EXHIBIT 10.40

          PORTIONS OF THIS DOCUMENT HAVE BEEN OMITTED (DESIGNATED BY AN
             ASTERIX (*) AND WHITE SPACE) AND FILED SEPARATELY WITH
              THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
                    REQUEST FOR CONFIDENTIAL TREATMENT DATED
                        AUGUST 21, 1997; FILE NO. 0-15609



                                    VIRACEPT
                              (NELFINAVIR MESYLATE)

                                LICENSE AGREEMENT

                                     BETWEEN

              AGOURON PHARMACEUTICALS, INC. AND JAPAN TOBACCO INC.

                                       AND

                            F. HOFFMANN-LA ROCHE LTD









                                  June 30, 1997


<PAGE>

<TABLE>
<CAPTION>

                                                                                   
                                TABLE OF CONTENTS

                                                                                                        Page No.
<S>                 <C>

BACKGROUND          .........................................................................................1


ARTICLE I           DEFINITIONS..............................................................................2

Section 1.01        Affiliate................................................................................2
Section 1.02        Agouron/JT Patent Rights.................................................................2
Section 1.03        Agouron/JT Technology....................................................................2
Section 1.04        Combination Product......................................................................2
Section 1.05        Compound.................................................................................3
Section 1.06        Control, Controlled or Controlling.......................................................3
Section 1.07        D&L Agreement............................................................................3
Section 1.08        Development Program......................................................................3
Section 1.09        Development Program Patent Rights........................................................3
Section 1.10        Development Program Technology...........................................................4
Section 1.11        Dossier..................................................................................4
Section 1.12        Effective Date...........................................................................4
Section 1.13        EMEA.....................................................................................4
Section 1.14        Field....................................................................................4
Section 1.15        Initial Commercial Sale..................................................................4
Section 1.16        Licensed Territory and Asian Licensed Territory..........................................4
Section 1.17        MAA......................................................................................5
Section 1.18        Major European Country...................................................................5
Section 1.19        Net Sales................................................................................5
                    (a)    Adjusted Gross Sales..............................................................5
                    (b)    Net Sales.........................................................................5
Section 1.20        Patent Rights............................................................................5
Section 1.21        Product..................................................................................5
Section 1.22        Registration.............................................................................5
Section 1.23        Roche Technology.........................................................................6
Section 1.24        Territory................................................................................6
Section 1.25        Trade Dress..............................................................................6
Section 1.26        Trademark(s).............................................................................6

ARTICLE II          COMMERCIAL RIGHTS........................................................................6

Section 2.01        License Grants...........................................................................6
Section 2.02        Indications of the Compound and/or Products Outside of the Field.........................8
Section 2.03        Diligent Efforts to Market...............................................................8
Section 2.04        Discontinuance of the Development Program................................................9


                                                                       i
<PAGE>

<S>                 <C>
                                                                                                        Page No.

ARTICLE III         SHARING AND PROTECTION OF INTELLECTUAL PROPERTY.........................................10

Section 3.01        Patents.................................................................................10
Section 3.02        Infringement of Patents of Third Parties................................................13
Section 3.03        Trademarks..............................................................................15
Section 3.04        Information Exchange....................................................................15
Section 3.05        Confidentiality.........................................................................16
Section 3.06        Publication.............................................................................17

ARTICLE IV          MANAGEMENT STRUCTURE OF COLLABORATION...................................................18

Section 4.01        Coordination..............................................................................
Section 4.02        Development and Registration; Responsibility for Development Costs......................18
Section 4.03        Marketing...............................................................................20
Section 4.04        Supply of Product.......................................................................22

ARTICLE V           LICENSE FEES AND ROYALTIES; GENERAL LICENSING                                        TERMS     25

Section 5.01        License Fees and Royalties..............................................................25
Section 5.02        General Licensing Terms.................................................................28
Section 5.03        Foreign Currency........................................................................32

ARTICLE VI          TERM AND TERMINATION....................................................................33

Section 6.01        Termination for Breach..................................................................33
Section 6.02        Termination by Roche....................................................................33
Section 6.03        Termination by Mutual Agreement.........................................................35
Section 6.04        Termination Upon Bankruptcy.............................................................35
Section 6.05        Disposition of Inventory................................................................35
Section 6.06        Effect of Termination...................................................................35

ARTICLE VII         WARRANTIES, COVENANTS; INDEMNITIES; INSURANCE; DISPUTE RESOLUTION; GOVERNMENTAL 
                    APPROVALS; EXPORT CONTROLS..............................................................36

Section 7.01        Warranties and Covenants................................................................36
Section 7.02        Indemnities; Insurance..................................................................36
Section 7.03        Dispute Resolution......................................................................38
Section 7.04        Governmental Approvals..................................................................39
Section 7.05        U.S. Export Controls....................................................................39

ARTICLE VIII        DISCLOSURE OF AGREEMENT.................................................................39

Section 8.01        Disclosure of Agreement.................................................................39


                                                                       ii
<PAGE>
<S>                 <C>  



ARTICLE IX          GENERAL PROVISIONS......................................................................40

Section 9.01        No Implied Licenses.....................................................................40
Section 9.02        No Waiver...............................................................................40
Section 9.03        Severability; Government Acts...........................................................40
Section 9.04        Ambiguities.............................................................................40
Section 9.05        Notification of Authorities.............................................................40
Section 9.06        No Agency...............................................................................40
Section 9.07        Captions; Number; Official Language.....................................................41
Section 9.08        Force Majeure...........................................................................41
Section 9.09        Amendment...............................................................................41
Section 9.10        Applicable Law..........................................................................41
Section 9.11        Notices.................................................................................42
Section 9.12        Assignment..............................................................................42
Section 9.13        Succession..............................................................................42

                                   APPENDICES
Schedule 1        Agouron/JT Patent Rights                                                                S1-1
Schedule 2        Asian Licensed Territory                                                                S2-1
Schedule 3        Nelfinavir Mesylate Clinical Studies                                                    S3-1
                           Results to be Contained in the MAA                                             S3-1
                           Interim Results to be Contained in the MAA                                     S3-2
                           Results to be Provided Later                                                   S3-3
Attachment 1      Trademark License                                                                       A1-1
Attachment 2      Product Manufacturing Specifications                                                    A2-1

</TABLE>

                                                                       iii
<PAGE>


         This    VIRACEPT(TM)1    (nelfinavir    mesylate)   License   Agreement
("Agreement"),  dated for reference purposes only this 30th day of June 1997, is
by and among Agouron  Pharmaceuticals,  Inc., a corporation  duly  organized and
existing under the laws of the state of California,  having a principal place of
business at 10350 North Torrey Pines Road, La Jolla,  California,  United States
of America  (hereinafter  referred  to as  "Agouron"),  Japan  Tobacco  Inc.,  a
corporation  duly  organized  and existing  under the laws of Japan,  having its
principal place of business at JT Building,  2-1, Toranomon 2-chome,  Minato-ku,
Tokyo, Japan (hereinafter  referred to as "JT"), and F. Hoffmann-La Roche Ltd, a
corporation  duly organized and existing under the laws of  Switzerland,  having
its  principal  place of business  at  CH-4002-Basel,  Switzerland  (hereinafter
referred to as "Roche").  Agouron,  JT and Roche are each sometimes  hereinafter
referred to as a party (collectively "parties") to this Agreement.

                                   BACKGROUND

         On December  1, 1994,  Agouron and JT entered  into a  Development  and
License  Agreement ("D&L  Agreement")  under which they have collaborated in the
development and  commercialization of the chemical compound known as "nelfinavir
mesylate"  (sometimes  referred  to herein as  "VIRACEPT")  to treat and prevent
Human Immunodeficiency Virus infections.

         On January 17,  1997,  Agouron,  JT and Roche  entered into a Letter of
Intent  ("LOI")  pursuant to which  Agouron and JT granted a license to Roche to
sell nelfinavir  mesylate  products to treat and prevent Human  Immunodeficiency
Virus  infections in certain  countries of the world on terms  substantially  in
accordance  with those  contained in Exhibit A to the LOI ("Exhibit  A").  While
Exhibit A states the basic terms of the understanding  between the parties,  the
parties  agreed  that  the  full  license  terms  would be  subject  to  further
negotiation and preparation of a further agreement  containing the full terms of
the license between the parties.  This Agreement is entered into for the purpose
of setting  forth the  definitive  terms  under  which Roche is licensed to sell
nelfinavir mesylate products to treat and prevent Human  Immunodeficiency  Virus
infections in certain countries of the world.

         NOW,  THEREFORE,  in  consideration  of the  premises,  and the  mutual
covenants,  benefits and  obligations  set forth  herein,  the parties  agree as
follows:

--------
1 VIRACEPT is a trademark of Agouron Pharmaceuticals, Inc., and is registered in
the United States and in certain other countries.

                                       1
<PAGE>

                             ARTICLE I - DEFINITIONS

         When used in this Agreement, each of the following terms shall have the
meanings set out in this  Article I. All  references  to Articles,  Attachments,
Sections and Schedules shall, except as otherwise explicitly provided,  refer to
the  Articles,  Attachments,  Sections and Schedules of this  Agreement,  all of
which are incorporated herein by reference.

         Section 1.01 "Affiliate" means any person, organization or entity which
is, directly or indirectly,  controlling, controlled by, or under common control
with Roche,  Agouron or JT, as the case may be. The term  "control"  (including,
with correlative  meaning,  the terms  "controlled by" and "under common control
with"),  as used with  respect to any person or  entity,  means the  possession,
directly or indirectly,  of the power to direct,  or cause the direction of, the
management and policies of such person,  organization or entity, whether through
the ownership of voting securities,  or by contract or court order or otherwise.
The  ownership of voting  securities of a person,  organization  or entity shall
not, in and of itself,  constitute  "control"  for purposes of this  definition,
unless said ownership is of a majority of the outstanding securities entitled to
vote of such a person,  organization or entity.  For purposes of this Agreement,
Genentech,  Inc.  shall be  considered  to be an  Affiliate  of  Roche,  and the
government of Japan shall not be considered to be an Affiliate of JT.

         Section 1.02      "Agouron/JT Patent Rights" means:  *








         Section 1.03      "Agouron/JT Technology" *







         Section 1.04      "Combination Product" means *



                                       2
<PAGE>


         Section 1.05      "Compound" means the chemical compound known as 
nelfinavir mesylate whose chemical name is as follows:
        
           [3S-(3R*, 4aR*, 8aR*, 2'S*, 3'S*)]-2-[2'-hydroxy-3'-phenylthiomethyl-
           4'-aza-5'-oxo-5'-(2"-methyl-3"-hydroxyphenyl)pentyl]-
           decahydroisoquinoline-3-N-t-butyl carboxamide methanesulfonic acid 
           salt

and whose chemical structure is as follows:

                  [GRAPHIC OMITTED]

         Section 1.06      "Control," "Controlled" or "Controlling" *



         Section 1.07      "D&L Agreement" means the December 1, 1994 
Development and License Agreement between Agouron and JT, as amended.
      
         Section 1.08      "Development Program" *











         Section 1.09      "Development Program Patent Rights" *






                                       3
<PAGE>











         Section 1.10      "Development Program Technology" *










         Section  1.11  "Dossier"  means the  document  which is filed  with and
approved by a government or health authority for purposes of  Registration,  for
example, a Marketing Authorization Application.

         Section 1.12 "Effective Date" means January 17, 1997.

         Section  1.13 "EMEA" means the European  Agency for the  Evaluation  of
Medicinal Products.

         Section  1.14  "Field"  means the  treatment  and  prevention  of Human
Immunodeficiency Virus ("HIV") infections.

         Section 1.15      "Initial Commercial Sale" means the first commercial 
sale of a Product in the Field *
        
         Section 1.16 "Licensed  Territory" and "Asian Licensed Territory" shall
have the following meanings:

                                       4
<PAGE>

         (a) "Licensed  Territory"  means all countries of the world  (including
all countries  included in the "Asian  Licensed  Territory"  as defined  below),
except for the United States (and its territories, possessions and protectorates
(including Puerto Rico), and the District of Columbia),  Canada,  Mexico,  Japan
(other  than those  areas in Japan in which  Roche is granted  and  accepts  the
commercialization rights described in Schedule 2), South Korea and North Korea.

         (b)      "Asian Licensed Territory" means all the countries of Asia 
listed on Schedule 2.

         Section 1.17      "MAA" means Marketing Authorization Application

         Section 1.18      "Major European Country" means *


         Section  1.19 "Net Sales" and the related term  "Adjusted  Gross Sales"
shall have the following meanings:

         (a)      "Adjusted Gross Sales" means *







         (b)      "Net Sales" means *






         Section 1.20      "Patent Rights" means, collectively, *


         Section 1.21      "Product" means *



         Section  1.22  "Registration"   means  the  official  approval  by  the
government or health  authority in a country (or  supra-national  organizations,
such as the European  Agency for the  Evaluation of Medical  Products)  which is
required for a Product to be offered for sale in such  country,  including  such
authorizations  as may be required  for the  production,  importation,  

                                       5
<PAGE>

pricing,  reimbursement and sale of such Product, and for subsequent  regulatory
filings for line extensions and/or additional indications of such Product.

         Section 1.23      "Roche Technology" means *







         Section 1.24      "Territory" means *

         Section  1.25  "Trade  Dress"  means  any  materials   supporting   the
commercialization  of a  Product,  including,  but not  limited  to,  packaging,
package inserts,  advertising or selling aids, brochures,  mailings and/or other
marketing or packaging materials.

         Section 1.26 "Trademark(s)" means any trademark selected and owned by a
party and  registered  (or applied  for) by such  party,  its  Affiliate(s)  and
sublicensee(s)  in the  Territory  for use in  connection  with the marketing of
Products.  The definition of Trademark(s) shall not refer to trade names used by
a party to designate the name of such party.

                         ARTICLE II - COMMERCIAL RIGHTS

         Section 2.01 License Grants. To implement the  commercialization of the
Compound and/or Products  arising out of the Development  Program,  the parties,
subject to the other applicable obligations of this Agreement,  grant and accept
the license rights provided below in this Article II.

         (a)      *






         (b)      *







                                       6
<PAGE>

         (c)      *





         (d)      *




         (e)      *




         (f)      *






         (g)      *












         (h)      *









                                       7
<PAGE>



         (i)      *





         (j)      *













         Section 2.02 Indications of the Compound and/or Products Outside of the
Field.

         (a) Subject to the provisions of the D&L Agreement,  except as provided
in Section 2.02(b), Agouron and JT, in their sole discretion,  shall be entitled
to make,  use,  develop and  commercialize  the  Compound  and/or  Products  for
indications outside of the Field in the Territory.

         (b)      *




         Section 2.03      Diligent  Efforts to Market.  As provided  below, the
right of Roche to market  Products  in the Field in a country  located in the
Licensed Territory shall be subject to diligent marketing efforts by Roche.  *
                                                        Roche,   using  diligent
marketing efforts, agrees to provide sales and other promotional support *
        that is equivalent to or greater than that which Roche,  its  Affiliates
and/or  sublicensees  are then providing for  saquinavir in such country.  After
such * Roche shall  provide a  reasonable  level of sales and other  promotional
support  for a Product in a country  which,  when  measured as

                                       8
<PAGE>

a  percentage  of  Adjusted  Gross  Sales of such  Product in such  country,  is
equivalent  to  or  greater  than  that  which  Roche,  its  Affiliates   and/or
sublicensees are then providing *

                             If, after *                          written  
notice of the  failure by Roche to provide  the agreed  upon level of sales
and other promotional support for a Product in a country located in the Licensed
Territory,  Roche  fails to fulfill  its  obligation  under this  Section  2.03,
Agouron and JT shall have the right, *











         Section 2.04      Discontinuance of the Development Program.

         (a)      Roche shall, in a timely manner,  use reasonable  diligence in
the development and Registration of a Product in the Field in the countries of
the Licensed Territory.  *


                                                                     If, after *
                                    written  notice  of the  failure  by  Roche 
to use  reasonable  diligence,  in a  timely  manner,  in the  development  and
Registration  of a Product  in the Field in a country  located  in the  Licensed
Territory,  Roche fails to fulfill its obligations  under this Section  2.04(a),
such failure shall be deemed to be an election by Roche *
















                                       9
<PAGE>




         (b)      *

























          ARTICLE III - SHARING AND PROTECTION OF INTELLECTUAL PROPERTY

         Section 3.01      Patents.

         (a)      *









                                       10
<PAGE>


                  (i)      *











                  (ii)     *













                  (iii)    *











                  (iv)     Notwithstanding the preceding, *






                                       11
<PAGE>





         (b) The preparation, filing, prosecution,  maintenance and extension of
patent  applications  and issued patents  included within the Agouron/JT  Patent
Rights shall be conducted in accordance  with and governed by the  provisions of
the D&L Agreement; provided, however, that an *

                                                                 Ownership 
of the Agouron/JT  Patent Rights shall be determined in accordance  with the
provisions of the D&L  Agreement;  provided,  however,  that the parties  hereby
acknowledge that, in accordance with the provisions of *



                                                      (including expenses for 
the preparation, filing, prosecution and maintenance of patent term restoration
applications and supplemental protection certificates,  but excluding any travel
expenses  of the  parties,  which  shall be borne by the  party  incurring  such
expenses).

         (c)      A representative of Roche and an authorized representative of 
Agouron and JT shall *
to review and discuss  the actions  taken or to be taken by each of the parties
in protecting  the commercial  interests of the parties in  Development  Program
Patent Rights. Such meetings may be conducted in person or by means of telephone
conference  calls.  Each party shall pay its own costs of  participating in such
meetings.  Prior to or  immediately  after  the  filing  of the  initial  patent
application  for an  invention,  the filing party shall  provide the  authorized
representatives  of the other  parties with an English  language  version of the
patent application for the non-filing  parties' review and comment. If requested
by a non-filing party, the filing party shall also provide such non-filing party
with a full copy of each patent application actually filed in English and in the
language in which it was originally  filed. It is the intent of the parties that
any patent  issuing to the parties  hereunder  shall be of the same  quality and
scope  that the party  would have  sought  with  respect  to its other  valuable
proprietary  property not subject to this  Agreement.  Each of the parties shall
annually  prepare  a list  which  reflects,  to the best of its  knowledge,  the
current  status of any  Development  Program Patent Rights for which it controls
the preparation, filing, prosecution, maintenance and/or extension of the patent
applications  and issued  patents,  which list shall be  submitted  to the other
parties within sixty (60) days after the end of the calendar year. An authorized
representative  of Agouron and JT shall annually  prepare a list which reflects,
to the best of their  knowledge,  the current  status of the  Agouron/JT  Patent
Rights.  For purposes of this Section 3.01, Agouron and JT shall be deemed to be
a single party. The parties, if they so elect, may mutually prepare a joint list
to satisfy the preceding obligations.

                                       12
<PAGE>

         (d)      *




         (e)      *










         (f)      *


















         Section 3.02      Infringement of Patents of Third Parties.

         (a) Each party, its Affiliates and  sublicensees,  and their respective
employees and agents shall use diligent efforts to avoid infringement of patents
of any third party in discovering, developing, manufacturing and commercializing
the Compound,  intermediates  thereof and/or  Products.  However,  a party,  its
Affiliates and sublicensees, and their respective employees and agents shall not
be  liable  to  another  party,  its  Affiliates  and  sublicensees,  and  their
respective employees and agents if the practice of the Patent Rights, Agouron/JT
Technology,   Roche  

                                       13
<PAGE>

Technology,  and/or Development  Program Technology in discovering,  developing,
manufacturing  or  commercializing  the Compound,  intermediates  thereof and/or
Products infringe any patent of any third party. If a party becomes aware of any
claim or suit by any third  party  for  infringement  of a patent of such  third
party in connection with the discovery, development, manufacture, use or sale of
the Compound,  intermediates  thereof  and/or  Products by a party hereto,  such
party  shall  notify the other  parties in writing of such claim or suit  within
thirty  (30) days  thereafter.  Each  party  agrees to  render  such  reasonable
assistance  as the other  party(s)  may request in  defending  any such claim or
suit.  The parties  shall  mutually  agree to any  settlement of any existing or
potential  infringement  claim or action  that would  require the payment of any
royalty or lump sum payment to a third party,  except that if the parties cannot
promptly reach  agreement,  they shall appoint an independent  patent counsel to
give an opinion, which shall be binding on the parties, as to whether there is a
substantial risk that the third party patent is both valid and infringed. If the
opinion  is that there is a  substantial  risk that the patent is both valid and
infringed,  the marketing  party of a Product in a country,  after  consultation
with the other  parties,  may settle the matter in its sole  discretion  on such
terms as it deems  appropriate.  If more than one party is  participating in the
marketing of a Product in a country,  the marketing parties shall mutually agree
to any  settlement  of any  infringement  claim or action that would require the
payment of any royalty or lump sum payment to a third party;  if the parties are
unable to mutually agree on the  settlement,  then the issue shall be decided by
binding arbitration in accordance with the provisions of Section 7.03 hereof.

         (b)      *







                        The parties  acknowledge that the manufacture and/or use
of certain materials or processes used in the manufacture of the Product *


                                       (iii) that the provisions of this Section
3.02 do not apply to *


                                      If royalties to third parties are due 
because of the  manufacture and/or use of certain materials or processes used in
the  manufacture  of the Product and such  royalties are measured by Roche's Net
Sales of such Product,  then such royalties  shall not be payable by Roche prior
to  the  date  of  sale  of  such  Product.  The  parties  further  specifically
acknowledge that license fees and/or royalties may be owed to third parties *


           Notwithstanding the preceding, *

                                       14
<PAGE>

                                              which are then being  commercially
used in the  manufacture  of the Product,  the parties  shall discuss in good
faith the sharing of such costs as provided above, versus changing the method of
manufacture of the Product.

         Section 3.03      Trademarks. A party, its Affiliates and sublicensees,
if any, *




                                                               it is the intent 
of the parties that a single  Trademark be identified  and developed for use in
connection with marketing of Products in the Field wherever possible  throughout
the Territory. The parties acknowledge that, while Agouron has already selected,
filed and owns the VIRACEPT  Trademark  application  and/or Trademark in certain
countries  of the  Territory,  it is  nevertheless  their  intention  to use the
VIRACEPT  Trademark in  connection  with the  marketing of Products in the Field
wherever  possible.  If  required by the laws of a specific  country,  the party
owning  the  Trademark  shall  assist  the other  party(s)  in  qualifying  as a
registered user of such Trademark in such country. *






             Additionally, the parties agree to cooperate with the other parties
in  reasonable  efforts to protect  the  rights of the  parties in a  Trademark,
including  notification  of  any  infringement  which  may  come  to  a  party's
attention,  and the proper  execution and filing of appropriate  registered user
documents. *





         Section 3.04      Information Exchange.  *











                                       15
<PAGE>



         Section 3.05  Confidentiality.  Except as otherwise expressly specified
in this  Agreement  and except for the proper  exercise  of any  license  rights
granted or rights  reserved under this  Agreement,  Roche,  Agouron and JT shall
each  keep in  confidence  and  shall  each use its best  efforts  to cause  its
respective  Affiliates,  employees,  directors,  agents,  consultants,  clinical
research   associates,   outside   contractors,   clinical   investigators   and
sublicensees  to whom it is  permitted to disclose  information  pursuant to the
terms of this  Agreement  to  retain in  confidence:  (i) all  confidential  and
proprietary information of the other party, including *
                                                         and/or the  marketing 
and business  plans of such other party that is disclosed to it  hereunder;  and
(ii) Development  Program  Technology.  Without  limiting the foregoing,  Roche,
Agouron and JT shall each  exercise the same degree of  diligence  and care with
respect to the  above-described  information as it exercises with respect to its
other proprietary  information.  Each party represents to the other parties that
it  maintains  policies  and  procedures  designed to prevent  the  unauthorized
disclosure of its proprietary data and information. Roche further agrees that it
shall: (i) limit dissemination of and access to the confidential and proprietary
information of Agouron and JT within Roche's  organization to those of Roche and
its Affiliates' personnel who have a need to know the information;  and (ii) not
disclose such  confidential and proprietary  information to any employees of any
of its  Affiliates if such Affiliate is doing business in a country not included
in the Licensed Territory, unless an authorized representative of Agouron and JT
specifically  authorizes  in writing such  disclosure,  and the employees of the
Affiliate receiving such information agree in writing not to disclose or use any
such  information  disclosed  to them  other  than for the  performance  of this
Agreement  and the  proper  exercise  of any  license  rights  granted to Roche.
Agouron and JT agree to limit  dissemination  of and access to confidential  and
proprietary   information  of  Roche  concerning  INVIRASE  to  Agouron  and  JT
personnel,  and their respective Affiliates' personnel,  who have a need to know
the  information.  Roche,  Agouron and JT shall each be entitled to disclose the
above-described  information to its consultants,  clinical research  associates,
outside  contractors,  collaborators,  clinical  investigators  and other  third
parties who are subject to  confidentiality  and use  obligations  equivalent to
those applicable to the disclosing party hereunder, and to governmental or other
regulatory  and/or  health  authorities,  to the extent that such  disclosure is
reasonably  necessary to obtain patents,  to obtain  authorization or to conduct
clinical  trials on the  Compound or Products,  to prepare the  Dossier,  and/or
otherwise to fulfill its obligations  pursuant to this Agreement.  An authorized
representative  of Agouron and JT shall be responsible,  in its sole discretion,
for  authorizing  the supply of any drug samples of the Compound and/or Products
to third party researchers.  Roche,  Agouron and JT shall each have the right to
disclose  Development  Program  Technology  to persons it proposes to enter into
business  relationships  with,  if such  persons are subject to  confidentiality
obligations  equivalent to those  applicable to the disclosing  party hereunder.
The preceding  obligations of confidentiality  shall be waived as to information
which the party claiming waiver can demonstrate,  based on written records:  (i)
is in the public domain at the time of disclosure hereunder; (ii) comes into the
public domain through no fault of the party claiming waiver;  (iii) was known to
the party claiming waiver prior to its disclosure  under this Agreement,  unless
such information was obtained from the other 

                                       16
<PAGE>

party on a confidential basis; (iv) is disclosed on a non-confidential  basis to
the party  claiming  waiver by a third party  having a lawful right to make such
disclosure on a  non-confidential  basis; (v) is published with the prior mutual
agreement  of the  parties  after  having  given  consideration  to  appropriate
commercial  factors;  (vi)  comes into the public  domain  through  governmental
publication  of a patent  application;  or (vii) is required to be  disclosed to
file a patent or other regulatory application, or to comply with applicable laws
and  regulations.  The obligations  under this Section 3.05 shall survive to the
later  of:  (i) *         after  the  end of  the  Development  Program;  or  
(ii) the  termination or expiration date of the last to expire of any license(s)
granted  pursuant  to this  Agreement,  to the  extent the  Development  Program
Technology,  Agouron/JT  Technology  or Roche  Technology  is  applicable to the
practice of grants under such  license(s);  or (iii) the expiration  date of the
last to expire of any patent(s) within the Patent Rights on a Product.

         Section 3.06 Publication.  Agouron,  JT and Roche each acknowledges the
interests of the other  parties in  publishing  certain of their  results of the
development  and  Registration  of a Product  to obtain  recognition  within the
scientific  community  and to advance  the state of  scientific  knowledge.  The
parties  also  recognize  their  mutual  interests  in  obtaining  valid  patent
protection  for their drug  products.  Consequently,  a party,  its employees or
consultants *





Furthermore, in acknowledgment that certain *

the parties agree that each party shall *








                                                                           After
giving   reasonable   consideration  to  the  suggestions  of  the
objecting party, the party wishing to *
                                                                       Each  
party will use its reasonable efforts to inform the other parties about proposed
oral  presentations  which such party  intends to make, if it will be disclosing
new  scientifically   significant  data  concerning  the  Product  at  the  oral
presentation.

                                       17
<PAGE>

               ARTICLE IV - MANAGEMENT STRUCTURE OF COLLABORATION

         Section 4.01 Coordination. Coordination of the parties' development and
commercialization  efforts  for the  Compound  and  Products in the Field in the
Licensed Territory shall be carried out as specified in Sections 4.02 and 4.03.

         Section  4.02   Development  and   Registration;   Responsibility   for
Development Costs.  Roche,  Agouron and JT acknowledge their mutual intention to
cooperate in a commercially reasonable approach in the timely development of the
Compound  and  Products  in the Field in the  Licensed  Territory.  The  parties
further  acknowledge  their mutual  willingness  to discuss ad hoc agreements to
establish   appropriate   mechanisms  for  such  cooperation.   Recognizing  the
importance  of timely  initiation of  development  activities,  however,  Roche,
Agouron and JT agree to the following  basic approach to development of Products
in the Field in the Licensed Territory,  and to the conduct and funding of their
respective development activities.

         (a) Except as otherwise agreed to by the parties,  Agouron and JT shall
be responsible for completing,  in a reasonable  manner, and funding the studies
*                     these studies include the core development program studies
designed to achieve Registration of Products in the Field in the major countries
of the Licensed Territory.  The parties acknowledge that Agouron and JT, despite
reasonable diligence,  may be unable to complete *






         (b)      In collaboration with Roche, Agouron shall be responsible *

                                                                           and 
shall have the primary responsibility for the *








                                                                       for  the 
ongoing   correspondence  and  interaction  concerning  such  Product  with  the
applicable  regulatory  authorities  of  the  European  Union.  Roche  shall  be
responsible for  negotiating  pricing and  reimbursement  for a Product with the
regulatory authorities of the European Union.

         (c)      *         shall be responsible for making in a timely manner 
any alterations to the 
*                 which are required for *

                                       18
<PAGE>

                                      Except as otherwise agreed to by the
parties, Roche shall be responsible for *







         (d)      Roche shall be responsible for *
(other than those *                 ) which involve *

                                      ).  Roche shall be responsible for the *


         (e) Subject to the  availability  of  adequate  drug supply of Product,
Roche  shall  be  responsible  for the  cost  and  implementation  (possibly  in
cooperation with a previously  contracted contract research  organization) of an
expanded  access program for Products in  appropriate  countries of the Licensed
Territory,  including  specifically the countries located in Europe,  Australia,
New Zealand and Brazil,  which  expanded  access  program shall be consistent in
scope with the expanded access program  implemented by Agouron in North America.
Agouron and JT will reasonably  consider Roche's request to conduct a portion of
the expanded  access program as a program  involving  special  license sales, if
such  request  does not  interfere  with the parties  relationship  with the HIV
community  and/or  government  authorities  and does not require a change in the
formulation (clinical versus commercial  formulations) of drug product otherwise
allocated to the expanded access program.

         (f)      *







         (g) Each  party  shall be  entitled  to have the  government  or health
authorities  cross-reference  information contained in any Dossier for a Product
filed in any  country  in the  Territory,  as may be  necessary  to  obtain  and
maintain the Registration on a Product in any other country in the Territory.

         (h) Each party agrees to use its diligent  efforts in  responding  in a
timely  manner,  but not more than thirty (30) days,  to requests from the other
party for preclinical and clinical results and other information  concerning the
Development  Program  to  enable  the  other  party to  comply  with  regulatory
requirements for the Development  Program.  To the extent possible,  the parties

                                       19
<PAGE>

shall develop and use compatible  reporting forms in the clinical  studies aimed
at achieving  Registration of Products in the Field. A party  conducting a study
involving the Product shall assist the other parties in the incorporation of the
data from such study into their Dossiers, if necessary.

         (i) Roche shall keep  Agouron  and JT  informed of its  progress in the
development and  Registration of Products.  This shall include,  *       regular
meetings of the parties,  and such written  progress reports as are agreed to by
the parties which summarize Roche's  activities during each reporting period and
Roche's planned  activities for the succeeding  period. The meeting locations of
the parties shall be at sites agreed to by the parties. Meeting minutes shall be
promptly  prepared and  approved by  designated  representatives  of each of the
parties.  Each party shall pay all of its respective expenses for such meetings.
Agouron and JT shall keep Roche informed of their  development and  Registration
activities to the extent that such development and  Registration  activities are
relevant  to the  development  and  Registration  of  Products  by  Roche in the
Licensed Territory. Each of the parties shall *
                                                               each  
representative  shall report to his/her management on the matters discussed at 
each of the meetings of the parties.  Each party, prior to its implementation  
of a *
                                                               shall use its
reasonable efforts to provide the other parties with a copy of the *
manner, but not more than thirty (30) days, *


                                                   Roche agrees to use its 
diligent efforts in responding in a timely manner, but not more than *
to requests from Agouron or JT for information *

         (j)      Roche, Agouron and JT shall each use qualified persons in the 
development activities of the Development Program.

         (k) All work in  connection  with the  development  of the  Compound or
Products,  to the extent required by applicable  laws or  regulations,  shall be
conducted in  accordance  with Good  Laboratory  Practices,  Good  Manufacturing
Practices  and Good  Clinical  Practices,  as such rules of practice are amended
from time to time.

         (l) If a party is  conducting  a study in a country  located in another
party's marketing  territory,  the party conducting the study shall use its best
efforts to avoid interfering with such other party's activities in such country.

         Section 4.03 Marketing. Roche shall be responsible for the marketing of
Products in the Field in the Licensed Territory.  Roche, Agouron and JT agree to
the  following  basic  approach to the marketing of Products in the Field in the
Licensed Territory and to the conduct of their respective marketing activities.

                                       20
<PAGE>

         (a)      *

                                                                          Roche
shall modify the        *         only to the extent required to respond to 
country-specific needs, and implement *


Agouron, JT and their licensees *



         (b) Roche shall be  responsible  for  distribution  of a Product in any
countries located in the Licensed Territory where Roche is exclusively marketing
such Product in the Field.

         (c)      Roche shall keep Agouron and JT informed of Roche's *
                             This shall include, *                              
the regular  meetings of the parties,  and such written  progress reports as
are agreed to by the parties  which  summarize  Roche's  activities  during each
reporting period and Roche's planned  activities for Products for the succeeding
period.  The meeting locations of the parties shall be at sites agreed to by the
parties.  Meeting  minutes  shall  be  promptly  prepared  and  approved  by the
designated representatives of each of the parties. Each of the parties shall pay
all of its respective expenses for such meetings. Each of the parties shall *
                            each  representative  shall report to his/her  
management on the matters discussed at the meetings of the parties.  At the 
meetings of the parties, the representatives of the parties shall review and 
discuss *






         (d) It is the intent of the  parties  that the  VIRACEPT  Trademark  be
identified and developed for use in connection with the marketing of Products in
the Field wherever  possible  throughout the Territory.  Unless otherwise agreed
and as permitted by law, Roche agrees to market  Products in the Field under the
VIRACEPT brand name in all countries in the Licensed Territory. The parties also
acknowledge  their  intention  to use, if  appropriate,  the same Trade Dress in
connection with the marketing of Products in the Field wherever possible.

         (e) In countries where Roche is exclusively  marketing a Product in the
Field,  unless  prohibited by law or  regulation,  the labeling for such Product
shall state that the Product is licensed  from Agouron and JT, and indicate that
the Product is a product of the joint  development of Agouron,  JT and Roche. To
the extent required to comply with the provisions of this Section 4.03(e),  each
party  grants  to the other  parties  the right to use its name and logos in the
labeling for a Product.

                                       21
<PAGE>

         (f)      Roche shall use qualified persons in its marketing activities 
for a Product in a country located in the Licensed Territory.

         (g) Roche shall be responsible for responding,  in a timely manner,  to
inquiries and for  reporting  adverse drug  reactions  related to a Product in a
country located in the Licensed  Territory after the Product is on the market in
the Field in such country.  Notwithstanding  Roche's ultimate responsibility for
the  professional  services  and  the  health  and/or  regulatory   authorities'
communications  related to a Product  after such Product is on the market in the
Field in a country located in the Licensed  Territory,  to the extent reasonably
possible, Agouron and JT shall have the right to review, comment and participate
in  communications  concerning  such Product with the health  and/or  regulatory
authorities in such country.  Furthermore,  Roche,  Agouron and JT shall each be
entitled to respond to routine medical questions or inquiries  directed to them.
Each party  shall use its best  efforts to provide  the other  parties  with all
information  reasonably  necessary to respond  properly and promptly to any such
questions or  inquiries;  the parties  shall also use their best efforts to keep
such information current. Without limiting the foregoing,  Roche, Agouron and JT
*



The parties shall confer with respect to responding to anticipated inquiries and
questions.  Each party shall use its best efforts to promptly  provide the other
parties with new information,  scientific findings,  and summaries of regulatory
or judicial requests  specifically related to a Product, to the extent that such
information, findings or requests are likely to have a significant impact on the
other parties' marketing of such Product.

         Section 4.04      Supply of Product.

         (a) Roche shall purchase from Agouron and/or JT, and Agouron and/or JT,
subject to the provisions of Section 4.04(c), shall use their reasonable efforts
to deliver, the finished dosage form(s) of Product *














                                       22
<PAGE>



         (b) Roche shall  purchase from Agouron and/or JT and Agouron and/or JT,
subject to the provisions of Section 4.04(c), shall use their reasonable efforts
to deliver,  the finished  dosage  form(s) of Product,  for sale in the Licensed
Territory, including special license sales, *








         (c)      Agouron and JT shall maintain books of account and complete 
and accurate records of all of their *














         (d)      *











                                       23
<PAGE>




         (e) Roche shall assist Agouron and JT in the identification of low-cost
manufacturing sources for a Product. Roche shall also provide without charge, to
the extent  available,  technical and  manufacturing  assistance  and use of its
technology  and  proprietary  information  to  Agouron  and JT in an  effort  to
decrease the production costs of such Product.

          (f)  Agouron  and JT agree to  discuss  in good  faith  with  Roche an
arrangement  under which Roche could be the manufacturer of a Product to be used
in the Licensed Territory, including the prerequisite requirement that *











         (g)  All  Product  is  to  be   manufactured  in  accordance  with  the
specifications to be determined during  development and later attached hereto in
Attachment 2 to this Agreement and any amendments thereto.  All Product shall be
furnished with a certificate of analysis.

         (h) Roche shall grant to both  Agouron and JT a right of  reference  to
the drug master file for a Product in the countries where Roche,  its Affiliates
or  sublicensees  are marketing such Product,  and shall take all other steps as
may be reasonably  requested by a  manufacturer  of such Product for the limited
purpose of enabling it to manufacture  the Product for Roche,  its Affiliates or
sublicensees.  The manufacturer  shall  manufacture a Product in compliance with
the Dossier for such  Product.  Each party shall  promptly  and fully advise the
other parties of any changes,  alterations or amendments to the drug master file
for a Product, or any amendments, instructions or specifications required by the
health or regulatory authority, and the parties shall confer with respect to the
best mode of compliance with any such requirements.

         (i) In the event  any  Product  delivered  hereunder  must be  recalled
because of action by the relevant health authority,  the parties shall cooperate
fully with each other in conducting such recall to the full extent  necessary to
ensure that the recall is effective.  Any recall  expenses for such Product in a
country  located in the Licensed  Territory shall be the  responsibility  of the
party marketing the Product.




                                       24
<PAGE>





                     ARTICLE V - LICENSE FEES AND ROYALTIES;
                             GENERAL LICENSING TERMS

         Section 5.01      License Fees and Royalties.

         (a) In partial consideration for the rights granted to Roche by Agouron
and JT, Roche hereby agrees to make the following  non-refundable  license issue
fee payments directly to Agouron and JT.


                                                             USD (MM)

        On January 24, 1997

             To Agouron                                       $  9.0

             To JT                                               9.0




        Within ten (10) days of the execution of this 
        Agreement

             To Agouron                                          2.0

             To JT                                               2.0




        Within thirty (30) days of first regulatory approval
        in a Major European

        Country or upon marketing authorization from the European 
        Commission

               To Agouron                                        11.0

               To JT                                             11.0




        Within thirty (30) days of first regulatory approval
        in a country located in the Asian Licensed Territory  
        or upon marketing authorization in a  country located  
        in the Asian Licensed Territory

               To Agouron                                         1.0

               To JT                                              1.0




                                                TOTAL            46.0


         (b)      In partial consideration for the rights granted each of the 
parties in this Agreement, the parties agree as follows:

                  (i) Roche shall pay Agouron and JT directly,  a royalty  based
         on the Net Sales of Product by Roche, its Affiliates and  sublicensees,
         consolidated  into CHF, in amounts  which equal the greater of: (A) the
         royalty  amounts  calculated  according  to  Royalty  Schedule  1 below
         (Product  only);  or (B) the royalty  amounts  calculated  according to
         Royalty  Schedule 2 below  (Product  and any  formulations  of INVIRASE
         which Roche markets, with royalties being calculated separately for the
         consolidated  annual Net Sales of such Product and  INVIRASE).  Royalty
         Schedule  2 shall  not apply to Net Sales  (including  special  license
         sales)  in a  country  located  in the  Licensed  Territory  until  the
         Registration  of a Product  in such  country.  A sum equal to  one-half
         (1/2) of the  following  royalties  shall be paid by Roche  directly to
         each of Agouron and JT.




                                       25
<PAGE>






                               Royalty Schedule 1




     Royalty Rate                      Consolidated Annual Net Sales Level
     Per Consolidated                  of the Product in Licensed Territory
     Annual Net Sales Level            (other than the Asian Licensed Territory)


               *                             <= *
               *                             > CHF   *         <= CHF *
               *                             > CHF *



plus

     Royalty Rate                       Consolidated Annual Net Sales Level of
     Per Consolidated                   the Product in the Asian Licensed 
     Annual Net Sales Level             Territory


               *                             <= USD   *
               *                             > USD   *         <= USD *
               *                             > USD   *








                               Royalty Schedule 2




                                      Consolidated Annual Net Sales Level for
                                      the Product and INVIRASE in the Licensed
                                      Territory, other than the Asian Licensed
      Royalty Rate                    Territory (With Royalties Being Calculated
      Per Consolidated                Separately for the Consolidated Annual
      Annual Net Sales Level          Net Sales of the Product and INVIRASE)


               *                             <= CHF    *
               *                             > CHF    *         <= CHF *
               *                             > CHF *



plus

                                     Consolidated Annual Net Sales Level for the
                                     Product and INVIRASE in the Asian Licensed
      Royalty Rate                   Territory  (With Royalties Being Calculated
      Per Consolidated               Separately for the Consolidated Annual
      Annual Net Sales Level         Net Sales of the Product and INVIRASE)


                *                             <= USD  *
                *                             > USD  *           <= USD *
                *                             > USD  *




                  (ii) If either: (A) regulatory  approval for the first Product
            is not  obtained  in a  Major  European  Country  prior  to * or (B)
            marketing  authorization  for the first Product is not obtained from
            the European Commission prior to *
            the  royalty  rate for  Royalty  Schedule  2 for the  Licensed
            Territory (other than the Asian Territory) shall be adjusted as 
            follows.




                                       26
<PAGE>







                               Royalty Schedule 2





                                     Consolidated Annual Net Sales Level for
                                     the Product and INVIRASE in the Licensed
                                     Territory (other than the Asian Licensed
         Royalty Rate                Territory) (With Royalties Being Calculated
         Per Consolidated            Separately for the Consolidated Annual Net
         Annual Net Sales Level      Sales of the Product and INVIRASE)


                  *                             <= CHF    *
                  *                             > CHF    *         <= CHF *
                  *                             > CHF    *




                  (iii) If  regulatory  approval  for the first  Product  is not
         obtained in Thailand prior to * and Roche has used reasonable diligence
         in the  development  and  Registration  of a  Product  in the  Field in
         Thailand (including Roche's filing of a regulatory approval application
         in Thailand during * ), the royalty rate for Royalty Schedule 2 for the
         Asian Licensed Territory shall be adjusted as follows.





                               Royalty Schedule 2





                                     Consolidated Annual Net Sales Level for the
                                     Product and INVIRASE in the Asian Licensed
         Royalty Rate                Territory  (With Royalties Being Calculated
         Per Consolidated            Separately for the Consolidated Annual
         Annual Net Sales Level      Net Sales of the Product and INVIRASE)

                  *                             <= USD   *
                  *                             > USD   *          <= USD *
                   *                            > USD   *


                  (iv)     If either:  (A) regulatory approval for the first 
         Product is not obtained in a Major European Country prior to *
         or (B) marketing authorization for the first Product is not obtained 
         from the European Commission prior to
         * Royalty  Schedule 2 for the Licensed  Territory (other than the Asian
         Licensed Territory) shall not apply and Roche shall be obligated to pay
         JT and Agouron directly, royalties according to Royalty Schedule 1 only
         for the Licensed Territory (other than the Asian Licensed Territory).

                  (v) If  regulatory  approval  for  the  first  Product  is not
         obtained in Thailand prior to * and Roche has used reasonable diligence
         in the  development  and  Registration  of a  Product  in the  Field in
         Thailand (including Roche's filing of a regulatory approval application
         in Thailand * Royalty Schedule 2 for the Asian Licensed Territory shall
         not apply and Roche shall be obligated to pay JT and Agouron  directly,
         royalties  according to Royalty  Schedule 1 only for the Asian Licensed
         Territory.

                  (vi)     If Roche files a regulatory approval application in 
         Thailand after *
                                             then the milestone *             
         and *
                dates  specified in  subparagraphs  (iii) and (v) above shall be
         deferred  by the number 



                                       27
<PAGE>

         of days such  regulatory  application  is filed  after * 
         provided,  however,  that the above-referenced  milestone dates
         shall not be  deferred  for any  day(s)  where  such delay is caused by
         reasons beyond Roche's control.

                  (vii) If Roche  markets any other HIV protease  inhibitors  in
         the Licensed  Territory  during the term of this  Agreement,  sales for
         such  product(s)  shall  be  included  in the  consolidated  Net  Sales
         calculation according to Royalty Schedule 2.

                  (viii) The annual period  Consolidated  Annual Net Sales Level
         for  calculating  royalties  on Net Sales shall be the  calendar  year;
         provided, however, that Net Sales occurring during the partial calendar
         year period  commencing with the Initial  Commercial Sale of Product in
         the Licensed  Territory,  shall be calculated  on an annualized  twelve
         (12) month basis ending December 31.

                  (ix)  If  Agouron  and JT  are  unable  to  deliver  to  Roche
         significant  amounts of Product  ordered by Roche for  commercial  sale
         (other than special license sales) in the Licensed Territory during the
         period ending on the first  anniversary of the marketing  authorization
         for the first  Product  from the  European  Commission  (or  regulatory
         approval for the first  Product in a Major  European  Country) and such
         Product  was  ordered by Roche in a timely  manner in  accordance  with
         forecasting and ordering  procedures  agreed upon by the parties,  then
         the  parties  will  discuss  in  good  faith  an   adjustment   in  the
         implementation of Schedule 2. *















         Section 5.02      General Licensing Terms.

         (a) No sales  shall be deemed to have  occurred  as the result of sales
between and among the  parties,  their  Affiliates  and  sublicensees;  it being
understood that sales occur when made to non-Affiliated  third party purchasers.
A sale of a Product  shall be deemed  to have  been  made upon the  earliest  of
invoicing or delivery of such Product for value to a non-Affiliated  third party
purchaser.  In the case of a sale or other disposal of a Product for value other
than in an 


                                       28
<PAGE>

arm's-length transaction exclusively for money, such as barter or counter-trade,
sales shall be calculated using the fair market value of such Product (if higher
than the stated sales price) in the country of disposal.

         (b)      *













         (c)      *








         (d) In calculating royalties with respect to a Combination Product, the
parties shall enter into good faith negotiations regarding the percentage of the
Net  Sales  of such  Combination  Product  to be used in  calculating  royalties
payable with respect to such Combination Product on a country-by-country  basis.
If the parties are unable to agree upon such percentage,  royalties with respect
to a Combination Product in a country *











                                       29
<PAGE>

         (e)  Royalties due on the sale of a Product shall be owed from the date
of Initial Commercial Sale (or, if earlier, the first special license sale) by a
party,  its  Affiliates  or  sublicensees  of such  Product  in a country of the
Licensed Territory, until the latest of: *














         (f) The parties  agree that the  accounting  and  payment of  royalties
shall comply with the following terms and conditions:

                  (i)      As soon as possible, but no later than *
                            Roche shall  provide to the  authorized  
representative  of Agouron and JT with its good faith  estimate of the amount of
Net Sales for such calendar month.

                  (ii)     On or before the *
                    of each and every  calendar year for as long as royalties 
are due following  the  commencement  of the marketing of Products, Roche shall:
         (A) *






                  (iii)    Roche's accounting of royalty *                      
shall be reviewed and signed by an  appropriate  financial  employee of Roche,
         and shall identify all relevant details regarding *



                  (iv)     Any royalty payments due that are not paid on or 
before the date such payments are due shall bear interest at *




                                       30
<PAGE>

         (g) Roche shall maintain and cause its Affiliates and  sublicensees  to
maintain  books of account and complete and accurate  records  pertaining to the
sale or other  disposition  of Products  and of the  royalty  and other  amounts
payable  under this  Agreement  in  sufficient  detail to permit the  authorized
representative of Agouron and JT to confirm the correctness of such items. *





























         (h) Roche shall be entitled to withhold from a royalty or other payment
due Agouron and/or JT, the amount,  if any, of any withholding tax assessable to
the party due the  payment,  provided  evidence  of  payment  of any such tax is
promptly  provided  to the party for  which  the tax is  withheld.  If any taxes
(other than  value-added  taxes) are imposed on payments of royalties to Agouron
and/or JT and are required to be withheld therefrom, such taxes shall be for the
account of Agouron  and/or JT,  respectively,  and the payments due to the party
for which tax is  withheld  shall be reduced  accordingly.  Roche  shall  advise
Agouron and/or JT and provide them with copies of the tax receipts for all taxes
deducted from the payment of royalties due them.

                                       31
<PAGE>

         (i) The costs of  defending  or settling any claim or suit by any third
party for  infringement of a patent of such third party by a party's practice of
the Patent Rights, Agouron/JT Technology,  Roche Technology,  and/or Development
Program Technology in discovering,  developing, manufacturing or commercializing
the Compound, intermediates thereof and/or Products *


         (j) Upon the  expiration  of the  foregoing  royalty  obligations  in a
country,  which shall also be the expiration date of the licenses  granted Roche
in such country pursuant to Sections 2.01(a) or 2.03, Roche *

                                     intermediates  thereof and Products in the 
Field in such country on a non-exclusive basis;  provided,  however,  that such
commercialization is subject to any other continuing obligations due Agouron and
JT, including license obligations under Section 2.01(j), if any.

         (k) The parties agree in the future to use their reasonable  efforts to
negotiate any additional licensing terms for the Compound, intermediates thereof
and/or  Products which may be necessary to clarify the rights and obligations of
the parties.

         Section 5.03      Foreign Currency.

         (a)  Development  costs,  Patent and Trademark  costs,  Adjusted  Gross
Sales,  Net  Sales and any  royalty  amounts  shall be  stated in United  States
dollars. Payments of development costs, Patent and Trademark costs and royalties
shall be made in United States dollars.  Any required  conversion of development
costs,  Patent and  Trademark  costs,  Adjusted  Gross Sales,  Net Sales and any
royalty amounts to United States dollars shall be done using the monthly average
rate of exchange for the calendar month in which such development costs,  Patent
and Trademark  costs,  Adjusted Gross Sales,  Net Sales and any royalty  amounts
were incurred or first determined.

         (b)      The conversion from a foreign currency to United States 
dollars shall be made by *





         (c)      *







                                       32
<PAGE>












         (d)      *







                        ARTICLE VI - TERM AND TERMINATION

         Section 6.01  Termination for Breach.  Either party may, at its option,
terminate  this  Agreement for cause in the event the other party shall commit a
material  breach of this  Agreement  (including the failure of Roche to make the
payments described in Section 5.01(a) in a timely manner) and shall fail to cure
such breach  during the one hundred  twenty  (120) day period  (thirty  (30) day
period in the case of any payment default) following receipt of a written notice
of such breach from the  non-breaching  party.  After the end of the  applicable
cure  period,  the party  who has the  right of  termination  may  exercise  its
termination  option by giving the  breaching  party prior  written  notice of at
least fifteen (15) days of its election to terminate.  Any  termination  of this
Agreement shall not release the breaching  party from any  obligations  incurred
hereunder, and the non-breaching party shall be entitled to pursue an action for
damages  arising  as a result of such  material  breach.  For  purposes  of this
Article VI,  Agouron and JT shall be deemed to be a single party;  an authorized
representative  of Agouron and JT shall be  entitled  to take any actions  which
Agouron  and/or JT are  entitled  to take  pursuant  to the  provisions  of this
Article VI.

         Section 6.02      Termination by Roche.

         (a) Roche may elect to cancel the  development  and  Registration  of a
Product in the Field in a country  located in the  Licensed  Territory  upon one
hundred  eighty (180) days  written  notice.  If Roche  elects to terminate  its
participation in the development and Registration of a Product in the Field in a
country  located in the  Licensed  Territory,  it shall use its best  efforts to

                                       33
<PAGE>

terminate  its  participation  concurrently  with the  completion of its ongoing
clinical studies.  In the event that Roche elects to discontinue the development
and  Registration of a Product in the Field in a country located in the Licensed
Territory, subject to the provisions of the D&L Agreement, Agouron and JT, their
Affiliates  and  sublicensees  shall be free,  without  any  further  action  by
Agouron,  JT or Roche,  and  without  any  further  obligation  to Roche and its
Affiliates, to continue to develop and/or commercialize Products in such country
on their own or with any third  party,  and to retain,  use and  disclose to any
such third party,  information  and materials  which have been  developed in the
development and Registration of the Product,  provided that Agouron and JT shall
not disclose to such third party the confidential and proprietary information of
Roche  (other  than  clinical,  regulatory  and  manufacturing  information  and
materials   specifically  relating  to  such  Product).  In  the  event  of  the
discontinuation  of Roche's  development  and  Registration  of a Product in the
Field in a country, the licenses granted to it by the provisions of Section 2.01
to use, offer for sale, sell and/or import in or into such country, such Product
in the Field under applicable  Agouron/JT Patent Rights and Development  Program
Patent Rights, and using applicable Agouron/JT Technology,  Roche Technology and
Development Program Technology,  shall be terminated,  and Agouron and JT, their
Affiliates and sublicensees  shall have no royalty or other obligations to Roche
and its Affiliates  resulting from the  manufacture,  use, offer for sale,  sale
and/or  import in or into such country of the  Compound,  intermediates  thereof
and/or Products by Agouron and JT, their Affiliates and sublicensees. Subject to
the provisions of the D&L Agreement: (i) Agouron and JT shall have the exclusive
right to Trademarks; (ii) Roche shall transfer ownership of any Dossiers for the
Product in such country to Agouron and JT; and (iii) Roche shall  cooperate with
Agouron  and JT to affect an  orderly  transition  of  Roche's  development  and
Registration  responsibilities in such country to Agouron and JT. Roche shall be
responsible  for the cost of its  development  activities in a country until the
effective  date  of  such  cancellation,  including  the  expenses  incurred  in
terminating  such activities and the costs of completing  clinical studies which
were  obligated  to prior to its election to  discontinue  the  development  and
Registration of such Product in the Field in such country.

         (b) Roche may elect to terminate its marketing  rights for a Product on
a country-by-country basis upon one hundred eighty (180) days written notice. In
the event that Roche elects to terminate its marketing rights for a Product in a
country,  subject  to the  provisions  of the D&L  Agreement:  (i) the  licenses
granted to Roche by the provisions of Section 2.01 to use, offer for sale,  sell
and/or  import  in or  into  such  country,  such  Product  in the  Field  under
applicable  Agouron/JT Patent Rights and Development  Program Patent Rights, and
using applicable Agouron/JT Technology, Roche Technology and Development Program
Technology,  shall be  terminated,  and Agouron  and JT,  their  Affiliates  and
sublicensees  shall be free,  without  any further  obligation  to Roche and its
Affiliates,  to market such Product in such country on its own or with any third
party; (ii) Agouron and JT, their Affiliates and sublicensees shall not have any
royalty or other  obligations  to Roche and its  Affiliates  resulting  from the
manufacture,  use, offer for sale, sale and/or import in or into such country of
the Compound,  intermediates  thereof  and/or  Products by Agouron and JT, their
Affiliates and sublicensees; (iii) Agouron and JT shall have the exclusive right
to Trademarks in such country;  (iv) Roche shall  transfer  ownership to Agouron
and JT of any  Dossiers for such  Product in such  country;  and (v) Roche shall
cooperate  

                                       34
<PAGE>

with  Agouron  and JT to affect  an  orderly  transition  of  Roche's  marketing
responsibilities in such country to Agouron and JT.

         (c) If there is a material  breach of this  Agreement by Agouron and JT
but Roche nevertheless  wishes to retain its rights granted by the terms of this
Agreement  in the  Compound  and/or  Products  arising  out  of the  Development
Program, then Roche shall not be entitled to terminate this Agreement for cause,
but shall only be entitled  to pursue an action for damages  arising as a result
of such material breach.

         Section 6.03      Termination  by Mutual  Agreement.  The parties may 
at any time  terminate  this  Agreement,  in part or in its entirety,  by mutual
written agreement.

         Section 6.04 Termination Upon Bankruptcy.  In the event that a party is
subject to any proceeding  under the bankruptcy laws, or to the appointment of a
receiver,  trustee or  liquidator  of its business or  substantially  all of its
assets,  and such  proceeding,  if  involuntary,  is not dismissed or discharged
within one hundred fifty (150) days after such proceeding is instituted, or upon
the  liquidation,  dissolution,  or  winding  up  of  its  business,  then  this
Agreement,  at the  election  of the other  party,  shall be  terminated  in its
entirety  for cause upon a notice in writing of at least  fifteen (15) days from
the party who is not bankrupt or insolvent.

         Section 6.05 Disposition of Inventory. In the event of the cancellation
or  termination  of any license  rights with respect to a Product,  inventory of
such Product may be sold for up to six (6) months after date of  cancellation or
termination, provided required payments, if any, are paid thereon.

         Section 6.06 Effect of  Termination.  The termination of this Agreement
shall, to the extent not otherwise  expressly provided herein, have no affect on
the rights and  obligations of the parties under this Agreement with respect to:
(i)  the  parties'   obligations   of   confidentiality,   indemnification   and
compensation  for services  performed;  (ii) a party's  liability for failure to
fulfill its  obligations or  undertakings  under this  Agreement;  and (iii) the
rights or obligations of the parties otherwise expressly stated in the Agreement
to survive the termination of this  Agreement.  If this Agreement is terminated,
Agouron and JT's obligations  under Section 2.02(b) shall  terminate.  Any other
provisions  of this  Agreement  which by their  nature are  intended  to survive
termination  shall also survive.  Upon any  termination of this Agreement in its
entirety because of a breach of a party,  neither party waives any rights to any
remedies it may have arising out of the termination.  In the event of any breach
by a party with respect to obligations which continue after a termination in its
entirety of this  Agreement,  the  non-breaching  party shall have all  remedies
available  to it, as if the  Agreement  were still in effect on the date of such
breach.



                                       35
<PAGE>


                  ARTICLE VII - WARRANTIES AND COVENANTS; INDEMNITIES; 
     INSURANCE; DISPUTE RESOLUTION; GOVERNMENTAL APPROVALS; EXPORT CONTROLS

         Section 7.01      Warranties and Covenants.

         (a) Each party represents and warrants to the other parties that it has
the legal power, authority and right to enter into this Agreement and to perform
all of its respective  obligations  set forth herein,  including the attachments
hereto.

         (b) Agouron and JT each  represents  and warrants  that, as of the date
this  Agreement  is executed,  it was not aware of the  existence of any patents
owned  and  Controlled  by a third  party  covering  the  Compound  which  would
materially prevent the parties from commercializing the Compound in the Field in
the Licensed Territory.  For purposes of this Section 7.01(b), the parties agree
that United States Patent No.  5,587,481 and United States Patent No.  4,439,613
and their  foreign  counterparts  do not  materially  prevent the  parties  from
commercializing the Compound in the Field in the Licensed Territory.

         (c) Each  party  covenants  that it shall not commit any act or fail to
take any action which,  in any  significant  way,  would be in conflict with its
material obligations under this Agreement and the attachments hereto.

         (d) Each party  promises to comply in all  material  respects  with the
terms of the licenses granted to it under this Agreement,  and with all federal,
state,  local  and  foreign  laws,  rules  and  regulations  applicable  to  the
development,   manufacture,   distribution,  import  and  export,  and  sale  of
pharmaceutical products pursuant to this Agreement.

         (e) EXCEPT AS OTHERWISE  EXPRESSLY PROVIDED IN THIS AGREEMENT,  EACH OF
THE PARTIES MAKES NO WARRANTIES,  EXPRESSED OR IMPLIED,  OF  MERCHANTABILITY  OR
FITNESS FOR A  PARTICULAR  PURPOSE OF ANY  SUBJECT  MATTER  INCLUDED  WITHIN THE
CLAIMS OF THE PATENT RIGHTS,  INCLUDING THE COMPOUND. THE PARTIES UNDERSTAND AND
AGREE THAT  DEVELOPMENT  AND  COMMERCIALIZATION  OF THE COMPOUND AND/OR PRODUCTS
WILL  INVOLVE  APPROVAL  BY  REGULATORY  AUTHORITIES,   AND  THAT  NO  PARTY  IS
GUARANTEEING THE SAFETY OR EFFICACY OF THE COMPOUND AND/OR PRODUCTS, OR THAT THE
COMPOUND AND/OR PRODUCTS WILL RECEIVE THE REQUIRED APPROVALS.

         Section 7.02      Indemnities; Insurance.

         (a) Roche shall  indemnify and hold harmless  Agouron and JT, and their
Affiliates,  employees,  and agents (an "Agouron/JT Indemnified Party") from and
against any and all liabilities,  losses, damages, costs, or expenses (including
reasonable  investigative and attorneys' fees) which the Agouron/JT  Indemnified
Party may  incur,  suffer or be  required  to pay  resulting  


                                       36
<PAGE>

from or arising in connection with any product liability or other claims,  other
than claims for patent  infringement,  arising from the use by any person of any
Product,  to the extent such product  liability or other claim  results from the
negligent,  reckless or  intentional  misconduct  of Roche,  its  Affiliates  or
sublicensees, or their respective employees and agents, or on account of Roche's
failure  to fulfill  its  obligations  or  undertakings  under  this  Agreement;
provided,  however,  that in no event  shall  Roche be liable  to an  Agouron/JT
Indemnified  Party  for  any  indirect,  incidental,  special  or  consequential
damages, including loss of revenues or profits from sales of Products.

         (b)  Agouron and JT shall  indemnify  and hold  harmless  Roche and its
Affiliates, employees, and agents (a "Roche Indemnified Party") from and against
any  and  all  liabilities,  losses,  damages,  costs,  or  expenses  (including
reasonable  investigative and attorneys' fees) which the Roche Indemnified Party
may incur, suffer or be required to pay, resulting from or arising in connection
with any  product  liability  or other  claims,  other  than  claims  for patent
infringement,  arising from the use by any person of any Product,  to the extent
such product  liability or other claim results from the  negligent,  reckless or
intentional  misconduct of Agouron and/or JT, their  Affiliates or sublicensees,
or their  respective  employees  and  agents,  or on  account of Agouron or JT's
failure  to fulfill  its  obligations  or  undertakings  under  this  Agreement;
provided,  however,  that in no event  shall  Agouron or JT be liable to a Roche
Indemnified  Party  for  any  indirect,  incidental,  special  or  consequential
damages, including loss of revenues or profits from sales of Products.

         (c) To the extent that a product liability or other claim, other than a
claim  for  patent  infringement,   results  from  the  negligent,  reckless  or
intentional  misconduct of more than one party, their Affiliates,  sublicensees,
or their  respective  employees  and agents,  the  parties  agree to share in an
equitable  manner  such  liabilities,  losses,  damages,  costs,  or expenses in
proportion  to the  relative  fault of each of the  parties,  their  Affiliates,
sublicensees, or their respective employees and agents.

         (d) Unless the parties agree otherwise, all other liabilities,  losses,
damages,  costs, or expenses (including reasonable  investigative and attorneys'
fees) under this Section  7.02  relating to or involving a Product in a country,
except as provided by the terms of Sections  7.02(a),  (b) and (c), shall be the
responsibility  of the party  marketing such Product in such country.  The party
marketing a Product in a country shall indemnify the non-marketing party in such
country from and against any and all  liabilities,  losses,  damages,  costs, or
expenses  (including  reasonable  investigative  and attorneys' fees) which such
non-marketing  party may incur,  suffer or be required to pay resulting  from or
arising in connection  with any product  liability or other  claims,  other than
claims  for  patent  infringement,  arising  from the use by any  person of such
Product  in such  country.  Section  3.02  sets  forth  the  parties'  liability
obligations arising from claims for patent infringement.

         (e)      The aforesaid obligations of the indemnifying party shall be 
subject to the indemnified party fulfilling the following obligations:

                                       37
<PAGE>

                  (i) The  indemnified  party  shall  fully  cooperate  with the
         indemnifying party in the defense of any claims,  actions,  etc., which
         defense shall be controlled by the indemnifying party.

                  (ii) The indemnified  party shall not, except at its own cost,
         voluntarily  make any payment or incur any expense  with respect to any
         claim or suit  without the prior  written  consent of the  indemnifying
         party, which consent such party shall not be required to give.

                  (iii)  Promptly  after  receipt  by the  indemnified  party of
         notice of the  commencement  of any  litigation or threat thereof which
         may reasonably  lead to a claim for  indemnification,  such party shall
         notify the indemnifying party.

         (f)      The parties agree to maintain appropriate amounts of product 
liability insurance coverage.

         Section 7.03 Dispute  Resolution.  In the event of any  controversy  or
claim arising out of or relating to any provision of this  Agreement or any term
or condition hereof, or the performance by a party of its obligations hereunder,
the parties shall try to settle their differences  amicably between  themselves.
If the  representatives of the parties are unable to reach agreement on any such
issue, the issue shall be submitted for consideration,  in the case of Roche, to
a designee  of the Head of the  Pharma  Division  of Roche  and,  in the case of
Agouron and JT, to one or more representatives  jointly appointed by Agouron and
JT. If they are unable to agree,  then the issue shall be resolved,  in the case
of  Roche,  by the Head of the  Pharma  Division  of Roche  and,  in the case of
Agouron and JT, by one or more representatives  jointly appointed by Agouron and
JT. Any unresolved  issues arising between the parties  relating to, arising out
of, or in any way connected with this Agreement or any term or condition hereof,
or the  performance by a party of its obligations  hereunder,  whether before or
after  termination  of this  Agreement,  except as  otherwise  provided  in this
Agreement,  shall be finally resolved by binding  arbitration.  Whenever a party
shall decide to institute arbitration proceedings,  it shall give written notice
to that effect to the other party.  The party  giving such notice shall  refrain
from  instituting  the  arbitration  proceedings for a period of sixty (60) days
following such notice.  If Roche is the party  initiating the  arbitration,  the
arbitration  shall be held in San Diego,  California,  according to the rules of
the  American  Arbitration  Association  ("AAA").  If  Agouron  and  JT,  acting
collectively as a single party,  is the party  initiating the  arbitration,  the
arbitration shall be held in Newark,  New Jersey,  according to the rules of the
AAA. The arbitration shall be conducted by a single  arbitrator  mutually chosen
by the  parties.  If the parties can not agree upon a single  arbitrator  within
fifteen (15) days after the institution of the arbitration proceeding,  then the
arbitration  shall be  conducted  by a panel of three  arbitrators  appointed in
accordance  with AAA rules;  provided,  however,  that each party shall,  within
thirty (30) days after the institution of the arbitration  proceedings,  appoint
one  arbitrator  with  the  third  arbitrator  being  chosen  by the  other  two
arbitrators.  If only one party  appoints an  arbitrator,  then such  arbitrator
shall be entitled to act as the sole arbitrator to resolve the controversy.  Any
arbitration hereunder shall be conducted in the English language, to the maximum
extent  possible.  All  arbitrator(s)  eligible to conduct the 

                                       38
<PAGE>

arbitration must agree to render their opinion(s) within thirty (30) days of the
final arbitration  hearing.  The arbitrator(s) shall have the authority to grant
injunctive  relief and specific  performance and to allocate between the parties
the costs of arbitration in such  equitable  manner as he determines;  provided,
however,  that each party shall bear its own costs and  attorneys'  and witness'
fees.  Notwithstanding  the terms of this Section  7.03, a party shall also have
the  right to  obtain,  prior to the  arbitrator(s)  rendering  the  arbitration
decision,   provisional  remedies,   including  injunctive  relief  or  specific
performance,  from a court having jurisdiction thereof. The arbitrator(s) shall,
upon the request of either  party,  issue a written  opinion of the  findings of
fact and  conclusions  of law and shall  deliver a copy to each of the  parties.
Decisions of the arbitrator(s) shall be final and binding on all of the parties.
Judgment  on  the  award  so  rendered  may  be  entered  in  any  court  having
jurisdiction thereof.

         Section 7.04 Governmental Approvals. Roche, Agouron and JT shall obtain
any  government   approval(s)  required  to  enable  this  Agreement  to  become
effective,  or to  enable  any  payment  hereunder  to be  made,  or  any  other
obligation  hereunder  to be  observed or  performed.  Each party shall keep the
other  informed of its progress in obtaining  any such  government  approval and
shall cooperate with the other party in any such efforts.

         Section 7.05 U.S. Export Controls. The parties agree to comply with the
United  States laws and  regulations  governing  exports and  re-exports  of the
Compound,  intermediates  thereof,  Products,  Development  Program  Technology,
Agouron/JT  Technology,  Roche  Technology,  or any other technology or software
developed or disclosed as a result of this  Agreement.  The parties  acknowledge
that any performance  under this Agreement is subject to any restrictions  which
may be imposed by the United States laws and regulations  governing  exports and
re-exports.  Each party agrees to provide the other parties with any  reasonable
assistance,  including  written  assurances which may be required by a competent
governmental  authority and by applicable laws and regulations as a precondition
for any  disclosure of technology or software by the other party under the terms
of  this  Agreement.   The  obligations  of  this  Section  7.05  shall  survive
termination or expiration of this Agreement.

                     ARTICLE VIII - DISCLOSURE OF AGREEMENT

         Section  8.01  Disclosure  of  Agreement.  Except  as  agreed to by the
parties,  neither  Agouron,  JT nor Roche shall release any  information  to any
third party with respect to any of the terms of this Agreement without the prior
written  consent of the other parties,  which consent shall not  unreasonably be
withheld.  This  prohibition  includes,  but is not limited to, press  releases,
educational and scientific  conferences,  promotional  materials and discussions
with the media.  If a party  determines  that it is  required  by law to release
information to any third party regarding the terms of this  Agreement,  it shall
notify the other  parties of this fact prior to releasing the  information.  The
notice to the other parties shall include the text of the  information  proposed
for release. The other parties shall have the right to confer with the notifying
party regarding the necessity for the disclosure and the text of the information
proposed for release. Notwithstanding the preceding, Roche, Agouron and JT shall
each have the  right to  disclose  the terms of this  Agreement  to  persons  it
proposes to enter into business  relationships with, if such 

                                       39
<PAGE>

persons are subject to confidentiality  and use obligations  equivalent to those
applicable to the disclosing party hereunder.

                         ARTICLE IX - GENERAL PROVISIONS

         Section 9.01 No Implied Licenses. Only the licenses granted pursuant to
the express terms of this Agreement  shall be of any legal force and effect.  No
license rights shall be created by implication or estoppel.

         Section  9.02 No Waiver.  Any  failure by a party to enforce  any right
which it may have  hereunder  in any  instance  shall not be deemed to waive any
right which it or the other parties may have in any other  instance with respect
to any provision of this Agreement, including the provision which such party has
failed to enforce.

         Section  9.03  Severability;  Government  Acts.  In the event  that any
provision  of  this  Agreement  is  judicially,  or  by a  competent  authority,
determined to be  unenforceable,  in part or in whole, with regard to any or all
of the countries in the Territory,  the remaining provisions or portions of this
Agreement  shall be valid and binding to the fullest  extent  possible,  and the
parties shall endeavor to negotiate  additional terms, as feasible,  in a timely
manner so as to fully  effectuate  the original  intent of the  parties,  to the
extent  possible,  in the  applicable  countries.  In the  event  that  any act,
regulation,  directive, or law of a country, including its departments, agencies
or courts  should make  impossible  or prohibit,  restrain,  modify or limit any
material act or obligation of a party under this  Agreement and, if any party to
this  Agreement is  materially  adversely  affected  thereby,  the parties shall
attempt in good faith to negotiate a lawful and enforceable modification to this
Agreement which substantially  eliminates the material adverse effect; provided,
that,  failing  any  agreement  in that  regard,  the  party  who is  materially
adversely  affected shall have the right, at its option, to suspend or terminate
this Agreement as to such country.

         Section 9.04 Ambiguities.  Ambiguities, if any, in this Agreement shall
not be construed against any party, irrespective of which party may be deemed to
have authored the ambiguous provision.

         Section  9.05  Notification  of  Authorities.  After  execution of this
Agreement,  to the extent  required by law,  Agouron,  after  consultation  with
Roche, shall notify the appropriate United States authorities about the terms of
this Agreement;  JT, after consultation with Roche, shall notify the appropriate
Japanese  authorities  about  the  terms of this  Agreement;  and  Roche,  after
consultation with the authorized  representative of Agouron and JT, shall notify
the  appropriate  European  and  other  authorities  about  the  terms  of  this
Agreement.  The parties  shall keep each other  fully  advised of the status and
progress of the notification procedures.

         Section 9.06 No Agency.  Agouron, JT and Roche shall have the status of
independent contractors under this Agreement and, except as otherwise explicitly
provided in this  Agreement,  
                                       40
<PAGE>

nothing in this Agreement shall be construed as an  authorization  of a party to
act as an agent of another party.

         Section 9.07 Captions;  Number;  Official Language. The captions of the
Articles  and  Sections  of this  Agreement  are  for  general  information  and
reference  only, and this Agreement  shall not be construed by reference to such
captions.  Where applicable in this Agreement,  the singular includes the plural
and vice  versa.  To the extent  appropriate,  the  meaning of terms whose first
letters  are  capitalized,  but which are  variations  of terms that are defined
elsewhere  in this  Agreement,  shall each have the same  meaning as the defined
term.  English shall be the official  language of this Agreement and any license
agreement  provided for hereunder,  and all  communications  between the parties
hereto shall be conducted in that language.

         Section 9.08 Force  Majeure.  A party shall not be  responsible  to the
other parties for any failure,  delay or  interruption in the performance of any
of its obligations  under this Agreement if such failure,  delay or interruption
is caused by any act of God, earthquake,  fire, casualty,  flood, war, epidemic,
riot,  insurrection,  or  any  act,  exercise,  assertion  or  requirement  of a
governmental  authority,  or other cause  beyond the  reasonable  control of the
party  affected if the party  affected shall have used its best efforts to avoid
such  occurrence.  If a  party  believes  that  the  performance  of  any of its
obligations  under this Agreement shall be delayed or interrupted as a result of
any of the reasons  stated in this Section 9.08, and provided such party is able
to do so, such party shall  promptly  notify the other  parties of such delay or
interruption  and the cause therefor,  and shall provide such other parties with
its estimate of when the performance of its obligations shall  recommence.  When
the party affected is able to recommence the performance of obligations  delayed
or interrupted as a result of any of the reasons stated in this Section 9.08, it
shall so notify the other  parties  and,  except as  otherwise  provided in this
Agreement, it shall promptly resume the performance of such obligations.

         Section 9.09 Amendment.  This Agreement,  including the Attachments and
Schedules,  constitutes  the full  agreement  of the parties with respect to the
subject matter of this Agreement, and incorporates any prior discussions between
them  with  respect  to  such  subject  matter;  provided,   however,  that  the
Confidential Disclosure Agreements ("CDAs") between the parties dated January 7,
1997 and  April 3,  1997  shall be  deemed  by the  parties  to  supplement  the
confidentiality  provisions of this Agreement. In the event of any inconsistency
between this  Agreement  and the LOI,  including  Exhibit A thereto,  and/or the
CDAs, the terms of this Agreement shall govern.  This  Agreement,  including the
attachments  hereto,  shall not be amended,  supplemented or otherwise modified,
except by an instrument  in writing  signed by duly  authorized  officers of the
parties.  Except as otherwise explicitly provided in this Agreement,  nothing in
this  Agreement  shall be deemed to amend the rights and  obligations of Agouron
and JT under the D&L  Agreement,  or otherwise  amend the  provisions of the D&L
Agreement.

         Section 9.10  Applicable Law. This Agreement shall be construed and the
rights of the parties shall be  determined  in  accordance  with the laws of the
United States and the State of California, without regard to its conflict of law
provisions.

                                       41
<PAGE>

         Section  9.11  Notices.  Any notice  required or  permitted to be given
under this Agreement shall be in writing and shall be given in person, delivered
by recognized overnight delivery service,  sent by mail (certified or registered
or air mail for addresses  outside of the  continental  U.S.), or by telefax (or
other similar means of electronic communication),  whose receipt is confirmed by
confirming  telefax,  and  addressed,  in the  case  of  Agouron,  to  the  Vice
President, Commercial Affairs (with a copy to the Legal Department), in the case
of JT,  to the  Vice  President,  Pharmaceutical  Division  (with  a copy to the
International  Legal  Division)  and,  in the  case  of  Roche,  to the  Head of
Strategic Marketing and Business  Development of Pharma Division (with a copy to
the  Legal  Department),  at the  addresses  shown  at  the  beginning  of  this
Agreement,  or such other person  and/or  address as may have been  furnished in
writing to the notifying party in accordance with the provisions of this Section
9.11. Except as otherwise  provided herein, any notice shall be deemed delivered
upon the  earlier  of:  (i) actual  receipt;  (ii) two (2)  business  days after
delivery to such recognized overnight delivery service;  (iii) five (5) business
days after  deposit in the mail;  or (iv) the date of receipt of the  confirming
telefax.

         Section 9.12 Assignment.  This Agreement shall be assignable by Agouron
and/or JT, but shall not be assignable by Roche, except to an Affiliate, without
the prior written  consent of both Agouron and JT, which consent may be withheld
at the sole discretion of Agouron or JT. Any such  assignment  without the prior
written  consent of both  Agouron  and JT shall be void.  If this  Agreement  is
assigned by Roche to an Affiliate,  Roche shall still be responsible  for all of
its obligations specified in this Agreement.  Notwithstanding the preceding,  in
the event of:  (i) a sale or  transfer  of all or  substantially  all of Roche's
assets; or (ii) the merger or consolidation of Roche with another company,  this
Agreement shall be assignable to the transferee or successor company.

         Section 9.13      Succession.  This Agreement shall be binding upon all
successors in interest,  assigns,  trustees and other legal representatives of
the parties.



                                       42
<PAGE>


         IN WITNESS WHEREOF, the parties hereto have executed this Agreement, in
triplicate originals, by their respective officers thereunto duly authorized, as
of the Effective Date.

AGOURON PHARMACEUTICALS, INC.           JAPAN TOBACCO INC.

By:      /s/ Gary Friedman              By:      /s/ Masakazu Kakei
Name:    Gary Friedman                  Name:    Masakazu Kakei
Title:   Corporate V.P. &               Title:   Executive Director,
         General Counsel                         Pharmaceuticals

By:      /s/ R. Kent Snyder             By:      /s/ Y. Inubushi
Name:    R. Kent Snyder                 Name:    Y. Inubushi
Title:   Senior V.P., Head of           Title:   Vice President, Pharm. Division
         Commercial Affairs     


F. HOFFMANN-LA ROCHE LTD

By:      /s/ W. Henrich
Name:    W. Henrich
Title:   Director

By:      /s/ S. Arnold
Name:    S. Arnold
Title:   Authorized Signatory




                                       43
<PAGE>





                                   SCHEDULE 1

                            AGOURON/JT PATENT RIGHTS

"Agouron/JT Patent Rights" collectively means:

         1.       *


                  (a)       *





                  (b)       *


         2.       *


                  (a)       *


         3.       *


         4.       *


         5.       *


         6.       *



                                      S1-1
<PAGE>

                                   SCHEDULE 2

                            ASIAN LICENSED TERRITORY

"Asian Licensed Territory" means the following countries of Asia:

*
*
*
*
*
*
*
*
*
*
*
*
*
*
*

*









Licenses in the  above-listed  countries shall be subject to compliance by Roche
with the United States laws and regulations  governing exports and re-exports of
Product and any technology developed or disclosed as a result of this Agreement.

                                      S2-1
<PAGE>


                                   SCHEDULE 3

                      NELFINAVIR MESYLATE CLINICAL STUDIES

                       Results to be Contained in the MAA

---------------- ---------------------------------------------------------------

    Protocol     Title
---------------- ---------------------------------------------------------------

       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------

                                      S3-1
<PAGE>


                                   SCHEDULE 3
                NELFINAVIR MESYLATE CLINICAL STUDIES (Continued)
                   
                   Interim Results to be Contained in the MAA

---------------- ---------------------------------------------------------------

    Protocol     Title
---------------- ---------------------------------------------------------------

       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------

                                      S3-2
<PAGE>

                                   SCHEDULE 3
                NELFINAVIR MESYLATE CLINICAL STUDIES (Continued)

                          Results to be Provided Later

---------------- ---------------------------------------------------------------

    Protocol     Title
---------------- ---------------------------------------------------------------

       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------
       *         *
---------------- ---------------------------------------------------------------


                                      S3-3
<PAGE>

                                  ATTACHMENT 1

                           TRADEMARK LICENSE AGREEMENT

This  Trademark  License,  effective as of January 17, 1997, is between  Agouron
Pharmaceuticals,  Inc., a corporation duly organized and existing under the laws
of the state of California,  having a principal place of business at 10350 North
Torrey Pines Road, La Jolla,  California,  United States of America (hereinafter
referred to as "Agouron"),  Japan Tobacco Inc., a corporation duly organized and
existing  under the laws of Japan,  having a  principal  place of business at JT
Building, 2-1, Toranomon 2-chome,  Minato-ku, Tokyo, Japan (hereinafter referred
to as "JT") and F.  Hoffmann-La  Roche Ltd, a  corporation  duly  organized  and
existing under the laws of Switzerland,  having a principal place of business at
CH-4002-Basel, Switzerland (hereinafter referred to as "Roche"). Agouron, JT and
Roche are each sometimes  hereinafter each referred to as a party  (collectively
"parties") to this Trademark License.

(Terms containing an initial capitalized letter,  except as explicitly otherwise
indicated,  shall have the meanings stated in the VIRACEPT License Agreement, as
defined below.)

                                   BACKGROUND

On  December  1, 1994,  Agouron and JT entered  into a  Development  and License
Agreement   under  which  they  have   collaborated   in  the   development  and
commercialization of the chemical compound known as "nelfinavir mesylate"

         [3S-(3R*,4aR*, 8aR*,  2'S*,
         3'S*)]-2-[2'-hydroxy-3'-phenylthiomethyl-4'-aza-5'-oxo-5'-
         (2"-methyl-3"-hydroxyphenyl)pentyl]-decahydroisoquinoline-3-N-t-butyl
         carboxamide methanesulfonic acid salt)

(sometimes  referred  to  herein  as  "VIRACEPT")  to treat  and  prevent  Human
Immunodeficiency Virus ("HIV") infections.

On January 17,  1997,  Agouron,  JT and Roche  entered  into a VIRACEPT  License
Agreement. The VIRACEPT License Agreement, as now or as subsequently amended, is
hereinafter referred to as the "VIRACEPT License Agreement."

Agouron  and JT have  granted a license to Roche to sell  VIRACEPT  products  to
treat and prevent HIV  infections in certain  countries of the world pursuant to
the terms of a Letter of Intent  entered into by the parties on January 17, 1997
and the VIRACEPT License Agreement.

The VIRACEPT License  Agreement  provides that a form trademark license shall be
agreed upon by the parties and  attached to the  VIRACEPT  License  Agreement as
Attachment  1. The  VIRACEPT  License  Agreement  also  contains  the  following
provisions concerning ownership and utilization of Trademarks:

                                       A1-1
<PAGE>

                  Section 1.26  "Trademark(s)"  means any trademark selected and
         owned by a party and  registered  (or applied  for) by such party,  its
         Affiliate(s) and  sublicensee(s) in the Territory for use in connection
         with the marketing of Products.  The definition of  Trademark(s)  shall
         not refer to trade names used by a party to designate  the name of such
         party.

                  Section 2.01      License Grants. . . .

                                                            * * *

                            (j)     *















                  Section  3.03   Trademarks.   A  party,   its  Affiliates  and
         sublicensees,  if any,  shall be free to use and to register in its own
         name in any  trademark  office in the  Territory  any Trademark for use
         with  Products for which it holds  license  rights to make,  use and/or
         sell  hereunder  as it desires and in its sole  discretion.  Said party
         shall own all right,  title and interest in and to the Trademark in its
         own name or that of its designated  Affiliate or  sublicensee,  if any,
         during  and  after  the  term of this  Agreement.  Notwithstanding  the
         preceding, *








                             Agouron   and  JT  agree  to  share   equally   all
         preparation,  filing,  prosecution  and  maintenance  expenses  in  the
         Licensed  

                                       A1-2
<PAGE>

         Territory  for the  VIRACEPT  Trademark  which are payable to third  
         parties  (excluding  any travel  expenses of the parties,  which
         shall be borne by the party incurring such expenses);  each party shall
         pay its share of such expenses within thirty (30) days from the date of
         its receipt of a proper  invoice for such  expenses.  The parties shall
         not use a Trademark  used in  marketing  of  Products  in the  Licensed
         Territory  for  marketing  other  commercial  products in the  Licensed
         Territory. *


                                                                  Each   of  the
         parties shall annually  prepare a list which  reflects,  to the best of
         its  knowledge,  the current  status of any  Trademark  which its owns.
         Details  regarding  the license  provisions  of the  Trademark  license
         granted in Section 2.01(j) hereof, including quality and specifications
         of the Product,  shall be agreed upon by the parties and later attached
         hereto in Attachment 1 to this Agreement.

                  Section 4.03      Marketing. . . .

                                                            * * *

                            (d)  It is  the  intent  of  the  parties  that  the
         VIRACEPT  Trademark be  identified  and developed for use in connection
         with  the  marketing  of  Products  in  the  Field  wherever   possible
         throughout the Territory.  Unless  otherwise agreed and as permitted by
         law,  Roche  agrees to market  Products in the Field under the VIRACEPT
         brand name in all countries in the Licensed Territory. The parties also
         acknowledge  their  intention  to use, if  appropriate,  the same Trade
         Dress in  connection  with  the  marketing  of  Products  in the  Field
         wherever possible.

One or more of the parties is the owner(s) of the VIRACEPT Trademark, in certain
countries of the Territory.

The parties  intend to use the  VIRACEPT  Trademark,  including  its  associated
non-English translations  (hereinafter collectively referred to as the "VIRACEPT
Trademark"),  only in connection  with the marketing of nelfinavir  mesylate for
the treatment and prevention of HIV infections.

NOW  THEREFORE,  in  accordance  with the  provisions  of the  VIRACEPT  License
Agreement, for good and valuable consideration, the parties agree as follows:

                                       A1-3
<PAGE>

                                TRADEMARK LICENSE

          1. Under the  provisions of the VIRACEPT  License  Agreement,  as more
         specifically  set forth above,  each party  granted to the other party,
         its  Affiliates  and  sublicensees  a  non-exclusive  right  to use the
         granting  party's  Trademark(s)  in the  Territory in the  marketing of
         VIRACEPT products.

2.       Products  marketed  using the  VIRACEPT  Trademark  shall be  
         manufactured  strictly  in  accordance  with  applicable governmental 
         statutes, regulations or directives.

3.       The  licensed  user of the VIRACEPT  Trademark  shall comply with all 
         applicable  governmental  statutes, regulations or directives.

4.       The licensed user of the VIRACEPT  Trademark shall not use the VIRACEPT
         Trademark  in a manner  which is  deceptive,  or which  would bring the
         VIRACEPT Trademark,  the Product or the other parties,  into disrepute.
         Each party shall use the VIRACEPT  Trademark,  including its associated
         non-English  translations,  only in  connection  with the  marketing of
         Products for the treatment and prevention of HIV infections. *



5.       Pursuant to the terms of the VIRACEPT License  Agreement,  Agouron,  JT
         and Roche shall share  obligations  and   responsibilities   related  
         to   Trademark(s).   Provided  a  party  fulfills  its  obligations  
         and responsibilities related to Trademark(s), and subject to the terms 
         of the VIRACEPT License Agreement, *



6.       Each party shall,  upon  learning  thereof,  promptly  notify the other
         party in writing of any  infringement  by a third party of the parties'
         rights in the  VIRACEPT  Trademark,  or of any claim or suit by a third
         party that the use of the  VIRACEPT  Trademark  infringes  or otherwise
         violates the rights of a third party.  The parties  shall  cooperate in
         taking  commercially  reasonable  legal actions to protect the parties'
         rights in the VIRACEPT  Trademark  and/or to contest a claim by a third
         party that the use of the  VIRACEPT  Trademark  infringes  or otherwise
         violates any rights of a third party. *





7.       Only  the  licenses  granted  pursuant  to the  express  terms  of this
         Trademark  License and the VIRACEPT  License  Agreement shall be of any
         legal  force  and  effect.  No  license  rights  shall  be  created  by
         implication or estoppel.

                                       A1-4
<PAGE>

8.       This  Trademark  License  shall  terminate in  accordance  with the  
         provisions  of the  VIRACEPT  License Agreement.

9.       Any failure by a party to enforce any right which it may have hereunder
         in any instance  shall not be deemed to waive any right which it or the
         other  parties  may have in any  other  instance  with  respect  to any
         provisions of this  Trademark  License,  including the provision  which
         such party has failed to enforce.

10.      In the event that any provision of this Trademark License is judicially
         determined  to be  unenforceable,  in whole or in part,  the  remaining
         provisions  or  portions  thereof  shall be valid  and  binding  to the
         fullest  extent  possible,  and the parties shall endeavor to negotiate
         additional  terms,  as  feasible,  in a  timely  manner  so as to fully
         effectuate the original intent of the parties,  to the extent possible.
         Ambiguities,  if any, in this Trademark  License shall not be construed
         against  any party,  irrespective  of which party may be deemed to have
         authored the ambiguous provision.

11.      This Trademark  License and the VIRACEPT License  Agreement  constitute
         the full agreement of the parties with respect to the subject matter of
         this Trademark License,  and incorporate any prior discussions  between
         them with respect to such subject matter.  This Trademark License shall
         not be  amended,  supplemented  or  otherwise  modified,  except  by an
         instrument  in  writing  signed by a duly  authorized  officer  of each
         party.

12.      If there is a conflict between the terms of this Trademark  License and
         the  VIRACEPT  License  Agreement,  the terms of the  VIRACEPT  License
         Agreement shall control.

13.      This  Trademark  License  shall be  construed,  and the  rights  of the
         parties shall be determined,  in accordance  with the laws of the state
         of California and the United States,  without regard to conflict of law
         provisions.

14.      Any notice  required  or  permitted  to be given  under this  Trademark
         License shall be in writing and shall be given in person,  delivered by
         recognized  express  delivery  service,  sent  by  mail  (certified  or
         registered, or air mail for addresses outside of the continental U.S.),
         or by telefax  (or other  similar  means of  electronic  communication)
         whose receipt is confirmed by confirming telefax, and addressed, in the
         case of Agouron, to the Vice President, Commercial Affairs (with a copy
         to the Legal  Department),  in the case of JT,  to the Vice  President,
         Pharmaceutical  Division  (with  a  copy  to  the  International  Legal
         Division) and, in the case of Roche, to the Head of the Pharma Division
         (with a copy to the Legal Department) at the respective addresses shown
         at the  beginning  of the  VIRACEPT  License  Agreement,  or such other
         person  and/or  address  as may have been  furnished  in writing to the
         notifying  party in accordance  with the provisions of this  paragraph.
         Except  as  otherwise  provided  herein,  any  notice  shall be  deemed
         delivered  upon  the  earlier  of:  (i)  actual  receipt;  (ii) two (2)
         business days after delivery to a 

                                       A1-5
<PAGE>

          recognized  express delivery service; (iii) five (5)  business  days 
          after  deposit in the mail;  or (iv) the date of receipt of the 
          confirming telefax.

15.      This  Trademark  License  shall  be  binding  upon  all  successors  in
         interest,  assigns,  trustees  and other legal  representatives  of the
         parties.


IN WITNESS WHEREOF,  the parties hereto have executed this Trademark License, in
triplicate originals,  by their respective officers thereunto duly authorized as
of the day and year hereinabove written.

AGOURON PHARMACEUTICALS, INC.           JAPAN TOBACCO INC.


By:   /s/ R. Kent Snyder                By:   /s/ Masakazu Kakei
Name: R. Kent Snyder, Sr. V.P.          Name: Masakazu Kakei
Title:Head of Commercial Affairs        Title:Executive Director Pharmaceuticals

By:   /s/ Gary Friedman                 By:    /s/ Tatsuya Yoneyama
Name: Gary Friedman                     Name:  Tatsuya Yoneyama
Title:VP and General Counsel            Title: Pharm Div. JT, Vice President


F. HOFFMANN-LA ROCHE LTD


By:   /s/ W. Henrich
Name: W. Henrich
Title:Director

By:   /s/ Stephan Arnold
Name: Stephan Arnold
Title:Authorized Signatory



                                      A1-6
<PAGE>

                                 ATTACHMENT 2

                      PRODUCT MANUFACTURING SPECIFICATIONS



          THE TERMS OF THE PRODUCT MANUFACTURING SPECIFICATIONS WILL BE
CONTAINED IN THE APPLICABLE REGISTRATION FILING (S) FOR THE PRODUCT, AS AMENDED



                                      A2-1