Document:

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                                                                   Exhibit 10.38

                     AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT

         THIS AMENDMENT NO. 1 to the Employment Agreement is made as of the 14th
day of November, 2005 by and among Molecular Insight Pharmaceuticals, Inc., a
Massachusetts corporation (the "Employer"), and Robert Gallahue (the
"Employee"). Terms used but not defined herein have the meaning set forth in
that certain Employment Agreement dated July 1, 2005 by and between the Employer
and the Employee (the "Employment Agreement").

         WHEREAS, the Employment Agreement contains certain provisions
pertaining to severance compensation in the event that the Employee's employment
is terminated by the Employer without cause; and

         WHEREAS, the Internal Revenue Service has recently implemented Section
409A of the Internal Revenue Code of 1986, as amended (the "Code"), which
imposes an excise tax on severance payments that do not comply with the
provisions of Section 409A of the Code; and

         WHEREAS, the Employer and the Employee each desire to amend the
Employment Agreement as set forth herein.

         NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree amend the
Employment Agreement as follows:

         1. Subject to Paragraph 2 below, section 15A(b) is amended by deleting
the phrase "from the Termination Date" that appears immediately prior the "(the
"Severance Package")" and inserting "which payments shall commence six (6)
months after the Termination Date and continue for the twelve (12) months
thereafter" in lieu thereof.

         2. This Amendment shall not be effective until immediately prior to the
closing of the Employer's initial public offering of equity securities pursuant
to a registration statement filed with the Securities and Exchange Commission.

         3. Except as expressly set forth in this Amendment, the Employment
Agreement, as amended to date, is ratified and confirmed, shall remain in full
force and effect and shall not be altered, amended or modified.

         4. This Amendment may be executed in counterparts, all of which taken
together shall constitute one in the same instrument.
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         IN WITNESS WHEREOF, the parties hereto have executed this Amendment No.
1 to Employment Agreement on the date first written above.

                                  MOLECULAR INSIGHT PHARMACEUTICALS, INC.

                                  By:/s/ Jonathan Lane
                                     ------------------------------------
                                  Name:
                                  Title: VP, HR

                                  /s/ Bob Gallahue
                                  ---------------------------------------
                                  (signature)

                                  Bob Gallahue
                                  ---------------------------------------
                                  (print name)<PAGE>

                                                                    EXHIBIT 10.1

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                       COLLABORATION AND LICENSE AGREEMENT

                                 BY AND BETWEEN

                           ALTUS PHARMACEUTICALS INC.

                                       AND

                                 GENENTECH, INC.

                          DATED AS OF DECEMBER 19, 2006

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     This COLLABORATION AND LICENSE AGREEMENT (this "Agreement"), dated as of
December 19, 2006 (the "Execution Date"), is made by and between Altus
Pharmaceuticals Inc., a Delaware corporation having its principal office at 125
Sidney Street, Cambridge, Massachusetts, 02139 ("Altus"), and Genentech, Inc., a
Delaware corporation having its principal office at 1 DNA Way, South San
Francisco, CA 94080 ("Genentech"). Altus and Genentech may each be referred to
as a "Party" or together, the "Parties".

     WHEREAS, Altus is engaged in the development and commercialization of
protein therapeutics for patients with chronic gastrointestinal and metabolic
diseases and is currently developing a drug product candidate, known as
ALTU-238, for the treatment of patients with growth hormone disorders; and

     WHEREAS, Genentech has significant experience in the development and
commercialization of drug products, particularly growth hormone products, and
can make significant contributions to the successful development and
commercialization of Products (as defined below) in the Licensed Territory (as
defined below);

     NOW, THEREFORE, in consideration of the mutual promises and agreements
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties agree as follows:

                                    ARTICLE I
                            DEFINITIONS; CONSTRUCTION

     1.1 Defined Terms.

          1.1.1 "Accounting Standards" means United States Generally Accepted
Accounting Principles, consistently applied.

          1.1.2 "Acquisition" means (a) a merger, reorganization or
consolidation of a Party with a Third Party that results in the shareholders of
such Party receiving less than fifty percent (50%) of the combined voting power
of the surviving entity immediately after such merger, reorganization or
consolidation, (b) a Third Party becoming the direct or beneficial owner of
fifty percent (50%) or more of the combined voting power of the outstanding
securities or outstanding share of common stock of such Party, (c) the
stockholders of a Party have approved of a plan or proposal for the liquidation
or dissolution of the company, or (d) the sale, lease, exchange or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of such Party's assets which relate to this Agreement to a
Third Party.

          1.1.3 "Act" means both the United States Federal Food, Drug, and
Cosmetic Act, as amended from time to time, and the regulations promulgated
under the foregoing.

          1.1.4 "Adverse Drug Experience" means any of the following: an
"adverse drug experience," a "life-threatening adverse drug experience," a
"serious adverse drug experience," or an "unexpected adverse drug experience,"
as those terms are defined at either 21 C.F.R. Section 312.32 or 21 C.F.R.
Section 314.80, or their equivalents under Laws of jurisdictions outside the
United States.

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

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          1.1.5 "Affiliate" means, with respect to a Party, any other Person
that directly or indirectly controls, is controlled by or is under common
control with such Party. For purposes of this definition, "control" (including,
with correlative meanings, "controlled by", "controlling" and "under common
control with") means possession, direct or indirect, of (a) the power to direct
or cause direction of the management and policies of such Party (whether through
ownership of securities or other ownership interests), or (b) greater than 50%
of the voting securities (whether directly or pursuant to any option, warrant or
other similar arrangement) or other comparable equity interests. Notwithstanding
that Genentech and Roche Holdings Ltd. ("Roche") are Affiliates in accordance
with the foregoing, for purposes of this Agreement, with respect to Genentech,
the term "Affiliate" shall not include Roche and its successors, or any entity
that controls, is controlled by or is under common control with Roche, in each
case that is not controlled by Genentech. For the avoidance of doubt, neither of
the Parties shall be deemed to be an "Affiliate" of the other. A "Controlled
Affiliate" is an Affiliate that is controlled by the applicable Party.

          1.1.6 "Allocable Overhead" means costs incurred by a Party or for its
accounts that are attributable to a Party's (a) [***] services, (b) [***] and
[***] (excluding [***] charges for [***] and [***]), (c) [***] and [***]
functions, (d) [***] costs and (e) [***] costs (to the extent not directly
charged), which, in each case, are reasonably allocated to company departments
or functions utilized to support the activities under this Agreement based on
[***] or [***] or [***] consistently applied by a Party.

          1.1.7 "ALTU-238" means any pharmaceutical product containing a [***],
including [***] ALTU-238.

          1.1.8 "Altus Housemark" means the name and logo of Altus, or an
Affiliate of Altus, as identified by Altus to Genentech from time to time.

          1.1.9 "Altus Know-How" means Know-How that (a) is Controlled by Altus
as of the Effective Date or during the Term and (b) is necessary or useful to
research, develop, make, use, sell, offer for sale, or import any Formulation or
Product in the Field; excluding Collaboration Technology.

          1.1.10 "Altus Patents" means those Patent Rights that (a) are
Controlled by Altus as of the Effective Date or during the Term and (b) are
necessary or useful to research, develop, make, use, sell, offer for sale, or
import any Formulation or Product in the Field, including the Patent Rights set
forth in Schedule 1.1.10 (which Schedule, shall be updated by Altus from time to
time); excluding Collaboration Technology.

          1.1.11 "Altus Technology" means Altus Patents and Altus Know-How.

          1.1.12 "Approval Application" means the submission to the relevant
Regulatory Authority of an appropriate application, such as an NDA, seeking a
Marketing Authorization for a Product.

          1.1.13 "Bankruptcy Code" means Title 11 of the United States Code, as
amended from time to time.

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                       -2-

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          1.1.14 "Business Day" means a day that is not a Saturday, Sunday or
public holiday in South San Francisco, California or Cambridge, Massachusetts.

          1.1.15 "Calendar Quarter" means for each Calendar Year, any of the
three (3) month periods ending March 31, June 30, September 30, and December 31;
provided, that the first Calendar Quarter for the first Calendar Year shall
extend from the Effective Date to the end of the calendar quarter in which the
Effective Date falls.

          1.1.16 "Calendar Year" means, for the first Calendar Year, the period
commencing on the Effective Date and ending on December 31 of the calendar year
during which the Effective Date occurs, and each successive period beginning on
January 1 and ending twelve (12) consecutive calendar months later on December
31.

          1.1.17 "Collaboration Know-How" means all Know-How first conceived, or
otherwise first created, in furtherance of and as a direct result of activities
under this Agreement (including under the Development Plan or Commercialization
Plan): (i) which activities were [***] the [***] of the [***] or [***], or were
[***], either in whole or in any part, by [***] as [***] or other [***] or [***]
by [***] under this Agreement, including under Section [***], [***] or [***] or
use any [***] in support of such activities under this Agreement, which Know-How
was conceived or created [***] by [***] and/or its respective employees,
contractors or consultants or [***] by [***] and/or its respective employees,
contractors or consultants [***] and [***] and/or their respective employees,
contractors or consultants on the other hand; (ii) which Know-How was conceived
or created jointly by the Parties and/or their employees, contractors or
consultants; or (iii) which Know-How was conceived or created [***] by [***]
and/or its respective employees, contractors or consultants, excluding any
Know-How [***] to the [***] of a [***]. Collaboration Know-How shall exclude
Collaboration Patents.

          1.1.18 "Collaboration Patents" means all Patent Rights which claim
Collaboration Know-How.

          1.1.19 "Collaboration Technology" means Collaboration Know-How and
Collaboration Patents.

          1.1.20 "Commercially Reasonable Efforts" means the carrying out of
obligations under this Agreement using those efforts and resources as would be
expended on, or committed to, a development or commercialization program of
[***] and [***], at a [***] in development or product life, [***] and [***], and
[***] of the [***] or to be [***], taking into account the following factors to
the extent reasonable and relevant: issues of [***] the Product, [***] Third
Party products, the [***] or other [***] of the Product and/or Third Party
products, the [***] involved and the [***], and [***] and [***].

          1.1.21 "Competing Product" means a pharmaceutical product containing
[***], other than a Product, that is being or has been developed [***] or [***].

          1.1.22 "Complexed" means any association of a [***] with [***],
including a [***] of a [***] and a [***], or other association.

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                       -3-

<PAGE>

          1.1.23 "Compound" means synthetic, natural or recombinant human growth
hormone or any of its active fragments, analogues derivatives or other variants.

          1.1.24 "Confidential Information" means all confidential or
proprietary information, materials or data (including Know-How), whether
provided in written, oral, graphic, video, computer, or other form, provided or
transmitted by or on behalf of one Party (the "Disclosing Party") to the other
Party (the "Receiving Party"), including information relating to the Disclosing
Party's existing or proposed research, development efforts, Patent Rights,
Know-How, business, finances (including all financial information subject to
review under or prepared by accountants pursuant to Section 9.15 or provided
pursuant to Section 9.21) or products (including Product training materials
contemplated by Section 7.5.2, the Development Plan and the Commercialization
Plan), and the existence of and terms of this Agreement. Notwithstanding the
foregoing sentence, Confidential Information shall not include any information,
materials or data that the Receiving Party can demonstrate:

          (a) were already known to the Receiving Party (other than under an
obligation of confidentiality) at the time of disclosure by the Disclosing
Party;

          (b) were generally available to the public or otherwise part of the
public domain at the time of disclosure by the Disclosing Party;

          (c) became generally available to the public or otherwise part of the
public domain after disclosure or development, as the case may be, other than
through any act or omission of the Receiving Party in breach of the Receiving
Party's confidentiality obligations to the Disclosing Party;

          (d) were disclosed to the Receiving Party, other than under an
obligation of confidentiality, by a Third Party who had no obligation to the
Disclosing Party not to disclose such information to others;

          (e) were independently discovered or developed, as the case may be, by
or on behalf of the Receiving Party by Persons without the use of or reliance on
the Disclosing Party's Confidential Information; or

          (f) released from the restrictions set forth in this Agreement by the
express prior written consent of the Disclosing Party.

          1.1.25 "Consumer Price Index" or "CPI" means the Consumer Price Index
- Urban Wage Earners and Clerical Workers, U.S., All Items, 1982-84 = 100,
published by the United States Department of Labor, Bureau of Labor Statistics
(or its successor equivalent index).

          1.1.26 "Control" or "Controlled" means the possession by a Party or
its Controlled Affiliates, as of the Effective Date or during the term of this
Agreement, of (i) with respect to materials, data or information, physical
possession or the right to such physical possession of those items and the right
to provide such materials, data or information to the other Party, and (ii) with
respect to intellectual property or other intangible rights, rights (whether by

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                       -4-

<PAGE>

ownership or license other than a licensed granted under this Agreement)
sufficient to grant the applicable license or sublicense under this Agreement;
in each case without violating the terms of any agreement with any Third Party.

          1.1.27 "Co-Promote" or "Co-Promotion" means the performing of sales
calls by Altus or Genentech Sales Representatives to specific customer targets
and to medical staff associated with those customer targets in the Co-Promote
Territory under the Product Trademark(s), as more specifically described and to
the extent permitted by ARTICLE VII. "Co-Promote" when used as a verb means to
engage in such Co-Promotion.

          1.1.28 "Cover", "Covering" or "Covered" means, with respect to a
Product, that the using, selling, or offering for sale of such Product would,
but for ownership of, or a license granted under this Agreement to, the relevant
Patent Rights infringe a Valid Claim of the relevant Patent Rights in the
country in which the activity occurs.

          1.1.29 "Development Costs" means the costs actually incurred by or on
behalf of a Party, including [***], for [***] of the [***] of a Product
conducted [***], or by [***] or [***], [***] for the purpose of [***] for the
purpose of submission to a Governmental Authority to [***] Marketing
Authorization of a Product. The "Development Costs" shall also include expenses
for [***] and [***] Costs for [***] of such Product.

          1.1.30 "Development Plan" means the plan for the development of, and
pursuit of Marketing Authorization for, Products in the North American
Territory.

          1.1.31 "Effective Date" means the date, on or after the HSR Clearance
Date, on which (i) Genentech has received from Altus a certificate, signed by a
duly authorized officer of Altus, that the representations and warranties of
Altus set forth in Section 11.2 are true and correct as if made on and as of
such date, or (ii) Genentech has waived, in writing, the requirement set forth
in (i) above.

          1.1.32 "FDA" means the United States Food and Drug Administration and
any successor agency thereto.

          1.1.33 "Field" means the prevention, treatment or control of any
disease or condition in humans.

          1.1.34 "First Commercial Sale" means the first commercial sale of a
Product to an end user in a country in the Licensed Territory after receipt of
Marketing Authorization for such country.

          1.1.35 "Formulation" means any composition containing [***].

          1.1.36 "FTC" means the United States Federal Trade Commission.

          1.1.37 "FTE" means a full-time equivalent person year (consisting of a
total of [***] hours per year or [***] hours per quarter) of [***] work.

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                       -5-

<PAGE>

          1.1.38 "Fully Burdened Manufacturing Costs or "FBMC" means one hundred
percent (100%) of the costs incurred by the manufacturing Party that are
attributable to manufacturing of a Product or Compound, including without
limitation the [***] of goods produced as determined in accordance with GAAP by
the Party manufacturing or contracting with a Third Party [***] of the
manufacturing process (i.e., bulk, fill/finish), including [***], plus [***].

          1.1.39 "Genentech Housemark" means the name and logo of Genentech or
an Affiliate of Genentech as identified by Genentech to Altus from time to time.

          1.1.40 "Genentech Know-How" means Know-How that (a) is Controlled by
Genentech as of the Effective Date or during the Term and (b) is necessary to
develop, make, use, sell, offer for sale or import a Product in the Field;
excluding Collaboration Technology; but excluding any Know-How related to the
manufacture of a Compound.

          1.1.41 "Genentech Patents" means those Patent Rights that (a) are
Controlled by Genentech as of the Effective Date or during the Term and (b)
claim a Compound, Formulation or Product (or their manufacture or use) in the
Field; but excluding Collaboration Technology and any Patent Rights related to
the manufacture of a Compound.

          1.1.42 "Genentech Technology" means Genentech Patents and Genentech
Know-How.

          1.1.43 "Governmental Authority" means any applicable government
authority, court, tribunal, arbitrator, agency, legislative body, commission or
other instrumentality of (a) any government of any country or territory, (b) any
state, province, county, city or other political subdivision thereof or (c) any
supranational body.

          1.1.44 "Housemark" means, when used in connection with Altus, the
Altus Housemark, and, when used in connection with Genentech, the Genentech
Housemark.

          1.1.45 "HSR Act" means the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended (15 U.S.C. Section 18a), and the rules and regulations
promulgated thereunder.

          1.1.46 "HSR Clearance Date" means the date on which (i) the Parties
shall have complied with all applicable requirements of the HSR Act, and (ii)
any applicable waiting period specified in the HSR Act, including any extensions
thereof, shall have expired or been terminated; provided that (a) no judicial or
administrative proceeding opposing consummation of all or any part of this
Agreement shall be pending; (b) no injunction (whether temporary, preliminary or
permanent) prohibiting consummation of the transactions contemplated by this
Agreement or any material portion hereof shall be in effect; and (c) no
requirements or conditions shall have been formally requested or imposed by the
DOJ or FTC in connection therewith that are not satisfactory to the Parties.

          1.1.47 "Improved Formulations" means any Know-How and Patent Rights
Controlled by Altus as of the Effective Date or during the Term that relate to
[***] of [***] or [***] other than [***].

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                       -6-

<PAGE>

          1.1.48 "Initial Indications" means (a) [***] and (b) [***].

          1.1.49 "Know-How" means any and all technical information, data,
ideas, test results, inventions, instructions, processes, knowledge, techniques,
discoveries, formulae, specifications, designs, regulatory filings, and
biological or other materials (including biological, chemical, toxicological,
physical and analytical, safety, manufacturing and quality control data and
information) and other information (whether or not patentable). Know-How
excludes Patent Rights.

          1.1.50 "Laws" means all applicable laws, statutes, rules, regulations,
orders, judgments, injunctions, ordinances or other pronouncements having the
binding effect of law of any Governmental Authority in the Licensed Territory.

          1.1.51 "Licensed Territory" means (a) North American Territory, and
(b) upon exercise of the option set forth in Section 2.1, the Option Territory.

          1.1.52 "Loss" or "Losses" means any and all (a) losses, liabilities,
damages, fines, penalties, costs or expense (including, without limitation,
reasonable attorneys' fees and other expenses of litigation).

          1.1.53 "Major European Country" means the [***].

          1.1.54 "Marketing Authorization" means, with respect to a country, all
approvals, licenses, registrations and regulatory authorizations required to
make, store, import, transport, market and sell a Product in such country as
granted by the relevant Regulatory Authority. For countries where Regulatory
Authority approval is required for pricing or reimbursement for Product,
"Marketing Authorization" shall not be deemed to occur until such pricing or
reimbursement approval is obtained.

          1.1.55 "NDA" means a complete "application" or "New Drug Application"
as defined in 21 C.F.R. 314.3 and containing the content, and in the format,
required by 21 C.F.R. Part 314, Subpart B, or a corresponding application with a
regulatory agency in a country other than the United States, together with all
additions, deletions, and supplements thereto.

          1.1.56 "Net Sales" means the gross amounts invoiced by a Party, its
Affiliates and sublicense licensees for, in the case of Genentech, sales of
Products, and, in the case of Altus, Termination Products and other products (in
each case, in final form for end use) "as used in this definition "products"),
less the following deductions:

          (a) trade, quantity and cash discounts or rebates;

          (b) refunds, chargebacks and any other allowances that effectively
reduce the net selling price;

          (c) actual product returns, credits and allowances allowed to
customers, credits and allowances for wastage replacement and bad debts;

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                       -7-

<PAGE>

          (d) credits and allowances for [***] and similar programs, to the
extent such credits and allowances do not exceed one and [***] of gross amounts
invoiced for products (prior to these deductions (a)-(j));

          (e) rebates paid or credited to any Governmental Authority (or branch
thereof) or to any Third Party payor, administrator or contractee;

          (f) discounts mandated by or granted to meet the requirements of Law,
including required chargebacks and retroactive price reductions;

          (g) [***], and inventory management fees, discounts or credits;

          (h) commissions related to import or distribution of products paid to
Third Parties (excluding sales personnel, sales representatives and sales agents
who are employees or consultants of the selling Party, its Affiliates or their
respective sublicensees);

          (i) transportation, freight, data, postage charges and other charges,
such as insurance, related to the handling or distribution of products or
services provided in connection with the handling or distribution of products
(to the extent not paid by a Third Party customer); and

          (j) taxes, excises or other governmental charges or duties upon or
measured by the production, sale, transportation, import, export, delivery or
use of products.

     All of the foregoing elements of Net Sales calculations shall be determined
on an accrual basis in accordance with Accounting Standards.

     The Steering Committee shall determine an [***] following the deductions
set forth in (a) through (j) above, [***] relating to products.

     Sales between or among a Party and its Affiliates, and their respective
sublicensees, shall be excluded from the computation of Net Sales, but Net Sales
shall include the first sales to Third Parties by any such Affiliates or
sublicensees.

     Notwithstanding anything else in this Section, the supply or other
disposition of products as (i) samples, (ii) for use in non-clinical or clinical
studies, (iii) for use in any tests or studies reasonably necessary to comply
with any Law, regulation or request by a regulatory or Governmental Authority or
as is otherwise reasonable and customary in the industry, in each case shall not
be included within the computation of Net Sales.

     In the event a product is sold in combination with, or contains, one or
more other active ingredients which are not the subject of this Agreement (as
used in this definition of Net Sales, a "Combination"), then the gross amount
invoiced for that product shall be calculated by multiplying the gross amount
invoiced for such Combination by the [***], where [***] is the gross amount
invoiced for the product sold separately and [***] is the gross amount invoiced
for the other active ingredient(s) sold separately. In the event that the other
active ingredient is not

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                       -8-

<PAGE>

sold separately, then the [***] for that product shall be calculated by
multiplying the gross amount invoiced for the Combination by the [***], where
[***] is the gross invoice amount for the product, if sold separately, and [***]
is the gross invoice amount for the Combination. In the event that no such
separate sales are made, Net Sales for royalty determination shall be determined
by the Parties in good faith.

     Where (A) the consideration for products includes [***]; or (B) products
are transferred by the selling Party, its Affiliate, or a respective
sublicensee, in any manner other than an arms-length, invoiced sale, the Net
Sales applicable to any such transaction shall be the [***] in the [***] of the
Territory. The fair market value shall be determined, wherever possible, by
reference to the [***] of the relevant product in [***] in the [***].

          1.1.57 "North American Territory" means the United States of America
(and its territories and possessions), Canada and Mexico.

          1.1.58 "Option Territory" means every territory in the world that is
not part of the North American Territory.

          1.1.59 "Patent Rights" means all patents and patent applications,
including any continuations, continuations-in-part, divisions, provisionals, or
any substitute applications, any patent issued with respect to any such patent
applications, any reissue, reexamination, renewal, or extension (including any
supplementary protection certificate) of any such patent, and any confirmation
patent or registration patent or patent of addition based on any such patent,
and all foreign counterparts of any of the foregoing, or as applicable portions
thereof or individual claims therein.

          1.1.60 "Person" means any individual, partnership, joint venture,
limited liability company, corporation, firm, trust, association, unincorporated
organization, Governmental Authority or any other entity not specifically listed
herein.

          1.1.61 "Phase II Clinical Trial" means a human clinical trial in any
country in the Licensed Territory that would satisfy the requirements of 21
C.F.R. Section 312.21(b).

          1.1.62 "Phase III Clinical Trial" means a human clinical trial in any
country in the Licensed Territory that would satisfy the requirements of 21
C.F.R. Section 312.21(c).

          1.1.63 "Polycation Collaboration Technology" means that [***], and
[***] in the event that [***] is [***] pursuant to Section [***], solely to the
extent that such [***] and, if applicable, [***], claims or relates directly to
[***].

          1.1.64 "Product" means any pharmaceutical product containing a
Formulation, and not any other active pharmaceutical ingredient that is not a
Compound which active pharmaceutical ingredient is Covered by a Valid Claim
within the Altus Technology or that uses or embodies Altus Know-How.

          1.1.65 "Product Reversion Package" means, with respect to a particular
Termination Product: (i) copies of any data and materials Controlled by
Genentech and made or

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<PAGE>

developed in the course of developing such Termination Product hereunder that
are necessary for the continued development or commercialization of such
Termination Product (including any information regarding safety, efficacy,
toxicity, and potential side effects), (ii) all of Genentech's right, title and
interest in and to any agreements between Genentech and Third Parties that are
[***], (iii) to the extent [***] as of the effective date of such termination;
(iv) [***] all regulatory filings and Marketing Authorizations Controlled by
Genentech and specific to such Termination Product; (v) a right of reference to
the applicable drug master files, or the equivalent, necessary to obtain or
maintain Marketing Authorization for such Termination Product; and (vi) subject
to the terms of Section [***] and any licenses or sublicenses granted by
Genentech to a Third Party, a non-exclusive, non-sublicensable, non-transferable
license under the Genentech Technology and Genentech Collaboration Technology as
necessary to make, have made, use, sell, offer for sale and import such
Termination Product.

          1.1.66 "Product Trademark" means the trademark(s) used by Genentech in
connection with the distribution, marketing, promotion and sale of a Product or
accompanying logos, trade dress or indicia of origin, but excluding Housemarks.

          1.1.67 "Regulatory Authority" means the FDA or any other counterpart
or additional Governmental Authority responsible for granting applicable
Marketing Authorizations.

          1.1.68 "Sales FTE Rate" means the annual rate to be payable at [***],
increased or decreased by the percentage increase or decrease in the Consumer
Price Index as of the then most recent December 31 over the level of the CPI as
of December 31, 2006, and calculation of the rate of payment for such FTE to be
pro-rated on a daily basis (per annum amount to be divided by [***] to produce
the rate per whole day consisting of eight hours).

          1.1.69 "Sales Representative" means an individual who engages in
Co-Promotion of Products and who has been trained in accordance with Section
7.5.3.

          1.1.70 "Third Party" means any Person other than Genentech or Altus or
any Affiliate of either Party.

          1.1.71 "Valid Claim" means claim of an issued and unexpired patent
that has not been revoked or held unenforceable or invalid by a final decision
of a court or other Governmental Authority of competent jurisdiction, and that
has not been disclaimed, denied or admitted to be invalid or unenforceable
through reissue or disclaimer or otherwise.

          1.1.72 Other Terms. The definition of each of the following terms is
set forth in the section of this Agreement indicated below:

<TABLE>
<CAPTION>
Term                                 Section
----                                 -------
<S>                                  <C>
1974 Convention                      16.6
AAA                                  14.2(a)
AGHD                                 1.1.48
Agreement                            Preamble
</TABLE>

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                                      -10-
<PAGE>

<TABLE>
<CAPTION>
Term                                 Section
----                                 -------
<S>                                  <C>
Altus                                Preamble
Altus Co-Promote Opt-Out             7.8.3
Altus Parties                        13.1
AMA                                  7.5.4
AMA Guidelines                       7.5.4
Combination                          1.1.56
Confidentiality Agreement            15.5
Commercialization Plan               7.3
Controlled Affiliate                 1.1.5
Co-Promote Territory                 7.2
Decision Period                      2.7.2
Disclosing Party                     1.1.24
Effective Date                       Preamble
Exchange                             15.6.3
Genentech                            Preamble
Genentech Collaboration Technology   10.1.3(a)
Genentech Option                     2.1.1
Genentech Parties                    13.2
HSR Filings                          12.7
Indemnified Party                    13.3
Indemnifying Party                   13.3
Initial Co-Promotion Period          9.12
Joint Collaboration Technology       10.1.3(b)
Joint Other Inventions               10.3
Joint Project Team or JPT            3.1
License                              2.2.3
Option Period                        2.1.1
Other Inventions                     10.3
Outside Patent Counsel               10.5.4
Parties                              Preamble
Party                                Preamble
PGHD                                 1.1.48
PhRMA                                7.5.4
PhRMA Code                           7.5.4
PHS Act                              7.5.4
Prosecution or Prosecute             10.5.1
Quality Agreement                    6.3
Recalls                              5.5
Receiving Party                      1.1.24
Royalties                            9.8, 9.9, 12.9
Royalty Report                       9.11
Royalty Term                         9.8.5
Severed Clause                       16.8
Term                                 12.1
</TABLE>

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                                      -11-

<PAGE>

<TABLE>
<CAPTION>
Term                                 Section
----                                 -------
<S>                                  <C>
Termination Date                     12.1
Termination Product                  12.8.1
Third Party Claims                   13.1
</TABLE>

     1.2 Captions; Certain Conventions; Construction. All captions herein are
for convenience only and shall not be interpreted as having any substantive
meaning. The Schedules and Exhibits to this Agreement are incorporated herein by
reference and shall be deemed a part of this Agreement. Unless otherwise
expressly provided herein or the context of this Agreement otherwise requires,
(a) words of any gender include each other gender, (b) words such as "herein",
"hereof", and "hereunder" refer to this Agreement as a whole and not merely to
the particular provision in which such words appear, (c) words using the
singular shall include the plural, and vice versa, (d) the words "include,"
"includes" and "including" shall be deemed to be followed by the phrase "but not
limited to", "without limitation", "inter alia" or words of similar import, and
(e) references to "ARTICLE," "Section," "subsection", "clause" or other
subdivision, or to a Schedule or Exhibit, without reference to a document are to
the specified provision, Schedule or Exhibit of this Agreement. In the event of
any conflict between the operative terms of this Agreement and any Schedule or
Exhibit, the operative terms of this Agreement shall prevail. This Agreement
shall be construed as if the Parties drafted it jointly.

                                   ARTICLE II
                            GRANT OF RIGHTS; OPTIONS

     2.1 Option Territory.

          2.1.1 Genentech Option. Genentech shall have the exclusive option,
until the later of [***] days following the [***] or [***] ("Option Period"), to
include the Option Territory within the Licensed Territory (the "Genentech
Option"). The Option Period shall be extended for a period of [***] upon the
request of Genentech. The Option Period also may be extended upon agreement of
the Parties.

          2.1.2 Option Exercise. In order to exercise the Genentech Option,
Genentech must provide Altus with written notice thereof at any time within the
Option Period. Upon Genentech's exercise of the Genentech Option, the Option
Territory shall become part of the Licensed Territory.

     2.2 Grant by Altus.

          2.2.1 Exclusive License. Subject to the terms and conditions of, this
Agreement, Altus hereby grants to Genentech an exclusive right and license, with
the right to grant sublicenses (subject only to Section 2.2.4) under the Altus
Technology and Altus's interest in and to the Joint Collaboration Technology to
(i) make (and have made), use, and import Formulations and Products in the Field
in the Licensed Territory and (ii) sell and offer for sale Products in the Field
in the Licensed Territory.

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<PAGE>

          2.2.2 Non-Exclusive License. As applicable prior to the expiration of
the Option Period or if Genentech does not exercise the Genentech Option, Altus
further grants to Genentech a non-exclusive right and license, with the right to
grant sublicenses (subject only to Section 2.2.4), under the Altus Technology to
(i) make (and have made, subject to Section 2.2.4) Formulations and Products in
the Field in the Option Territory, and (ii) to use, and import (but not sell or
offer for sale) Formulations and Products in the Field in the Option Territory;
in each case of (i) and (ii) above, solely for the purpose of developing
Formulations and Products and commercializing Products in the Field in the
Licensed Territory.

          2.2.3 License Defined. The licenses granted under this Section 2.2 are
referred to collectively as the "License".

          2.2.4 Sublicensing by Genentech.

          (a) The License includes the right by Genentech to grant sublicenses;
provided that [***]. No consent shall be required from Altus for any sublicense
granted by Genentech to [***].

          (b) Any sublicense granted by Genentech under the License must be
granted pursuant to a written agreement that contains terms regarding the
confidentiality and use of Altus Know-How and Altus's Confidential Information
substantially similar to those contained in this Agreement. In the event of any
such sublicense, Genentech shall continue to remain primarily liable for all
liabilities and obligations under this Agreement, including the payment
obligations set forth in ARTICLE IX.

     2.3 Grants by Genentech.

          (a) Conduct of Development Plan. Subject to the terms and conditions
of this Agreement, Genentech hereby grants to Altus a non-exclusive,
non-transferable, non-sublicenseable right and license under the (i) Genentech
Technology, (ii) Genentech Collaboration Technology, (iii) Altus Technology (to
the extent licensed to Genentech pursuant to Section 2.2.1) and (iv) [***]; in
each case to make and use (but not sell, offer for sale or import) Products in
the Field in the North American Territory (a) [***] for Altus to perform those
development activities with respect to a Formulation or Product to be performed
by Altus pursuant to Section 4.4 and (b) to conduct certain other activities
[***].

          (b) Co-Promotion. Subject to the terms of this Agreement, Genentech
hereby grants to Altus a non-exclusive, non-transferable, non-sublicenseable,
right and license under the (i) Genentech Technology, (ii) Genentech
Collaboration Technology, (iii) Altus Technology (to the extent licensed to
Genentech pursuant to Section 2.2.1) and (iv) [***]; in each case [***] to
Co-Promote Products in the Co-Promote Territory in the Field in accordance with
the Commercialization Plan and ARTICLE VII, and in accordance with the
requirements of all applicable Marketing Authorizations.

          (c) [***] Technology. Subject to the terms of this Agreement
(including Section 9.9), Genentech hereby grants to Altus a non-exclusive,
non-transferable right and license under the [***] Technology to make, use,
sell, offer for sale or import any product that is

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                                      -13-

<PAGE>

not a Formulation or Product in the Licensed Territory, and any product outside
of the Licensed Territory. Any sublicense granted by Altus to an Affiliate or
Third Party under the [***] Technology must be granted pursuant to a written
agreement. In the event of any such sublicense, Altus shall continue to remain
primarily liable for all liabilities and obligations under this Agreement,
including the payment obligations set forth in Section 9.9.

          (d) Genentech Housemarks. Subject to the terms of this Agreement,
Genentech hereby grants to Altus a non-exclusive, non-transferable,
non-sublicenseable, right and license to use the Genentech Housemarks and
Product Trademarks solely in connection with Altus's Co-Promotion of Products in
the Co-Promote Territory in the Field in accordance with the requirements of the
applicable Marketing Authorizations, and to such limited extent as set forth in
the Commercialization Plan and ARTICLE VII. All Genentech Housemarks and Product
Trademarks are and shall remain the sole and exclusive property of Genentech and
all use thereof and goodwill associated therewith shall inure to the benefit of
Genentech.

     2.4 No Implied Licenses. Except as expressly set forth in this Agreement,
nothing contained in this Agreement shall be construed as conferring to either
Genentech or Altus, by implication, estoppel, or otherwise, any option, license
or right under the Genentech Technology, Altus Technology, Collaboration
Technology or any other Patent Rights or other intellectual property rights held
by Genentech or Altus.

     2.5 Section 365(n) of the Bankruptcy Code. The rights and licenses granted
under or pursuant to any Section of this Agreement, including under Sections 2.2
and 2.3, are rights to "intellectual property" (as defined in Section 101(35A)
of the Bankruptcy Code). Each Party shall retain and may fully exercise all of
its rights and elections under the Bankruptcy Code or equivalent legislation in
any jurisdiction other than the United States. Upon the bankruptcy of either
Party and the occurrence of the events described in 11 U.S.C. Sections 365(n)(3)
or 365(n)(4), the other Party shall further be entitled to a complete duplicate
of, or complete access to, as appropriate, any such intellectual property, and
such intellectual property, if not already in its possession, shall be promptly
delivered to such other Party, unless the Party in bankruptcy elects to
continue, and continues, to perform all of its obligations under this Agreement.

     2.6 Exclusivity. Beginning on the Effective Date and for a period of [***]
following the Effective Date, Genentech shall not, alone or in collaboration
with a Third Party or Affiliate, [***] for the Licensed Territory. Beginning on
the Effective Date and for a period of [***] from the [***], Genentech shall
not, alone or in collaboration with a Third Party or Affiliate, [***].

     2.7 Right of First Negotiation for [***].

          2.7.1 Notification of [***]. From time to time, but in no event less
than once per year, Altus shall provide Genentech with a report, in writing, of
all [***]. The report shall be in a form and contain a sufficient level of
detail to provide Genentech with enough information to evaluate the nature and
applications of the [***].

          2.7.2 [***] Rights. Altus agrees that, prior to licensing,
transferring or otherwise conveying or granting rights to any Third Party to any
[***], or if so requested by Genentech, the Parties will in good faith discuss
and negotiate a license to Genentech covering

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                                      -14-

<PAGE>

[***] for use, development and commercialization. If Altus and Genentech cannot
agree on the terms and conditions of any such license within [***] of commencing
such negotiations, then Altus may negotiate the terms and conditions of a
license covering [***] with a Third Party; provided, however, that in each case,
prior to licensing [***] to a Third Party, Altus shall be obligated to offer to
Genentech a license on substantially the same terms and conditions as negotiated
with the Third Party. If Genentech does not accept such terms and conditions for
such license [***] of the date of offer by Altus (the "Decision Period"), then
Altus may enter into the license covering such [***] with the Third Party;
provided that if Altus does not enter into such license with such Third Party
[***] shall again be subject to the provisions of this Section 2.7.2.

                                   ARTICLE III
                       GOVERNANCE; EXCHANGE OF INFORMATION

     3.1 Committees. In order to fulfill the objectives of this Agreement, the
Parties shall establish a "Steering Committee". The members of the Steering
Committee, as designated in equal numbers by each Party, shall be appropriate
for the tasks then being undertaken and the stage of development, in terms of
their seniority, availability, function in their respective organizations,
training and experience. The Steering Committee shall have two co-chairpersons,
one designated by each of Altus and Genentech. From time to time, the Steering
Committee may establish "Joint Project Teams" ("JPTs") to oversee particular
projects or activities; those JPTs will be constituted as the Steering Committee
approves. It is the intent of the Parties that the Parties shall have, through
the Steering Committee or one or more JPTs, a forum for communication with
respect to the development, commercialization and manufacture of Products to the
degree both Parties continue to have responsibilities for aspects of
development, commercialization, and manufacture as dictated by this Agreement.

     3.2 Meetings. The co-chairpersons of the Steering Committee shall call
meetings at least once per Calendar Quarter or as otherwise mutually agreed.
Steering Committee meetings may be held in person, by telephone, or by video
conference call. The location of any in-person Steering Committee meeting shall
alternate between United States sites selected by each co-chairperson, unless
otherwise agreed. The decisions of the Steering Committee shall be by a vote of
the co-chairpersons, each co-chairperson having one vote, and all decisions
shall be by unanimous consent of the co-chairpersons, except as provided in
Section 3.4. Additional participants may be invited by any representative of the
Steering Committee to attend meetings when and where deemed appropriate by the
co-chairpersons and provided that such additional participants are bound by
appropriate confidentiality obligations. Each Party's representatives on the
Steering Committee shall act in good faith to resolve all matters presented to
them as cooperatively and expeditiously as possible. Each Party shall be
responsible for expenses incurred by its employees and its members of the
Steering Committee and any established JPTs in attending or otherwise
participating in meetings.

          3.2.1 Meeting Minutes. The Steering Committee shall record all
decisions made, and otherwise take minutes as appropriate. Responsibility for
keeping minutes will alternate between the Parties, beginning with Genentech.
Steering Committee meeting minutes will be sent to each Party's co-chairperson
for review as soon as practicable after a meeting.

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     3.3 Steering Committee Responsibilities. Subject to Section 3.4, the
Steering Committee shall perform the following functions:

          (a) overseeing the development and commercialization, and as set forth
herein the manufacture, of Products in the North American Territory;

          (b) reviewing the Development Plan and Commercialization Plan;

          (c) reviewing and allocating resources and efforts for the development
of Products for the North American Territory and commercialization of Products
in the Co-Promote Territory;

          (d) performing such other functions referred to in the Development
Plan and/or Commercialization Plan, or as otherwise specified in this Agreement
or agreed to by the Parties.

     3.4 Decision Making. The Steering Committee and any established JPT shall
strive to work cooperatively to reach unanimous decisions. If, despite such
efforts, any JPT established by the Steering Committee is unable to reach a
decision on any issue within [***], the issue shall be referred for resolution
to the Steering Committee. If the Steering Committee is unable to reach a
decision on any issue [***], then [***], provided that in no event may [***].

     3.5 Exchange of Information. Each Party shall, through the Steering
Committee or appropriate JPT, keep the other Party updated on the progress of
activities under a Development Plan and/ or Commercialization Plan. In addition,
as directed by the Steering Committee, the Parties shall set up and establish a
secure and reliable means of transferring information, such as a secure server,
as soon as practicable after the Effective Date.

                                   ARTICLE IV
                             DEVELOPMENT OF PRODUCTS

     4.1 General. The Parties intend and agree that the development, filing for
any Marketing Authorization, and commercialization (subject to Altus's right to
Co-Promote as set forth in ARTICLE VII) of Products shall be controlled by
Genentech. Without limiting the generality of the foregoing, Genentech shall be
responsible for making and have authority to make all decisions, and undertake
any actions necessary as a result of such decisions, regarding development
(including additional preclinical and clinical development and testing), and
preparing and filing NDAs and any other Approval Applications and Marketing
Authorizations; and shall solely own all data, results and regulatory
submissions related thereto, including all Approval Applications and Marketing
Authorizations. Altus shall have, through the Steering Committee or appropriate
JPT, the opportunity to provide input and suggestions into matters relating to
the development of Products solely with respect to the North American Territory,
and Genentech shall reasonably consider such input and suggestions.

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     4.2 Transition of Development Responsibilities to Genentech.

          (a) Oversight. Within [***] of the Effective Date, the Steering
Committee, or appropriate JPT, shall meet to discuss the further development of
Products subsequent to the Effective Date, the transition of control over such
development to Genentech, and Altus's role in such development.

          (b) Committee Responsibilities. The Steering Committee, or appropriate
JPT, shall facilitate the exchange of information and the coordination between
the Parties relating to the development of Products for the North American
Territory, and to serve as a forum for each Party to keep the other Party
updated with regard to such development, including with respect to the
commencement and progress of clinical trials, the results of any clinical
trials, and the strategy for obtaining Marketing Authorizations in the North
American Territory.

     4.3 Development Plan.

          (a) Initial Development Plan; Modifications. Within [***] of the
Effective Date, the Steering Committee, or appropriate JPT, shall meet to discus
the strategy for further development of Products for the North American
Territory subsequent to the Effective Date, and the implementation thereof.
Within [***] of the Effective Date, Genentech will create an initial Development
Plan which will address the further development of Products for the North
American Territory subsequent to the Effective Date. From time to time,
Genentech will update the Development Plan as needed to address any changes in
the plans for development of Products in the North American Territory, including
in Genentech's reasonable discretion the development of indications beyond the
Initial Indications.

          (b) Altus Review and Comment. Although Genentech shall be responsible
for the creation and updating of the Development Plan, Altus shall have, through
the Steering Committee, or appropriate JPT, the opportunity to comment on the
Development Plan, and [***] with respect to the Development Plan. Genentech
shall inform Altus between meetings of the Steering Committee, or appropriate
JPT, of significant changes to the Development Plan.

     4.4 Altus Development Activities. Without limiting the generality of
Section 4.1, the Parties, through the Steering Committee, may agree that certain
activities related to the development and seeking of Marketing Authorization of
Products be performed by Altus, provided, however, that no such activities shall
be allocated to Altus without the prior consent of Altus. Altus shall perform
all activities allocated to Altus hereunder with Commercially Reasonable Efforts
and in compliance with all Laws.

     4.5 Cooperation. Each Party shall cooperate with and provide reasonable
support to the other Party in its conduct of any activities in the development
and seeking of Marketing Authorization of Products for the Licensed Territory,
including any activities set forth in the Development Plan.

     4.6 Transfer of Information and Regulatory Filings. Altus shall disclose
(and transfer as applicable) to Genentech all Altus Know-How, including any
preclinical data, clinical data, assays and associated materials, protocols,
procedures and any other information in Altus's

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<PAGE>

possession or control, that is reasonably necessary or useful to continue or
initiate pre-clinical or clinical development, or in seeking Marketing
Authorization, of Products. Without limiting the generality of the foregoing,
upon Genentech's request Altus shall assign to Genentech (i) all applications
and filings made with any Regulatory Authority with respect to a Formulation or
Product, including any IND and orphan drug designations, (ii) all agreements
related to the conduct of any clinical trial with respect to a Formulation or
Product, and (iii) all agreements related to the manufacture, supply or
distribution of clinical and/or commercial supplies of a Formulation or Product.

     4.7 Development Costs. Genentech shall be responsible for all Development
Costs incurred by it in respect of Products following the Effective Date and
[***], as set forth in Section 9.4, [***] Section [***].

                                    ARTICLE V
                               REGULATORY MATTERS

     5.1 General. As between Genentech and Altus, Genentech shall own all
Approval Applications and Marketing Authorizations and other regulatory
authorizations related to the development and commercialization of Products in
the Licensed Territory. Altus shall assist Genentech, its Affiliates and any
Genentech sublicensee in the preparation and filing for any Marketing
Authorization with respect to Products, including by delivering all information
in Altus's possession (in a complete and accurate form) necessary or useful to
complete and file any Approval Application for a Product.

     5.2 Communication with Governmental Authorities. Genentech (or one of its
Affiliates or sublicensees) shall be responsible for and act as the sole point
of contact for communications with Governmental Authorities in connection with
the development, commercialization, and manufacturing of Products in the Field
in the Licensed Territory after the end of the communications relating to those
Phase II Clinical Trials initiated by Altus before the Effective Date. Following
the Effective Date, Altus shall not initiate, with respect to any Product, any
meetings or contact with Governmental Authorities in the Licensed Territory
without Genentech's prior written consent. Any correspondence directed to Altus
from Governmental Authorities in the Licensed Territory shall promptly be
forwarded to Genentech for coordination of response.

          5.2.1 Certain Obligations.

          (a) Genentech shall, through the Steering Committee or appropriate
JPT, keep Altus apprised of all material regulatory communications with
Governmental Authorities relating to Products with respect to the North American
Territory. In addition, Genentech shall (i) provide Altus with a copy of any
material documents, to the extent related to a Product and the North American
Territory, submitted to, and material written correspondence with, Governmental
Authorities, if reasonably possible sufficiently in advance of the intended
submission dates to enable Altus to review and provide comments to Genentech
concerning the content thereof and (ii) as soon as reasonably practicable after
completion of any inspections by any Governmental Authority with respect to a
Product for the North American Territory, provide

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<PAGE>

to Altus a summary of such inspection, the outcome and any corrective actions,
all to the extent related directly and solely to a Product and the North
American Territory. Any documents, correspondence, summary or other information
provided by Genentech to Altus pursuant to this Section shall be Genentech's
Confidential Information.

          (b) To the extent Altus receives any written or oral communication
from any Governmental Authority relating to a Product, Altus shall (i) refer
such Governmental Authority to Genentech, and (ii) as soon as reasonably
practicable, notify Genentech and provide Genentech with a copy of any written
communication received by Altus or, if applicable, complete and accurate minutes
of such oral communication.

          5.2.2 Participation in Meetings. Altus shall have the right to have,
[***] representatives observe substantive meetings with the Governmental
Authorities in the North American Territory pertaining to Products. Genentech
shall provide Altus with reasonable advance notice of all such meetings.
Genentech shall have the right to initiate meetings and contact with
Governmental Authorities independently of Altus, provided that Altus shall have
the right to observe in such meetings as set forth above.

     5.3 Cooperation. Each Party agrees to provide the other Party with all
reasonable assistance and take all actions reasonably requested that are
reasonably necessary to enable such Party to comply with any Laws applicable to
Products in the Licensed Territory, including meeting its reporting and other
obligations to maintain and update any Marketing Authorizations for Products in
the Licensed Territory.

     5.4 Drug Safety Information. As soon as reasonably necessary, the Parties
shall enter into a pharmacovigilance and global safety reporting agreement
reasonably acceptable to both Parties in respect of any Products. As between
Genentech and Altus, Genentech shall be responsible for maintenance of the
global safety database and global safety monitoring, except to the extent
prohibited by Law.

     5.5 Recalls. Genentech shall make all decisions with respect to any recall,
market withdrawals or any other corrective action related to a Product in the
Licensed Territory (collectively, "Recalls") for safety or any other reason, and
shall have responsibility for executing such Recalls. Genentech shall promptly
notify Altus of any decision by Genentech to conduct any Recalls; provided,
that, if reasonably practicable, such notice shall occur prior to such action so
as to permit Altus a reasonable opportunity to consult with Genentech with
respect thereto. Altus will cooperate with Genentech in connection with any
Recall, including making available to Genentech, upon request, all of its
pertinent records which Genentech may reasonably request to assist Genentech in
effecting any Recall.

     5.6 Costs. Except as otherwise set forth in this Agreement, Genentech
shall, following the Effective Date, bear all costs relating to obtaining,
supporting and maintaining Marketing Authorizations in the Licensed Territory.

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -19-

<PAGE>

     5.7 Altus Access to Clinical Data.

          5.7.1 Initial Indications. In the event that Genentech does not
exercise the Genentech Option, Altus may request, in writing, that Genentech
provide to Altus access to and the right to use certain clinical and other data
generated by Genentech following the Effective Date reasonably necessary to
Altus's pursuit of Marketing Authorizations for Products in the Initial
Indications outside the North American Territory. [***] following such written
request from Altus, Genentech shall provide Altus with an invoice in the amount
of [***] of the [***]. [***] of Altus's written approval of such invoice, [***],
Genentech shall provide Altus with the requested data and associated right to
use such data as reasonably necessary for obtaining Marketing Authorizations for
Products outside the North American Territory. Altus shall provide Genentech
with written notice of any such submission [***] thereof. Altus shall [***]
associated with transferring the requested data to Altus.

          5.7.2 Other Indications. In the event that Genentech does not exercise
the Genentech Option, Altus may request, in writing, that Genentech provide to
Altus access to and the right to use certain clinical and other data reasonably
necessary for Altus's pursuit of Marketing Authorizations for Products outside
the North American Territory in indications other than the Initial Indications.
Following such request, the Parties shall discuss in good faith the possible
provision of such data to Altus and the compensation due to Genentech therefor.

          5.7.3 Other Data Sharing. In the event that Genentech does not
exercise the Genentech Option, upon the written request of either Party, the
other Party shall discuss in good faith the possible sharing of clinical and
other data generated by each Party for their respective territories with the
goal of enabling a more efficient global development and commercialization of
Products for both Parties.

          5.7.4 Genentech Confidential Information. All clinical and other data
provided to Altus pursuant to this Section 5.7 shall be the Confidential
Information of Genentech.

                                   ARTICLE VI
                             MANUFACTURE AND SUPPLY

     6.1 Manufacture and Supply of Clinical Requirements of Product. Unless
otherwise agreed to by the Steering Committee, Altus shall, subject to oversight
by the Steering Committee and the terms and conditions of this Agreement, be
initially responsible for the manufacture and supply of all quantities of
Products for use in development (including clinical trials) of Products for use
in the Licensed Territory. Genentech shall be responsible for reasonably
supporting Altus in such efforts, including supplying, at Genentech's own
expense, all quantities of Compound reasonably required by Altus to manufacture
Products for use in development (including clinical development) in the Licensed
Territory. Genentech's supply of Compound shall be according to a reasonable
production schedule established by the Steering Committee. The FBMC of Products
for use in development (including clinical trials) in the Licensed Territory
shall be deemed a Development Cost for which Genentech shall reimburse Altus in
accordance with Section 9.4. Altus and Genentech shall cooperate to transfer to
Genentech, as soon as reasonably practicable following the Effective Date,
responsibility for the manufacture

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -20-

<PAGE>

of Product for use in development. Altus shall use Commercially Reasonable
Efforts to affect such transfer.

     6.2 Manufacture and Supply of Commercial Requirements of Product. As
between Genentech and Altus, Genentech shall be responsible for the manufacture
and supply of Products for promotion and sale in the Licensed Territory, and
bear all costs associated therewith. Altus shall support and provide all
assistance, including any Altus Know-How, reasonably required by Genentech to
manufacture Products.

     6.3 Quality Agreement. The Parties shall enter into a separate agreement
governing the roles and responsibilities of the Parties in the manufacture,
testing, release and storage of Product and/or Compound (the "Quality
Agreement"). The Parties shall use reasonable efforts to complete such Quality
Agreement [***] of the Effective Date.

     6.4 Manufacture and Supply of Compound for Option Territory. In the event
that Genentech does not exercise the Genentech Option, Altus may, [***]
expiration of the Genentech Option, provide Genentech with a written request for
Genentech to supply Altus with clinical and/or commercial requirements of
Compound, which as of the date of Altus's written request is currently
manufactured by Genentech, to use exclusively outside the Licensed Territory.
Provided that Genentech timely receives such written request, Genentech shall
supply Altus, under terms mutually agreeable to the Parties, with clinical
requirements of Compound for a period of no longer than [***] expiry of the
Genentech Option and commercial requirements for a period of no longer than
[***] receipt of the first Marketing Authorization for Product outside the
Licensed Territory. Altus shall reimburse Genentech for such supply of Compound
at a cost to be negotiated no less than Genentech's [***] and no more than
Genentech's [***].

                                   ARTICLE VII
                         COMMERCIALIZATION; CO-PROMOTION

     7.1 General. Subject to Altus's right to Co-Promote Products in the
Co-Promote Territory (as defined in Section 7.2 below) in accordance with this
ARTICLE VII, Genentech shall be responsible for commercializing Products in the
Licensed Territory.

     7.2 Altus Co-Promotion Option. Subject to the conditions in Sections 7.4
and 9.12, Altus shall have the option to Co-Promote Products in each country
within the North American Territory, which option shall be exercisable with
respect to each country in the North American Territory no later than [***] the
first Approval Application for a Product is submitted to the appropriate
Regulatory Authority in the applicable country; provided that Altus provides
Genentech with written notice of its exercise of such option within the
foregoing time period, which notice specifically identifies the countries within
the North American Territory in which Altus elects to Co-Promote Products (the
"Co-Promote Territory").

     7.3 Commercialization Plan. Within [***] the first Approval Application for
a Product in the Co-Promote Territory is filed, the Steering Committee, or
appropriate JPT, shall meet to discus the strategy for commercialization of
Product in the Co-Promote Territory. Within [***] the foregoing meeting of the
Steering Committee or appropriate JPT, Genentech

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                                      -21-

<PAGE>

shall submit to the Steering Committee, or appropriate JPT, an annual plan for
the commercialization of such Product in the Co-Promote Territory (the
"Commercialization Plan"). Although Genentech shall be responsible for the
creation of the Commercialization Plan, Altus, through the Steering Committee,
or appropriate JPT, shall have the opportunity to comment on the
Commercialization Plan, and Genentech shall reasonably consider Altus's comments
with respect to the Commercialization Plan. Genentech shall update the
Commercialization Plan on [***]. Prior to each [***] of the Commercialization
Plan, the Steering Committee, or appropriate JPT, shall meet to broadly review
the past year's commercialization of Products in the Co-Promote Territory and
discuss plans for commercialization of Products in the Co-Promote Territory in
the upcoming year. Altus shall be kept apprised of the commercialization
activity by and through the Steering Committee, or appropriate JPT. In addition,
Genentech shall, as reasonably practicable, inform Altus between meetings of the
Steering Committee, or appropriate JPT, of significant changes to the
Commercialization Plan and any material events in the marketing and sales of
Products in the Co-Promote Territory.

     7.4 Co-Promotion Responsibilities. The Parties acknowledge that, as of the
Effective Date, Genentech is the Party that has established the infrastructure
and expertise for the marketing and sales of therapeutic drugs, and that except
as set forth in this ARTICLE VII, Genentech shall have the [***], and [***], for
the [***] and [***] of [***] and the [***] and [***] of Products, including
[***], and [***], and the [***] of [***]. Subject to the term and conditions of
this ARTICLE VII, Section 9.12 and provided that Altus has established [***],
Altus shall have the right to deploy, in the Co-Promote Territory, a
Co-Promotion sales force equal to [***] of the total number of Sales
Representatives for Products, or as otherwise unanimously determined by the
Steering Committee. The Steering Committee shall [***] and [***] within the
Co-Promote Territory to [***] in a [***] in view of the [***] of [***] and
[***].

     7.5 Commercialization Efforts. Each Party, to the extent that such Party is
participating in the Co-Promotion of Products, shall use Commercially Reasonable
Efforts in marketing Products in accordance with the Commercialization Plan.

          7.5.1 Sales and Distribution. Unless otherwise agreed in writing,
Genentech shall have the sole responsibility for the following with respect to
Products:

          (a) Booking sales for and distributing Products. If Altus receives any
orders for Products, it shall refer such orders to Genentech.

          (b) Handling all returns of Products. If any Product is returned to
Altus, it shall promptly be shipped to the facility responsible for shipment of
such Product in the country in question to the attention of the "returned goods
department" or another location as may be designated by Genentech.

          (c) Handling all aspects of order processing, invoicing and
collection, distribution, warehousing, inventory and receivables, and collection
of data of sales to hospitals and other end users (e.g., DDD data).

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -22-

<PAGE>

          (d) Handling all other customer service related functions, including
providing customer medical information.

          7.5.2 Marketing and Promotional Materials. All marketing and
promotional materials related to Products shall be prepared by Genentech.
Genentech shall be entitled to select any Third Party involved in the
preparation of such materials.

          7.5.3 Training Program. Genentech shall develop training programs
relating to Products for the sales forces of each respective Party and for any
Third Party engaged in selling or promotion. The Steering Committee, or
appropriate JPT, may reasonably assign responsibility to itself, Genentech,
Altus or a Third Party for the preparation of materials for training programs
and conduct of training. The Parties agree to utilize such training programs on
an ongoing basis to assure a consistent, focused promotional strategy. The
initial training shall be carried out at a time which is mutually acceptable to
the Parties, and which is prior to but reasonably near the date on which the
first Marketing Authorization in the Co-Promote Territory is expected. As
additional members are added to the Parties' respective sales forces, training
will be given to groups of the newly selected members.

          7.5.4 Co-Promotion Compliance Responsibilities. Each Party
Co-Promoting a Product shall in all material respects conform its practices and
procedures relating to such Co-Promotion to the Act, the Public Health Service
("PHS Act"), the Pharmaceutical Research and Manufacturers of America ("PhRMA")
Code of Pharmaceutical Marketing Practices (the "PhRMA Code") and the American
Medical Association ("AMA") Guidelines on Gifts to Physicians from Industry (the
"AMA Guidelines"), as the same may be amended from time to time, and the rules
and regulations promulgated under any of the foregoing, and promptly notify the
other Party of and provide the other Party with a copy of any material
correspondence or other reports with respect to the Co-Promotion of a Product
submitted to or received from the FDA (or other Regulatory Authority), PhRMA or
the AMA relating to the Act, the PHS Act, the PhRMA Code, or the AMA Guidelines.

     7.6 Product Trademarks.

          7.6.1 Selection, Prosecution and Maintenance. All Products shall be
sold under the Product Trademarks selected by Genentech. All Product Trademarks
shall be owned by Genentech worldwide. Genentech shall control the preparation,
prosecution and maintenance of applications related to any and all Product
Trademarks.

          7.6.2 Enforcement and Defense. Each Party shall notify the other Party
promptly upon learning of any actual, alleged or threatened infringement of a
Product Trademark in the North American Territory, or of any unfair trade
practices, trade dress imitation, passing off of counterfeit goods, or like
offenses. Upon learning of such offenses, the Parties shall confer regarding the
defense of the Product Trademark. The ultimate decision whether and how to
enforce or defend a Product Trademark will rest solely with Genentech, and
Genentech shall have the exclusive right to respond to and defend any such
infringement or offense. Altus shall cooperate, in good faith, with respect to
all Product Trademark enforcement actions hereunder, including as necessary or
desirable, being joined as a party to such action. Genentech shall notify Altus
of all substantive developments with respect to such Product Trademark

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -23-

<PAGE>

enforcement actions in the North American Territory, including, but not limited
to, all material filings, court papers and other related documents. Genentech
shall consider the timely, reasonable comments and advice of Altus with respect
to the strategy employed and submissions made relative to any Product Trademark
enforcement actions in the North American Territory. Genentech shall have the
right to control settlement of any claims or actions regarding a trademark
applicable to a Product; provided, however, that no settlement shall be entered
into with respect to the North American Territory without the written consent of
Altus if such settlement would materially and adversely affect any right or
obligation of Altus under this Agreement.

          7.6.3 Costs. All of the costs, expenses and legal fees associated with
preparing filing, prosecuting, registering and maintaining a Product Trademark,
as well as any action to maintain, protect or defend a Product Trademark, and
any recovery, shall be Genentech's.

     7.7 Party Name on Licensed Packaging and Labeling. With respect to each
Product marketed in the Co-Promote Territory and then currently Co-Promoted by
Altus, to the extent such Product's packaging, labeling or promotional materials
identifies or otherwise references any of the Parties, both Genentech and Altus
shall be presented and described with equal prominence and emphasis as having
joined and participated in the development and Co-Promotion thereof, as
permitted by Laws.

     7.8 Termination of Co-Promotion.

          7.8.1 Breach of Agreement. If Altus (i) materially breaches this
Agreement and fails to cure such breach within [***] written notice from
Genentech or (ii) fails to cure, within [***] written notice from Genentech,
circumstances or conditions [***] a material breach, for which Altus has also
received written notices thereof; Genentech shall have the right to terminate,
by written notice, Altus's Co-Promotion rights granted under this Agreement
(including this ARTICLE VII) with respect to all Products. Termination of
Altus's Co-Promotion rights under this Section 7.8.1 shall be effective [***]
Genentech's notice of termination and, on such effective date, (i) all licenses
granted in Section 2.3, except for the license granted under Section 2.3(c),
shall terminate and (ii) all rights and privileges granted to Altus under this
ARTICLE VII shall terminate.

          7.8.2 [***]. Upon any [***] of this Agreement [***] or [***],
Genentech shall have [***] under this Agreement (including [***]) by written
notice. [***] under this Section 7.8.2 shall be effective on the [***] and, on
such effective date, (i) [***] and (ii) [***].

          7.8.3 Altus Co-Promotion Opt-Out. Altus shall have the right to elect
to cease its Co-Promotion of Products in the Co-Promote Territory ("Altus
Co-Promote Opt-Out"); provided that Altus provides Genentech with written notice
of such election. An Altus Co-Promote Opt-Out for which Genentech received
notice prior to [***] of a particular Calendar Year shall become effective on
[***] of the following Calendar Year. If notice of an Altus Co-Promote Opt-Out
is received after [***] of a particular Calendar Year, such Altus Co-Promote
Opt-Out shall not become effective until [***] the Calendar Year following the
next Calendar Year, or such other earlier date that Genentech may determine (of
which date Genentech shall provide Altus notice). On the effective date of an
Altus Co-Promote Opt-Out (i) all licenses

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -24-

<PAGE>

granted in Section 2.3, except for the license granted under Section 2.3(c),
shall terminate and (ii) all rights and privileges granted to Altus under this
ARTICLE VII shall terminate.

          7.8.4 Transitional Assistance. Upon any termination of Altus's
Co-Promotion rights in accordance with this Section 7.8, Altus covenants and
agrees to cooperate, and cause its employees, contractors and agents to
cooperate, with Genentech to enable Genentech to transition any Co-Promotion
activities performed by Altus to Genentech in a timely and orderly manner.

     7.9 Commercial Expenses. Except where otherwise specifically set forth in
this Agreement, Genentech shall bear all costs and expenses incurred in
connection with the marketing and sale of Products in the Licensed Territory;
provided that [***].

     7.10 Outsourcing of Co-Promotion Activities. Provided that Altus is
currently Co-Promoting Products in the Co-Promote Territory, if Genentech
desires to outsource or contract its Co-Promotion of Products in the Co-Promote
Territory to a Third Party, Genentech shall discuss in good-faith with Altus the
possibility of Altus engaging in such Co-Promotion activities on Genentech's
behalf.

                                  ARTICLE VIII
                             DILIGENCE OBLIGATIONS

     8.1 Commercially Reasonable Efforts by Genentech. Subject to Altus's
fulfillment of its obligations under this Agreement, Genentech shall use
Commercially Reasonable Efforts to develop and commercialize at least one
Product in the United States and, if Genentech exercises the Genentech Option,
[***]. Activities by Genentech's Affiliates and sublicensees will be considered
as Genentech's activities under this Agreement for purposes of determining
whether Genentech has complied with any obligation to use Commercially
Reasonably Efforts.

     8.2 Commercially Reasonable Efforts by Altus. Subject to Genentech's
fulfillment of its obligations under this Agreement, Altus shall use
Commercially Reasonable Efforts to execute and perform all development
(including activities performed by Altus pursuant to Section 4.4) and
commercialization activities (including the Co-Promotion of Products as set
forth in ARTICLE VII) reserved for or assigned to Altus under this Agreement.

     8.3 Genentech's Cessation of Development and Commercialization of Products.
If, [***] of the Effective Date, Genentech, despite the use of Commercially
Reasonable Efforts as set forth in Section 8.1 [***] ceases all development and
commercialization of Products in the Licensed Territory, Genentech agrees, upon
the written request of Altus, [***].

                                   ARTICLE IX
                              FINANCIAL PROVISIONS

     9.1 Program Fee. In consideration of the grant of the License and its other
rights under this Agreement, Genentech shall pay Altus a non-creditable,
non-refundable fee of Fifteen Million Dollars (US$15,000,000) [***] of the
Effective Date.

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -25-

<PAGE>

     9.2 Stock Purchase. On the Execution Date, Altus and Genentech will execute
the "Stock Purchase Agreement" attached hereto as Exhibit A, pursuant to which
Genentech will purchase, and Altus will sell, subject to the terms, conditions
and contingencies set forth in the Stock Purchase Agreement, Fifteen Million
Dollars (US$15,000,000) of Altus common stock.

     9.3 Genentech Option Fee. In the event that Genentech exercises the
Genentech Option in accordance with Section 2.1.1, Genentech shall, [***] of the
written notice required by Section 2.1.1, pay Altus a [***].

     9.4 Development Costs. Genentech shall reimburse Altus for undisputed
Development Costs actually incurred by Altus following the Effective Date in
connection with the Development Plan [***].

     9.5 Milestone Payments. In consideration of the grant of the License and
other rights under this Agreement, Genentech shall make the following payments
[***] of the milestone events listed below:

<TABLE>
<CAPTION>
                           MILESTONE PAYMENT
MILESTONE EVENT          (IN U.S. $ MILLIONS)
---------------          --------------------
<S>                      <C>
Development Milestones
[***]                            [***]

[***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]

[***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]

[***]
[***]                            [***]
[***]                            [***]

[***]
</TABLE>

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -26-

<PAGE>

<TABLE>
<CAPTION>
                           MILESTONE PAYMENT
MILESTONE EVENT          (IN U.S. $ MILLIONS)
---------------          --------------------
<S>                      <C>
[***]                           [***]
[***]                           [***]
[***]                           [***]
</TABLE>

Genentech shall provide Altus with written notice of the achievement of each of
the milestone events listed above promptly (and in any event [***]) following
such achievement.

     9.6 Option Territory Milestone Payments. Provided that Genentech exercises
the Genentech Option under Section 2.1.1, Genentech shall make the following
payments [***] of the milestone events listed below:

<TABLE>
<CAPTION>
                           MILESTONE PAYMENT
MILESTONE EVENT          (IN U.S. $ MILLIONS)
---------------          --------------------
<S>                      <C>
[***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]

[***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
[***]                            [***]

[***]
[***]                            [***]
[***]                            [***]
[***]                            [***]
</TABLE>

Genentech shall provide Altus with written notice of the achievement of each of
the milestone events listed above promptly (and in any event [***]) following
such achievement.

     9.7 Single Milestone Payment. With respect to each set of milestone
payments to be made under this Agreement, only one set shall ever be due and
payable, regardless of the number of Products developed, or the number of
indications pursued or approved or whether a Product is

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -27-
<PAGE>

discontinued after a milestone payment has been made. Milestone payments due
under Section 9.5 or 9.6 shall only by due on those Products Covered by a Valid
Claim within the Altus Patent Rights or Valid Claim of Patent Rights within
Joint Collaboration Technology, or which uses or embodies Altus Know-How.

     9.8 Royalties. In each Calendar Quarter during the Royalty Term in which
Genentech records Net Sales of a Product, and subject to and in accordance with
the terms and conditions of this Agreement, Genentech shall pay royalties to
Altus at the time it issues each Royalty Report as calculated according to this
Section 9.8 (such amounts, the "Royalties").

          9.8.1 North American Territory Covered by Valid Altus Patent Claim.
Genentech shall pay Altus Royalties on annual Net Sales of Products in the North
American Territory Covered by a Valid Claim within the Altus Patents as follows:

<TABLE>
<CAPTION>
   CALENDAR YEAR NET SALES OF PRODUCTS                 ROYALTY RATE
           (IN U.S. $ MILLIONS)             AS A PERCENTAGE OF SUCH NET SALES
   -----------------------------------      ---------------------------------
<S>                                         <C>
        Up to and including [***]                         [***]
Above [***] and up to and including [***]                 [***]
Above [***] and up to and including [***]                 [***]
Above [***] and up to and including [***]                 [***]
               Above [***]                                [***]
</TABLE>

For example, if, during a Calendar Year Net Sales of Products Covered by a Valid
Claim within the Altus Patents were equal to [***], the Royalties payable by
Genentech under this Section 9.8.1 would be calculated by adding (a) the royalty
with respect to the first [***] at the first level percentage of [***], (b) the
royalty with respect to the next [***] at the second level percentage of [***],
(c) the royalty with respect to the next [***] at the third level percentage of
[***], (d) the royalty with respect to the next [***] at the fourth level
percentage of [***] and (e) the royalty with respect to the final [***] at the
fifth level percentage of [***], for total Royalties of [***].

          9.8.2 Option Territory Covered by Valid Altus Patent Claim. Provided
that Genentech exercises the Genentech Option under Section 2.1.1,Genentech
shall pay Altus Royalties on annual Net Sales of Products in the Option
Territory Covered by a Valid Claim within the Altus Patents as follows:

<TABLE>
<CAPTION>
   CALENDAR YEAR NET SALES OF PRODUCTS                 ROYALTY RATE
           (IN U.S. $ MILLIONS)             AS A PERCENTAGE OF SUCH NET SALES
   -----------------------------------      ---------------------------------
<S>                                         <C>
        Up to and including [***]                         [***]
Above [***] and up to and including [***]                 [***]
               Above [***]                                [***]
</TABLE>

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

                                      -28-

<PAGE>

          9.8.3 Licensed Territory Covered by Valid Joint Collaboration
Technology Claim. Genentech shall pay Altus Royalties on annual Net Sales of
Products in the Licensed Territory Covered by a Valid Claim of a Patent Right
within the Joint Collaboration Technology as follows:

<TABLE>
<CAPTION>
   CALENDAR YEAR NET SALES OF PRODUCTS                 ROYALTY RATE
           (IN U.S. $ MILLIONS)             AS A PERCENTAGE OF SUCH NET SALES
   -----------------------------------      ---------------------------------
<S>                                         <C>
        Up to and including [***]                         [***]
Above [***] and up to and including [***]                 [***]
               Above [***]                                [***]
</TABLE>

          9.8.4 Know-How Royalty. Genentech shall pay Altus Royalties on annual
Net Sales in the Licensed Territory of Products that use or embody Altus
Know-How as follows:

<TABLE>
<CAPTION>
   CALENDAR YEAR NET SALES OF PRODUCTS                 ROYALTY RATE
           (IN U.S. $ MILLIONS)             AS A PERCENTAGE OF SUCH NET SALES
   -----------------------------------      ---------------------------------
<S>                                         <C>
        Up to and including [***]                         [***]
Above [***] and up to and including [***]                 [***]
               Above [***]                                [***]
</TABLE>

          9.8.5 Royalty Term. Genentech's obligation to pay Altus Royalties
under (a) Section 9.8.1, 9.8.2, 9.8.3, as applicable, are payable only during
time periods in which the applicable Product is Covered by a Valid Claim within
the Altus Patents or Patent Rights within the Joint Collaboration Technology (as
applicable) in the applicable country, and (b) Section 9.8.4, if applicable,
shall expire no later than [***] the First Commercial Sale of the applicable
Product that utilizes or incorporates Altus Know-How in the applicable country
(as applicable, the "Royalty Term"). [***].

          9.8.6 Single Royalty. Notwithstanding anything herein to the contrary,
with respect to any Product only a single royalty payment shall be due and
payable, regardless if such Product is Covered by more than one Valid Claim. In
the event that more than one royalty rate described in this Section 9.8 apply to
a Product, only the highest applicable royalty rate shall apply.

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     9.9 Royalties to Genentech. In each Calendar Quarter in which Altus, an
Altus Affiliate or permitted sublicensee of Altus records Net Sales of any
product utilizing any [***] or [***], Altus shall pay royalties to Genentech at
the time it issues each Royalty Report as calculated according to this Section
9.9 (such amounts also "Royalties").

          9.9.1 [***]. Altus shall pay Genentech a royalty of [***] of annual
Net Sales of products, the making, using, selling, offering for sale, or import
of which would infringe a Valid Claim of a Patent Right within the [***].

          9.9.2 [***]. Altus shall pay Genentech a royalty of [***] of annual
Net Sales of products, the making, using, selling, offering for sale, or import
of which would infringe a Valid Claim of a Patent Right within the [***].

          9.9.3 Single Royalty. In the event that more than one royalty rate
described in this Section 9.9 apply to a product, only the highest applicable
royalty rate shall apply.

     9.10 Deductions from Payments.

          9.10.1 Generally. If in Genentech's [***] it is necessary or
reasonable [***] in order for Genentech, its Affiliates, or a sublicensee [***]
herein, or Genentech, its Affiliates, or a sublicensee [***] any Third Party
(including in connection with [***]) any [***] in connection with the
manufacture, use, sale, offer for sale or import of a Product, Genentech shall
have the right to set [***] of any [***] to such [***] (other than amounts
[***]), including [***], against any royalty payment payable to Altus hereunder;
provided that as a result of such offset the royalties otherwise payable to
Altus (i) pursuant to Sections 9.8.1 or 9.8.2 shall not be reduced below [***]
of applicable Net Sales and (ii) pursuant to Section 9.8.3 or 9.8.4 shall not be
reduced by greater than [***] of the royalties otherwise payable to Altus under
such Sections.

          9.10.2 Exceptions.

          (a) [***].

          (b) [***].

          9.10.3 [***].

          9.10.4 Rights are Cumulative. The rights of offset set forth in this
Section 9.10 shall be in addition to, and not in lieu of, any other rights or
claims either Party may have under this Agreement or otherwise.

     9.11 Reporting of Net Sales. Within [***] after the end of each Calendar
Quarter in which a Royalty is required to be paid, the paying Party shall submit
to the other Party a written report (each a "Royalty Report") setting forth for
such Calendar Quarter the following information: (i) total Net Sales of all
Products sold in the Licensed Territory during such Calendar Quarter, (ii) Net
Sales on a country-by-country basis, (iii) the exchange rate used to convert Net
Sales from the currency in which they are earned to United States dollars; and
(iv) the total royalty payments due. Within [***] after the end of each Calendar
Quarter in which a

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Royalty is required to be paid, the paying Party shall submit to the other Party
an informal written report setting forth for such Calendar Quarter its unaudited
estimate of the foregoing information.

     9.12 Altus Co-Promotion Costs. Commencing on the date of Altus's exercise
of its Co-Promotion option as set forth in Section 7.2, and for a period of
[***] after the First Commercial Sale of a Product in the Co-Promote Territory
(the "Initial Co-Promotion Period"), Genentech shall reimburse Altus for the
[***] Altus Sales Representatives, [***], that are dedicated by Altus to the
Co-Promotion of Products in the Co-Promote Territory within [***] the receipt by
Genentech of an invoice for such and a supporting report detailing the names of
each Altus Sales Representative and [***] for the completed Calendar Quarter.
The invoice amount shall be computed at the [***] multiplied by the number of
[***] reported by Altus as Sales Representatives during the invoice period, up
to the maximum number of Altus Sales Representatives determined pursuant to
Section 7.4. Altus shall provide Genentech with any such invoice within [***]
the end of each Calendar Quarter. Altus may elect to continue to Co-Promote
Products in the Co-Promote Territory beyond the Initial Co-Promotion Period at
entirely its own cost and expense, such election to be made by Altus in writing
no later than [***] prior to expiry of the Initial Co-Promotion Period. In the
event that Altus elects to continue to Co-Promote Products in the Co-Promote
Territory beyond the Initial Co-Promotion Period, the Parties may discuss
financial consideration due to Altus for its continued Co-Promotion of Products
in the Co-Promote beyond the Initial Co-Promotion Period; provided that any such
financial consideration shall be subject to approval of the Steering Committee.

     9.13 Commercial Expenses. If Genentech requests Altus's assistance with
commercialization activities in the Licensed Territory beyond the Co-Promotion
activities set forth in ARTICLE VII, and Altus agrees to provide such
assistance, Genentech shall pay Altus for those costs and expenses incurred by
Altus and approved in advance in writing by Genentech [***] the receipt by
Genentech of an invoice for such expenses. Altus shall only provide Genentech
with any such invoice [***] the end of each Calendar Quarter.

     9.14 Books and Records; Audit Rights. Each Party shall keep and maintain
(in conformity with the Accounting Standards), for a period of [***] following
the end of a Calendar Year, complete and accurate records to enable Royalties,
Development Costs, and reimbursement for Altus Sales Representatives to be
determined. Each Party shall have the right, once per Calendar Year and not more
frequently than once with respect to records covering any specific period of
time, at its own expense, to have an independent, certified public accounting
firm, acceptable to the other Party review any such records in the location(s)
where such records are maintained by such Party upon reasonable notice (which
shall be no less than [***] prior written notice) and during regular business
hours for the sole purpose of verifying the basis and accuracy of payments of
Royalties or the calculation of Development Costs or reimbursement for Altus
Sales Representatives within the [***] as of the date of the request for review.
Prior to any review, the independent certified public accounting firm shall have
entered into a written agreement with the Party whose records are subject to
review limiting the use of such records to verification of the accuracy of
payments due under this Agreement and prohibiting the disclosure of any
information contained in such records to a Third Party for any purpose and to
the other Party for a purpose other than as set forth in this Section 9.14. The
report of such accounting

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firm shall be limited to a certificate stating whether any report made or
payment submitted by Genentech, or invoice of Development Costs or reimbursement
for Altus Sales Representatives by Altus, during such period is accurate or
inaccurate and the actual amounts of Royalties due for such period, or actual
Development Costs or appropriate reimbursement to Altus for the costs of its
Sales Representatives. The Party whose records are being reviewed shall receive
a copy of each such report of the independent certified public accountant prior
to such report being provided to the other Party. After review of the certified
public accounting firm's report, each Party shall promptly pay any uncontested,
understated amounts due to the other Party. In the event of a dispute regarding
such amounts, one finance representative of each Party shall meet and attempt in
good faith to resolve any such dispute. Any overpayment made by a Party shall be
promptly refunded or fully creditable against amounts payable in subsequent
payment periods, at such Party's election. Any review or audit by an independent
certified public accounting firm under this Section 9.14 is to be made at the
expense of the Party requesting such review or audit, except that if the results
of the review reveal that a Party has underpaid or overstated by [***] for the
period under review, then the reasonable audit fees shall be paid by the Party
whose records were reviewed.

     9.15 Confidentiality. The Parties agree that all information provided in a
Royalty Report, all records kept by a Party under Section 9.14, and any
information provided by the independent certified public accounting firm to a
Party are Confidential Information of the Party whose records were reviewed
pursuant to Section 9.14.

     9.16 Payment Type. All payments due under this Agreement shall be paid in
immediately available funds by wire transfer to a United States based account to
be identified by the payee.

     9.17 Taxes. Each Party shall comply with Laws regarding filing and
reporting for income tax purposes. Neither Party shall treat their relationship
under this Agreement as a pass through entity for tax purposes. All payments
made under this Agreement shall be free and clear of any and all taxes, duties,
levies, fees or other charges, except for withholding taxes. Each Party shall be
entitled to deduct from its payments to the other Party under this Agreement the
amount of any withholding taxes required to be withheld, to the extent paid to
the appropriate Governmental Authority on behalf of the other Party (and not
refunded or reimbursed). Each Party shall deliver to the other Party, upon
request, proof of payment of all such withholding taxes. Each Party shall
provide reasonable assistance to the other Party in seeking any benefits
available to such Party with respect to government tax withholdings by any
relevant Law or double tax treaty.

     9.18 Currency Denomination. With respect to amounts invoiced in United
States Dollars, all corresponding Royalties shall be expressed in United States
Dollars. With respect to amounts invoiced in a currency other than United States
Dollars, all corresponding Royalties shall be expressed both in the currency in
which the amount was invoiced and in the United States Dollar equivalent. The
United States Dollar equivalent shall be calculated using the conversion rate
reported by Reuters Ltd. on for the last day of the Calendar Quarter for which
such payment is being determined.

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     9.19 Blocked Payments. If by reason of Laws in any country in the Licensed
Territory or Option Territory, the prompt remittance of milestone payments,
Royalties or other payments to a Party under this Agreement is prevented, the
paying Party shall promptly notify the other Party. During any such period
described above, milestone payments, Royalties or other payments shall continue
to accrue, and shall continue to be reported, until such time payment can be
made through any lawful means or methods that may be available as the Parties
shall reasonably determine.

     9.20 Late Payments. Each Party shall pay interest to the other Party on the
aggregate amount of any payment that is not paid on or before the date such
payment is due from the date due at [***] on the last Business Day of the
applicable Calendar Quarter prior to the date on which such payment is due, plus
[***], calculated on the basis of a 360-day year.

     9.21 Rights Regarding Consolidation of Financial Data. With a view toward
compliance with the currently in effect Accounting Standards, if, at any time
during the term of this Agreement, compliance with any term or condition of this
Agreement would, [***], require Genentech to consolidate Altus within
Genentech's financial statements, then upon Genentech's request, Altus shall
provide to Genentech (a) Altus's unaudited quarterly consolidated financial
statements, prepared in accordance with Accounting Standards (i.e., balance
sheet, income statement and statement of cash flows) [***] after the end of each
Calendar Quarter, and (b) subject to the obligations under ARTICLE XV, Altus's
[***] results for a given Calendar Quarter, based on its [***] estimates, no
earlier than [***] prior to, and no later than [***] prior to, the close of such
calendar quarter. [***]. The Parties shall cooperate with respect to each
Party's compliance with this Section 9.21 and the purpose underlying this
Section 9.21. Further, if Genentech invokes this Section 9.21, Genentech agrees
to provide Altus an unaudited estimated Royalty Report [***] after the end of
each Calendar Quarter in order to facilitate Altus's compliance with this
Section 9.21.

                                    ARTICLE X
         INTELLECTUAL PROPERTY OWNERSHIP, PROTECTION AND RELATED MATTERS

     10.1 Ownership of Inventions.

          10.1.1 Altus Technology. As between the Parties, Altus will solely own
all right, title and interest in and to the Altus Technology, subject to the
rights and licenses granted in ARTICLE II.

          10.1.2 Genentech Technology. As between the Parties, Genentech will
solely own all right, title and interest in and to the Genentech Technology,
subject to the rights and licenses granted in ARTICLE II.

          10.1.3 Collaboration Technology.

          (a) Genentech Collaboration Technology. As between the Parties,
Genentech will solely own all right, title and interest in and to all
Collaboration Technology conceived or

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created solely by Genentech and/or its respective employees, contractors or
consultants, or by a Genentech Affiliate, sublicensee or Third Party and which
Collaboration Technology is Controlled by Genentech, ("Genentech Collaboration
Technology"), subject to the rights and licenses granted in ARTICLE II.

          (b) Joint Collaboration Technology. The Parties shall jointly own all
Collaboration Technology conceived or created [***] ("Joint Collaboration
Technology"), subject to the rights and licenses granted in ARTICLE II. Subject
to the licenses granted by one Party to the other under this Agreement, each
Party retains full ownership rights (including as provided under 35 U.S.C.
Section 262) in and to such Joint Collaboration Technology, for any field, and
including the right to license and sublicense, and to freely exploit, transfer
or encumber its ownership interest, without the consent of, or payment or
accounting to, the other Party. Each Party hereby waives any right it may have
under the Laws of any jurisdiction to require such payment, accounting, or
consent with respect to Joint Collaboration Technology. Each Party shall
cooperate with the other Party to effectuate ownership of any Joint
Collaboration Technology, including as set forth in Section 10.1.4.

          10.1.4 Further Assurances.

          (a) Altus. Altus shall require all of its employees, and use its best
efforts to require its contractors and agents, and any Affiliates and Third
Parties working on its behalf under this Agreement (and their respective
employees, contractors and agents), to assign to Altus and/or Genentech (as
required by this Agreement, including Section 10.1.3(b)) any Altus Technology
and Collaboration Technology.

          (b) Genentech. Genentech shall require all of its employees, and use
its best efforts to require its contractors and agents, and any Affiliates and
Third Parties working on its behalf under this Agreement (and their respective
employees, contractors and agents), to assign to Genentech and/or Altus (as
required by this Agreement) any Collaboration Technology.

          (c) Cooperation. The Parties shall cooperate with each other to
effectuate ownership of any intellectual property rights as set forth in this
Agreement, including, but not limited to, by executing and recording documents.

     10.2 Disclosure of Inventions. Each Party shall promptly disclose to the
other Party any [***]. Genentech shall disclose to Altus any [***]. The Altus
Patents as of the Effective Date are listed on Schedule 1.1.10, and during the
Term, Altus shall, on at least a Calendar Quarterly basis, provide Genentech
with an updated Schedule 1.1.10 accurately reflecting all Altus Patents, and the
status thereof, as of the current date.

     10.3 Other Inventions. During the Term of this Agreement, inventions may be
made by employees of either Party, solely or jointly, which are not
Collaboration Technology ("Other Inventions"). As between the Parties, Altus
shall own all Other Inventions made by its employees solely or jointly with
Third Parties, and Genentech shall own all Other Inventions made by its
employees solely or jointly with Third Parties. As between the Parties, all
Other Inventions made jointly by employees of Altus and Genentech will be owned
jointly by Altus and Genentech ("Joint Other Inventions"). Subject to the
licenses granted by one Party to the

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other under this Agreement, each Party retains full ownership rights (including
as provided under 35 U.S.C. Section 262) in and to Joint Other Inventions, for
any field, and including the right to license and sublicense, and to freely
exploit, transfer or encumber its ownership interest, without the consent of, or
payment or accounting to, the other Party. Each Party hereby waives any right it
may have under the Laws of any jurisdiction to require such payment, accounting,
or consent with respect to Joint Other Inventions. Each Party shall cooperate
with the other Party to effectuate ownership of any Joint Other Inventions. Each
Party at its sole discretion and responsibility may file, prosecute and maintain
patent applications and patents covering solely owned Other Inventions and the
Parties shall be jointly responsible as agreed to between the Parties for
filing, prosecuting and maintaining patent applications and patents covering
Joint Other Inventions.

     10.4 Treatment of Patent Rights and Know-How of Acquired Party.
Notwithstanding anything in this Agreement to the contrary, Patents Rights and
Know-How (i) initially owned or controlled by a Third Party, (ii) developed
independent of this Agreement and any Confidential Information, Altus
Technology, Genentech Technology and Collaboration Technology, and (iii) which
become Controlled by a Party as a result of such Party acquiring ownership or
control of such Patent Rights and Know-How in connection with the acquisition of
all or substantially all of such Third Party's outstanding voting equity or
assets ("Acquired Patent Rights and Know-How"), shall not become subject to
rights and obligations set forth in this Agreement; provided that, the foregoing
exclusion shall not apply to Acquired Patent Rights and Know-How that
specifically relate to either a Product or that would be infringed by the
making, using, selling, offering for sale, or import of a Product.

     10.5 Prosecution and Maintenance of Patent Rights.

          10.5.1 Definition. For the purposes of this Section, "Prosecution" or
"Prosecute" with regard to a particular Patent Right shall mean the preparation,
filing, prosecution, and maintenance, including any re-issues or
re-examinations, interferences, opposition proceedings, revocation actions or
the like, with respect to such Patent Right.

          10.5.2 Altus Patents. As between the Parties, Altus shall, at its sole
discretion and expense, have the right (but not the obligation) to Prosecute
Patents Rights within the Altus Technology.

          10.5.3 Genentech Technology. As between the Parties, Genentech shall,
at its sole discretion and expense, have the right (but not the obligation) to
Prosecute Patent Rights within the Genentech Technology and Genentech
Collaboration Technology.

          10.5.4 Joint Collaboration Technology. Subject to the provisions of
this Section 10.5.4 (including Section 10.5.4(d)), Altus and Genentech shall
select a mutually upon agreed outside counsel ("Outside Patent Counsel") to be
responsible for the Prosecution of Patent Rights within the Joint Collaboration
Technology.

          (a) Filing of Applications. Should a Party wish to file a patent
application covering any Joint Collaboration Technology, it shall inform the
other Party. With respect thereto, Genentech shall engage Outside Patent Counsel
to Prosecute Patent Rights to such Joint

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Collaboration Technology. With respect to any patent application claiming Joint
Collaboration Technology, Outside Patent Counsel shall be instructed to provide
to each Party a copy of any such patent application for review and comment by
the Parties, and such Outside Patent Counsel shall be instructed to reasonably
consider the comments of both Parties with respect thereto.

          (b) Review and Comment. With respect to Patent Rights within the Joint
Collaboration Technology, the Outside Patent Counsel shall be instructed to (i)
keep the Parties informed as to the Prosecution (including those involving in
which countries to initiate or continue prosecution (including validation), the
question of the scope of, the issuance of, the rejection of, an interference
involving, or an opposition to any such Patent Rights), such that each Party has
sufficient time to review and comment upon any documents intended for submission
to any patent office; (ii) promptly furnish to each Party a copy of any patent
application and copies of documents relevant to such Prosecution, including
copies of correspondence with any patent office, foreign associates, and outside
counsel; and (iii) reasonably consider and incorporate comments of the Parties
on documents filed with any patent office.

          (c) Cooperation. Generally, the Parties shall cooperate with and
assist each in the Prosecution of Patent Rights within the Joint Collaboration
Technology, including (i) consulting with the other Party after receiving any
substantial action or development in the prosecution of any such Patent Rights,
(ii) making scientists and scientific records reasonably available, and (ii)
making reasonably available its respective authorized attorneys, agents or
representatives. In addition, each Party shall sign or use its best efforts to
have signed and delivered, at no charge to the other Party, all documents
necessary in connection with such Prosecution.

          (d) Abandonment of Prosecution and Maintenance. With respect to Patent
Rights within the Joint Collaboration Technology, if Genentech elects not to
Prosecute such Patent Rights (whether worldwide or with respect to any
particular country), including electing not to file a patent application with
respect thereto or to allow any such Patent Rights to lapse or become abandoned
or unenforceable, then Genentech shall promptly notify Altus in writing (which
such notice shall be at least sixty (60) days prior to the lapse or abandonment
of any such Patent Rights). Thereafter, Altus may, but is not required to,
undertake, at its sole expense and in its sole discretion, the Prosecution of
such Patent Rights. In the event that Altus undertakes such Prosecution,
Genentech shall cooperate as set forth in Section 10.5.4(c).

          (e) Costs. Unless otherwise agreed by the Parties and subject to
Section 10.5.4(d), both during and after the Term of this Agreement, all costs
of Prosecuting Patent Rights within the Joint Collaboration Technology shall be
[***].

          (f) Good Faith. Without in any way limiting the foregoing, including
Section 10.5.4(d), the Parties shall use reasonable efforts and act in good
faith to assist and advise the other and the Outside Patent Counsel in
connection with the Prosecution of Patents Rights within the Joint Collaboration
Technology.

          10.5.5 Patent Interferences. If an interference is declared by the
U.S. Patent and Trademark Office (a) between (i) a claim in one or more Patent
Rights within the Altus Patents

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and (ii) a claim in one or more Patent Rights within the Genentech Patents or
Collaboration Technology, where at least one of such claims would, but for the
licenses in this Agreement, be infringed by the making, using, offering for
sale, selling or importing of a Compound, Formulation or Product; then the
Parties shall in good faith establish within thirty (30) days of the declaration
of such interference, or such other time as agreed upon, a mutually agreeable
process to resolve such interference in a reasonable manner (including, without
limitation, control and cost sharing), in conformance with all applicable legal
standards.

     10.6 Inventorship. Any determination of inventorship with respect to any
Patent Rights or Know-How (including any Altus Technology, Genentech Technology,
or Collaboration Technology) shall be resolved in accordance with United States
patent laws.

     10.7 Third Party Infringement.

          10.7.1 Notice. Each Party shall promptly report to the other Party
during the Term any known or suspected infringement of any of the Altus
Technology or Joint Collaboration Technology in the Licensed Territory of which
such Party becomes aware, and shall provide the other Party with all available
evidence supporting such known or suspected infringement or unauthorized use.
Altus shall promptly report to Genentech during the Term any known or suspected
infringement of any of the Genentech Technology or Genentech Collaboration
Technology in the Licensed Territory of which Altus becomes aware, and shall
provide Genentech with all available evidence supporting such known or suspected
infringement or unauthorized use.

          10.7.2 Right to Enforce.

          (a) Altus Technology. Altus shall have the sole and exclusive right,
but not the obligation, to initiate a suit or take other appropriate action that
it believes is reasonably required to prevent or abate actual or threatened
infringement or misappropriation of the Altus Technology outside of the Field or
outside of the Licensed Territory. Subject to Section 10.7.3, Genentech shall
have the first right to initiate a suit or take other appropriate action that it
believes is reasonably required to prevent or abate actual or threatened
infringement or misappropriation of the Altus Technology in the Field in the
Licensed Territory.

          (b) Genentech Technology and Genentech Collaboration Technology.
Genentech shall have the sole and exclusive right, but not the obligation, to
initiate a suit or take other appropriate action that it believes is reasonably
required to prevent or abate actual or threatened infringement or
misappropriation or otherwise enforce the Genentech Technology or Genentech
Collaboration Technology.

          (c) Joint Collaboration Technology. Subject to Section 10.7.3,
Genentech shall have the first right to initiate a suit or take other
appropriate action that it believes is reasonably required to prevent or abate
actual or threatened infringement or misappropriation of the Joint Collaboration
Technology.

          10.7.3 Step-In Right. If Genentech fails to initiate a suit or take
other appropriate action that it has the initial right to initiate or take
pursuant to Section 10.7.2(a) or 10.7.2(c)

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within ninety (90) days after becoming aware of the basis for such suit or
action, then Altus may, in its discretion, provide Genentech with written notice
of Altus's intent to initiate a suit or take other appropriate action. If Altus
provides such notice and Genentech fails to initiate a suit or take such other
appropriate action within thirty (30) days after receipt of such notice from
Altus, then Altus shall have the right to initiate a suit or take other
appropriate action that it believes is reasonably required to prevent or abate
actual or threatened infringement or misappropriation of the Altus Technology or
Joint Collaboration Technology (as applicable).

          10.7.4 Conduct of Certain Actions; Costs. The Party initiating suit
shall have the sole and exclusive right to select counsel for any suit initiated
by it pursuant to Section 10.7.2 or 10.7.3. If required under Law, or otherwise
necessary, in order for the initiating Party to initiate or maintain such suit,
the other Party shall join as a party to the suit. The other Party shall offer
reasonable assistance to the initiating Party in connection therewith at no
charge to the initiating Party except for reimbursement of reasonable
out-of-pocket costs incurred in rendering such assistance. The initiating Party
shall assume and pay all of its own out-of-pocket costs approved in advance and
incurred in connection with any litigation or proceedings initiated by it
pursuant to Section 10.7.2 or 10.7.3, including the fees and expenses of the
counsel selected by it. With respect to any suit initiated pursuant to Section
10.7.3, the other Party shall have the right to participate and be represented
in any such suit by its own counsel at its own expense.

          10.7.5 Settlement. The Party controlling any such action described in
Section 10.7.2 may not settle or consent to an adverse judgment, including any
judgment which affects the scope, validity or enforcement of any Altus
Technology or Joint Collaboration Technology, without the express written
consent of the non-controlling Party (such consent not to be unreasonably
withheld), except that Genentech may settle or consent to an adverse judgment in
any action described in Section 10.7.2(b) without obtaining consent from Altus
unless any such settlement or consent judgment would either impose a financial
obligation upon Altus, or limit the scope of or invalidate any Altus Technology
or Joint Collaboration Technology, in which event Genentech shall obtain Altus's
prior written consent (such consent not to be unreasonably withheld or delayed).

          10.7.6 Recoveries. With respect to any suit or action referred to in
Section 10.7.2(b), any recovery obtained as a result of any such proceeding, by
settlement or otherwise, shall be Genentech's. With respect to any suit or
action referred to in Section 10.7.2(a) and 10.7.2(c), any recovery obtained as
a result of any such proceeding, by settlement or otherwise, shall be applied,
subject to the respective indemnity obligations of the Parties set forth in
ARTICLE XIII, in the following order of priority: (i) first, [***]; (ii) second,
any remainder [***]; provided, however, that [***]; and (iii) third, any
remaining amount [***]. Notwithstanding the foregoing, [***]; provided, however,
that [***].

     10.8 Third Party Suits.

          10.8.1 Against Genentech. In the event that a Third Party shall make
any claim or bring any suit or other proceeding against Genentech, or any of its
Affiliates, sublicensees, or customers, for infringement or misappropriation of
any intellectual property rights with respect to the research, development,
making, using selling, offering for sale, import or export of any

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Compound, Formulation or Product, Genentech shall have the right to defend and
control the defense of such claim, suit or other proceeding as well as to
initiate and control any counterclaim or other similar action. Altus shall fully
cooperate with Genentech in defense of such claim, suit or other proceeding,
including by being joined as a party. Unless otherwise mutually agreed by the
Parties, and subject to the respective indemnity obligations of the Parties set
forth in ARTICLE XIII, the provisions of Sections 10.7.5 and 10.7.6 shall apply
to any proceeding covered by this Section 10.8.1, except that the negotiation of
any license or immunity from suit from the Third Party shall be subject to
Section 9.10.

          10.8.2 Against Altus. In the event that a Third Party shall make any
claim or bring any suit or other proceeding against Altus, or any of its
Affiliates, for infringement or misappropriation of any intellectual property
rights with respect to the development, making, using, or offering for sale of
any Product, Altus shall have the right to defend and control the defense of
such claim, suit or other proceeding. Any counterclaim or other similar action,
to the extent they involve any Genentech Technology, will be treated as
enforcement actions subject to Sections 10.7.2 and 10.7.3. Promptly upon receipt
of notice of any such claim, suit or other proceeding against Altus, Altus shall
provide written notice thereof to Genentech. Upon Genentech's written request,
Altus will discuss cooperation regarding any such claims and/or keep Genentech
informed as to the status of the claim suit or proceeding and defense. Also upon
Genentech's written request, Altus shall permit Genentech to participate in the
defense and settlement of any such claim, suit or proceeding, at its own expense
and as represented by counsel of its own choice. Unless otherwise mutually
agreed by the Parties, and subject to the respective indemnity obligations of
the Parties set forth in ARTICLE XIII, the provisions of Sections 10.7.5 and
10.7.6 shall apply to any proceeding covered by this Section 10.8.2.

     10.9 Patent Term Extensions. The Parties shall cooperate, if necessary and
appropriate, with each other in gaining patent term extensions wherever
applicable to Patent Rights Controlled by either Party that Cover a Product in
the Field in the Licensed Territory. The Parties shall use reasonable efforts to
agree upon a joint strategy relating to patent term extensions, but, in the
absence of mutual agreement with respect to any extension issue in the Licensed
Territory, the Patent Rights or the claims of the Patent Rights shall be
selected on the basis of the scope, enforceability and remaining term of the
Patent Right in the relevant jurisdiction. All filings for such extensions shall
be made by the Party Controlling such Patent Rights or, in the case of Patent
Rights within the Joint Collaboration Technology, by Outside Patent Counsel.

     10.10 Patent Marking. Genentech shall be responsible for complying with
patent marking statutes in each country in the Licensed Territory in which a
Product is sold by Genentech, its Affiliates or its licensees.

     10.11 Certification under Drug Price Competition and Patent Restoration
Act.

          10.11.1 Notice. If a Party becomes aware of any certification filed
pursuant to 21 U.S.C. Section 355(b)(2)(A) (or any amendment or successor
statute thereto) claiming that any Altus Patents, any Genentech Patents or any
Collaboration Patents are invalid or otherwise unenforceable, or that
infringement will not arise from the manufacture, use, import,

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offer for sale or sale of a Product by a Third Party, such Party shall promptly
notify the other Party in writing.

          10.11.2 Control of Response. Control of the response to the
certification shall, as between the Parties, be determined in the same manner as
enforcement rights are determined pursuant to Sections 10.7.2 and 10.7.3, with
the time periods set forth in Section 10.7.3 shortened where necessary to
provide the other Party sufficient time to respond without a loss of rights, and
the non-controlling Party shall cooperate with the controlling Party in the
preparation and formulation of such response, and in taking other steps
reasonably necessary to respond.

                                   ARTICLE XI
                         REPRESENTATIONS AND WARRANTIES

     11.1 Mutual Representations and Warranties. Each of the Parties hereby
represents and warrants to the other that:

          (a) as of the Execution Date, it is duly incorporated under the
relevant Laws of incorporation and each has full corporate authority to enter
into and to perform its obligations under this Agreement;

          (b) as of the Execution Date, this Agreement has been fully
authorized, executed and delivered by it and it has full legal right, power and
authority to enter into and perform this Agreement, which constitutes a valid
and binding agreement between the Parties and that it does not conflict with or
result in a breach of the terms of any agreement, whether written or oral, to
which such Party is a party; and

          (c) as of the Execution Date and during the Term, it follows
reasonable commercial practices common in the industry to protect its
proprietary and confidential information, including requiring its employees,
consultants and agents to be bound in writing by obligations of confidentiality
and non-disclosure, and requiring its employees, consultants and agents to
assign to it any and all inventions and discoveries discovered by such
employees, consultants and/or agents made within the scope of, and during their
employment, and only disclosing proprietary and confidential information to
Third Parties pursuant to written confidentiality and non-disclosure agreements.

     11.2 Additional Representations and Warranties by Altus. Altus warrants and
represents that:

          (a) as of the Execution Date, it solely owns the entire right, title
and interest in the Altus Patents, Altus Know-How and Altus Housemark, free and
clear of all [***];

          (b) as of the Execution Date the rights granted to Genentech hereunder
[***], and during the Term [***] with rights granted by Altus, an Altus
Affiliate, or any Altus sublicense to any Third Party;

          (c) as of the [***], neither Altus nor any of its Affiliates has
received [***];

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          (d) as of the Execution Date, [***], except for Patent Rights expiring
at the end of their statutory terms [***];

          (e) as of the Execution Date, to Altus's knowledge, [***]; and

          (f) to Altus's knowledge as of Execution Date, the Altus Technology
[***].

     11.3 Additional Representations and Warranties by Genentech. Genentech
warrants and represents that, as of the Effective Date, to Genentech's knowledge
[***].

     11.4 DISCLAIMER. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER PARTY HERETO MAKES ANY REPRESENTATION AND EXTENDS NO WARRANTY OF ANY
KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, THE IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, VALIDITY,
NON-INFRINGEMENT AND ALL SUCH OTHER WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED
TO THE FULLEST EXTENT PERMITTED BY LAW.

                                   ARTICLE XII
                              TERM AND TERMINATION

     12.1 Term. This Agreement shall be binding upon the Parties as of the
Execution Date to the extent permitted by the HSR Act, but shall not otherwise
take effect until the Effective Date. The term of this Agreement (the "Term")
shall commence on the Execution Date and, unless earlier terminated as provided
in this ARTICLE XII (the date of any such termination, the "Termination Date"),
shall continue in full force and effect, on a country-by-country and
Product-by-Product basis until there is no remaining royalty or other payment
obligation in such country with respect to such Product, at which time this
Agreement shall expire in its entirety with respect to such Product in such
country and all licenses granted to Genentech under this Agreement with respect
to such Product in such country shall become fully paid-up and irrevocable.

     12.2 Termination for Material Breach. In the event of a material breach of
this Agreement by a Party, the other Party may give the Party in default notice
thereof. If such material breach is not cured [***] after receipt of such notice
([***] if such material breach relates solely to the [***] hereunder), the
notifying Party shall be entitled to those rights of termination set forth in
Section 12.8 (without prejudice to any of its other rights conferred on it by
this Agreement or under Law) by giving written notice to the defaulting Party,
with such termination to take effect immediately. The right of either Party to
terminate this Agreement as set forth in this Section 12.2 shall not be affected
in any way by its waiver of, or failure to take action with respect to, any
previous default. Any dispute regarding an alleged material breach of this
Agreement shall be resolved in accordance with ARTICLE XIV.

     12.3 Other Termination Events.

          (a) Genentech shall have the option to terminate this Agreement, on a
[***], upon [***] prior written notice to Altus if (i) the [***], or (ii) [***],
in each case by delivering

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written notice to Altus that it is terminating this Agreement pursuant to this
provision no later than [***] following the occurrence of an event set forth in
(i) or (ii). If Genentech fails to exercise the termination option within such
[***] period, Genentech's termination option pursuant to this Section 12.3(a)
with respect to such event shall expire and be of no further force or effect.

          (b) If a [***] has [***], Genentech may, upon written [***] prior
written notice to Altus, [***] terminate this Agreement with respect to such
territory; provided that if such [***], Genentech shall have also have the right
to terminate this Agreement [***].

     12.4 Termination for Bankruptcy. Genentech shall have the right to
terminate this Agreement upon written notice to Altus, in the event that Altus
seeks protection of any bankruptcy or insolvency law, a proceeding in bankruptcy
or insolvency is filed by or against Altus and such proceeding remains
undismissed or unstayed for a period of more than [***], or there is an
adjudication by a court of competent jurisdiction that Altus is bankrupt or
insolvent.

     12.5 Termination on Acquisition of Altus. Genentech shall have the right to
[***] this Agreement on any Acquisition of [***] providing Altus with written
notice thereof within [***] of Genentech's receipt of the notice to Genentech
required by Section 16.1(a).

     12.6 Genentech Termination for Convenience. Genentech may terminate this
Agreement, with or without cause, upon [***] advanced written notice to Altus.

     12.7 Termination for Delay in Effective Date. After [***] following the
filing of the "Notification and Report Forms" and related material that it may
be required to file with the Federal Trade Commission and the Antitrust Division
of the United States Department of Justice under the HSR Act ("HSR Filings"),
either Party may terminate this Agreement if the Effective Date has not been
reached within [***] following such HSR Filings; provided that, [***]. Upon
termination of this Agreement pursuant to this Section 12.7 all provisions of
this Agreement shall terminate and be of no force or effect.

     12.8 Consequences of Certain Terminations.

          12.8.1 Altus may terminate this Agreement in accordance with Section
12.2 only for material, uncured breach by Genentech of its diligence obligations
under Section 8.1, its payment obligations under Sections 9.1, 9.4, 9.5, 9.6 and
9.8, its obligations under Section 2.6, 5.3 (to the extent that Altus is
conducting activities under the Development Plan on Genentech's behalf), 6.4
(subject to the terms and conditions therein) or ARTICLE XV, or a representation
or warranty made in Section 11.1(a) or 11.1(b). Upon termination of this
Agreement by Altus in accordance with the preceding sentence, or a termination
by Genentech pursuant to Section 12.6, (i) all rights and licenses granted to
Genentech under Section 2.2 and to Altus under Section 2.3(a), 2.3(b) and 2.3(d)
shall immediately terminate; (ii) upon written request by Altus and subject to
the Termination Royalties set forth in Section 12.9, Genentech shall provide a
Product Reversion Package to Altus to support the continued development and
commercialization of those Products (if any) for which Genentech has undertaken
development or commercialization prior to such termination and to which such
breach or termination applies (each a "Termination Product"); (iii) upon request
by Altus, Genentech shall continue to manufacture and supply to

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Altus for a period of [***] from the date of notice of such termination such
Termination Products (and/or the Compound used therein) that are, as of the date
of such termination, in clinical development or sold commercially, such supply
to be reimbursed by Altus at [***]; and (iv) all Confidential Information of
Altus provided to Genentech under this Agreement shall be returned to Altus or
destroyed, at Altus's option in accordance with Section 15.3. Notwithstanding
anything in this Agreement to the contrary, any license or sublicense granted to
a Third Party outside the United States shall survive termination of this
Agreement under this Section 12.8.1, provided that such sublicensee is in good
standing and agrees to be bound by the provisions of this Agreement applicable
to such sublicensee. Notwithstanding anything in this Agreement to the contrary,
Sections 5.7.1 and 6.4 shall survive a termination of this Agreement by Altus
under this Section 12.8.1.

          12.8.2 Genentech may terminate this Agreement in accordance with
Section 12.2 for any material, uncured breach by Altus. Upon termination of this
Agreement by Genentech in accordance with the preceding sentence, or a
termination by Genentech pursuant to Section 12.4, or Section 12.5, (i) all
rights and licenses granted to Altus under this Agreement (including Sections
2.3(a), 2.3(b), and 2.3(d), but not Section 2.3(c)) shall immediately terminate,
(ii) the rights and obligations of the Parties under the following sections of
this Agreement shall survive such termination: ARTICLE [***], but in all cases
the surviving provisions shall be interpreted to exclude the subject matter of
non-surviving terms, and (iii) all Confidential Information of Genentech, data
and materials provided to Altus under this Agreement shall be returned to
Genentech or destroyed, at Genentech's option, in accordance with Section 15.3.
In the case that the Altus breach that gave rise to termination of this
Agreement was a breach of any of the following provisions: Section [***], then,
in addition to, or notwithstanding, (as the case may be) the foregoing (A) [***]
will not survive such termination; (B) upon the First Commercial Sale of a
Product by Genentech, [***] Sections [***] and [***]; and (C) [***]; and (D) all
right, title and interest in and to any [***].

          12.8.3 Upon termination by Genentech pursuant to Section 12.3, that
Parties shall meet in good-faith to discuss the disposition of any remaining
rights to develop and market Product in the Licensed Territory, which may
include a transfer of rights to continue the development and/or
commercialization of Products to Altus and the payment to Genentech of up-front,
milestone, royalty and other payments.

     12.9 Termination Royalties. Subsequent to termination as described in
Section 12.8.1, in each Calendar Quarter in which Altus records Net Sales of a
Termination Product, Altus shall pay to Genentech, on a Termination
Product-by-Termination Product and country-by-country basis, an amount equal to
(such amounts also "Royalties"):

          12.9.1 [***] of annual Net Sales of Termination Products that are
Covered by a Valid Claim of a Patent Right within the [***] or [***], and for
which, as of the effective date of termination, Genentech [***];

          12.9.2 [***] f annual Net Sales of Termination Products that are
Covered by a Valid Claim of a Patent Right within the [***], and for which, as
of the effective date of termination, Genentech [***];

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          12.9.3 [***] of annual Net Sales of Termination Products that are not
Covered by a Valid Claim of a Patent Right within the [***] or [***], and for
which, as of the effective date of termination, Genentech [***];

          12.9.4 [***] of annual Net Sales of Termination Products that are
Covered by a Valid Claim of a Patent Right within the [***] or [***], and for
which, as of the effective date of termination, Genentech [***];

          12.9.5 [***] of annual Net Sales of Termination Products that are
Covered by a Valid Claim of a Patent Right within the [***], and for which, as
of the effective date of termination, Genentech [***]; and

          12.9.6 [***] of annual Net Sales of Termination Products that are not
Covered by a Valid Claim of a Patent Right within the [***] or [***], and for
which, as of the effective date of termination, Genentech [***].

          12.9.7 Royalty Term. Altus's obligation to pay Genentech Royalties
under Sections 12.9.1, 12.9.2, 12.9.4 and 12.9.5, as applicable, shall only be
during time periods in which the applicable Termination Product is Covered by a
Valid Claim of a Patent Right within the Genentech Technology, Genentech
Collaboration Technology or Joint Collaboration Technology (as applicable) in
the applicable country. For Net Sales of Termination Products not Covered by a
Valid Claim of a Patent Right within the Genentech Technology, Genentech
Collaboration Technology or Joint Collaboration Technology, the royalty payment
obligations under this Section 12.9 shall terminate upon the date that is [***]
from the date of First Commercial Sale of the applicable Termination Product in
the applicable country. For the avoidance of doubt, no Royalties shall be
payable under this Section 12.9 on Net Sales outside of the Licensed Territory
of any Product that Altus has the right to make, use, sell, offer for sale and
import outside of the Licensed Territory as of the applicable Termination Date.

          12.9.8 Single Royalty. In the event that more than one royalty rate
described in this Section 12.9, or in Section 9.9, apply to a Termination
Product, only the highest applicable royalty rate shall apply.

     12.10 Effects of Expiration or Termination; Accrued Rights and Obligations.

          12.10.1 Survival of Liability. Expiration or termination of this
Agreement for any reason shall not release either Party from any liability that,
at the time of such expiration or termination, has already accrued or that is
attributable to a period prior to such expiration or termination, nor preclude
either Party from pursuing any right or remedy it may have hereunder or at Law
or in equity with respect to any breach of this Agreement.

          12.10.2 Survival of Obligations. The rights and obligations set forth
in this Agreement shall extend beyond the Term or termination of this Agreement
only to the extent expressly provided for in this Agreement. In addition to as
set forth in Section 12.8, and without limiting the generality of the foregoing,
it is agreed that the provisions of ARTICLE I, Sections [***], 2.4 and 2.5,
5.7.4, [***], Section 12.8, [***], 12.10 [***], ARTICLE XIV, ARTICLE XV, and
Sections 16.2, 16.3, 16.5, 16.6, 16.8, 16.9, and 16.10 shall survive expiration
or

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termination of this Agreement for any reason, but in all cases shall be
interpreted to exclude the subject matter of non-surviving terms..

                                  ARTICLE XIII
                                 INDEMNIFICATION

     13.1 Indemnification in Favor of Altus. Genentech shall indemnify, defend
and hold harmless the Altus Parties (as hereinafter defined) from and against
any and all Losses arising or resulting from any Third Party claim, action,
suit, or other proceeding (collectively, "Third Party Claims") to the extent
such Losses result from:

          (a) [***]; or

          (b) [***].

     For purposes of this ARTICLE XIII, "Altus Parties" means Altus, its
Affiliates and their respective agents, directors, officers, and employees.

     The indemnification obligations set forth in this Section 14.1 shall not
apply to the extent that any Loss is the result of a breach of this Agreement
(including a breach of any representation or warranty) by Altus or the gross
negligence or willful misconduct of Altus.

     13.2 Indemnification in Favor of Genentech. Altus shall indemnify, defend
and hold harmless the Genentech Parties (as hereinafter defined) from and
against any and all Losses arising or resulting from any Third Party Claim, to
the extent such Losses result from:

          (a) any breach of any representation or warranty made by Altus in this
Agreement; or

          (b) the activities performed by or on behalf of Altus in connection
with the exercise of its licenses and rights under this Agreement.

     For purposes of ARTICLE XIII, "Genentech Parties" means Genentech, its
Affiliates and their respective agents, directors, officers, and employees.

     The indemnification obligations set forth in this Section 13.2 shall not
apply to the extent that any Loss is the result of a breach of this Agreement
(including a breach of any representation or warranty) by Genentech or the gross
negligence or willful misconduct of Genentech.

     13.3 Indemnification Procedures. If a Party intends to claim
indemnification under this ARTICLE XIII ("Indemnified Party"), it shall promptly
notify the other Party (the "Indemnifying Party") in writing of such alleged
Losses. The Indemnifying Party shall have the right to control the defense
thereof with counsel of its choice as long as such counsel is reasonably
acceptable to the Indemnified Party; provided, however, that any Indemnified
Party shall have the right to retain its own counsel at its own expense for any
reason. The Indemnified Party, its employees and agents, shall reasonably
cooperate with the Indemnifying Party and its

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legal representatives in the investigation or defense of any Losses or Third
Party Claims covered by this ARTICLE XIII. The failure to deliver written notice
to the Indemnifying Party within a reasonable time after the commencement of any
such action, to the extent prejudicial to its ability to defend such action,
shall relieve the Indemnifying Party of any obligation to the Indemnified Party
under this Section 13.3. It is understood that only Altus or Genentech may claim
indemnity under this ARTICLE XIII (on its own behalf or on behalf of its Altus
Parties or Genentech Parties, respectively), and Altus Parties or Genentech
Parties may not directly claim indemnity hereunder.

     13.4 Settlement. No compromise or settlement of any Third Party Claim may
be effected by the Indemnifying Party without the Indemnified Party's written
consent (which consent shall not be unreasonably withheld or delayed), unless
(i) there is no finding or admission of any violation of Law or any violation of
the rights of any person and no effect on any other claims that may be made
against the Indemnified Party, (ii) the sole relief provided is monetary damages
that are paid in full by the Indemnifying Party, and (iii) the Indemnified
Party's rights under this Agreement are not adversely affected. In any event,
the Indemnified Party shall have no right to settle any such Third Party Claim
without the prior written consent of the Indemnifying Party, unless (a) there is
no finding or admission of any violation of Law or any violation of the rights
of any person and no effect on any other claims that may be made against the
Indemnifying Party, (b) the sole relief provided is monetary damages that are
paid in full by the Indemnified Party, and (c) the Indemnifying Party's rights
under this Agreement are not adversely affected; any settlement under this
Section 13.4 without the prior written consent of the Indemnifying Party shall
relieve the Indemnifying Party of its obligations under this ARTICLE XIII.

     13.5 Insurance.

          13.5.1 Coverage. Each Party shall maintain, at its own cost, the
insurance coverages set forth in this Section 13.5.1; provided, however, that
Genentech has the right, in its sole discretion, to self-insure in part or in
whole for any such coverage.

          (a) Commencing no later than thirty days following the Execution Date,
and thereafter for the period of time required under Section 13.5.2, each Party
shall obtain and maintain on an ongoing basis, (i) Commercial General Liability
insurance, including contractual liability, in the minimum amount of [***] per
occurrence, combined single limit for bodily injury and property damage
liability, and (ii) Products Liability insurance, including contractual
liability, in the minimum amount of [***] per occurrence, combined single limit
for bodily injury and property damage liability.

          (b) Commencing no later than submission of the first Approval
Application for a Product in the Licensed Territory, and thereafter for the
period of time required under Section 13.5.2, each Party shall obtain and
maintain on an ongoing basis, (i) Commercial General Liability insurance,
including contractual liability, in the minimum amount of [***] per occurrence,
combined single limit for bodily injury and property damage liability, and (ii)
Products Liability insurance, including contractual liability, in the minimum
amount of [***] per occurrence, combined single limit for bodily injury and
property damage liability. No later than

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[***] following submission of the first Approval Application for a Product in
the Licensed Territory, Altus shall provide to Genentech a certificate
evidencing all such coverage required hereunder.

          13.5.2 Additional Requirements. Except to the extent that Genentech
self-insures as authorized under Section 13.5.1, the following provisions apply:

          (a) All insurance coverages shall be primary insurance with respect to
each Party's own participation under this Agreement, and shall be maintained
with an insurance company or companies having an [***].

          (b) [***].

          (c) The insurance policies shall be under an occurrence form, but if
only a claims-made form is available to a Party, then in such a case, such Party
shall maintain the insurance coverage for at least [***] following such Party's
completing performance of its obligations under this Agreement.

          (d) Each Party shall provide to the other Party its respective
certificates of insurance evidencing the insurance coverages set forth in
Section 13.5.1. Each Party shall provide to the other Party at least [***] prior
written notice of any cancellation, non-renewal or material change in any of the
insurance coverages. Each Party shall, upon receipt of written request from the
other Party, provide renewal certificates to the other Party for as long as such
Party is required to maintain insurance coverages hereunder.

     13.6 LIMITATION OF DAMAGES. NEITHER PARTY HERETO WILL BE LIABLE FOR
INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES,
INCLUDING LOST PROFITS, ARISING FROM OR RELATING TO THIS AGREEMENT, REGARDLESS
OF ANY NOTICE OF SUCH DAMAGES. NOTHING IN THIS SECTION 13.6 IS INTENDED TO LIMIT
OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF EITHER PARTY UNDER THIS
AGREEMENT.

                                  ARTICLE XIV
                               DISPUTE RESOLUTION

     14.1 Resolution of Disputes.

          (a) Any dispute, controversy or claim related to matters within the
powers and authority of the Steering Committee or any JPT shall be resolved by
the Parties in accordance with the procedures set forth in ARTICLE III and as
otherwise set forth in this Agreement.

          (b) Except as set forth in Section 14.3 and subject to Section
14.1(a), any dispute, controversy or claim related to compliance with the terms
of this Agreement, or the validity, breach, termination or interpretation of
this Agreement, shall first be referred to the Steering Committee for
resolution. If the Steering Committee is unable to resolve the matter within
[***] after referral, such dispute, controversy or claim shall be referred to
senior

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<PAGE>

executives (of at least the Senior Vice President level) of Altus and Genentech
(or their respective designee) for resolution. In the event the senior
executives are unable to resolve the matter within [***] after referral, such
dispute, controversy or claim shall be resolved through binding arbitration
pursuant to Section 14.2.

     14.2 Arbitration. In the event that the senior executives are unable to
resolve any dispute, controversy or claim between the Parties referred to them
pursuant to Section 14.1(b) arising out of or in connection with compliance with
this Agreement, or the validity, breach, termination or interpretation of this
Agreement, the dispute, controversy or claim shall, at the request of either
Party, be finally settled by binding arbitration as follows:

          (a) A Party may submit such dispute to arbitration by notifying the
other Party in writing of such dispute. Within [***] after receipt of such
notice, each Party shall select one (1) arbitrator, and the two (2) arbitrators
so selected shall choose a third arbitrator. All three (3) arbitrators shall
serve as neutrals and have at least ten (10) years of (i) dispute resolution
experience (including judicial experience) or (ii) legal or business experience
in the biotech or pharmaceutical industry. In any event, at least one (1)
arbitrator shall satisfy the foregoing experience requirement under clause (ii).
If a Party fails to nominate its arbitrator, or if the Parties' arbitrators
cannot agree on the third arbitrator, the necessary appointments shall be made
in accordance with the Commercial Arbitration Rules of the American Arbitration
Association (the "AAA"). Once appointed by a Party, such Party shall have no ex
parte communication with its appointed arbitrator.

          (b) Any arbitration proceedings shall be conducted in [***]. The
arbitration proceedings and all pleadings and written evidence shall be in the
English language. Any written evidence originally in another language shall be
submitted in English translation accompanied by the original or a true copy
thereof. Each Party agrees to use reasonable efforts to make all of its current
employees available, if reasonably needed, and agrees that the arbitrators may
deem any party as "necessary."

          (c) Within [***] after the designation of the arbitrators, the
arbitrators and the Parties shall meet, at which time the Parties shall be
required to set forth in writing all disputed issues and a proposed ruling on
the merits of each such issue. The arbitrators shall set a date for a hearing,
which shall be no later than thirty (30) days after the submission of written
proposals, to discuss each of the issues identified by the Parties. The Parties
shall have the right to be represented by counsel. Except as provided herein,
the arbitration shall be governed by the Commercial Arbitration Rules of the
AAA.

          (d) The arbitrators shall be instructed and required to render a
written, binding, non-appealable resolution and award on each issue that clearly
states the basis upon which such resolution and award is made. The written
resolution and award shall be delivered to the Parties as expeditiously as
possible, but in no event more than [***] after conclusion of the hearing,
unless otherwise agreed by the Parties. The determination of the arbitrators as
to the resolution of any dispute shall be binding and conclusive upon the
Parties.

          (e) Unless the arbitrators determine that matters of equity or justice
suggest otherwise, the Parties agree that (i) they shall share equally the fees
and expenses of the

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<PAGE>

arbitrators and (ii) each Party shall bear its own attorneys' fees and
associated costs and expenses.

          (f) Any arbitration award may be entered in and enforced by any
competent court or application may be made to any competent court for judicial
acceptance of such an award.

          (g) Each Party agrees that, notwithstanding any provision of Law or of
this Agreement, it will not request, and the arbitrators shall have no authority
to award, punitive or exemplary damages against any Party.

          (h) At the request of either Party, the arbitrators shall enter an
appropriate protective order to maintain the confidentiality of information
produced or exchanged in the course of the arbitration proceedings. The
arbitrators shall have the power to decide all questions of arbitrability.

     14.3 Subject Matter Exclusions. Notwithstanding anything in Section 14.2 to
the contrary, any dispute, controversy or claim that involves the validity or
infringement of any Patent Right (a) that is issued in the United States shall
be subject to actions before the United States Patent and Trademark Office
and/or submitted exclusively to the federal court located in the jurisdiction of
the district where any of the defendants resides; and (b) that is issued in any
other country shall be brought before an appropriate regulatory or
administrative body or court in that country, and the Parties hereby consent to
the jurisdiction and venue of such courts and bodies. Further, the provisions of
Section 14.2 shall not apply to any dispute, controversy or claim relating to
any antitrust, anti-monopoly or competition law or regulation, whether or not
statutory.

     14.4 Continued Performance. Provided the Agreement has not terminated, the
Parties agree to continue performing under the Agreement in accordance with its
provisions, pending the final resolution of any arbitration proceeding, and,
without limiting the foregoing, shall continue to cooperate and participate as
set forth in this Agreement.

     14.5 No Limitation. Nothing in ARTICLE XIV shall be construed as limiting
in any way the right of a Party to seek a temporary restraining order,
preliminary injunction or other interim or conservatory relief without breaching
these arbitration provisions and without abridging the powers of the
arbitrators.

                                   ARTICLE XV
                                 CONFIDENTIALITY

     15.1 Non-use and Non-disclosure of Confidential Information. During the
Term, and for a period of [***] thereafter, a Party shall (i) except to the
extent permitted by this Agreement, keep confidential and not disclose to any
Third Party any Confidential Information of the other Party; (ii) except for
purposes of this Agreement, not use for any purpose any Confidential Information
of the other Party; and (iii) take all reasonable precautions to protect the

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<PAGE>

Confidential Information of the other Party (including without limitations, all
precautions a Party employs with respect to its own confidential information of
a similar nature).

     15.2 Authorized Disclosure. Notwithstanding Section 15.1, a Party may use
and disclose Confidential Information belonging to the other Party as follows:

          (a) if required by Law (including without limitation, to comply with
the order of a Governmental Authority or a court of competent jurisdiction);
provided, however, that such Party shall promptly provide written notice thereof
to the other Party, consult with the other Party with respect to such disclosure
and provide the other Party a reasonable opportunity to object to any such
disclosure or to seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this Agreement;

          (b) to the extent such use and disclosure is reasonably required in
the filing, prosecution, maintenance or publication of Patent Rights within the
Genentech Technology or Collaboration Technology;

          (c) as reasonably necessary to obtain or maintain any Marketing
Authorizations, including pricing approvals, for any Products, provided, that,
the such Party shall take all reasonable steps to limit disclosure of the
Confidential Information and to otherwise maintain the confidentiality of the
Confidential Information; or

          (d) to the extent necessary, to its Affiliates, collaborators,
licensees, vendors, consultants, agents, contractors and clinicians under
written agreements of confidentiality at least as restrictive on those set forth
in this Agreement, who have a need to know such information in connection with
such Party performing its obligations or exercising its rights under this
Agreement.

     15.3 Return of Confidential Information. Upon expiration or termination of
the entirety of this Agreement, at the request of the Disclosing Party, the
Receiving Party shall use commercially reasonable efforts to return or destroy
all Confidential Information of the Disclosing Party that remains in the
Receiving Party's possession that is not reasonably necessary to exercise rights
that survive such expiration or termination, except one copy of which may be
retained for archival purposes solely to ensure compliance with the terms of
this Agreement.

     15.4 Equitable Relief. The Parties acknowledge and agree that the
restrictions set forth in this ARTICLE XV are reasonable and necessary to
protect the legitimate interests of the Parties, and that any breach or
threatened breach by a Party of any provision of this ARTICLE XV may result in
irreparable injury to the other Party for which there may be no adequate remedy
at Law. In such event, the other Party shall be authorized and may be entitled
to seek and obtain from any court of competent jurisdiction injunctive relief,
whether preliminary or permanent, specific performance or any other type of
equitable relief available in connection with such breach, in addition to any
other rights or remedies available at Law or in equity.

     15.5 Termination of Prior Agreement. As of the Effective Date, this
Agreement supersedes the Mutual Confidentiality Agreement between the Parties
dated November 16, 2005,

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<PAGE>

(the "Confidentiality Agreement"), but only so far as it relates to the subject
matter of this Agreement. All "INFORMATION" (as defined in such Confidentiality
Agreement) exchanged between the Parties thereunder relating to the subject
matter of this Agreement shall be deemed Confidential Information hereunder and
shall be subject to the provisions of this Agreement.

     15.6 Press Releases and Other Public Disclosures.

          15.6.1 Generally. For purposes of this Section 15.6, a "Disclosure"
means a press release or other public disclosure concerning this Agreement or
the subject matter hereof including, the [***]. Subject to Sections 15.6.2,
15.6.3, and 15.6.4, if a Party desires to make a Disclosure, it shall (i)
provide the other Party with no less than [***] to review and provide comments
on the proposed Disclosure, and (ii) obtain the other Party's prior written
approval for the proposed Disclosure (such approval not to be unreasonably
withheld or delayed). The provisions of this Section 15.6 are in addition to the
provisions of Sections 15.1 and 15.7.

          15.6.2 No Approval Required. The review and approval required under
Section 15.6.1 for a Disclosure shall not apply to Altus's issuance of the press
release attached hereto as Exhibit B.

          15.6.3 Disclosure Required by Law. In the event that one Party
reasonably concludes that a Disclosure is required by Law (including the
disclosure requirements of the Securities and Exchange Commission or the
securities exchange or other stock market on which such Party's securities are
traded (collectively, an "Exchange")) and the other Party would prefer not to
make such Disclosure, the Party seeking such Disclosure shall either (i) [***]
or (ii) [***]. Each Party agrees that it shall obtain its own legal advice with
regard to its compliance with securities laws, rules and regulations, and will
not rely on any statements made by the other Party relating to such securities
laws, rules and regulations.

          15.6.4 Filing of Agreement. With respect to complying with the
disclosure requirements of an Exchange, in connection with any required filing
of this Agreement with such Exchange, the filing Party shall, at the request of
the other Party, seek confidential treatment for portions of this Agreement from
such Exchange and shall provide the other Party with the opportunity, for [***],
to review and comment on any such proposed filing, and shall thereafter provide
reasonable advance notice and opportunity for comment on any subsequent changes
to such filing.

     15.7 Scientific Publications. Notwithstanding Section 15.6, in the event a
Party wishes to publish in a peer review journal or present at a scientific
conference information relating to or arising from this Agreement, such Party
shall submit to the other Party (through the Steering Committee or JPT tasked by
the Steering Committee to review such proposals) the proposed publication or
presentation (including, without limitation, posters, slides, abstracts,
manuscripts, and written descriptions of oral presentations) at least [***] to
the date of submission for publication or the date of presentation, whichever is
earlier, of any of such submitted materials. The other Party shall review such
submitted materials and respond to the submitting Party [***] of receipt
thereof. At the option of the reviewing Party, the submitting Party shall [***].
In the event the reviewing Party does not respond within the period specified
above, the submitting Party will be free to make such proposed publication or
presentation.

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<PAGE>

     15.8 Use of Names. Neither Party shall use the name, symbol and/or logo of
the other Party, its Affiliates and/or employees, agents, or contractors in any
medium or forum without the other Party's prior written consent.

                                  ARTICLE XVI
                                 MISCELLANEOUS

     16.1 Assignment.

          (a) Neither this Agreement nor any rights or obligations hereunder may
be assigned or otherwise transferred, in whole or in part, by Altus to a Third
Party without the prior written consent of Genentech; provided, however, that,
subject to Section 7.8, Altus may assign this Agreement and the whole of its
rights and obligations hereunder without Genentech's consent in connection with
an Acquisition of Altus, provided further that Altus provide Genentech with
[***] prior written notice of such Acquisition. Any purported assignment in
contravention of this Section 16.1 shall, at the option of Genentech, be null
and void and of no effect. Notwithstanding the foregoing, Altus shall not assign
or otherwise transfer to any Affiliate or to any Third Party the ownership of,
or its right in or to, any Altus Technology or Joint Collaboration Technology in
any manner inconsistent with this Agreement or Genentech's exercise of the
rights granted to it under this Agreement.

          (b) Genentech may assign this Agreement or any right or obligation
hereunder [***]. Genentech shall give Altus written notice within [***] after
such assignment.

          (c) No assignment shall release either Party from responsibility for
the performance of any obligation accrued hereunder prior to a permitted
assignment. This Agreement shall be binding upon and enforceable against the
successor to or any permitted assignee of a Party.

     16.2 Entire Agreement; Amendment. This Agreement constitutes the entire
agreement between the Parties with respect to the subject matter of this
Agreement and supersedes all previous agreements, whether written or oral.
Notwithstanding the authority granted to the Steering Committee under this
Agreement, this Agreement may be amended only in writing signed by properly
authorized representatives of each of Genentech and Altus. In the event of a
conflict between the Development Plan or the Commercialization Plan, on the one
hand, and this Agreement, on the other hand, the terms of this Agreement shall
govern.

     16.3 Notices. Except as otherwise expressly provided in the Agreement, all
notices required under this Agreement shall be in writing and shall specifically
refer to this Agreement. Notices shall be sent via one of the following means
and will be effective (a) on the date of delivery, if delivered in person; (b)
on the date of receipt, if sent by a facsimile (with delivery confirmed); or (c)
on the date of receipt, if sent by private express courier or by first class
certified mail, return receipt requested (or its equivalent). Any notice sent
via facsimile shall be followed by a copy of such notice by private express
courier or by first class mail. Notices shall be sent to the other Party at the
addresses set forth below. Either Party may change its addresses for purposes of
this Section 16.3 by sending written notice to the other Party.

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<PAGE>

          if to Altus, to:

               Altus Pharmaceuticals, Inc.
               125 Sidney Street
               Cambridge, Massachusetts 02139
               Attn: General Counsel
               Telephone No.: (617) 299-2900
               Facsimile No.: (617) 299-2999

          if to Genentech, to:

               Genentech, Inc.
               1 DNA Way
               South San Francisco, California 94080-4990
               Attn: Corporate Secretary
               Telephone No.: (650) 225-1000
               Facsimile No.: (650) 467-9146

               with a copy to:

               Genentech, Inc.
               1 DNA Way
               South San Francisco, California 94080-4990
               Attn: VP, Alliance Management and Pipeline Strategy Support
               Telephone No.: (650) 225-1000
               Facsimile No.: (650) 467-3294

     16.4 Counterparts; Facsimile Signatures. This Agreement may be executed in
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original, and all of which counterparts, taken together,
shall constitute one and the same instrument even if both Parties have not
executed the same counterpart. Signatures provided by facsimile transmission
shall be deemed to be original signatures.

     16.5 Relationship of the Parties. Neither Party shall have any
responsibility for the hiring, firing or compensation of the other Party's
employees or for any employee benefits. For all purposes, and notwithstanding
any other provision of this Agreement to the contrary, each Party's legal
relationship under this Agreement to the other Party shall be that of
independent contractor, and nothing herein shall create any association,
partnership, joint venture, fiduciary duty or the relation of principal and
agent between the Parties, and neither Party shall have the authority to bind
the other or the other's representatives in any way.

     16.6 Governing Law. This Agreement shall be governed by and interpreted
under the laws of the State of New York without regard to its conflicts of laws
principles, except for matters of intellectual property which shall be
determined in accordance with U.S. federal patent Laws or the intellectual
property Laws relevant to the intellectual property in question. The United
Nations Conventions on Contracts for the International Sale of Goods, the 1974
Convention on the Limitation Period in the International Sale of Goods (the
"1974 Convention"),

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<PAGE>

the Protocol amending the 1974 Convention, done at Vienna April 11, 1980, and
any other unified Laws relating to the conclusion and implementation of
contracts for the international sale of goods, shall not apply.

     16.7 Force Majeure. If the performance of this Agreement or any obligations
hereunder is prevented, restricted or interfered with by reason of earthquake,
fire, flood or other casualty or due to strikes, riot, storms, explosions, acts
of God, war, or a similar occurrence or condition beyond the reasonable control
of the Parties, the Party so affected shall, upon giving prompt notice to the
other Party, be excused from such performance during such prevention,
restriction or interference, and any failure or delay resulting therefrom shall
not be considered a breach of this Agreement.

     16.8 Severability. If, under Law, any provision of this Agreement is
invalid or unenforceable, or otherwise directly or indirectly affects the
validity of any other material provision(s) of this Agreement (such invalid or
unenforceable provision, a "Severed Clause"), this Agreement shall endure except
for the Severed Clause, provided that such deletion of such Severed Clause does
not alter the basic purpose and structure of this Agreement. The Parties shall
consult one another and use reasonable efforts to agree upon a valid and
enforceable provision that is a reasonable substitute for the Severed Clause in
view of the intent of this Agreement.

     16.9 Waiver. Waiver by a Party of a breach hereunder by the other Party
shall not be construed as a waiver of any succeeding breach of the same or any
other provision. No delay or omission by a Party to exercise or avail itself of
any right, power or privilege that it has or may have hereunder shall operate as
a waiver of any right, power or privilege by such Party. No waiver shall be
effective unless made in writing with specific reference to the relevant
provision(s) of this Agreement and signed by a duly authorized representative of
the Party granting the waiver.

     16.10 No Third Party Beneficiaries. None of the provisions of this
Agreement shall be for the benefit of or enforceable by any Third Party,
including any creditor of either Party.

     16.11 HSR Act. The Parties shall use commercially reasonable efforts to
promptly obtain any clearance required under the HSR Act for the consummation of
this Agreement and the transactions contemplated hereby. Each Party shall
furnish to the other Party reasonably necessary information and reasonable
assistance as the other Party may request in connection with its compliance with
the HSR Act, and any inquiries or requests for additional information in
connection therewith. Genentech shall provide Altus notice of achievement of the
HSR Clearance Date on the HSR Clearance Date or promptly thereafter.

     16.12 CREATE Act. It is the intention of the Parties that this Agreement is
a "joint research agreement" as that phrase is defined in 35 U.S.C. Section
103(c)(3). In the event that either Party to this Agreement intends to overcome
a rejection of a claimed invention within the Collaboration Technology or
Genentech Technology pursuant to the provisions of 35 U.S.C. Section 103(c)(2),
such Party shall first obtain the prior written consent of the other Party.
Following receipt of such written consent, such Party shall limit any amendment
to the specification or statement to the patent office with respect to this
Agreement to that which is strictly required by

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<PAGE>

35 U.S.C. Section 103(c) and the rules and regulations promulgated thereunder
and which is consistent with the terms and conditions of this Agreement
(including the scope of the joint research). To the extent that the Parties
agree that, in order to overcome a rejection of a claimed invention within the
Collaboration Technology or Genentech Technology pursuant to the provisions of
35 U.S.C. Section 103(c)(2), the filing of a terminal disclaimer is required or
advisable, the Parties shall first agree on terms and conditions under which the
patent application subject to such terminal disclaimer and the patent or
application over which such application is disclaimed shall be jointly enforced,
to the extent that the Parties have not previously agreed to such terms and
conditions. In the event that Genentech enters into an agreement with a Third
Party with respect to the further research, development or commercialization of
a Product for the purpose of furthering the Parties' objectives under this
Agreement, Altus shall, upon Genentech's request and concurrence of the Parties
that such agreement is a "joint research agreement" in furtherance of the
Parties' objectives under this Agreement (which concurrence shall not be
unreasonably withheld or delayed), similarly enter into such agreement with the
Third Party for the purposes of furthering the Parties' objectives under this
Agreement, provided that such agreement does not place any material obligation
on Altus.

                            [Signature Page Follows]

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<PAGE>

     IN WITNESS WHEREOF, Altus and Genentech, by their duly authorized officers,
have executed this Agreement as of the Effective Date.

ALTUS PHARMACEUTICALS INC.              GENENTECH, INC.

By: /S/ SHELDON BERKLE                  By: /S/ ARTHUR D. LEVINSON
    ---------------------------------       ------------------------------------
Name: Sheldon Berkle                    Name: Arthur D. Levinson
Title: President and CEO                Title: Chairman and Chief Executive
                                               Officer

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                                      -56-
<PAGE>

                                 SCHEDULE 1.1.10

                                  ALTUS PATENTS

[***]

<TABLE>
<CAPTION>
COUNTRY                  SERIAL NO.   FILING DATE
-------                  ----------   -----------
<S>                      <C>          <C>
Australia                   [***]        [***]
South Africa                [***]        [***]
United States               [***]        [***]
PCT                         [***]        [***]
Canada                      [***]        [***]
European Patent Office      [***]        [***]
Hong Kong                   [***]        [***]
India                       [***]        [***]
Japan                       [***]        [***]
Singapore                   [***]        [***]
United States               [***]        [***]
</TABLE>

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Schedule 1.1.10                                                           Page 1

<PAGE>

[***]

<TABLE>
<CAPTION>
COUNTRY                  SERIAL NO.   FILING DATE
-------                  ----------   -----------
<S>                      <C>          <C>
United States               [***]        [***]
United States               [***]        [***]
PCT                         [***]        [***]
Australia                   [***]        [***]
Brazil                      [***]        [***]
Canada                      [***]        [***]
China                       [***]        [***]
Columbia                    [***]        [***]
EPO                         [***]        [***]
HK                          [***]        [***]
India                       [***]        [***]
Israel                      [***]        [***]
Japan                       [***]        [***]
South Korea                 [***]        [***]
Mexico                      [***]        [***]
New Zealand                 [***]        [***]
Philippines                 [***]        [***]
Russian Federation          [***]        [***]
Singapore                   [***]        [***]
South Africa                [***]        [***]
</TABLE>

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Schedule 1.1.10                                                           Page 2

<PAGE>

[***]

<TABLE>
<CAPTION>
COUNTRY                  SERIAL NO.   FILING DATE
-------                  ----------   -----------
<S>                      <C>          <C>
United States               [***]        [***]
PCT                         [***]        [***]
Australia                   [***]        [***]
Brazil                      [***]        [***]
Canada                      [***]        [***]
Columbia                    [***]        [***]
EPO                         [***]        [***]
HK recording                [***]        [***]
India                       [***]        [***]
Israel                      [***]        [***]
Japan                       [***]        [***]
South Korea                 [***]        [***]
Mexico                      [***]        [***]
New Zealand                 [***]        [***]
Philippines                 [***]        [***]
Singapore                   [***]        [***]
South Africa                [***]        [***]
United States               [***]        [***]
</TABLE>

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Schedule 1.1.10                                                           Page 3

<PAGE>

[***]

<TABLE>
<CAPTION>
COUNTRY                  SERIAL NO.   FILING DATE
-------                  ----------   -----------
<S>                      <C>          <C>
[***]                       [***]        [***]
</TABLE>

[***]

<TABLE>
<CAPTION>
COUNTRY                  SERIAL NO.   FILING DATE
-------                  ----------   -----------
<S>                      <C>          <C>
[***]                       [***]        [***]
</TABLE>

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Schedule 1.1.10                                                           Page 4
<PAGE>

                                    EXHIBIT A

                            STOCK PURCHASE AGREEMENT

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<PAGE>

                         COMMON STOCK PURCHASE AGREEMENT

     COMMON STOCK PURCHASE AGREEMENT (this "Agreement") dated as of December 19,
2006, between ALTUS PHARMACEUTICALS INC., a Delaware corporation (the
"Company"), and GENENTECH, INC. (the "Purchaser").

     WHEREAS, the parties hereto are simultaneously entering into a
Collaboration and License Agreement (the "Collaboration Agreement"); and

     WHEREAS, in connection with the transactions contemplated by the
Collaboration Agreement, the Purchaser desires to purchase from the Company, and
the Company desires to issue and sell to the Purchaser, shares of Common Stock,
$0.01 par value per share (the "Common Stock"), of the Company.

     NOW, THEREFORE, in consideration of the mutual promises hereinafter set
forth and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereby agree as follows:

     Purchase and Sale of the Shares.

          (a) Subject to the terms and conditions of this Agreement, at the
Closing (as defined in clause (b) below), the Company will issue and sell to the
Purchaser, and the Purchaser will purchase from the Company, 794,575 shares (the
"Shares") of Common Stock of the Company for an aggregate purchase price of
$15,000,000 (the "Purchase Price"). For the sake of clarification only, the per
share price used to calculate such number of Shares is equal to the average of
the reported last sale price of the Common Stock on the Nasdaq Global Market
from November 28, 2006 through December 18, 2006. The number of Shares to be
issued to the Purchaser hereunder shall be adjusted to reflect fully the effect
of any reclassification, stock split, reverse split, stock dividend,
reorganization, recapitalization or other like change with respect to Common
Stock of the Company occurring after the date hereof and prior to the Closing.

          (b) The closing of the transactions contemplated hereby (the
"Closing") shall take place at 10:00 a.m., Eastern time, on a date to be
specified by the Company and the Purchaser (the "Closing Date"), which shall be
no later than the fifth business day after satisfaction or waiver of the
conditions to the Closing set forth in Section 4 of this Agreement, remotely via
the exchange of documents and signatures, unless another date, place or time is
agreed to in writing by the Purchaser and the Company. The respective
obligations of the parties to this Agreement to effect the transactions
contemplated hereby shall be subject to the delivery of the following at the
Closing:

               (i) the Company and the Purchaser shall execute and deliver the
Registration Rights Agreement in the form attached hereto as Exhibit A (the
"Registration Rights Agreement");

               (ii) the Company shall deliver to the Purchaser a certificate of
its Secretary or Assistant Secretary attesting as to the resolutions of the
Board of Directors of the Company relating to the sale of the Shares;

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

               (iii) the Company shall deliver to the Purchaser a certificate as
to the corporate good standing of the Company issued by the Secretary of State
of the State of Delaware;

               (iv) Wilmer Cutler Pickering Hale and Dorr LLP, counsel for the
Company, shall deliver to the Purchaser an opinion, dated the Closing Date, in
substantially the form attached hereto as Exhibit B;

               (v) the Purchaser shall pay the Purchase Price to the Company by
wire transfer of immediately available funds to an account designated by the
Company; and

               (vi) the Company shall instruct the transfer agent for the Common
Stock to issue and promptly deliver to the Purchaser a stock certificate
representing the Shares.

     2. Representations and Warranties of the Company. The Company represents
and warrants to the Purchaser that the statements contained in this Section 2
are true and correct as of the date hereof.

          (a) Organization and Good Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. The Company has the corporate power and authority to enter into and
perform its obligations under this Agreement and the Registration Rights
Agreement, to own and operate its properties and assets and to carry on its
business as currently conducted and as presently proposed to be conducted.

          (b) Authorization and Binding Nature. The execution, delivery and
performance by the Company of this Agreement and the Registration Rights
Agreement and the issuance and delivery of the Shares has been duly authorized
by all requisite corporate action on the part of the Company and this Agreement
and the Registration Rights Agreement constitute valid and legally binding
obligations of the Company, enforceable against the Company in accordance with
their respective terms, except (i) as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting the enforcement of creditors' rights generally and (ii) as may be
limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies.

          (c) Non-Contravention. The execution, delivery and performance by the
Company of this Agreement and the Registration Rights Agreement will not, with
or without the giving of notice or the passage of time or both, (i) violate or
conflict with the provisions of the certificate of incorporation or bylaws of
the Company, (ii) violate or conflict with any judgment, decree, order or award
of any court, governmental body or arbitrator applicable to the Company, or
(iii) violate or conflict with any material agreement to which the Company is a
party or by which it is bound.

          (d) Governmental Consents. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority is required on
the part of the Company in order to enable the Company to execute, deliver and
perform its obligations under this Agreement, or to execute and deliver the

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  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

Registration Rights Agreement, except for such qualifications or filings under
applicable securities laws as may be required to be made after the Closing in
connection with the transactions contemplated by this Agreement.

          (e) Authorization of Shares. When issued, sold and delivered in
accordance with the provisions of this Agreement for the consideration expressed
herein, the Shares will be duly authorized, validly issued, fully paid and
nonassessable, and will be free of restrictions on transfer other than
restrictions under this Agreement, the Registration Rights Agreement and
applicable state and federal securities laws.

          (f) SEC Reports. The Company has previously furnished or made
available to the Purchaser (i) its Annual Report on Form 10-K for the fiscal
year ended December 31, 2005, as amended, as filed with the Securities and
Exchange Commission (the "SEC"), and (ii) all other reports filed by the Company
with the SEC under Section 13 or subsections (a) and (c) of Section 14 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") since January
1, 2006 (such reports are collectively referred to herein as the "Reports"). The
Reports constitute all of the documents required to be filed by the Company
under Section 13 or subsections (a) and (c) of Section 14 of the Exchange Act
with the SEC from January 1, 2006 through the date of this Agreement. The
Reports complied in all material respects with the requirements of the Exchange
Act and the rules and regulations thereunder when filed. The Reports, when
considered together, do not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.

     3. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants to the Company that the statements contained in this
Section 3 are true and correct as of the date hereof.

          (a) Corporate Power. The Purchaser has the corporate power and
authority to enter into and perform its obligations under this Agreement and the
Registration Rights Agreement. The Purchaser has not been organized, reorganized
or recapitalized for the purpose of investing in the Company.

          (b) Authorization and Binding Nature. The execution, delivery and
performance by the Purchaser of this Agreement and the Registration Rights
Agreement have been duly authorized by all requisite corporate action on the
part of the Purchaser and this Agreement and the Registration Rights Agreement
constitute valid and legally binding obligations of the Purchaser, enforceable
against the Purchaser in accordance with their respective terms, except (i) as
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
and other laws of general application affecting the enforcement of creditors'
rights generally and (ii) as may be limited by laws relating to the availability
of specific performance, injunctive relief or other equitable remedies.

          (c) Non-Contravention. The execution, delivery and performance by the
Purchaser of this Agreement will not, with or without the giving of notice or
the passage of time or both, (i) violate the provisions of the certificate of
incorporation or bylaws of the Purchaser, (ii) violate any judgment, decree,
order or award of any court, governmental body or arbitrator

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

applicable to the Purchaser, or (iii) conflict with or violate any material
agreement to which the Purchaser is a party or by which it is bound.

          (d) Accredited Investor. The Purchaser is an "accredited investor," as
defined in Rule 501 under the Securities Act.

          (e) Investment. The Purchaser is acquiring the Shares for its own
account for investment, not for resale to any other person and not with a view
to or in connection with any resale or distribution. The Purchaser understands
that the Shares have not been registered under the securities laws of the United
States or any other jurisdiction and cannot be transferred or resold except as
permitted pursuant to a valid registration statement or an applicable exemption
from registration. The Purchaser acknowledges that the Company has not made any
representations with respect to registration of the Shares under applicable
securities laws, that there can be no assurance that any market for the Common
Stock will continue into the foreseeable future and that, as a result, the
Purchaser must be prepared to bear the economic risk of its investment for an
indefinite period of time.

          (f) Access to Information. The Purchaser has substantial knowledge and
experience in making investment decisions of this type and is capable of
evaluating the merits and risks of its investment in the Company. The Company
has made available to the Purchaser all documents and other information
necessary for the Purchaser to evaluate the merits and risks of its investment
in the Company. The Company has made available to the Purchaser all documents
requested and has provided answers to all of its questions relating to an
investment in the Company. In evaluating the suitability of an investment in the
Company, the Purchaser has not relied upon any representations (whether oral or
written) other than as set forth herein. The Purchaser has had an opportunity to
discuss this investment with representatives of the Company and to ask questions
of them. The Purchaser understands that an investment in the Company involves
significant risks.

     4. Conditions to Closing.

          (a) Conditions to Obligations of the Purchaser. The Purchaser shall
have no obligation to effect the transactions contemplated hereby until the
Effective Date (as such term is defined in the Collaboration Agreement), at
which time the obligations of the Purchaser to effect the transactions
contemplated hereby shall be subject to the delivery by the Company at the
Closing of the items identified in Section 1(b) of this Agreement and the
satisfaction on or prior to the Closing Date of each of the following additional
conditions, any of which may be waived, in writing, exclusively by the
Purchaser:

               (i) The representations and warranties of the Company set forth
in this Agreement shall be true and correct as of the Closing Date as though
made on and as of the Closing Date (except (A) to the extent such
representations and warranties are specifically made as of a particular date, in
which case such representations and warranties shall be true and correct as of
such date and (B) where the failure to be true and correct, individually or in
the aggregate, has not had a Material Adverse Effect); and the Purchaser shall
have received a certificate signed on behalf of the Company by the chief
executive officer or the chief financial officer of the Company to such effect.
For purposes of this Agreement, the term "Material Adverse Effect"

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

means a material adverse change in the business, financial condition or results
of operations of the Company and its subsidiaries, taken as a whole; provided,
however, that none of the following shall constitute, or shall be considered in
determining whether there has occurred, a Material Adverse Effect: (1) changes
that are the result of economic factors affecting the national, regional or
world economy or acts of war or terrorism; (2) changes that are the result of
factors generally affecting the industries or markets in which the Company
operates; (3) any adverse change arising out of or resulting from actions
contemplated by the parties in connection with this Agreement or the
Collaboration Agreement or the pendency or announcement of the transactions
contemplated by this Agreement or the Collaboration Agreement, including without
limitation actions of collaborators, competitors or employees; (4) changes in
law, rules or regulations or generally accepted accounting principles or the
interpretation thereof; (5) any action taken pursuant to or in accordance with
this Agreement or the Collaboration Agreement or at the request of the
Purchaser; (6) any failure by the Company to meet any published securities
analyst estimates of revenues, earnings, expenses or amount of cash for any
period ending on or after the date of this Agreement and prior to the Closing;
(7) any loss of collaborators or other business relationships resulting directly
or indirectly from the announcement of the transactions contemplated by this
Agreement or the Collaboration Agreement; (8) any stockholder litigation; and
(9) a decline in the price of the Common Stock of the Company.

               (ii) The Collaboration Agreement shall not have been terminated
prior to the Closing.

          (b) Conditions to Obligations of the Company. The Company shall have
no obligation to effect the transactions contemplated hereby until the Effective
Date, at which time the obligations of the Company to effect the transactions
contemplated hereby shall be subject to the delivery by the Purchaser at the
Closing of the items identified in Section 1(b) of this Agreement and the
satisfaction on or prior to the Closing Date of each of the following additional
conditions, any of which may be waived, in writing, exclusively by the Company:

               (i) The representations and warranties of the Purchaser set forth
in this Agreement shall be true and correct in all material respects as of the
Closing Date as though made on and as of the Closing Date; and the Company shall
have received a certificate signed on behalf of the Purchaser by an officer of
the Company to such effect.

               (ii) The Collaboration Agreement shall not have been terminated
prior to the Closing.

     5. Closing Efforts. Each of the Company and the Purchaser shall use
reasonable commercial efforts to consummate the transactions contemplated by
this Agreement.

     6. Termination. This Agreement may be terminated (i) at any time by mutual
written consent of the Company and the Purchaser, (ii) by either party if the
Collaboration Agreement has been terminated for any reason prior to the Closing
or (iii) by either party if the Closing has not occurred within 30 days after
the Effective Date. In the event that this Agreement is terminated, the
respective obligations of the Company and the Purchaser to sell and purchase the
Shares and as otherwise provided in this Agreement shall become void and be of
no further force or effect, provided that any such termination shall not relieve
any party from

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

liability for any breach by such party, prior to the termination of this
Agreement, of any covenant or agreement (but not any representation or warranty)
contained in this Agreement or impair the right of any party to obtain such
remedies as may be available to it in law or equity with respect to such a
breach by any other party.

     7. Opinions and Legends. The Purchaser agrees that the Shares shall not be
sold or transferred unless: (i) the Shares shall first have been registered
under the Securities Act, (ii) the Shares are sold pursuant to Rule 144 under
the Securities Act of 1933, as amended (the "Securities Act") and the Company is
furnished with an opinion of counsel reasonably satisfactory to the Company to
the effect that such sale or transfer is exempt from the registration
requirements of the Securities Act or (iii) the Company shall first have been
furnished with an opinion of counsel reasonably satisfactory to the Company to
the effect that such sale or transfer is exempt from the registration
requirements of the Securities Act. The Purchaser understands that the
certificate representing the Shares shall bear a legend substantially in the
following form:

          "The securities represented by this certificate have not been
          registered under the Securities Act of 1933, as amended, and may not
          be sold, exchanged, transferred, pledged, hypothecated or otherwise
          disposed of unless and until such securities are registered under such
          Act or an opinion of counsel satisfactory to the issuer is obtained to
          the effect that such registration is not required."

Promptly after a request from the Purchaser, the foregoing legend shall be
removed and the Company shall issue a certificate without such legend to the
holder of any Shares upon which it is stamped, if, unless otherwise required by
state securities laws, (i) the Shares are resold under an effective registration
statement under the Securities Act or (ii) the Shares are eligible for resale
pursuant to Rule 144(k) of the Securities Act and the Company is furnished with
an opinion of counsel reasonably satisfactory to the Company to such effect.

     8. Miscellaneous.

          (a) Notices. Any notices or other communications required or permitted
hereunder shall be sufficiently given if delivered personally or sent by
facsimile or with a reputable express courier, with charges prepaid, to the
address set forth below or to such other address of which the parties may have
given notice. Unless otherwise specified herein, such notices or other
communications shall be deemed received one business day after personal delivery
or delivery by facsimile, or three business days after being sent, if sent by
reputable express courier.

               If to the Company:

                    Altus Pharmaceuticals Inc.
                    125 Sidney Street
                    Cambridge, Massachusetts 02139
                    Attention: General Counsel
                    Facsimile No.: (617) 299-2999

                    with a copy to:

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  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

                    WilmerHale
                    60 State Street
                    Boston, Massachusetts 02109
                    Attention: Peter N. Handrinos, Esq.
                    Facsimile No.: (617) 526-5000

               If to the Purchaser:

                    Genentech, Inc.
                    1 DNA Way
                    South San Francisco, California 94080
                    Attn: Corporate Secretary
                    Facsimile No.: (650) 467-9146

          (b) Successors and Assigns. No party may assign its rights or
obligations hereunder without the prior written consent of the other party.
Subject to the foregoing, this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. Any
assignment in contravention of this provision shall be void.

          (c) Survival of Warranties. The representations and warranties of the
Company and the Purchaser contained in or made pursuant to this Agreement shall
survive the execution and delivery of this Agreement and the Closing for one
year.

          (d) Entire Agreement. This Agreement and the Registration Rights
Agreement represent the entire understanding and agreement between the parties
hereto with respect to the subject matter hereof and supersede all prior oral
and written and all contemporaneous oral negotiations, commitments and
understandings between such parties. The parties may amend or modify this
Agreement, in such manner as may be agreed upon, only by a written instrument
executed by the parties hereto.

          (e) Expenses. Each party shall pay its own expenses in connection with
this Agreement and the transactions contemplated hereby.

          (f) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without reference to
conflict of laws principles, and the parties hereby consent to the jurisdiction
of the courts of the State of Delaware.

          (g) Section Headings. The section headings are for the convenience of
the parties and in no way alter, modify, amend, limit or restrict the
contractual obligations of the parties.

          (h) Severability. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

          (i) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
shall be one and the same document.

                  [Remainder of Page Intentionally Left Blank]

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          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of and on the date first above written.

                                        ALTUS PHARMACEUTICALS INC.

                                        By: /S/ SHELDON BERKLE
                                            ------------------------------------
                                        Name: Sheldon Berkle
                                        Title: President and CEO

                                        GENENTECH, INC.

                                        By: /S/ ARTHUR D. LEVINSON
                                            ------------------------------------
                                        Name: Arthur D. Levinson
                                        Title: Chairman and Chief Executive
                                               Officer

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          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

                                    EXHIBIT A

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  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

                          REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this "Agreement") dated as of ____________,
2007 is entered into by and among ALTUS PHARMACEUTICALS INC., a Delaware
corporation (the "Company"), and GENENTECH, INC., a Delaware corporation (the
"Purchaser").

                                    RECITALS

WHEREAS, the Company and the Purchaser have entered into a Common Stock Purchase
Agreement of even date herewith (the "Purchase Agreement"); and

WHEREAS, the Company and the Purchaser desire to provide for certain
arrangements with respect to the registration of shares of capital stock of the
Company under the Securities Act (as defined below);

NOW, THEREFORE, in consideration of the mutual promises and covenants contained
in this Agreement, the parties hereto agree as follows:

     1.   CERTAIN DEFINITIONS.

As used in this Agreement, the following terms shall have the following
respective meanings:

          "Affiliate" means any person or entity which, directly or indirectly,
controls, is controlled by or is under common control with the Purchaser.

          "Commission" means the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.

          "Common Stock" means the common stock, $0.01 par value per share, of
the Company.

          "Company" has the meaning ascribed to it in the introductory paragraph
hereto.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor federal statute, and the rules and regulations of the
Commission issued under such Act, as they each may, from time to time, be in
effect.

          "Indemnified Party" means a party entitled to indemnification pursuant
to Section 2.4.

          "Indemnifying Party" means a party obligated to provide
indemnification pursuant to Section 2.4.

          "Prospectus" means the prospectus included in any Registration
Statement, as amended or supplemented by an amendment or prospectus supplement,
including post-effective amendments, and all material incorporated by reference
or deemed to be incorporated by reference in such Prospectus.

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  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

          "Purchase Agreement" has the meaning ascribed to it in the recitals
hereto.

          "Purchaser" has the meaning ascribed to it in the introductory
paragraph hereto.

          "Registrable Shares" means the shares of Common Stock issued to the
Purchaser pursuant to the Purchase Agreement; provided, however, that shares of
Common Stock which are Registrable Shares shall cease to be Registrable Shares
(i) upon the sale of such shares, (ii) upon the transfer of such shares in any
manner to a person or entity which is not entitled, pursuant to Section 3.1, to
the rights provided by this Agreement, (iii) at such time as they become
eligible for sale pursuant to Rule 144(k) under the Securities Act or (iv) at
such time as they cease to be outstanding.

          "Registration Expenses" means all expenses incurred by the Company in
complying with the provisions of Section 2, including, without limitation, all
registration and filing fees, exchange listing fees, printing expenses and state
Blue Sky fees and expenses, but excluding underwriting discounts, selling
commissions and the fees and expenses of counsel to the Purchaser.

          "Registration Statement" means a registration statement on Form S-3
(or any successor form) filed by the Company with the Commission for a public
offering and sale of securities of the Company.

          "Securities Act" means the Securities Act of 1933, as amended, or any
successor federal statute, and the rules and regulations of the Commission
issued under such Act, as they each may, from time to time, be in effect.

     2.   REGISTRATION RIGHTS.

          2.1  Required Registration.

               (a) At any time after the later of (i) April 30, 2007 and (ii)
the date on which the Company becomes eligible to file a Registration Statement
on Form S-3 (or any successor form relating to secondary offerings), the
Purchaser may request, in writing, that the Company effect the registration on
Form S-3 (or such successor form) of the Registrable Shares then owned by the
Purchaser. Upon receipt of any such request for registration, the Company shall
use its commercially reasonable efforts to effect the registration on Form S-3
(or any successor form) of all Registrable Shares which the Company has been
requested by the Purchaser to so register.

               (b) The Company shall not be required (i) to effect more than
three registrations pursuant to Section 2.1(a) or (ii) to effect a registration
pursuant to Section 2.1(a) involving the distribution of Registrable Shares by
means of an underwriting. For purposes of this Section 2.1(b), a Registration
Statement shall not be counted until such time as such Registration Statement
has been declared effective by the Commission (unless the Purchaser withdraws
its request for such registration (other than as a result of information
concerning the business or financial condition of the Company which is made
known to the Purchaser after the

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          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

date on which such registration was requested) and elects not to pay the
Registration Expenses therefor pursuant to Section 2.4).

               (c) If at the time of any request to register Registrable Shares
by the Purchaser pursuant to this Section 2.1, the Company is engaged or has
plans to engage in a public offering of securities solely by, and solely on
behalf of, the Company or the Company is engaged in any other activity which, in
the good faith determination of the Company's Board of Directors, would be
adversely affected by the requested registration, then the Company may at its
option direct that such request be delayed for a period not to exceed 60
consecutive days from the date of such request or an aggregate of 120 days in
any one-year period.

               (d) The Company shall be entitled to include shares of Common
Stock held by others in any registration pursuant to this Section 2.1.

          2.2  Registration Procedures.

               (a) If and whenever the Company is required by the provisions of
this Agreement to use its commercially reasonable efforts to effect the
registration of any Registrable Shares under the Securities Act, the Company
shall: (i) promptly file with the Commission a Registration Statement with
respect to such Registrable Shares and use its commercially reasonable efforts
to cause that Registration Statement to become effective as soon as practicable;
(ii) use its commercially reasonable efforts to keep the Registration Statement
effective for 90 days from the effective date or such lesser period until all
such Registrable Shares are sold; (iii) promptly furnish to the Purchaser a copy
of the Prospectus, including any preliminary Prospectus, in conformity with the
requirements of the Securities Act, and such other documents as the Purchaser
may reasonably request in order to facilitate the public sale or other
disposition of the Registrable Shares; and (iv) use its commercially reasonable
efforts to register or qualify the Registrable Shares covered by the
Registration Statement under the securities or Blue Sky laws of such states of
the United States as the Purchaser shall reasonably request; provided, however,
that the Company shall not be required in connection with this paragraph (iv) to
qualify as a foreign corporation or to execute a general consent to service of
process in any jurisdiction or to amend its Certificate of Incorporation or
By-laws in a manner that the Board of Directors of the Company determines is
inadvisable.

               (b) If the Company has delivered a Prospectus to the Purchaser
and, after having done so, the Prospectus is amended to comply with the
requirements of the Securities Act, the Company shall promptly notify the
Purchaser and, if requested, the Purchaser shall immediately cease making offers
of Registrable Shares and return all Prospectuses to the Company. The Company
shall promptly provide the Purchaser with revised Prospectuses and, following
receipt of the revised Prospectuses, the Purchaser shall be free to resume
making offers of the Registrable Shares.

               (c) In the event that, in the judgment of the Company, it is
advisable to suspend use of a Prospectus included in a Registration Statement
due to pending material developments or other events that have not yet been
publicly disclosed and as to which the Company believes public disclosure would
be detrimental to the Company, the Company shall notify the Purchaser to such
effect, and, upon receipt of such notice, the Purchaser shall

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  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

<PAGE>

immediately discontinue any sales of Registrable Shares pursuant to such
Registration Statement until the Purchaser has received a copy of a supplemented
or amended Prospectus or until the Purchase is advised in writing by the Company
that the then current Prospectus may be used and has received a copy of any
additional or supplemental filings that are incorporated or deemed incorporated
by reference in such Prospectus. Notwithstanding anything to the contrary
herein, the Company shall not exercise its rights under this Section 2.2(c) to
suspend sales of Registrable Shares for a period in excess of 60 days
consecutively or 120 days in any 365-day period.

          2.3 Allocation of Expenses. The Company will pay all Registration
Expenses for all registrations under this Agreement; provided, however, that if
a registration under Section 2.1 is withdrawn at the request of the Purchaser
(other than as a result of information concerning the business or financial
condition of the Company which is made known to the Purchaser after the date on
which such registration was requested) and if the Purchaser elects not to have
such registration counted as a registration requested under Section 2.1, the
Purchaser shall pay the Registration Expenses.

          2.4 Indemnification and Contribution.

               (a) In the event of any registration of any of the Registrable
Shares under the Securities Act pursuant to this Agreement, the Company will
indemnify and hold harmless the Purchaser, each underwriter of Registrable
Shares, and each other person, if any, who controls the Purchaser or such
underwriter within the meaning of the Securities Act or the Exchange Act against
any losses, claims, damages or liabilities, joint or several, to which the
Purchaser, such underwriter or such controlling person may become subject under
the Securities Act, the Exchange Act, state securities or Blue Sky laws or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement under which such Registrable Shares were registered under the
Securities Act, any preliminary prospectus or final prospectus contained in the
Registration Statement, or any amendment or supplement to such Registration
Statement, or (ii) the omission or alleged omission to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and the Company will reimburse the Purchaser for any reasonable
legal or other expenses reasonably incurred by the Purchaser in investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any untrue
statement or omission made in such Registration Statement, preliminary
prospectus or prospectus, or any such amendment or supplement, in reliance upon
and in conformity with information furnished to the Company, in writing, by or
on behalf of the Purchaser, such underwriter or such controlling person
specifically for use in the preparation thereof or any statement or omission in
any prospectus that is corrected in any subsequent prospectus that was delivered
to the Purchaser prior to the pertinent sale or sales by the Purchaser.

               (b) In the event of any registration of any of the Registrable
Shares under the Securities Act pursuant to this Agreement, the Purchaser will
indemnify and hold harmless the Company, each of its directors and officers and
each underwriter (if any) and each

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<PAGE>

person (if any) who controls the Company or any such underwriter within the
meaning of the Securities Act or the Exchange Act, against any losses, claims,
damages or liabilities, joint or several, to which the Company, such directors
and officers, underwriter or controlling person may become subject under the
Securities Act, Exchange Act, state securities or Blue Sky laws or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement
under which such Registrable Shares were registered under the Securities Act,
any preliminary prospectus or final prospectus contained in the Registration
Statement, or any amendment or supplement to the Registration Statement, or (ii)
any omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, if the
statement or omission was made in reliance upon and in conformity with
information relating to the Purchaser furnished in writing to the Company by or
on behalf of the Purchaser specifically for use in connection with the
preparation of such Registration Statement, prospectus, amendment or supplement;
and the Purchaser will reimburse the Company for any reasonable legal or other
expenses reasonably incurred by the Company in investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the
obligations of the Purchaser hereunder shall be limited to an amount equal to
the net proceeds to the Purchaser of Registrable Shares sold in connection with
such registration.

               (c) Each Indemnified Party shall give notice to the Indemnifying
Party promptly after such Indemnified Party has actual knowledge of any claim as
to which indemnity may be sought, and shall permit the Indemnifying Party to
assume the defense of any such claim or any litigation resulting therefrom;
provided, that counsel for the Indemnifying Party, who shall conduct the defense
of such claim or litigation, shall be approved by the Indemnified Party (whose
approval shall not be unreasonably withheld, conditioned or delayed); and,
provided, further, that the failure of any Indemnified Party to give notice as
provided herein shall not relieve the Indemnifying Party of its obligations
under this Section 2.4 except to the extent that the Indemnifying Party is
adversely affected by such failure. The Indemnified Party may participate in
such defense at such party's expense; provided, however, that the Indemnifying
Party shall pay such expense if the Indemnified Party reasonably concludes that
representation of such Indemnified Party by the counsel retained by the
Indemnifying Party would be inappropriate due to actual or potential differing
interests between the Indemnified Party and any other party represented by such
counsel in such proceeding; provided, further that in no event shall the
Indemnifying Party be required to pay the expenses of more than one law firm as
counsel for the Indemnified Party. The Indemnifying Party also shall be
responsible for the expenses of such defense if the Indemnifying Party does not
elect to assume such defense. No Indemnifying Party, in the defense of any such
claim or litigation shall, except with the consent of each Indemnified Party,
consent to entry of any judgment or enter into any settlement which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect of such
claim or litigation, and no Indemnified Party shall consent to entry of any
judgment or settle such claim or litigation without the prior written consent of
the Indemnifying Party, which consent shall not be unreasonably withheld,
conditioned or delayed.

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<PAGE>

               (d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 2.4 is
due in accordance with its terms but for any reason is held to be unavailable to
an Indemnified Party in respect to any losses, claims, damages and liabilities
referred to herein, then the Indemnifying Party shall, in lieu of indemnifying
such Indemnified Party, contribute to the amount paid or payable by such
Indemnified Party as a result of such losses, claims, damages or liabilities to
which such party may be subject in such proportion as is appropriate to reflect
the relative fault of the Company on the one hand and the Purchaser on the other
in connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company and the Purchaser shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of material fact related to information supplied by the Company
or the Purchaser and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Purchaser agree that it would not be just and equitable if
contribution pursuant to this Section 2.4(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above. Notwithstanding the provisions
of this Section 2.4(d), in no case shall the Purchaser be liable or responsible
for any amount in excess of the net proceeds received by the Purchaser from the
offering of Registrable Shares; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. Any party entitled to contribution
will, promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this Section 2.4(d), notify such
party or parties from whom contribution may be sought, but the omission to
notify such party or parties from whom contribution may be sought shall not
relieve such party from any other obligation it or they may have thereunder or
otherwise under this Section 2.4(d). No party shall be liable for contribution
with respect to any action, suit, proceeding or claim settled without its prior
written consent, which consent shall not be unreasonably withheld, conditioned
or delayed.

               (e) The rights and obligations of the Company and the Purchaser
under this Section 2.4 shall survive the termination of this Agreement.

          2.5 Information by Holder. The Company shall not be required to
include any Registrable Shares in any Registration statement unless the
Purchaser furnishes the Company in writing such information regarding the
Purchaser and the distribution proposed by the Purchaser as the Company may
reasonably request in writing in connection with a Registration Statement or as
shall be required in connection with any such registration, qualification or
compliance. The Purchaser agrees to report promptly (and in any event within 10
days) all sales or other transfers of Registrable Shares.

          2.6 "Lock-Up" Agreement; Confidentiality of Notices. The Purchaser
agrees not to offer for sale, sell, contract to sell or otherwise dispose of any
shares of Common Stock or any securities that represent the right to receive
shares of Common Stock during the 20 days prior to and the 90 days beginning on
the effective date of any underwritten offering of the Company's equity
securities solely by, and solely on behalf of, the Company unless the

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<PAGE>

Company and the underwriters managing the offering otherwise agree. The Company
and the Purchaser agree that the provisions of this Section 2.6 shall be
enforceable by such underwriter(s) against the Purchaser, it being understood
that such underwriter(s) are intended third party beneficiaries hereof and, if
so requested by such underwriter(s), the Purchaser agrees to execute and deliver
to such underwriter(s) such agreements and instruments, in form and substance
reasonably satisfactory to such underwriter(s) and the Purchaser, further
evidencing the Purchaser's agreement not to sell such securities during such
period. The Company may impose stop-transfer instructions with respect to the
Registrable Shares or other securities subject to the foregoing restriction
until the end of such restricted period. Any written notice from the Company
regarding the Company's plans to file a Registration Statement and other
information related thereto shall be treated by the Purchaser as confidential
and the Purchaser shall not disclose such information to any person.

          2.7 Termination. This Agreement shall terminate upon the earlier of
(a) two years after the date hereof and (b) the date on which the Purchaser does
not hold any Registrable Shares.

     3.   GENERAL.

          3.1 Transfer of Rights. This Agreement, and the rights and obligations
of the Purchaser hereunder, may be assigned by the Purchaser only to an
Affiliate to which all of the Registrable Shares are transferred pursuant to the
terms of this Agreement, and, in such case, such transferee shall be deemed the
"Purchaser" for purposes of this Agreement; provided, however, that such
assignment of rights shall be contingent upon the transferee providing a written
instrument to the Company notifying the Company of such transfer and assignment
and agreeing in writing to be bound by the terms of this Agreement.

          3.2 Severability. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

          3.3 Specific Performance. In addition to any and all other remedies
that may be available at law in the event of any breach of this Agreement, the
parties hereto shall be entitled to specific performance of the agreements and
obligations of the parties hereunder and to such other injunctive or other
equitable relief as may be granted by a court of competent jurisdiction.

          3.4 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without reference to
conflict of laws principles, and the parties hereby consent to the jurisdiction
of the courts of the State of Delaware.

          3.5 Notices. All notices, requests, consents and other communications
under this Agreement shall be in writing and shall be deemed delivered (i) three
business days after being sent by registered or certified mail, return receipt
requested, postage prepaid or (ii) one business day after being sent via a
reputable nationwide overnight courier service guaranteeing next business day
delivery, in each case to the intended recipient as set forth below:

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<PAGE>

     If to the Company, at 125 Sidney Street, Cambridge, Massachusetts 02139,
Attention: General Counsel, or at such other address as may have been furnished
in writing by the Company to the Purchaser, with a copy to WilmerHale, 60 State
Street, Boston, Massachusetts 02109, Attention: Peter N. Handrinos, Esq.; or

If to the Purchaser, at 1 DNA Way, South San Francisco, California 94080,
Attention: Corporate Secretary, or at such other address as may have been
furnished in writing by the Purchaser to the Company.

     Any party may give any notice, request, consent or other communication
under this Agreement using any other means (including, without limitation,
personal delivery, messenger service, telecopy, first class mail or electronic
mail), but no such notice, request, consent or other communication shall be
deemed to have been duly given unless and until it is actually received by the
party for whom it is intended. Any party may change the address to which
notices, requests, consents or other communications hereunder are to be
delivered by giving the other parties notice in the manner set forth in this
Section 3.5.

          3.6 Complete Agreement. This Agreement constitutes the entire
agreement and understanding of the parties hereto with respect to the subject
matter hereof and supersedes all prior agreements and understandings relating to
such subject matter.

          3.7 Amendments and Waivers. This Agreement may be amended or
terminated and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively) with the written consent of the Company and the Purchaser.

          3.8 Counterparts; Facsimile Signatures. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original,
and all of which together shall constitute one and the same document. This
Agreement may be executed by facsimile signatures.

          3.9 Section Headings and References. The section headings are for the
convenience of the parties and in no way alter, modify, amend, limit or restrict
the contractual obligations of the parties. Any reference in this Agreement to a
particular section or subsection shall refer to a section or subsection of this
Agreement, unless specified otherwise.

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<PAGE>

     IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of and on the date first above written.

                                        ALTUS PHARMACEUTICALS INC.

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

                                        GENENTECH, INC.

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

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<PAGE>

                                    EXHIBIT B

                           FORM OF OPINION OF COUNSEL

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<PAGE>

_____________, 2007

Genentech, Inc.
1 DNA Way
South San Francisco, California 94080

Re: Altus Pharmaceuticals Inc.

Ladies and Gentlemen:

This opinion is being furnished pursuant to Section 1(b)(iv) of the Common Stock
Purchase Agreement, dated as of December 19, 2006 (the "Agreement"), by and
between Altus Pharmaceuticals Inc., a Delaware corporation (the "Company"), and
Genentech, Inc., a Delaware corporation (the "Purchaser"). Capitalized terms
used herein and not otherwise defined shall have the respective meanings
ascribed to them in the Agreement.

We have acted as counsel to the Company in connection with the preparation,
execution and delivery of the Agreement and the Registration Rights Agreement,
of even date herewith, by and between the Company and the Purchaser (the
"Registration Rights Agreement," and, together with the Agreement, the
"Transaction Documents"). As such counsel, we have examined and are familiar
with and have relied upon the following documents:

     (a)  the Restated Certificate of Incorporation and the Restated Bylaws of
          the Company;

     (b)  a Certificate of the Secretary of State of the State of Delaware,
          dated __________, 2007, attesting to the continued legal existence and
          corporate good standing of the Company in Delaware (the "Company
          Domestic Certificate");

     (c)  a Certificate of the Secretary of the Commonwealth of Massachusetts,
          dated __________, 2007, attesting to the good standing and due
          qualification of the Company to transact business in Massachusetts
          (the "Company Foreign Qualification Certificate");

     (d)  each of the Transaction Documents; and

     (e)  a Certificate of an officer of the Company, of even date herewith,
          attesting to the Company's charter and bylaws, certain resolutions
          adopted by the Board of Directors of the Company and the incumbency of
          certain officers of the Company.

In our examination of the documents described above, we have assumed the
genuineness of all signatures, the legal capacity of all individual signatories,
the completeness of all corporate and stock records provided to us, the
authenticity of all documents submitted to us as originals, the conformity to
original documents of all documents submitted to us as copies, and the
authenticity of the originals of such latter documents.

In rendering this opinion, we have relied, as to all questions of fact material
to this opinion, upon certificates of public officials and officers of the
Company and upon the representations and warranties made by the Company and the
Purchaser in the Transaction Documents. We have not

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<PAGE>

attempted to verify independently such facts. We have not conducted a search of
any electronic databases or the dockets of any court, administrative or
regulatory body, agency or other filing office in any jurisdiction.

For purposes of this opinion, we have assumed that the Transaction Documents
have been duly authorized, executed and delivered by the Purchaser, and that the
Purchaser has all requisite power and authority to effect the transactions
contemplated by the Transaction Documents. We have also assumed that each of the
Transaction Documents is the valid and binding obligation of the Purchaser, and
is enforceable against the Purchaser in accordance with its terms. We do not
render any opinion as to the application of any federal or state law or
regulation to the power, authority or competence of any party to the Transaction
Documents other than the Company.

For purposes of this opinion, we have assumed that the Board of Directors of the
Company has complied with its fiduciary duties in connection with the
transactions contemplated by the Transaction Documents.

Our opinions set forth below are qualified to the extent that they may be
subject to or affected by (i) applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or similar laws relating to or affecting the
rights of creditors generally, (ii) statutory or decisional law concerning
recourse by creditors to security in the absence of notice or hearing, (iii)
duties and standards imposed on creditors and parties to contracts, including,
without limitation, requirements of good faith, reasonableness and fair dealing,
and (iv) general equitable principles. We express no opinion as to the
availability of any equitable or specific remedy upon any breach of any of the
agreements as to which we are opining herein, or any of the agreements,
documents or obligations referred to therein, or to the successful assertion of
any equitable defenses, inasmuch as the availability of such remedies or the
success of any equitable defense may be subject to the discretion of a court. We
are expressing no opinion herein with respect to compliance by the Company with
any federal securities or state securities or "blue sky" laws, including without
limitation, federal and state antifraud laws, or the by-laws or any rules or
other regulations of the National Association of Securities Dealers, Inc.,
including without limitation, the rules, regulations and requirements of The
Nasdaq Stock Market. We are also expressing no opinion herein with respect to
compliance by the Company or the Purchaser with state or federal antitrust or
unfair competition laws, including without limitation, the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended.

We also express no opinion herein as to any provision of any agreement (a) which
may be deemed to or construed to waive any right of the Company, (b) to the
effect that rights and remedies are not exclusive, that every right or remedy is
cumulative and may be exercised in addition to or with any other right or remedy
and does not preclude recourse to one or more other rights or remedies, (c)
relating to the effect of invalidity or unenforceability of any provision of the
Transaction Documents on the validity or enforceability of any other provision
thereof, (d) requiring the payment of penalties, consequential damages or
liquidated damages, (e) which is in violation of public policy, including,
without limitation, any provision relating to non-competition and
non-solicitation or relating to indemnification and contribution with respect to
securities law matters, (f) purporting to indemnify any person against his, her
or its own negligence or intentional misconduct, (g) which provides that the
terms of the Transaction

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Documents may not be waived or modified except in writing or (h) relating to
choice of law, consent to jurisdiction or waiver of jury trial. We express no
opinion herein as to Sections 2.4 and 3.4 of the Registration Rights Agreement.

Our opinions expressed in paragraph 1 below, insofar as they relate to the valid
existence, due qualification and good standing of the Company, are based solely
on the Company Domestic Certificate and the Company Foreign Qualification
Certificate and are limited accordingly, and, as to such matters, our opinions
are rendered as of the respective dates of such certificates. We express no
opinion as to the tax good standing of the Company in any jurisdiction.

For purposes of our opinion in paragraph 3 below, we have relied upon
representations made by the Purchaser in the Agreement, and have assumed
(without any independent investigation) the accuracy of such representations.
For purposes of our opinion in paragraph 3 below, we have also assumed that in
connection with the offer and sale of securities to the Purchaser, neither the
Company nor any person acting on its behalf has engaged in any form of "general
solicitation or general advertising" within the meaning contemplated by Rule
502(c) of Regulation D promulgated under the Securities Act of 1933, as amended
(the "Securities Act").

We are opining herein solely as to the state laws of the Commonwealth of
Massachusetts, the Delaware General Corporation Law statute and the federal laws
of the United States of America. To the extent that any other laws govern any of
the matters as to which we are opining below, we have assumed, with your
permission and without independent investigation, that such laws are identical
to the state laws of the Commonwealth of Massachusetts, and we express no
opinion as to whether such assumption is reasonable or correct.

For purposes of our opinions rendered below, we have assumed that the facts and
law governing the future performance by the Company of its obligations under the
Transaction Documents will be identical to the facts and law governing its
performance on the date of this opinion.

Based upon and subject to the foregoing, we are of the opinion that:

     1.   The Company is a corporation validly existing and in good standing
          under the laws of the State of Delaware and has all requisite
          corporate power and authority to enter into and perform its
          obligations under the Transaction Documents, and to carry out the
          transactions contemplated by the Transaction Documents. The Company is
          duly qualified to do business and is in good standing in the
          Commonwealth of Massachusetts.

     2.   The execution and delivery by the Company of the Transaction
          Documents, and the consummation by the Company of the transactions
          contemplated thereby, have been duly authorized by all necessary
          corporate action on the part of the Company, and the Transaction
          Documents have been duly executed and delivered by the Company. Each
          of the Transaction Documents constitutes the valid and binding
          obligation of the Company, enforceable against the Company in
          accordance with its terms.

     3.   The execution and delivery by the Company of the Transaction
          Documents, and the consummation by the Company of the transactions
          contemplated thereby, do not (a)

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<PAGE>

          violate the provisions of any U.S. federal or Massachusetts state law,
          rule or regulation applicable to the Company or the Delaware General
          Corporation Law statute or (b) violate the provisions of the Company's
          Restated Certificate of Incorporation or Restated Bylaws.

     4.   The Shares have been duly authorized by all necessary corporate action
          on the part of the Company, and the Shares, when issued, sold and
          delivered against payment therefor in accordance with the provisions
          of the Agreement, will be duly and validly issued, fully paid and
          non-assessable.

This opinion is provided to the Purchaser as a legal opinion only and not as a
guaranty or warranty of the matters discussed herein. This opinion is based upon
currently existing statutes, rules, regulations and judicial decisions and is
rendered as of the date hereof, and we disclaim any obligation to advise you of
any change in any of the foregoing sources of law or subsequent developments in
law or changes in facts or circumstances which might affect any matters or
opinions set forth herein.

This opinion is rendered only to the Purchaser and is solely for the benefit of
the Purchaser in connection with the transactions contemplated by the
Transaction Documents. This opinion may not be relied upon by the Purchaser for
any other purpose, nor may this opinion be provided to, quoted to or relied upon
by any other person or entity for any purpose without our prior written consent.

Very truly yours,

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

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                                    EXHIBIT B

                              FORM OF PRESS RELEASE

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<PAGE>

NEWS RELEASE
Contact information:
John A. Jordan
Senior Director, Corporate Communications
617-299-2852

              ALTUS PHARMACEUTICALS ENTERS INTO EXCLUSIVE STRATEGIC
                         COLLABORATION WITH GENENTECH TO
              DEVELOP AND COMMERCIALIZE PRODUCTS FOR GROWTH HORMONE
                               DEFICIENT PATIENTS

               -- GENENTECH OBTAINS NORTH AMERICAN DEVELOPMENT AND
   COMMERCIALIZATION COLLABORATION LICENSE WITH GLOBAL OPTION FOR ALTU-238 --
  -- ALTUS TO RECEIVE $30 MILLION FROM UPFRONT PAYMENT AND EQUITY INVESTMENT --

CAMBRIDGE, MASS. - DECEMBER 20, 2006 - Altus Pharmaceuticals Inc. (NASDAQ: ALTU)
announced today that it has entered into an agreement with Genentech, Inc. to
develop, manufacture and commercialize Altus' product candidate ALTU-238. The
strategic alliance is an exclusive North American collaboration and license
arrangement, with an option for a global agreement. ALTU-238 is a subcutaneously
administered, once-per-week formulation of human growth hormone, which employs
Altus' proprietary protein crystallization and formulation technology, for
patients with growth hormone deficiencies.

     As part of the North American agreement, Genentech will make a $15 million
upfront payment to Altus with the potential for Altus to receive additional
payments of approximately $140 million based upon the successful completion of
certain development and commercialization milestones. In conjunction with this
agreement, Altus will receive a $15 million equity investment through the sale
of 794,575 shares of its common stock to Genentech. In addition, Genentech has
obtained a global commercialization option for ALTU-238. If Genentech exercises
the global option Altus could potentially receive additional payments of more
than $110 million, comprised of upfront and milestone payments.

     "The Altus and Genentech alliance is an important strategic move that we
believe further validates ALTU-238 as a long-acting product candidate for growth
hormone deficient patients as well as the value of our protein crystallization
platform," stated Sheldon Berkle, President and CEO of Altus Pharmaceuticals.
"Through this agreement, we are now collaborating with a premier
biopharmaceutical company that is a leader in the United States growth hormone
market. We believe that Genentech's development experience as well as their
knowledge of the regulatory and commercial environments for growth hormone
products should contribute to even greater potential for ALTU-238."

ALTUS AND GENENTECH STRATEGIC COLLABORATION/2

TERMS OF THE AGREEMENT

     Under the terms of the agreement, Genentech obtains an exclusive license to
collaborate with Altus to develop, manufacture and market ALTU-238 throughout
North America. Going forward, Genentech will be responsible for ALTU-238
development and commercialization costs. In North America, Altus and Genentech
anticipate co-promoting and marketing ALTU-238. Upon any commercialization,
Altus expects to receive double digit royalties on net sales of ALTU-238. The
completion of the agreement may

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          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

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be subject to Hart-Scott-Rodino approval under United States antitrust laws and
customary closing conditions.

CONFERENCE CALL ACCESS INFORMATION

     Altus will hold a conference call and simultaneous webcast today,
Wednesday, December 20, 2006 at 11:00 a.m. eastern time. To participate in the
conference call, please dial (800) 289-0726 in the U.S. or (913) 981-5545 for
international callers. A live audio webcast of the call will be accessible at
www.altus.com, under the Investor Relations section of the website. Please
connect to Altus' website several minutes prior to the start of the broadcast to
ensure adequate time for any software download that may be necessary.

     A replay of the webcast will be available on www.altus.com through January
20, 2007. Alternatively, the replay will be available starting at 3:00 p.m.
eastern time today through 11:59 p.m. eastern time Wednesday, December 27, 2006
by dialing (719) 457-0820 or (888) 203-1112. The replay passcode is 6959149.

ABOUT ALTU-238

     ALTU-238 is a long-acting subcutaneous formulation of recombinant human
growth hormone, in a ready-to-use liquid suspension formulation, that employs
Altus' proprietary protein crystallization and formulation technology. Altus'
technology preserves the structure of the human growth hormone molecule without
the need for polymers or encapsulation and enables administration through a fine
gauge needle. Recombinant human growth hormone is approved for treating multiple
growth disorders in children and adolescents and for growth hormone replacement
in adults. Global sales for all recombinant human growth hormone were
approximately $2.4 billion in 2005.

ALTUS AND GENENTECH STRATEGIC COLLABORATION/3

     Altus recently reported results from a Phase II trial in growth hormone
deficient adults in which ALTU-238 demonstrated a pharmacokinetic and
pharmacodynamic profile that the Company believes is supportive of a
once-per-week growth hormone therapy. The study identified doses of ALTU-238
that maintained IGF-1 levels within the normal range for age and gender over the
course of the study and a once-per-week dosing of ALTU-238 appeared to result in
a consistent, linear dose response of hGH and IGF-1 levels in the blood.

ABOUT GROWTH HORMONE DEFICIENCY AND GROWTH FAILURE

     Growth hormone disorders occur when the production of growth hormone,
secreted via the hypothalamic-pituitary axis is disrupted. Growth hormone plays
a critical role in stimulating bone growth and development and it is involved in
the production of muscle and in the breakdown of fats. In children, when there
is a deficiency or absence of growth hormone, growth failure occurs. Recombinant
human growth hormone (rhGH) products are currently approved to treat multiple
growth disorders, including pediatric hormone deficiency, Turner Syndrome,
chronic renal insufficiency, idiopathic short stature, Prader-Willi Syndrome,
short children born small for gestational age, genetic SHOX abnormalities, as
well as adult disorders of growth hormone deficiency, short bowel syndrome and
muscle wasting in patients with HIV.

ABOUT ALTUS PHARMACEUTICALS INC.

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     Altus Pharmaceuticals, headquartered in Cambridge, MA, is a
biopharmaceutical company focused on the development and commercialization of
oral and injectable protein therapeutics for patients with gastrointestinal and
metabolic disorders. The Company's website is http://www.altus.com.

ALTUS FORWARD LOOKING STATEMENT

     Certain statements in this news release concerning Altus' business are
considered "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements include, but are not
limited to the continued development for ALTU-238, payments to be received under
the agreements with Genentech, issuance of pending patents, and the ability of
Altus' proprietary protein crystallization technology to effectively deliver
growth hormone therapy through a once-weekly injection using a fine gauge
needle. These payments are dependant, in part, on the issuance of pending
patents and commercialization. Any or all of the forward-looking statements in
this press release may turn out to be wrong. They can be affected by inaccurate
assumptions Altus might make or by known or unknown risks and uncertainties and
other important factors, including, but not limited to uncertainties as to the
future success of ongoing and planned clinical trials; and the unproven safety
and efficacy of products under development. Consequently, no forward-looking
statement can be guaranteed, and actual results may vary materially. Additional
information concerning important factors that could cause actual results to
materially differ from those in the forward-looking statements is contained in
Altus' reports filed with the Securities and Exchange Commission, including its
most recent Quarterly Report on Form 10-Q. However, Altus undertakes no
obligation to publicly update forward-looking statements, whether because of new
information, future events or otherwise.

                                       ###

  PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
  SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
          CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT.

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