
              Attention: John H. Heuberger; and

      IF TO FEMCARE TO:

              Femcare Urology Limited
              St. Peter Street
              Nottingham NG7 3EN
              United Kingdom
              Attention:
              Fax: 011-44-115-942-0234
              Copy to B. Sweeney

      with a copy to:

              Nelson Solicitors
              Perrine House, 8 Stanford Street
              Nottingham NG1 7BQ
              United Kingdom
              Fax: 011-44-115-958-9113

      if to ESCROW AGENT, to the address specified on Exhibit A attached hereto

or to such other address as the party to whom notice is to be given may have
furnished to the other parties in writing in accordance herewith. Any such
communication shall be deemed to have been delivered (i) when delivered, if
delivered personally, (ii) when sent (with confirmation received), if sent by
facsimile transmission on a business day, (iii) on the first business day after
dispatch (with confirmation received), if sent by facsimile transmission on a
day other than a business day, (iv) on the third business day after dispatch, if
sent by air courier, and (v) on the fifth business day after mailing, if sent by
registered or certified mail.

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<PAGE>

     (b)   SEVERABILITY. In the event that any provision of this Escrow
Agreement would be held in any jurisdiction to be invalid, prohibited or
unenforceable for any reason, such provision, as to such jurisdiction, shall be
ineffective, without invalidating the remaining provisions of this Escrow
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction. Notwithstanding the foregoing, if such provision could be
more narrowly drawn so as not to be invalid, prohibited or unenforceable in such
jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without
invalidating the remaining provisions of this Escrow Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.

     (c)   GOVERNING LAW; DISPUTE RESOLUTION. Any controversy or claim arising
out of or relating to the Escrow Agreement, or the parties' decision to enter
into this Escrow Agreement, or the breach hereof, shall be settled by
arbitration in accordance with the International Arbitration Rules of the
American Arbitration Association ("AAA"), and judgment upon the award rendered
by the arbitrator may be entered in any court having jurisdiction thereof.
Notwithstanding the forgoing to the contrary or in the arbitration rules invoked
or in this Section 10 (c), the parties retain the right to request a judicial
authority to invoke interim measures of protection, and such request shall not
be deemed incompatible with this agreement to arbitrate or a waiver of the right
to arbitrate.

     The arbitration shall be held in the City of New York, State of New York,
U.S.A., and the arbitrator shall apply the substantive law of the State of
Delaware, except that the interpretation and enforcement of this arbitration
provision shall be governed by the Federal Arbitration Act. There shall be one
(1) arbitrator to be mutually agreed upon by the parties and to be selected from
the Regional Panel of Distinguished Neutrals. If the parties are unable to agree
upon such an arbitrator who is willing to serve within ten (10) days of receipt
of a demand to arbitrate by the other party, then the AAA shall appoint an
arbitrator willing to serve from the stated panel, or if no such panel exists,
the parties shall within three (3) days select one of the five (5) largest
international accounting firms (excluding those providing services for the
parties) and engage the managing partner or senior officer of its New York City
office to designate a partner of such firm to serve as the arbitrator. Failing
that, then the AAA shall appoint an arbitrator willing to serve from the
Regional Panel of Distinguished Neutrals, or if no such panel exists, then from
an appropriate AAA panel. It shall be the duty of the arbitrator to set dates
for preparation and hearing of any dispute and to expedite the resolution of
such dispute. Recognizing that the release of Escrow Materials is time critical,
the parties do hereby direct any arbitrator hereunder to reach a decision
regarding the release of Escrow Materials (which may be a temporary or
preliminary decision subject to such conditions as the arbitrator may, in its
sole discretion, order) within 30 days following his or her engagement or
appointment.

     It shall be the duty of the arbitrator to set dates for preparation and
hearing of any dispute and to expedite the resolution of such dispute. The
arbitrator shall permit and facilitate discovery, which will be conducted in
accordance with the Federal Rules of Civil Procedure, taking into account the
needs of the parties and the desirability of making discovery expeditious and
cost-effective. The arbitrator will set a discovery schedule with which the
parties will comply and attend depositions if requested by either party. The
arbitrator will entertain such presentation of sworn testimony or evidence,
written briefs and/or oral argument as the parties may wish to present; however,
no testimony or exhibits will be admissible unless the adverse party was
afforded an opportunity to

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examine such witness and to inspect and copy such exhibits during the pre-
hearing discovery phase. The arbitrator shall among his other powers and
authorities, have the power and authority to award interim or preliminary
relief. The arbitrator shall not be empowered to award either party exemplary or
punitive damages or any enhanced damages for willful infringement and the
parties shall be deemed to have waived any right to such damages.

     A qualified court reporter will record and transcribe the proceedings.  The
decision of the arbitrator will be in writing and judgment upon the award by the
arbitrator may be entered into any court having jurisdiction thereof.  Prompt
handling and disposal of the issue is important.  Accordingly, the arbitrator is
instructed to assume adequate managerial initiative and control over discovery
and other aspects of the proceeding to schedule discovery and other activities
for substantially continuous work, thereby expediting the arbitration as much as
is deemed reasonable to him, but in all events to effect a final award within
365 days of the arbitrator's selection or appointment and within 20 days of the
close of evidence.

     The proceedings shall be confidential and the arbitrator shall issue
appropriate protective orders to safeguard both parties' confidential
information and the Escrow Materials.  The fees of the arbitrator and the AAA
shall be paid as designated by the arbitrator or, if he shall not so designate,
they shall be split equally between the parties.

     (d)   BINDING EFFECT; BENEFITS; ASSIGNMENT. This Escrow Agreement shall
enure to the benefit of and be binding upon the parties hereto and their
respective permitted successors and assigns. Nothing contained herein shall give
to any other person any benefit or any legal or equitable right, remedy or
claim. This Escrow Agreement shall not be assignable by PPTI without the prior
written consent of FEMCARE, which consent may be withheld in the sole discretion
of FEMCARE. Notwithstanding the foregoing, no consent of FEMCARE shall be
required if such assignment is in connection with the sale or transfer of all or
substantially all of the assets of PPTI or the merger or consolidation of PPTI
with or into any other business entity. FEMCARE shall be permitted to assign
this Escrow Agreement upon written notice to PPTI to any party to which it
assigns all of its rights under the License Agreement or sells or transfers all
or substantially all of its assets. No such assignment shall relieve the
assigning party of its underlying obligations under this Escrow Agreement.

     (e)   ENTIRE ESCROW AGREEMENT; AMENDMENTS. This Escrow Agreement and the
other writings referred to herein or delivered pursuant hereto which form a part
hereof contain the entire understanding of the parties with respect to its
subject matter. This Escrow Agreement may be amended only by a written
instrument duly executed by the parties hereto.

     (f)   WAIVERS. It is further understood and agreed that no failure or delay
by either party hereto in exercising any right, power or privilege under this
Escrow Agreement shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise of any right,
power or privilege hereunder.

     (g)   COUNTERPARTS. This Escrow Agreement may be executed in any number of
counterparts, and execution by each of the parties of any one of such
counterparts will constitute due

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execution of this Escrow Agreement.  Each such counterpart hereof shall be
deemed to be an original instrument, and all such counterparts together shall
constitute but one agreement.

     (h)   HEADINGS. The article and section headings contained in this Escrow
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Escrow Agreement.

     IN WITNESS WHEREOF, the parties have caused this Escrow Agreement to be
signed by authorized persons, whereupon it became binding on the parties as of
the date first above written.



PROSPECTIVEPIERCING LIMITED            PROTEIN POLYMER TECHNOLOGIES, INC.,
(TO BECOME FEMCARE UROLOGY LIMITED)    a Delaware corporation


By:    /s/ Bernard Sweeney              By:    /s/ Thomas Parmeter
   --------------------------------         ------------------------------
Name:  Bernard Sweeney                        Thomas Parmeter, President and CEO
     ------------------------------
Its:   Managing Director
    -------------------------------



THE UNDERSIGNED PARENT COMPANY OF PROSPECTIVEPIERCING LIMITED, TO INDUCE PROTEIN
POLYMER TECHNOLOGIES, INC. AND THE ESCROW AGENT TO ENTER INTO THIS AGREEMENT AND
FOR OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT, ADEQUACY AND SUFFICIENCY
OF WHICH IS HEREBY ACKNOWLEDGED, HEREBY IRREVOCABLY AND UNCONDITIONALLY
GUARANTEES THE TIMELY AND FULL PERFORMANCE AND PAYMENTS UNDER THIS AGREEMENT BY
PROSPECTIVEPIERCING LIMITED AND AGREES THAT IT SHALL BE BOUND BY THE ARBITRATION
PROVISIONS HEREIN AS IF A FULL PARTY HERETO.

FEMCARE, LTD.


By:      /s/ Bernard Sweeney
   ----------------------------
Name:    Bernard Sweeney
      -------------------------
Title:   Managing Director
      -------------------------

                                       9
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                                   EXHIBIT A


     The undersigned party hereby (a) agrees to be the Escrow Agent pursuant to
and under that certain Escrow Agreement dated as of January __, 2000, between
Protein Polymer Technologies, Inc. and Femcare Urology Limited and (b) certifies
that it has liquid nitrogen storage capabilities and that it will use such
capabilities to store the cells that are part of the Escrow Materials.



                              ESCROW AGENT:

                              Name:
                                   ----------------------------------
                              Address:
                                      -------------------------------
                              Telephone:
                                        -----------------------------
                              Fax:
                                  -----------------------------------





                                    By:
                                       ------------------------------
                                    Name:
                                         ----------------------------
                                    Title:
                                          ---------------------------
                                    Date:
                                         ----------------------------






                                      A-1