C. ROBERT CUSICK
                              1100 Lancaster Street
                         Pittsburgh, Pennsylvania 15218



                                                              May 11, 1998

The Board of Directors
DynaGen. Inc.
99 Eric Street
Cambridge, Massachusetts  02139

Ladies and Gentlemen:

         The purpose of this letter is to set forth our understanding pursuant
to which I will become the non-executive Chairman of the Board of DynaGen, Inc.,
a Delaware corporation (the "Company") and act as a consultant to the Company in
respect to organizational and operational matters. Based upon the foregoing, we
agreed as follows:

         1. Effective May 15, 1998, I will be elected a director and
non-executive Chairman of the Board of Directors of the Company. In that
capacity, I will preside at meetings of the Board of Directors of the Company
and fulfill the obligations of such position as set forth in the Company's
By-Laws. I will also serve as Chairman of the Company's Operating Committee,
such committee to be composed of the Chief Executive Officer, the Executive Vice
President and the Chairman of the Board of the Company. The term of this letter
agreement shall be for a period of two years, and may be extended for an
additional one year period at my sole option. The Company agrees that (a) during
my tenure on the Operating Committee, any proposed action of such committee with
which I do not concur will be submitted to the entire Board of Directors for
consideration prior to its implementation by the officers, employees or agents
of the Company and (b) during the term of this Agreement, I shall have the right
to approve all press releases concerning the Company prior to their release to
the news media.

         2. As part of the services to be rendered pursuant to paragraph 1, I
agree to make myself available to the Company for up to one (1) day per week to
consult with the executive officers and directors of the Company on various
organizational and operational matters concerning the Company. Additionally, at
my option, I may make myself available at other times as may be requested by the
Company.

         3. As compensation for services to be provided hereunder, the Company
agrees to pay to me a consulting fee of $75,000.00 per annum, payable in monthly
installments of $6,250.00 per month, such payments to be made on the first of
each month. The consulting fees payable hereunder shall be in lieu of any
standard fees for attendance at meetings of the Board of Directors or any
committee thereof.


<PAGE>

DynaGen, Inc.
May 11, 1998
Page 2

         4. As an inducement to me to become Chairman of the Board of the
Company and perform the consulting services hereunder, the Company has agreed to
grant to me options to purchase 200,000 shares of the Company's Common Stock at
a price equal to $.33 per share (the "Option"). The shares granted pursuant to
the Option shall vest as follows: 250,000 shares shall vest and be fully
exercisable effective May 15, 1998; an additional 250,000 shares shall vest and
be fully exercisable on each August 15, November 15, February 15 and May 15
thereafter until fully vested. Options granted hereunder shall vest immediately
upon (a) any failure of the Board of Directors of the Company to elect me as
Chairman of the Board during the term hereof; (b) any action to remove me from
such capacity during the term of this letter agreement; or (c) my voluntary
termination of this letter agreement after February 15, 1999. Vested options
shall remain exercisable for a period of two years following the termination or
expiration of this letter agreement for any reason. Certificates or other
evidence of ownership of the Option will be delivered to me within ten days of
the execution of this letter agreement.

         5. The Company agrees to reimburse me for all travel, living and other
business expenses in accordance with the Company's policies and procedures upon
my submission of appropriate documentation with respect to such expenses.

         6. Nothing herein shall be construed to preclude or otherwise prohibit
me from entering into other consulting agreements or otherwise providing advice
and expertise to other similarly situated businesses, provided that any such
services are performed consistent with my fiduciary obligations to the Company
as a member of the Board of Directors of the Company, and are not, in any event,
provided to any business entity whose primary line is business is the
development, marketing and sale of generic drugs or branded generic drug
products.

         7. The Company has advised me that it has in place a directors and
officers liability insurance policy with a $5,000,000 limit. The Company agrees
to maintain such insurance at or above such limits during my tenure on the Board
of Directors and for a period of not less than five (5) years following my
resignation or other removal from the Board of Directors.

         8. The Company agrees to indemnify and hold me harmless from and
against any and all losses, claims, damages, liabilities, costs and expenses
(including, without limitation, all fees, expenses and disbursements of counsel)
(hereinafter collectively referred to as a "Loss"), which may be incurred by or
asserted or awarded against me in connection with or in any manner arising out
or relating to this letter agreement or the services to be performed by me
hereunder, whether or not any investigation, litigation or proceeding is brought
by the Company or any of its affiliates, shareholders or creditors, except to
the extent such Loss is found in a final judgment by a court of competent
jurisdiction to have resulted from my gross negligence or willful misconduct.
The indemnity contained in this paragraph 8 shall be in addition to, and not in
lieu of, any other obligation to indemnify me that the Company may have,
including, without limitation, any provisions in the Company's By-Laws or other
instruments or agreements to which the Company is a party, such other agreements
or instruments to be relied upon by me first before I seek indemnification from
the Company hereunder.

         If the above is acceptable to you, please so indicate by signing and
returning one copy of this letter to me.

                                                  Very truly yours

                                                  /s/ C. Robert Cusick

Accepted and agreed:

DYNAGEN, INC.


By:/s/ Dhananjay G. Wadekar
Title: Executive Vice President