Document:

<PAGE>
                                                                   Exhibit 10.14

                              INTERDEBTOR AGREEMENT

                        THIS INTERDEBTOR AGREEMENT (this "Agreement") is entered
into as of this ___ day of March 2002, by and between ICN Pharmaceuticals, Inc.,
a Delaware corporation ("ICN"), and its wholly-owned subsidiary, Ribapharm Inc.
("Ribapharm").

                                    RECITALS

                        WHEREAS, Pursuant to an Offering Memorandum dated July
13, 2001, ICN sold in a private placement, $400,000,000 aggregate principal
amount (and an additional $125,000,000 aggregate principal amount to cover
over-allotments) of 6 1/2% Convertible Subordinated Notes due 2008 (the
"Notes");

                        WHEREAS, the Notes were issued and sold pursuant to the
Purchase Agreement (the "Purchase Agreement"), dated as of July 13, 2001, among
ICN, Ribapharm, and UBS Warburg LLC (the "Initial Purchaser"), the Indenture
(the "Indenture"), dated as of July 18, 2001, among ICN, Ribapharm and The Bank
of New York, as trustee, and the Registration Rights Agreement (the
"Registration Rights Agreement"), dated as of July 18, 2001 among ICN,
Ribapharm, and the Initial Purchaser;

                        WHEREAS, Ribapharm has filed a registration statement to
effect the Ribapharm IPO (as defined in the Indenture);

                        WHEREAS, ICN intends to distribute its remaining
interest in Ribapharm in the Ribapharm Spin-Off (as defined in the Indenture);

                        WHEREAS, ICN and Ribapharm entered into a letter
agreement, dated July 18, 2001 (the "Letter Agreement") to clarify their
relationship with respect to certain provisions of the Notes; and

                        WHEREAS, each of ICN and Ribapharm believe that it is in
their best interest and in the best interest of their respective stockholders to
amend and restate the Letter Agreement in its entirety as set forth herein.

                        NOW, THEREFORE, in consideration of the foregoing and
for other good and valuable consideration the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

                        1. Primary Obligor. While upon the earlier of a
Ribapharm IPO or a Ribapharm Spin-Off, Ribapharm will become a joint and several
obligor of the Notes, as between ICN and Ribapharm, ICN and Ribapharm agree that
ICN shall be responsible for all payments of principal, premium, if any,
interest and any other payments under the Notes, including Ribapharm's
obligation to make an offer to repurchase the Notes upon a Change in Control of
Ribapharm or ICN. In the event Ribapharm makes any such payments under the Notes
for any reason, ICN shall promptly reimburse Ribapharm for these payments.
<PAGE>
Notwithstanding the foregoing, Ribapharm shall be responsible for the payment of
liquidated damages pursuant to Section 5 of the Registration Rights Agreement
caused by Ribapharm's failure to comply with its obligations to file and
maintain an effective Registration Statement.

                        2. Amendments. This Agreement may not be amended or
modified in any respect except by a written agreement signed by both of the
parties hereto and in accordance with the following:

                           a.       This Agreement may be amended or modified on
                                    behalf of ICN by a written instrument signed
                                    by an authorized officer of ICN.

                           b.       (i) Any amendment or modification to this
                                    Agreement that does not adversely affect the
                                    rights of Ribapharm may be made by a written
                                    instrument signed by an authorized officer
                                    of Ribapharm; and

                                    (ii) any other amendment or modification of
                                    this Agreement may be made by a written
                                    instrument signed by an authorized officer
                                    of Ribapharm only after such amendment or
                                    modification has been approved by the
                                    affirmative vote of at least a majority of
                                    the then outstanding shares of common stock
                                    of Ribapharm, par value $0.01 per share
                                    ("Ribapharm Common Stock"), excluding any
                                    shares of Ribapharm Common Stock then
                                    beneficially owned by ICN.

                        3. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such which may be hereafter declared invalid, void or
unenforceable.

                        4. Successors and Assigns. This Agreement shall be
binding upon the parties hereto and inure to the benefit of the parties hereto
and their respective successors and permitted assigns. Except with respect to a
merger of either party with another person, neither this Agreement nor any of
the rights, interests or obligations hereunder shall be assigned by either party
hereto without the prior written consent of the other party.

                        5. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.

                                     - 2 -
<PAGE>
                        6. Headings. The paragraph headings used in this
Agreement are for convenience only and shall not affect the interpretation of
any of the provisions hereof.

                        7. Definitions. All capitalized terms used but not
otherwise defined herein shall have the meanings ascribed to them in (or by
reference in) the Purchase Agreement, Indenture and Registration Rights
Agreement, as applicable.

                        6. Entire Agreement. This Agreement shall constitute the
entire agreement between the parties hereto with respect to the subject matter
hereof and shall supersede all prior agreements and understandings, whether
written or oral, between the parties with respect to such subject matter,
including, without limitation, the Letter Agreement.

                        7. Notices. All notices, requests and demands to or upon
the parties to be effective shall be in writing (or by telex, fax or similar
electronic transfer confirmed in writing) and shall be deemed to have been duly
given or made (i) when delivered by hand or (ii) if given by mail, when
deposited in the mails by certified mail, return receipt requested, or (iii) if
by telex, fax or similar electronic transfer, when sent and receipt has been
confirmed, addressed as follows:

                        If to ICN:
                                             ICN Pharmaceuticals, Inc.
                                             3300 Hyland Avenue
                                             Costa Mesa, CA  92626
                                             Attention:  General Counsel
                                             Telecopy:  (714) 641-7206
                                             Telephone:  (714) 545-0100
                        If to Ribapharm:
                                             Ribapharm Inc.
                                             3300 Hyland Avenue
                                             Costa Mesa, CA  92626
                                             Attention:  General Counsel
                                             Telecopy:  (714) 641 7233
                                             Telephone:  (714) 545-0100

                        The parties hereto may change their addresses and
transmission numbers for notices by notice in the manner provided in this
Section.

                        6. CONSENT TO JURISDICTION. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
(WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS

                                     - 3 -
<PAGE>
PRINCIPLES THEREOF) AS TO ALL MATTERS, INCLUDING MATTERS OF VALIDITY,
CONSTRUCTION, EFFECT, PERFORMANCE AND REMEDIES.

                        7. WAIVER OF TRIAL BY JURY. ICN AND RIBAPHARM HEREBY
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS AGREEMENT. EACH OF ICN AND RIBAPHARM
ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS
RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT
AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE
DEALINGS. EACH OF ICN AND RIBAPHARM WARRANTS AND REPRESENTS THAT EACH HAS HAD
THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACH
KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.

                        8. EFFECTIVENESS. THIS AGREEMENT SHALL BECOME EFFECTIVE
UPON THE TIME OF PURCHASE OF THE FIRM SHARES, AS DEFINED IN THE UNDERWRITING
AGREEMENT, BY AND AMONG ICN, RIBAPHARM AND THE UNDERWRITERS NAMED THEREIN, DATED
______ 2002, RELATING TO THE INITIAL PUBLIC OFFERING BY RIBAPHARM.

                                     - 4 -
<PAGE>
                        IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers as of the date first
written above.

                                             ICN PHARMACEUTICALS, INC.

                                             By: ______________________________
                                                     Name:
                                                     Title:

                                             RIBAPHARM ICN.

                                             By: ______________________________
                                                     Name:
                                                     Title:

                                     - 5 -<PAGE>
                                                                   Exhibit 10.15

** CERTAIN CONFIDENTIAL MATERIAL CONTAINED IN THIS DOCUMENT HAS BEEN OMITTED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO 17
C.F.R. SUBSECTION 200.80(B)(4) 200.83 AND 230.406**

<PAGE>

                               EXCHANGE AGREEMENT
                               ------------------

         This Exchange Agreement ("Exchange Agreement") is made as of June 29,
2001 by and among (a) HOFFMANN-LA ROCHE, INC. AND F. HOFFMANN-LA ROCHE LTD.
(collectively "HLR") and (b) RIBAPHARM, INC. AND ICN PUERTO RICO, A DIVISION OF
ICN DUTCH HOLDINGS, B.V. (collectively "ICN").

                                 R E C I T A L S
                                 ---------------

         WHEREAS, HLR owns and holds for use in its trade or business rights to
the protein compound, Interleukin (IL-12) ("Property A");

         WHEREAS,  ICN owns and holds for use in its trade or business rights to
 the compound  Levovirin(TM) ("Property B");

         WHEREAS, Property A and Property B are of like-kind nature;

         WHEREAS, HLR and ICN intend for the exchange to qualify under Section
1031 of the Internal Revenue Code as a like-kind exchange; and

         WHEREAS, HLR wishes to exchange Property A for Property B and ICN
wishes to exchange Property B for Property A, all upon the terms and conditions
set forth herein.

                                    AGREEMENT
                                    ---------

         For consideration, the value, sufficiency, and receipt of which are
hereby acknowledged, HLR and ICN agree as follows.

         1.       EXCHANGE.
                  --------

                  (a)   In exchange for ICN's transfer to HLR of Property B, HLR
hereby agrees to transfer Property A to ICN pursuant to the provisions of the
transfer agreement attached hereto as EXHIBIT A and in exchange therefor ICN
hereby agrees to transfer Property B to HLR pursuant to the provisions of the
transfer agreement attached hereto as EXHIBIT B (the "Exchange").

                  (b)   The transfer agreements attached as Exhibits A and B
both contain upfront payments that are shown as gross amounts for valuation
purposes. HLR and ICN agree that only the net amount of these upfront payments
will be paid.

<PAGE>
                  (c)   The parties are executing and delivering the transfer
agreements attached as EXHIBIT A and EXHIBIT B on the date of this Exchange
Agreement. The parties will use their best efforts to complete the further
documentation of the transfer of Property A within 15 days after the date
hereof.

         2.       MISCELLANEOUS.
                  -------------

                  (a)   This Exchange Agreement contains the complete agreement
of HLR and ICN with respect to the Exchange and supercedes all prior
discussions, negotiations, understandings, and agreements relating to the
Exchange.

                  (b)   No party hereto will assign or transfer any of its
rights or obligations under this Exchange Agreement, except with the written
consent of the other parties.

                  (c)   All waivers by a party of any of its rights in this
Exchange Agreement must be in writing executed by the waiving party.

                  (d)   This Exchange Agreement may be changed, modified, or
amended only by a writingexecuted by all parties hereto.

                  (e)   All notices, consents, and other communications required
or permitted hereunder will be given in accordance with the provisions governing
notice contained in the transfer agreement attached hereto as EXHIBIT B.

                  (f)   All disputes and controversies arising under the
Exchange Agreement will be resolved by binding arbitration in accordance with
the provisions governing dispute resolution contained in the transfer agreement
attached hereto as EXHIBIT B.

                  (g)   This Exchange Agreement will be governed by and
construed in accordance with the laws of the State of New York.

                  (h)    This Exchange Agreement is for the benefit of the
parties hereto and there are no third-party beneficiaries.

                  (i)    This Exchange Agreement may be executed and delivered
in two or more counterparts by facsimile, each of which will be deemed an
original and all of which will constitute one and the same agreement.

                                        2

<PAGE>

                  IN WITNESS WHEREOF, the parties have caused their authorized
representatives to duly execute and deliver this Exchange Agreement as of the
date first above written.

HOFFMANN-LA ROCHE, INC.                     RIBAPHARM, INC.

/s/ Frank D'Angelo                          /s/ Bill A. MacDonald
-------------------------------             -----------------------------------
Frank D'Angelo                              Bill A. MacDonald
Vice President                              Chief Executive

F. HOFFMANN-LA ROCHE LTD.                   ICN PUERTO RICO

/s/ Bertrand Lehuu                          /s/ Bill A. MacDonald
-------------------------------             -----------------------------------
Bertrand Lehuu                              Bill A. MacDonald
Vice Director                               President

/s/ Urs Jaisli
-------------------------------
Urs Jaisli
Vice Director - Corporate Law

                                        3

<PAGE>

                                    EXHIBIT A
                                    ---------

                               TRANSFER AGREEMENT
                                       FOR
                                   PROPERTY A

<PAGE>

                               TRANSFER AGREEMENT

This Transfer Agreement is made as of June 29, 2001 and is a legally binding
agreement pursuant to which HLR hereby transfers and sells to ICN the protein
compound, Interleukin (IL-12), on the same basic terms and conditions as set
forth in Appendix I hereto.

For all other terms the parties agree to adopt the terms of Exhibit A except
that Licensor in Exhibit A is treated as Licensee herein and Licensee in Exhibit
A to the Exchange Agreement of even date herewith is treated as Licensor herein.
For clarification, definitive documentation between the parties will be
finalized as soon as possible.

                                         HLR:

                                         F. HOFFMANN-LA ROCHE LTD.

                                         /s/ Bertrand Lehuu
                                         ---------------------------------------
                                         Bertrand Lehuu
                                         Vice Director

                                         /s/ Urs Jaisli
                                         ---------------------------------------
                                         Urs Jaisli
                                         Vice Director - Corporate Law

                                         HOFFMANN-LA ROCHE, INC.

                                         /s/ Frank D'Angelo
                                         --------------------------------------
                                         Frank D'Angelo
                                         Vice President

                                         ICN:

                                         ICN PUERTO RICO

                                         /s/ Bill A. MacDonald
                                         ---------------------------------------

                                         Bill A. MacDonald
                                         President

<PAGE>
APPENDIX I

TERM SHEET ON IL 12 (RO 24-7472)

1.        License grant to ICN

          Exclusive worldwide license in the Field under Roche patents and
          know-how, with no right to sublicense except as set forth below.

          "Field" is IL-12 protein for all indications.

2.        Roche option and right of first refusal; ICN right to sublicense

          Roche has an exclusive option to obtain exclusive worldwide rights to
          the product, including to practice improvements to the product
          developed by ICN. Roche's option commences upon notice from ICN that
          it has completed [REDACTED] and shall end [REDACTED] days thereafter.
          If Roche exercises its option, the parties shall enter into an
          exclusive worldwide license agreement which includes the following
          terms:

          Roche reimburses ICN for [REDACTED].
          Roche pays milestones on [REDACTED].
          Roche pays ICN royalties.

          The specific terms shall be negotiated in good faith and shall be
          reasonable and customary for similar products at a similar stage of
          development.

          Prior to commencement of Roche's option and during the pendency of
          Roche's option, ICN may not sublicense product rights. If Roche waives
          its option or Roche's option expires, ICN may sublicense product
          rights at its discretion, subject to the event that if ICN does not
          have a commercial partner at the end of [REDACTED] for any given
          country, in such country Roche shall have a right of first refusal to
          become ICN's commercial partner.

3.        Consideration

3.1       Upfront Payment--USD [REDACTED] million.

3.2       Milestone payments

          - USD [REDACTED] upon [REDACTED]
          - USD [REDACTED] upon [REDACTED]
          - USD [REDACTED] upon [REDACTED]
          - USD [REDACTED] upon [REDACTED]

<PAGE>
3.3       Royalty Payments--ICN shall pay royalties equal to [REDACTED] of Net
          Sales. Royalties shall be paid quarterly and--on a country by country
          basis--for the longer of (1) 10 years after the first sale or (2)
          patent expiration.

          Except with respect to Genetics Institute ("GI") ICN may deduct
          [REDACTED] of royalties to third parties. With respect to GI ICN shall
          be responsible for the first [REDACTED], but may deduct [REDACTED] of
          any royalties to GI beyond the first [REDACTED].

4.        Development

          - ICN to bear all development costs

          - Steering committee to oversee development; decisions on a consensus
            basis, in case of dissent, escalation to high level management, if
            no resolution, final decision by ICN;

5.        Manufacturing

          ICN has the right to manufacture for clinical and commercial supplies
          at its cost.

6.        Termination

          ICN has the right to terminate the Agreement at any time without cause
          with six months prior notice.

7.        Press Releases

          Unless required by law, neither party shall issue any press release or
          any other public disclosures related to this Term Sheet without the
          prior written consent of the other party.
<PAGE>

                                    EXHIBIT B
                                    ---------

                               TRANSFER AGREEMENT
                                       FOR
                                   PROPERTY B

<PAGE>

                                LICENSE AGREEMENT

                                     BETWEEN

                                 RIBAPHARM INC.
                                    LICENSOR

                                       AND

                             HOFFMANN-LA ROCHE INC.
                                    LICENSEE

                                       AND

                            F. HOFFMANN-LA ROCHE LTD
                                    LICENSEE

                            DATED AS OF JUNE 29, 2001

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S> <C>                                                                                                         <C>
                                                                                                               PAGE
ARTICLE I Definitions and Interpretation..........................................................................1

         1.1               Definitions............................................................................1
         1.2               Interpretation.........................................................................6

ARTICLE II Grant of License.......................................................................................6

         2.1               License................................................................................6
         2.2               Sublicense.............................................................................7
         2.3               Exclusivity............................................................................7
         2.4               Limit of Grant.........................................................................7
         2.5               Provision of Information...............................................................7
         2.6               Back-ups; Follow-ups...................................................................7

ARTICLE III Eastern European Countries............................................................................8

         3.1               Right of First Refusal.................................................................8
         3.2               European Union Membership..............................................................8

ARTICLE IV Compensation...........................................................................................8

         4.1               License Fee............................................................................8
         4.2               Milestone Payments.....................................................................9
         4.3               Royalties..............................................................................9
         4.4               Duration of Royalty Obligations.......................................................10
         4.5               Payment Terms.........................................................................10
         4.6               Taxes.................................................................................11
         4.7               Reports...............................................................................11
         4.8               Records...............................................................................11
         4.9               Sales in Foreign Currencies...........................................................12

ARTICLE V Development Steering Committee.........................................................................13

         5.1               Appointment and Administration of Development
                           Steering Committee....................................................................13
         5.2               Responsibility and Authority of the
                           Development Steering Committee........................................................14

ARTICLE VI Development and Marketing Obligations.................................................................14

         6.1               Commercial Development Obligation.....................................................14
         6.2               Licensor's Costs of Development.......................................................15
         6.3               Provision of Diagnostic Kits..........................................................15
         6.4               Phase II, III and IV Clinical Trials..................................................16
         6.5               Supply and Manufacture................................................................16
         6.6               Use of Name...........................................................................16
         6.7               Sampling..............................................................................16
</TABLE>
                                       i
<PAGE>
<TABLE>
<S> <C>                                                                                                         <C>

         6.8               Investigator-Initiated Trials; Indigent Sales.........................................16
         6.9               Foreign Registration and Laws.........................................................17

ARTICLE VII Patent Matters.......................................................................................17

         7.1               Patent Prosecution and Maintenance....................................................17
         7.2               Notification of Infringement..........................................................17
         7.3               Patent Enforcement....................................................................18
         7.4               Ownership of Improvements.............................................................18
         7.5               Ownership of Trademarks...............................................................19
         7.6               Adverse Reactions.....................................................................19

ARTICLE VIII Representations, Warranties and Limitation of Liability.............................................19

         8.1               Representations of Licensor...........................................................19
         8.2               Representations of Licensee...........................................................20
         8.3               Mutual Representation and Warranty....................................................21

ARTICLE IX Indemnification and Insurance.........................................................................21

         9.1               Indemnification by Licensee...........................................................21
         9.2               Indemnification by Licensor...........................................................21
         9.3               Obligations of the Party Seeking to Be Indemnified....................................22
         9.4               Other Indemnification Matters.........................................................22

ARTICLE X Confidentiality and Publication........................................................................23

         10.1              Confidentiality.......................................................................23
         10.2              Disclosure............................................................................23
         10.3              Publicity.............................................................................24
         10.4              Scientific Publications...............................................................24

ARTICLE XI Term and Termination..................................................................................24

         11.1              Term..................................................................................24
         11.2              Termination Without Cause.............................................................25
         11.3              Termination For Cause.................................................................25
         11.4              Rights and Obligations Upon Expiration or Termination.................................26
         11.5              Surviving Provisions..................................................................27

ARTICLE XII Assignment; Successors...............................................................................27

         12.1              Assignment............................................................................27
         12.2              Binding Upon Successors and Assigns...................................................27

ARTICLE XIII Dispute Resolution..................................................................................28

         13.1              Arbitration...........................................................................28
         13.2              Pre-Litigation Dispute Resolution.....................................................28
         13.3              Provisional Remedy....................................................................28
</TABLE>
                                       ii

<PAGE>
<TABLE>
<S> <C>                                                                                                         <C>

ARTICLE XIV General Provisions...................................................................................28

         14.1              Relationship of the Parties...........................................................28
         14.2              Excusable Delay.......................................................................29
         14.3              Notices...............................................................................29
         14.4              Expenses..............................................................................30
         14.5              Further Assurances....................................................................30
         14.6              Amendment.............................................................................30
         14.7              Waiver................................................................................31
         14.8              No Third Party Beneficiaries..........................................................31
         14.9              Entire Agreement......................................................................31
         14.10             Construction..........................................................................31
         14.11             Incorporation of Exhibits.............................................................31
         14.12             Counterparts..........................................................................31
         14.13             Severability..........................................................................31
         14.14             Joint and Several Liability of Licensor...............................................32
         14.15             Bankruptcy............................................................................32
         14.16             Remedies Cumulative...................................................................32
         14.17             Governing Law.........................................................................32
</TABLE>

                                      iii
<PAGE>

                                    EXHIBITS

A        Eastern European Countries

                                      iv
<PAGE>

                                LICENSE AGREEMENT
                                -----------------

         This License Agreement (this AGREEMENT) is made as of June 29, 2001
(the EFFECTIVE DATE) by and among Ribapharm Inc., a Delaware corporation (the
LICENSOR), Hoffmann-La Roche Inc., a New Jersey corporation, and F. Hoffmann-La
Roche Ltd, a Swiss corporation (together, the LICENSEE).

                                    RECITALS

         A.       Licensor is engaged in the research, development, manufacture,
and sale of therapeutic products and technologies.

         B.       Licensor has acquired or possesses the right to license
worldwide proprietary rights to an immunomodulator known as Levovirin(TM) for
the treatment of viral infections including hepatitis C.

         C.       Licensee has expertise in researching, developing,
manufacturing and marketing pharmaceutical products for the treatment of human
diseases and wishes to develop, manufacture, and market the Products based on
Levovirin(TM) .

         D.       Licensor wishes to grant an exclusive license to Licensee and
Licensee wishes to acquire an exclusive license to develop, manufacture, and
market such Products.

                                    AGREEMENT

         In consideration of the above and the mutual covenants set forth in
this Agreement and other valuable consideration received by the Parties, the
Parties agree as follows.

                                   ARTICLE I

                         DEFINITIONS AND INTERPRETATION

         1.1      DEFINITIONS

         In this Agreement, capitalized terms have the respective meanings set
forth below.

         ACT means the Federal Drug and Cosmetic Act (21 U.S.C.ss.321, et seq.),
including any amendments or supplements.

         ACCOUNTING PERIOD means a calendar quarter commencing on the first day
of an Accounting Period, respectively January 1, April 1, July 1, and October 1,
each being the first day, and finishing the last day of an Accounting Period
respectively on March 31, June 30, September 30 and December 31, each being the
last day.

         ADJUSTED GROSS SALES means the amount of gross sales of Products
(whether in active ingredient form, semi-finished form, finished product form,
or otherwise) invoiced by Licensee, its Affiliates and its Sublicensees to Third
Parties less deductions for returns
<PAGE>

(including allowances actually given for spoiled, damaged, out-dated, rejected,
returned Products sold, withdrawals and recalls), rebates (price reductions,
rebates to social and welfare systems, chargebacks, government mandated rebates
and similar types of rebates, such as P.P.R.S, Medicaid), volume (quantity)
discounts, taxes (value added or sales taxes, government mandated exceptional
taxes and other taxes imposed on the gross sales amount), as computed on a
product by product basis in the Licensee's worldwide "sales statistics" measured
in Swiss Francs for the countries concerned, whereby the amount of such sales in
foreign currencies is converted into Swiss Francs on the basis of the average
monthly rate of exchange at the time in accordance with Licensee's then current
standard practices, which will be in accordance with international accounting
standards. Notwithstanding the foregoing, amounts received by Licensee and its
Sublicensees for the sale of Products among Licensee and its Sublicensees for
resale will not be included in the computation of Adjusted Gross Sales.

         AFFILIATE of a Party means any corporation or other business entity
that controls, is controlled by, or is under common control with a Party, where
CONTROL means direct or indirect ownership of more than fifty percent (50%) of
the voting interest or income interest in a corporation or entity, or such other
relationship as, in fact, constitutes actual control of management. Anything to
the contrary in this paragraph notwithstanding, Genentech, Inc., a Delaware
corporation, will not be deemed an Affiliate of Licensee.

         AGREEMENT has the meaning set forth in the preamble.

         APPROVAL AUTHORITY means a governmental authority whose approval is
required in a country for any Product Registrations.

         BANKRUPTCY CODE means Title 11, U.S. Code.

         BREACHING PARTY has the meaning set forth in Section 11.3.

         BUSINESS DAY means a day when banks are open for business in New York
City.

         CLAIMS has the meaning set forth in Section 9.1.

         COMBINED PRODUCT means a pharmaceutical product with two or more active
ingredients, one of which is a Product and one of which is not, sold as a single
item for one price.

         COMPOSITION OF MATTER PATENT means issued US patent # US6130326 and all
patent applications and patents based upon or claiming priority thereto.

         COMMERCIAL SALE means, with respect to a Product in any country in the
Territory, (i) any sale by Licensee or any of its Affiliates or Sublicensees
after Product Registration, which transfers to a Third Party purchaser physical
possession and title to commercial quantities of the Product in such
country,(ii) Compassionate Sales,(iii) Indigent Sales and (iv) those
investigator initiated Phase IV Clinical Trials on which a royalty is due in
accordance with Section 6.8 hereof.

         COMPASSIONATE SALES means, with respect to a Product in any country in
the Territory, any sale of the Product by Licensee or any of its Affiliates or
Sublicensees that is required or permitted by a governmental authority to be
made to certain persons or classes of persons in such country,

                                       2
<PAGE>
before or after the Product has been approved for use in such country by the
Approval Authority, but before the price of the Product (or reimbursement for
the Product) has been determined by the applicable governmental authority in
such country.

         DEVELOPMENT STEERING COMMITTEE has the meaning set forth in
Section 5.1.

         EASTERN EUROPEAN COUNTRY means each of the countries listed in
Exhibit A.

         EFFECTIVE DATE has the meaning set forth in the preamble.

         EMEA means the European Medicines Evaluation Agency, or any successor.

         EUROPEAN UNION means the amalgamation of European member states created
by the Treaty on European Union (commonly called the Maastricht Treaty)
effective January 1, 1993.

         EXECUTIVE OFFICERS has the meaning set forth in Section 5.1(c).

         FDA means the United States Food and Drug Administration, or any
successor.

         FIELD means all human pharmaceutical applications of the Products.

         HANDLE has the meaning set forth in Section 7.1.

         IAS has the meaning set forth in Section 4.8.

         IMPROVEMENT means any and all Licensed Technology conceived after the
Effective Date by Licensor solely or jointly.

         IND means an investigational new drug application, as more fully
defined in the Regulations.

         INDEMNIFIED PARTY has the meaning set forth in Section 9.3.

         INDEMNIFYING PARTY has the meaning set forth in Section 9.3.

         INDIGENT SALES means, with respect to a Product in any country in the
Territory, any sale of the Product by Licensee or any of its Affiliates or
Sublicensees that is required by a governmental authority to be made to certain
persons or classes of persons in such country at a below market price to allow
such persons access to treatment.

         JOINT INVENTIONS means any and all Improvements that are conceived or
reduced to practice jointly by Licensor and Licensee.

         LICENSEE has the meaning set forth in the preamble.

         LICENSED COMPOUNDS means the immunomodulator, LevovirinTM which is
designated by Licensor as ICN 17261.

                                       3
<PAGE>
         LICENSED PATENTS means rights under patents and patent applications, as
well as corresponding certificates of invention or certificates of protection,
substitutes, extensions, supplementary protection certificates, renewals,
continuations-in-part, divisions, patents of addition (re-examination or
re-issue), in any country of the Territory, which (a) but for this Agreement
would be infringed by the developing, making, having made, marketing, importing,
using, offering for sale or sale by Licensee, its Affiliates or Sublicensees of
Products in the Field and (b) are owned by, or licensed to, Licensor as of the
Effective Date or during the term of this Agreement, to the extent such rights
are necessary to develop, make, have made, market, import, use, offer for sale
or sell Products in the Field in the Territory.

         LICENSED TECHNOLOGY means any and all proprietary information, and all
patentable and non-patentable inventions, discoveries, experience, disclosure
claims, formulas, processes, procedures, compositions of matter, specifications,
methods, techniques, trade secrets, technologies, data, know-how, results
(including physical, chemical, biological, toxicological, pharmacological,
pre-clinical and clinical data, product forms and formulations of the Licensed
Compounds) either owned, developed, acquired by, or licensed to Licensor and to
which Licensor has the right to grant licenses or sublicenses, without breach of
other agreements to which Licensor is a party on the Effective Date, before or
during the Term of this Agreement and which contributes to, or has contributed
to, the development, manufacture, registration, marketing, sale or use of a
Product.

         LICENSOR has the meaning set forth in the preamble.

         MAJOR MARKET COUNTRY means each of the following countries and its
territories and possessions: (i) Germany; (ii) the United Kingdom; (iii) France;
(iv) Spain; (v) Italy; and (vi) Japan.

         MAJOR MARKET COUNTRY APPROVAL AUTHORITY means

         (a)      in the case of Germany, the United Kingdom, France, Spain and
                  Italy -- the EMEA; and

         (b)      in the case of Japan the Japanese Ministery of Health and
                  Labor (MOHL).

         MATERIAL CONTRACT CLAIMS has the meaning set forth in Section 9.4(a).

         MILESTONE means any event relating to the development and
commercialization of Products set forth in Section 4.2.

         MILESTONE PAYMENT means any of the payments required under in Section
4.2.

         NDA means a New Drug Application filed with the FDA for marketing
approval for a drug pursuant to the Act and the Regulations.

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

                                       4
<PAGE>
other direct sales expenses). Notwithstanding the foregoing, amounts received by
Licensee and its Affiliates and its Sublicensees for the sale of Products among
Licensee and its Affiliates and its Sublicensees for resale will not be included
in the computation of Net Sales.

         NON-BREACHING PARTY has the meaning set forth in Section 11.3(a).

         PARTY means each of Licensor and Licensee.

         PHASE I CLINICAL TRIAL means the initial introduction of an
investigational new drug into humans designed to determine the metabolism and
pharmacologic actions of the drug in humans, the side effects associated with
increasing doses, and, if possible, to gain early evidence on effectiveness, and
also includes studies of drug metabolism, structure-activity relationships, and
mechanism of action in humans, as well as studies in which investigational drugs
are used as research tools to explore biological phenomena or disease processes.

         PHASE II CLINICAL TRIAL means the controlled clinical studies conducted
to evaluate the effectiveness of a drug for a particular indication or
indications in patients with the disease or condition under study and to
determine the common short-term side effects and risks associated with the drug.

         PHASE III CLINICAL TRIAL means expanded controlled and uncontrolled
clinical trials performed after preliminary evidence suggesting effectiveness of
a drug has been obtained, in order to gather the additional information about
effectiveness and safety that is needed to evaluate the overall benefit-risk
relationship of the drug and to provide an adequate basis for physician
labeling.

         PHASE IV CLINICAL TRIAL means post-marketing studies, whether
instigated by a Party or by an applicable regulatory authority in the Territory,
to delineate additional information about a drug's risks, benefits, and optimal
use, including but not limited to studying different doses or schedules of
administration than were used in a Phase II Clinical Trial, use of the drug in
other patient populations or other stages of the disease, or use of the drug
over a longer period of time.

         PRODUCT means any human pharmaceutical product containing, in whole or
as a component, one or more of the Licensed Compounds.

         PRODUCT PERCENTAGE means the proportion of a Combined Product
attributable to a Product, as agreed by the Parties after consideration of (i)
the respective contribution of each active ingredient to the overall efficacy of
the Combined Product, (ii) the respective market value of the Licensed Compound
used alone and the other active ingredients used alone, (iii) the respective
cost of goods for the Licensed Compound and the other active ingredients, and
(iv) other factors customarily used in the pharmaceuticals industry to apportion
value to active ingredients of pharmaceutical products.

         PRODUCT REGISTRATIONS means any and all government approvals required
by any government or regulatory authority in the Territory necessary to permit
the development, manufacture, marketing, pricing, reimbursement, importing, use
or sale of Products in any part of the Territory.

                                       5
<PAGE>
         RECIPIENT has the meaning set forth in Section 10.2(a).

         REGULATIONS means the regulations made under the Act, as amended or
supplemented.

         SUBLICENSEES means any and all Third Parties to whom Licensee has
granted a sublicense under Section 2.2.

         TERM means the term of this Agreement, as set forth in Section 11.1.

         TERRITORY means all the countries of the world and their territories
and possessions except for each Eastern European Country excluded from the
Territory in accordance with Section 3.1.

         THIRD PARTY means any person other than Licensor, Licensee or a
Sublicensee, or any of their Affiliates.

         UNITED STATES means the United States of America and its territories
and possessions.

         1.2      INTERPRETATION

         In this Agreement, unless the context requires otherwise

                  (a)      the singular includes the plural and vice versa;

                  (b)      words denoting persons include corporations,
partnerships and other legal persons;

                  (c)      a reference to a specified section,  paragraph or
schedule is a reference to that specified section, paragraph or schedule of
this Agreement;

                  (d)      the article and section headings and the Table of
Contents are for convenience only and do not affect the interpretation of
this Agreement;

                  (e)      "including" means including without limitation; and

                  (f)      a reference to a Party includes its successors and
permitted assigns.

                                   ARTICLE II

                                GRANT OF LICENSE

          2.1      LICENSE

         Licensor grants to Licensee and its Affiliates, and Licensee accepts on
behalf of itself and its Affiliates, the sole and exclusive right and license
under the Licensed Technology and Licensed Patents within the Field throughout
the Territory (with the right to grant sublicenses in accordance with Section
2.2), to develop, manufacture, have manufactured, market, import, use, offer for
sale, and sell the Products.

                                       6
<PAGE>
          2.2      SUBLICENSE

                  (a)      Subject to Section 2.2(b), Licensee has the sole and
exclusive right to grant sublicenses under the Licensed Technology and Licensed
Patents within the Field throughout the Territory to any Third Party (as such, a
SUBLICENSEE), to develop, manufacture, have manufactured, market, import, use,
offer for sale, and sell the Products.

                   (b)     Licensee is required to obtain the written consent
of Licensor prior to the grant of any sublicense, such consent not to be
unreasonably withheld or delayed by Licensor. Licensee will be fully
responsible to Licensor for the performance of any and all terms of this
License Agreement by Licensee's Sublicensees.

          2.3      EXCLUSIVITY

         Licensor will not license or otherwise grant any right under the
Licensed Patents or Licensed Technology to develop, manufacture, have
manufactured, market, import, use, offer to sell, or sell the Products to any
Third Party during the Term in the Territory within the Field.

          2.4      LIMIT OF GRANT

         Licensee has no right or license with respect to the Licensed Patents
or Licensed Technology except as expressly granted in this Agreement.

          2.5      PROVISION OF INFORMATION

         Licensor will disclose and provide information relating to the Licensed
Patents or Licensed Technology to the Licensee to the extent reasonably
necessary to enable the Licensee to perform its obligations under this
Agreement, including but not limited to information relating to manufacturing,
CMC, pre-clinical and clinical data in respect of the Products, correspondence
with the FDA, and IND's but excluding the food effect study conducted in the
second quarter of 2001 and the monkey Pegasys/Levovirin combination toxicology
study initiated in the second quarter of 2001 unless reimbursement is provided
to Licensor in accordance with Section 6.2 hereof. All information disclosed
pursuant to this Section 2.5 will be subject to the confidentiality provisions
of Article X. As soon as practicable after the Effective Date, Licensor will
assign to Licensee all available IND's previously filed for Products.

          2.6      BACK-UPS; FOLLOW-UPS

                   (a)     BACK-UPS. In the event that the Development Steering
Committee determines that the development of the Licensed Compounds will not be
successful and decides not to pursue such development, then, to the extent
Licensor is free to do so, Licensor will negotiate in good faith a possible
license to Licensee for a substitute compound of the same class as Levovirin(TM)
[REDACTED], but only to the extent that Licensor is free to grant such a
license.

                   (b)     FOLLOW-UPS. In any event, if Licensor, during the
term of this License Agreement, has discovered [REDACTED]

                                       7
<PAGE>
[REDACTED], then the Parties will negotiate in good faith a license thereto on
terms to be negotiated in good faith between Licensor and Licensee, but only to
the extent that Licensor would have been free as of the Effective Date to grant
such a license.

                                  ARTICLE III

                           EASTERN EUROPEAN COUNTRIES

          3.1      RIGHT OF FIRST REFUSAL

                   (a)     Licensee will notify Licensor in writing of the
first  filing for Product Registration of a Product in a European Union member
country within forty five (45) days following the date of such filing. Upon
receipt of such notice, Licensor shall have thirty (30) days to notify Licensee
in writing of those Eastern European Countries in which Licensor wishes to
develop, market, import, use, offer for sale or sell Products.

                   (b)     Each Eastern European Country which is identified to
Licensee by Licensor in a notice given within the 30 day period under Section
3.1(a) will be deemed to be excluded from the Territory from the end of such 30
day period; provided that each Eastern European Country that is identified to
Licensee within the 30 day period under Section 3.1(a) will remain included in
the Territory in the event that Licensor has no significant marketing
organization at that time in such country.

                   (c)     As soon as reasonably practicable after such 30 day
period, for any Eastern European Countries excluded from the Territory, the
Parties will negotiate in good faith an agreement under which Licensor and
Licensee will provide for a supply agreement to allow Licensor to sell in those
Eastern European Countries.

          3.2      EUROPEAN UNION MEMBERSHIP

          If an Eastern European Country becomes a member of the European Union
after the Effective Date, and assuming Licensor has not at the time such country
becomes a member of the European Union exercised its rights under this Section 3
with respect to such country, Licensor will no longer have such rights with
respect to such country.

                                   ARTICLE IV

                                  COMPENSATION

          4.1      LICENSE FEE

         Licensee will pay to Licensor an initial nonrefundable license fee in
the amount of [REDACTED] within ten (10) Business Days after the later of (a)
receipt of an invoice for such amount from Licensor, and (b) the Effective Date.

                                       8
<PAGE>
          4.2      MILESTONE PAYMENTS

                   (a)     In addition to the license fee payable under
Section 4.1

                           (i)     upon the initiation of the first [REDACTED]
          Clinical Trial for the first Product for which [REDACTED] Clinical
          Trials are undertaken by Licensee or any of its Affiliates or any
          Sublicensee, Licensee will make a one-time payment to Licensor in the
          amount of [REDACTED];

                           (ii)    upon the filing of the first [REDACTED] for
          the first Product for which an [REDACTED] by Licensee or any of its
          Affiliates or any Sublicensee, Licensee will make a  one-time payment
          to Licensor in the amount of [REDACTED];

                           (iii)   upon the first approval by the [REDACTED] for
          a Product in respect of which an [REDACTED], Licensee will make a
          one-time payment to Licensor in the amount of [REDACTED]; and

                           (iv)    upon the first approval by a Major Market
          Country Approval Authority of an [REDACTED] for a Product, Licensee
          will make a one-time payment to Licensor in the amount of [REDACTED].

                   (b)     Each Milestone Payment due under Section 4.2(a) will
be due only once for the first Product in respect of which the indicated
Milestone occurs. Licensee will promptly notify Licensor in writing of the
occurrence of each Milestone. Licensee will make all Milestone Payments within
[REDACTED] after the later of (a) receiving an invoice from Licensor for
the applicable amount, and (b) the occurrence of the Milestone. The subsequent
occurrence of any similar event in respect of any Product will not give rise to
any additional obligation of Licensee to make any Milestone Payment. The payment
provided for in Section 4.2(a)(iv) will not be made for any subsequent approval
in any other Major Market Country.

          4.3      ROYALTIES

                   (a)     In addition to the amounts payable under Sections 4.1
and 4.2, Licensee will pay Licensor a royalty, computed on a country by country
basis, in an amount equal to [REDACTED] of Net Sales of each Product. If a
Product is included in a Combined Product, the royalty on the Product will be
calculated as [REDACTED] of Net Sales of the Combined Product, multiplied by the
Product Percentage. The Parties will use their best efforts to agree upon the
Product Percentage for a Combined Product prior to the first launch of that
Product.

                   (b)     Royalties on Net Sales will be calculated quarterly
as of March 31, June 30, September 30 and December 31 (each being the last day
of an Accounting Period) and will be paid by Licensee quarterly within sixty
(60) days after the end of each Accounting Period in which such Net Sales occur,
commencing with the calendar quarter in which the first Commercial Sale of any
Product is made by Licensee, any of its Affiliates or any Sublicensee.

                                       9
<PAGE>
                   (c)     If the Licensee, acting in a commercially reasonable
manner, obtains a license from one or more Third Parties in order to develop,
manufacture, have manufactured, market, import, use, offer for sale or sell the
Products in the Territory, the Licensee may reduce the royalties otherwise due
to Licensor hereunder by an amount equal to [REDACTED] of the total
cumulative consideration paid by the Licensee to such Third Party or Third
Parties, including any upfront payments, milestone payments and royalties,
provided, however, that in no event will the royalties due to Licensor hereunder
be reduced to less than [REDACTED] of Net Sales on account of this Section
4.3(c).

                   (d)     If a Third Party not under license from the Licensor
sells a product which is generically equivalent to a Product in a country or
countries in which Licensee, an Affiliate or Sublicensee is selling such Product
and the units of such Third Party's sales of such generically equivalent
product, as determined by a reliable independent party, are equal to or greater
than [REDACTED] of the total units of such Product and the generically
equivalent product sold in such country or countries for two consecutive
calendar quarters, then the royalty payable by Licensee to Licensor hereunder
with respect to such Product in such country(ies) shall be reduced by [REDACTED]
of the royalty set forth in Section 4.3 (a), provided, however, that subsequent
to such reduction if for four consecutive quarters the sales of such generically
equivalent product in such country or countries are less than [REDACTED] of the
total units of such Product and the generically equivalent product sold, then
the royalty payable shall be as set forth in Section 4.3 (a).

                   (e)     If an Approval Authority imposes a price limitation
for specific indications or patients, and Licensee claims that such limitation
significantly adversely affects its Adjusted Gross Sales for a Product in such
country, Licensor and Licensee will discuss an appropriate reduction in the
applicable royalty which shall apply for so long as such price limitation
continues to have such effect.

         4.4       DURATION OF ROYALTY OBLIGATIONS

         The obligation of Licensee to pay the royalty under Section 4.3 with
respect to each Product will terminate in each country in the Territory upon the
occurrence of the later of:

                   (a)     the expiration or invalidation of the last to expire
or be invalidated Composition of Matter Patents which but for this Agreement
would be infringed by the sale of such Product in such country; and

                   (b)     ten (10) years after the first Commercial Sale in
such country of such Product, except for countries in the European Union as to
which this requirement will be ten (10) years after the first Commercial Sale
in the European Union of such Product.

         4.5       PAYMENT TERMS

         Licensee will make all payments required under this Agreement in United
States Dollars. Licensor will invoice Licensee for all payments required under
Section 4.1 and 4.2. Any payments provided for under this Agreement that are not
made when due will bear interest at an annual rate until paid in full, equal to
the 60-day London interbank offered rate (LIBOR) plus [REDACTED], as such rate
may from time to time fluctuate. Licensee will make all

                                       10
<PAGE>
payments under this Agreement to Licensor by wire transfer of immediately
available funds to a bank account of Licensor designated by Licensor from time
to time in accordance with this Agreement.

         4.6       TAXES

                   (a)     All amounts owed under this Agreement will be paid
after deduction as required by law for all applicable taxes, fees, and other
charges except taxes imposed with respect to or based on a Party's net income.
In particular, any tax required to be withheld by Licensee under the laws of any
country for the account of Licensor (withholding taxes) will be promptly paid by
Licensee for and on behalf of Licensor to the appropriate governmental
authority, and Licensee will furnish Licensor with proof of payment of such tax.
All such tax actually paid on Licensor's behalf will be deducted from royalty
payments due Licensor or promptly reimbursed to Licensee if no further payments
are due Licensor. Licensee will assist Licensor in minimizing the withholding
taxes applicable to any payment made by Licensee and in claiming tax refund at
Licensor's request. Each Party agrees to assist the other Party in claiming
exemption from such withholding of taxes of any type under double taxation or
similar agreement or treaty from time to time in force and in minimizing the
amount required to be so withheld or deducted.

                   (b)     In the event of a change in the
United States-Switzerland income tax treaty which results in the imposition by
Switzerland or any of its political subdivisions of withholding taxes on any
royalty payment hereunder, Licensee will pay to Licensor an amount, in addition
to all royalties payable hereunder, such that after the deduction of all such
taxes (including interest, penalties or additions to tax) Licensor receives the
full amount of the royalty without diminution for such taxes.

         4.7       REPORTS

                   (a)     Licensee will give Licensor, not more than thirty
(30) calendar days after the end of each Accounting Period, a written report
estimating the Net Sales for such Accounting Period unless Licensee makes the
royalty payment required by Section 4.3 within such thirty (30) day period.

                   (b)     With each royalty payment Licensee will deliver to
Licensor a full and accurate supporting accounting documentation to include at
least the following information:

                   (i)     total Adjusted Gross Sales for each Product subject
to royalty sold (by country) by Licensee, its Affiliates and Sublicensees; and

                   (ii)    total royalties payable to Licensor for the relevant
period.

         4.8       RECORDS

         Licensee and its Affiliates will keep, and will require its
Sublicensees to keep, full, true and accurate books of account containing all
particulars that may be necessary for the purpose of calculating all royalties
payable to Licensor with accounting principles consistently applied from period
to period, in accordance with international accounting standards. Such books of

                                       11
<PAGE>
account will be kept at Licensee's principal place of business. At the expense
of Licensor, Licensor or its authorized independent public accountant has the
right to engage Licensee's officially appointed worldwide independent public
accountant to perform, on behalf of Licensor or its independent public
accountant, an audit, conducted in accordance with international accounting
standards (IAS), of such books and records of Licensee, its Affiliates and
Sublicensees, that are deemed necessary by Licensee's independent public
accountant to report on Net Sales of Products for the period or periods
requested by Licensor and the correctness of any report or payments made under
this Agreement. Upon timely request and at least thirty (30) calendar days'
prior written notice from Licensor, such audit will be conducted as an
additional audit work during Licensee's annual audit of the countries
specifically requested by Licensor, during regular business hours in such a
manner as to not unnecessarily interfere with Licensee's normal business
activities, and will be limited to results in the two (2) calendar years prior
to audit notification. Such audit will not be performed more frequently than
once per calendar year nor more frequently than once with respect to records
covering any specific period of time. All information, data documents and
abstracts herein referred to will be used only for the purpose of verifying
royalty statements or compliance with this Agreement, will be treated by
Licensor as licensee confidential information subject to the obligations of
Section 10 of this Agreement and need not be retained more than one (1) year
after completion of an audit hereof, if an audit has been requested; nor more
than two (2) years from the end of the calendar year to which each will pertain;
nor more than one (1) year after the date of termination of this Agreement.
Audit work papers and results will be shared by Licensee and Licensor. If the
audit reveals an overpayment, Licensor will promptly reimburse Licensee for the
amount of the overpayment. If the audit reveals an underpayment, Licensee will
promptly make up such underpayment. If the audit reveals that the royalties owed
by Licensee to Licensor for the countries specifically requested and for any
calendar year in total have been understated by more than five percent (5 %),
Licensee will, in addition, pay the reasonable costs of such additional audit
work. The failure of Licensor to request verification of any royalty calculation
within the period during which corresponding records must be maintained will be
deemed to be acceptance of the royalty reporting.

         4.9       SALES IN FOREIGN CURRENCIES

         Whenever for the purpose of calculating royalties, conversion from any
foreign currency is required, such conversion will be made as follows:

         (i)       for Licensees and its Affiliates:

                   When calculating the Adjusted Gross Sales, the amount of such
sales in foreign currencies will be converted into Swiss Francs as computed in
the Licensee's central Swiss Francs "sales statistics" for the countries
concerned, using for internal foreign currency translation the Licensee's then
current standard practices actually used on a consistent basis in preparing its
audited financial statements in accordance with IAS.

         (ii)      for a sublicensee in a country:

                   When calculating the Adjusted Gross Sales, the amount of such
sales estimate will be reported by the sublicensee to Licensee within thirty
(30) days from the end of an Accounting Period, after having converted each
applicable monthly sales in foreign currency into

                                       12
<PAGE>
the Swiss Franc (or the applicable reporting currency) using the average rate of
exchange published in The Wall Street Journal (or some other source agreed upon
in writing by the Parties for any particular country) for each respective month
of the applicable Accounting Period.

         When calculating the royalties on Net Sales, such conversion will be at
the average quarterly rate of exchange of the Swiss Franc to the United States
Dollars currency as retrieved from the Reuters' system for the applicable
Accounting Period, in accordance with Licensee's then current standard practices
and IAS.

                                   ARTICLE V

                         DEVELOPMENT STEERING COMMITTEE

         5.1       APPOINTMENT AND ADMINISTRATION OF DEVELOPMENT STEERING
                   COMMITTEE

                   (a)     As soon as practicable after the execution of this
Agreement and in no event later than thirty (30) days after the Effective Date,
the Parties will establish a steering committee to oversee and review the
development of the Products, which will be composed of two members selected by
Licensor and two members selected by Licensee (the DEVELOPMENT STEERING
COMMITTEE). At least one member appointed by each Party will be a senior officer
of such Party responsible for product development or a person with substantial
experience in product development for similar products who is acceptable to the
other Party. Each Party, at its sole discretion, may at any time during the Term
of this Agreement replace a member it has the right to designate upon prior
written notice to the other Party. Each Party will use reasonable efforts to
cause its respective representatives to attend all meetings of the Development
Steering Committee. Each Party will bear the travel and out-of-pocket expenses
incurred by its members or representatives in connection with the Development
Steering Committee's meetings.

                   (b)     The Development Steering Committee will meet at least
once every calendar quarter, or more or less frequently as the Parties mutually
deem appropriate, on dates and at times and places as agreed by the Parties. The
Development Steering Committee may also convene or be polled or consulted from
time to time by means of telecommunications, video conferences or
correspondence, as deemed by the Parties to be necessary or appropriate.

                   (c)     All recommendations and decisions of the Development
Steering Committee will be made by consensus of the members present at the
meeting. If the Development Steering Committee is unable to reach consensus with
respect to a particular matter after good faith discussions, the matter will be
referred for further review and resolution by the head of development of each
Party (the EXECUTIVE OFFICERS). The Executive Officers will use reasonable
efforts to resolve the matter promptly. If the Executive Officers are unable to
resolve the matter at hand after good faith discussions, Licensee reserves the
final decision-making authority with respect to such matter and will promptly
inform Licensor in writing of its resolution of the matter.

                   (d)     The Development Steering Committee will exist until
the first approval of a Product by the relevant Approval Authority is obtained
in each of the United States, Japan and the European Union, unless otherwise
agreed by the Parties.

                                      13
<PAGE>

          5.2      RESPONSIBILITY AND AUTHORITY OF THE DEVELOPMENT STEERING
                   COMMITTEE

         Subject to the other terms of this Agreement, the Development Steering
Committee will be responsible for review and exchange of information concerning
(i) the status of clinical trials of Products, (ii) review of the development of
Products including contracts relating to their development, (iii) the
formulation used in respect of Products, and (iv) Licensor's research programs
on [REDACTED]. Such Committee shall report to the Parties regarding its
proceedings. It is understood that the purpose of (iv) above is to regularly
inform Licensee so that it is able to negotiate under Section 2.6(a) if
appropriate.

                                   ARTICLE VI

                      DEVELOPMENT AND MARKETING OBLIGATIONS

         6.1       COMMERCIAL DEVELOPMENT OBLIGATION

                   (a)     Licensee will use best efforts, at its sole expense,
to diligently develop, commercialize, promote and sell at least one Product in
the Territory in the Field, as promptly as is reasonably and commercially
feasible. For purposes of this Section 6.1, the standard of best efforts with
respect to development matters shall mean the standard that Licensee uses for
similar products of similar potential at a similar stage of development on a
worldwide basis. With respect to commercialization, promotion and sale, the
standard of best efforts shall be measured on a region by region basis, wherein
the regions are (i) the European Union, (ii) the United States, (iii) Japan and
(iv) the rest of the world. The standard of best efforts with respect to each
region shall mean the standard that Licensee uses for similar products of
similar potential and at a similar stage of development in each of those
regions, respectively.

                   (b)     Licensee will keep the Development Steering Committee
generally informed as to Licensee's  progress in the development of Products.

                   (c)     If Licensor has a reasonable basis to believe that
 Licensee is not using best efforts under Section 6.1(a) , it may provide
written notice to Licensee specifying the basis for such belief. On receiving
such notice, Licensee will have the right to reply in writing to Licensor's
notice within thirty (30) days. If Licensor does not receive a reply from
Licensee within that period, or if the Parties disagree, either Party may refer
the matter for dispute resolution pursuant to Article XIII. If the dispute is
referred to arbitration, and the arbitrators conclude that Licensee has not
fulfilled its obligation under Section 6.1(a), and such failure is not cured
within sixty (60) days from the date of the decision, or if Licensee has not
taken the requisite steps to cure such failure within such period (if not
capable of cure within sixty (60) days), or does not diligently pursue such
cure, Licensor may, upon notice to Licensee, (i) convert Licensee's license
with respect to such Licensed Patent to a non-exclusive license in any or all
countries in the applicable region (but limited to only one additional licensee
in any country) or (ii) terminate Licensee's license in any or all countries in
the applicable region.

                                       14
<PAGE>
                   (d)     Notwithstanding the other provisions of this Section
6.1, the Parties anticipate (without guarantee) the following timelines with
respect to the development of the Products:

                   (i)      Phase I Clinical Trial - already commenced in the
         United States by Licensor.

                   (ii)     Phase II Clinical Trials - [REDACTED].

                   (iii)    Phase III Clinical Trials - [REDACTED] The
         Phase III Clinical Trials will be pivotal studies powered to show
         efficacy and safety and are anticipated to be completed within
         24 to 28 months.

                   (iv)    Analysis and NDA Submission - should be completed
         within six months following the conclusion of the Phase III Clinical
         Trial.

         6.2       LICENSOR'S COSTS OF DEVELOPMENT

                   (a)     Licensee acknowledges that Licensor has commenced
development and Phase I Clinical Trials of a Product in the United States prior
to the Effective Date. Licensee agrees to reimburse Licensor for (i) all Third
Party costs incurred by Licensor with respect to the development as well as the
Phase I Clinical Trials by Licensor, including the preparation of any and all
materials for such development and Phase I Clinical Trials, and (ii) all Third
Party costs incurred by Licensor with respect to the development of all Products
during the period between January 1, 2001 and the Effective Date. Licensee will
reimburse Licensor within thirty (30) days after the receipt of an invoice with
respect to such costs from Licensor.

                   (b)     The total costs to be reimbursed by Licensee to
Licensor under Section 6.2(a) will not exceed two million dollars (US
$2,000,000). Licensor and Licensee agree that such two million dollar figure was
based on an estimate of Third Party costs incurred through April 2001 and that
Licensor's costs exceeded two million dollars (US $2,000,000) because of the
unanticipated two month delay in entering into this License Agreement. In
consequence, the Licensor and Licensee will consider in good faith an additional
reimbursement to Licensor for the Third Party cost to Licensor of the following
two studies in the event Licensee, after reviewing a report thereof, decides it
wishes to receive and use these studies from Licensor: [REDACTED].

                   (c)     Licensee will not be responsible for expenses of
Licensor with respect to the development of any Products other than as set
forth in Sections 6.2 (a) and 6.2 (b).

         6.3       PROVISION OF DIAGNOSTIC KITS

         Licensee will provide HCV RNA diagnostic kits for all phases of
clinical trials with respect to Products.

                                       15

<PAGE>
         6.4       PHASE II, III AND IV CLINICAL TRIALS

                   (a)     Subject to Section 6.4(b), after the Effective Date,
Licensee will be responsible, at its sole expense, for all development costs
incurred by Licensee, and the preparation and filing of any NDA and sNDA, with
respect to any Products.

                   (b)     Licensor represents and warrants that all
non-clinical studies required for an IND filing with respect to Levovirin(TM)
have been conducted.

         6.5       SUPPLY AND MANUFACTURE

                   (a)     Licensee will manufacture or arrange the manufacture
of Product and/or identify and contract with a suitable manufacturer of Product.

                   (b)     If on the Effective Date Licensor has an inventory
of Levovirin(TM) in any form or formulation, and placebo of the same, either on
hand or on order (and, if on order, capable of assignment or transfer by
Licensor to Licensee), Licensor will supply such items at cost to Licensee at
Licensee's request.

         6.6       USE OF NAME

                   (a)     Subject to Section 6.6(b), Licensor may not use the
name of Licensee or any variant, and Licensee may not use the name of Licensor
or any variant (or of ICN Pharmaceuticals, Inc. or any variant), in each case in
connection with the advertising or sale of any Product, without the prior
written consent of the other.

                   (b)     Licensee will include in all the packaging and
product inserts for each Product a statement to the effect that the Product
is made under license from Ribapharm Inc. (or Licensor's then current name).

         6.7       SAMPLING

         Each of Licensee, any of its Affiliates and any Sublicensees may
provide customary royalty free sampling for a Product for use in the treatment
of chronic hepatitis C in a country within the Territory. After the commercial
launch of the Product in any country, the amount of royalty free sampling of the
Product in that country will be limited to [REDACTED]. If the aggregate amount
of sampling by Licensee, any of its Affiliates and Sublicensees exceeds this
percentage with respect to any calendar quarter, the amount of Net Sales will be
multiplied by a percentage equal to the sum of [REDACTED] plus a fraction
(expressed as a percentage) in which the numerator [REDACTED] and the
denominator is [REDACTED].

         6.8       INVESTIGATOR-INITIATED TRIALS; INDIGENT SALES

                   (a)     Other than in the case of specific
investigator-initiated Phase IV Clinical Trials to which the Parties mutually
agree, and subject to Section 6.8(b), Licensee shall have the right to provide
Product on up to an aggregate of [REDACTED] patients free of royalty to the
extent it is

                                       16
<PAGE>
provided in investigator-initiated Phase IV Clinical Trials at any time prior to
the date which is two years after the later of the launch of a Product in (i)
the United States and (ii) the European Union. Beyond such number of patients,
[REDACTED] of the royalty due under Section 4.3 shall be due on all
investigator-initiated Phase IV Clinical Trials. For purposes of the immediately
preceding sentence, if the Product is provided in exchange for a price the
royalty will be determined as if the Product were sold in an Indigent Sale in
accordance with Section 6.8(b); if the Product is provided free of charge the
royalty will be determined as if the Product were distributed as a sample in
accordance with Section 6.7.

                   (b)     For purposes of determining the royalty due under
Section 4.3 hereof with respect to Indigent Sales in any country in the
Territory, the computation of Net Sales shall be based on the actual sales price
received for such Indigent Sales but in no event on a sales price less than
[REDACTED] of the sales price received for ordinary sales of the Product in the
same country.

         6.9       FOREIGN REGISTRATION AND LAWS

         Licensee agrees to register this Agreement with any foreign
governmental agency and otherwise comply with applicable law within the
Territory affecting this Agreement and pay all related costs and legal fees. If
such law requires registration by Licensor, Licensee will so inform Licensor
which will pay the applicable costs.

                                  ARTICLE VII

                                 PATENT MATTERS

         7.1       PATENT PROSECUTION AND MAINTENANCE

         Licensor may, but is not obligated to, at its own expense, (i) prepare,
file, prosecute and maintain (collectively, HANDLE) all Licensed Patents, (ii)
consult with Licensee as to the Handling of such Licensed Patents in Major
Market Countries as it relates to Products, and (iii) furnish to Licensee copies
of all documents relevant to any such Handling. Licensor will furnish such
documents and consult with Licensee in sufficient time before any action by
Licensor is due to allow Licensee to provide comments thereon, which comments
Licensor must consider. At Licensor's expense and reasonable request, Licensee
shall cooperate, in reasonable ways in connection with the preparing, filing,
prosecution and maintaining of all Licensed Patents. Should Licensor decide that
it does not desire to Handle a patent or patent application within a Licensed
Patent in a country of the Territory, as it relates to Product, it will promptly
advise Licensee thereof. In such circumstances, Licensee may, but is not
obligated to, Handle the same at Licensee's own cost, to the extent that
Licensee desires to do so.

         7.2       NOTIFICATION OF INFRINGEMENT

         If a Party learns of infringement or threatened infringement or
misappropriation by a Third Party of any Licensed Patent, Licensed Technology or
Improvement relating to Product within the Territory, it will promptly notify
the other Party and provide the other Party with all available evidence.

                                       17
<PAGE>
         7.3       PATENT ENFORCEMENT

         Licensee has the first right, but not the duty, to institute actions
against Third Parties for past, current and future infringement or
misappropriation based on any Licensed Patent or Licensed Technology or
Improvement to the extent related to Product. If, within thirty (30) days of
receipt of the notice referred to in Section 7.2, Licensee does not give notice
to Licensor of Licensee's election to institute an action against an offending
Third Party, Licensor may, but is not required to, institute such an action. The
costs and expenses of any such action (including fees of attorneys and other
professionals) will be borne by the Party instituting the action or, if the
Parties elect to cooperate in instituting and maintaining the action, by the
Parties in such proportions as they may agree in writing. Each Party will
execute all necessary and proper documents and take appropriate action to allow
the other Party to institute and prosecute such actions. Any award paid by Third
Parties as a result of an action (whether by way of settlement or otherwise)
will be paid to the Party who instituted and maintained the action or, if all
Parties instituted and maintained the action, allocated among the Parties in
proportion to their respective contributions to the costs and expenses incurred
in the action.

         7.4       OWNERSHIP OF IMPROVEMENTS

                   (a)     The Parties will jointly own any and all Joint
Inventions, as well as all patent rights in and to all Joint Inventions.
Licensor will solely own all Improvements (other than Joint Inventions), as well
as all patent rights in and to such Improvements except as licensed herein. Each
Party will promptly inform the other Party in writing as soon as it concludes
that it has made an Improvement, but may do so promptly after filing a priority
patent application for such Improvement if a Party faces a possible loss of
rights in a Major Market Country.

                   (b)     As soon as a Party concludes that it wishes to file
a patent application claiming a Joint Invention, it will immediately inform
the other Party in writing and consult about filing procedures and allocation
of costs concerning such patent application. The Party will as early as
possible also provide the other Party with a copy of a draft specification, the
scope of claims and a determination of inventors for such claims, but may do so
promptly after filing a priority patent application for such Improvement if a
Party faces possible loss of rights in a Major Market Country.

                   (c)     The Party performing the priority filing preparation
agrees to (i) prepare, file and prosecute and maintain such priority,
corresponding foreign patents, and resulting patents, (ii) consult with the
other Party as to the preparing, filing, prosecuting and maintaining of such
patent applications and resulting patents in the Major Market Countries, and
(iii) furnish the other Party with copies of all documents relevant to the
preparation, filing, prosecution and maintenance. Unless otherwise agreed, the
filing Party will furnish such documents to and consult with the other Party in
sufficient time before any action by the filing party is due to allow the other
party to provide comments, which comments the filing Party must consider. If the
filing Party decides that it does not desire to file, prosecute or maintain such
a patent application or resulting patent in any country of the Territory, it
will promptly advise the other Party in writing, and the other Party will then
have the right, but not the obligation, to file, prosecute and/or maintain the
same at its own cost, to the extent it desires to do so.

                                       18
<PAGE>
                   (d)     Section 7.1 will govern patent prosecution and
maintenance of Improvements other than Joint Inventions.

         7.5       OWNERSHIP OF TRADEMARKS

         Licensee will own all trademarks associated with or used in connection
with the manufacture, marketing and sale of any Product, together with
associated goodwill. Licensee will be responsible for obtaining, maintaining and
protecting all applicable trademarks in connection with the manufacture,
marketing and sale of Product.

         7.6       ADVERSE REACTIONS

         Before the commercial launch of each Product, each Party will inform
the other Party promptly of any adverse reactions, reports and information
regarding the Product occurring in the Territory which comes to its knowledge
and which may have to be reported to the appropriate health authorities within
the Territory. After the commercial launch of any Product, if any adverse
reactions to the Product occur in the Territory, Licensee will promptly inform
Licensor. Licensor will inform Licensee of adverse reactions to the Product
outside the Territory, of which Licensor has knowledge and, wherever Licensor
has granted an exclusive license covering the Product outside of the Territory,
Licensor will require its licensee thereunder to inform Licensor of such adverse
reactions. In the event Licensor markets the Product outside the Territory,
Licensor and Licensee will negotiate in good faith a pharma co-vigilance
agreement.

                                  ARTICLE VIII

             REPRESENTATIONS, WARRANTIES AND LIMITATION OF LIABILITY

         8.1       REPRESENTATIONS OF LICENSOR

         Licensor represents and warrants to Licensee as follows.

                   (a)     Licensor is a corporation duly organized under the
laws of the State of Delaware, and has all requisite legal and corporate power
and authority to carry on its business and to perform its obligations under this
Agreement. All action on the part of Licensor necessary for the execution and
delivery of this Agreement and the performance of Licensor's obligations under
this Agreement has been taken. The person(s) executing this Agreement on behalf
of Licensor have all necessary corporate powers and have been duly authorized by
Licensor to execute, and deliver this Agreement on its behalf. This Agreement
constitutes a valid and binding obligation of Licensor, enforceable in
accordance with its terms. Except as have been or will be obtained by Licensor
and except for Product Registrations, no permit, consent, approval or
authorization of, or declaration to or filing with, any person, party or
governmental authority is required in connection with the delivery,
consummation, or performance by Licensor of this Agreement.

                   (b)     The execution, delivery and performance of this
Agreement by Licensor will not, with or without notice or the passage of time or
both, result in any violation of, be in conflict with or constitute a default
under any material contract, obligation or commitment to

                                       19
<PAGE>
which Licensor is a Party or by which it is bound, or, to the best knowledge of
Licensor, any statute, rule or governmental regulation applicable to Licensor.

                   (c)     Licensor and ICN Pharmaceuticals, Inc. own or
control under valid licenses with the right of sublicense all right, title and
interest in and to the Licensed Patents and Licensed Technology. As of the
Effective Date of this Agreement, to the best knowledge of Licensor, there are
no adverse actions, suits, or claims pending or threatened against Licensor in
any court or by or before any governmental body or agency with respect to the
Licensed Technology or the Licensed Patents and, to the best knowledge of
Licensor, there are no Third Party patents which might give rise to such
actions, suits or claims.

         EXCEPT AS SET FORTH IN SECTIONS 8.1(A) THROUGH (C), LICENSOR MAKES NO
WARRANTY CONCERNING THE LICENSED PATENTS, THE LICENSED TECHNOLOGY OR THE
PRODUCTS INCLUDING THE FOLLOWING: (I) ANY EXPRESS OR IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WITH REGARD TO THE
PRODUCTS; (II) ANY WARRANTY AS TO THE VALIDITY OR SCOPE OF THE LICENSED PATENTS,
OR THAT ANY PRODUCT WILL BE FREE FROM INFRINGEMENT OF INTELLECTUAL PROPERTY
RIGHTS OF THIRD PARTIES; OR (III) ANY WARRANTY THAT NO THIRD PARTY IS INFRINGING
THE LICENSED PATENTS. IN NO EVENT WILL LICENSOR OR ITS AFFILIATES OR AGENTS BE
LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, OR LOST PROFITS, OF
LICENSEE.

         8.2       REPRESENTATIONS OF LICENSEE

         Licensee represents and warrants to Licensor as follows.

                   (a)     Hoffmann-La Roche Inc. is a corporation duly
organized under the laws of the State of New Jersey and F. Hoffmann-La Roche Ltd
is a corporation duly organized under the laws of Switzerland. Each of such
corporations has all requisite legal and corporate power and authority to carry
on its business and perform its obligations under this Agreement. All action on
the part of Licensee necessary for the execution and delivery of this Agreement
and the performance of Licensee's obligations under this Agreement has been
taken. The person(s) executing this Agreement on behalf of Licensee have all
necessary corporate powers and have been duly authorized by Licensee to execute
this Agreement on its behalf. This Agreement constitutes a valid and binding
obligation of Licensee, enforceable in accordance with its terms. Except as have
been or will be obtained by Licensee and except for Product Registrations, no
permit, consent, approval or authorization of, or declaration to or filing with,
any person, party or governmental authority is required in connection with the
delivery, consummation or performance by Licensee of this Agreement.

                   (b)     The execution, delivery and performance of this
Agreement by Licensee will not, with or without notice or the passage of time or
both, result in any violation of, be in conflict with or constitute a default
under any material contract, obligation or commitment to which Licensee is a
party or by which it is bound, or, to the best knowledge of Licensee, any
statute, rule or governmental regulation applicable to Licensee.

                                       20
<PAGE>

         8.3       MUTUAL REPRESENTATION AND WARRANTY

         Each Party has disclosed all information in its possession or control
(other than information which is subject to confidentiality or non-disclosure
obligations) which is material to the other Party entering into this Agreement,
and such information does not contain any untrue statement of material fact or
omit to state a material fact.

                                   ARTICLE IX

                          INDEMNIFICATION AND INSURANCE

         9.1       INDEMNIFICATION BY LICENSEE

         Licensee will at all times, during and after the Term, indemnify,
defend and hold harmless Licensor, its Affiliates, and its directors, officers,
employees, and agents against any and all claims, demands, actions and
liabilities, including reasonable attorneys' fees and costs (collectively,
CLAIMS), arising out of or resulting from

                   (a)     any breach of any representation, warranty or
covenant of Licensee under this Agreement; or

                   (b)     any Third Party claim or suit resulting from the
development, manufacture, marketing, import, use, or sale of Products by
Licensee, its Affiliates, or its Sublicensees pursuant to this Agreement.

         This indemnity obligation will not apply to the extent that the claim,
loss, damage, liability or Third Party claim or suit is the result of any
grossly negligent act or willful misconduct of Licensor, its Affiliates, or its
Sublicensees, or their directors, officers, employees or agents.

         9.2       INDEMNIFICATION BY LICENSOR

         Licensor will at all times, during and after the Term, indemnify,
defend and hold harmless Licensee, its Affiliates, and its Sublicensees and
their respective directors, officers, employees and agents against any and all
claims, demands, actions, and liabilities, including reasonable attorneys' fees
and costs, arising out of or resulting from

                   (a)     any breach of any representation, warranty or
covenant of Licensor under this Agreement; or

                   (b)     the use of active ingredients supplied by Licensor
or its Affiliates to Licensee for use in clinical trials of any Product.

         This indemnity obligation will not apply to the extent that the claim,
loss, damage, liability or Third Party claim or suit is the result of any
grossly negligent act or willful misconduct of Licensee, its Affiliates, or its
directors, officers, employees or agents.

                                       21
<PAGE>

         9.3       OBLIGATIONS OF THE PARTY SEEKING TO BE INDEMNIFIED

         If Licensor, Licensee, any Affiliate or any Sublicensee (in each case,
an INDEMNIFIED PARTY) receives any written Claim which it believes is the
subject of indemnity under this Agreement by Licensor or Licensee, as the case
may be (in each case, an INDEMNIFYING PARTY), the Indemnified Party will, as
soon as reasonably practicable after forming such belief, give notice to the
Indemnifying Party, including full particulars of such claim to the extent known
to the Indemnified Party. Failure to give timely notice to the Indemnifying
Party will not release the Indemnifying Party from any liability to the
Indemnified Party except to the extent that the Indemnifying Party is injured by
such delay. The Indemnifying Party will have the right, by prompt notice to the
Indemnified Party, to assume the defense of the claim at the cost of the
Indemnifying Party. If the Indemnifying Party does not assume the defense of the
claim or, having done so, does not pursue the defense, the Indemnified Party may
assume the defense, with counsel of its choice, but at the cost and for the
account of the Indemnifying Party. If the Indemnifying Party so assumes such
defense, the Indemnified Party may participate through counsel of its choice,
but the cost of such counsel will be for the account of the Indemnified Party.
The Party not assuming the defense of the claim will render all reasonable
assistance to the Party assuming the defense, and all out-of-pocket costs of
such assistance will be for the account of the Indemnifying Party. No such claim
will be settled other than by the Party defending the claim, and then only with
the consent of the other Party, which will not be unreasonably withheld.

         9.4       OTHER INDEMNIFICATION MATTERS

                   (a)     All Claims for indemnification by an Indemnified
Party must be made within the following time periods or will be irrevocably
barred

                           (i)     for all Claims arising out of or based on an
         alleged breach by a Party of a representation or warranty of a material
         contract, obligation or commitment adversely affecting the Licensed
         Patents, Licensed Technology, or Licensed Compounds (MATERIAL CONTRACT
         CLAIMS), one (1) year plus the period of the statute of limitations
         applicable to the claim for the breach of contract, measured from the
         Effective Date; and

                           (ii)    for all other Claims, eighteen (18) months
         measured from the Effective Date.

                   (b)     The maximum aggregate liability of an Indemnifying
Party to an Indemnified Party with respect to all Claims under Section 9.2(a) is
the total aggregate amount of all payments theretofore made by Licensee to
Licensor (including the license fee specified in Section 4.1, Milestone
Payments, and royalties set forth in Article III) plus eighty percent (80%) of
the Licensee's development costs for the Product to date. Such liability for
Material Contract Claims may, at the election of the Indemnifying Party, be paid
in equal installments over a period of up to five (5) years. The maximum
aggregate liability of an Indemnifying Party with respect to Claims (other than
Material Contracts Claims) based on Sections 9.2(a) and 9.2(b) is the amount of
Sixty Million Dollars (US $60,000,000).

                                       22
<PAGE>
                   (c)     In the event of Material Contract Claims, Licensor
and Licensee will, as soon as practicable after the notice described in Section
9.3 is given, meet and confer with respect to assessing the stage of development
of Product and commitments of Licensee with respect to the development.

                   (d)     No Indemnified Party will make any Claims until the
aggregate of all Claims to date first equals or exceeds $200,000, at which
time all Claims to date and all Claims arising thereafter may be asserted.

                                   ARTICLE X

                         CONFIDENTIALITY AND PUBLICATION

         10.1      CONFIDENTIALITY

         Subject to Section 10.2, during the Term and for three years after the
Term, each Party will maintain in confidence, to the same extent to which such
Party maintains its own proprietary information, all information and materials
disclosed by the other Party, including Licensed Patents, Licensed Technology,
or Improvements, whether provided prior to or after the Effective Date, and will
not use such information or materials for any purpose except as permitted by
this Agreement, and will not disclose such information and materials to anyone
other than those of its Sublicensees, Affiliates, potential sublicensees,
employees, consultants, agents or subcontractors as are necessary in connection
with such Party's activities pursuant to this Agreement. Each Party will obtain
a written agreement from its Sublicensees, potential sublicensees, consultants,
agents and subcontractors (if any), prior to disclosure, to hold in confidence
and not make use of such trade secrets or other proprietary information for any
purpose other than as permitted by this Agreement. Licensee will be responsible
to Licensor for compliance with this Article X by all parties to which Licensee
may disclose such information or materials.

         10.2      DISCLOSURE

         The obligation of confidentiality in this Agreement does not apply to
the extent that

                   (a)     either Party (as such, the RECIPIENT) is required to
disclose information by order or regulation of a governmental agency or a court
of competent jurisdiction, except that the Recipient will not make any such
disclosure (other than as required under the securities laws of any
jurisdiction, any filing of information or materials with a stock exchange upon
which its securities are listed, or a filing of information or materials
required by a governmental regulatory agency), without first notifying the other
Party and allowing such other Party a reasonable opportunity to seek injunctive
relief from (or protective order with respect to) the obligation to make such
disclosure;

                   (b)     the Recipient can demonstrate that (i) the disclosed
information was at the time of such disclosure to the Recipient already in (or
later enters) the public domain other than as a result of actions of the
Recipient, Recipient's Affiliates, employees, Sublicensees, agents or
subcontractors in violation of this Agreement; (ii) the disclosed information
was rightfully known by the Recipient or its Affiliates (as shown by its written
records)

                                       23
<PAGE>
prior to the date of disclosure to the Recipient in connection with the
negotiation, execution or performance of this Agreement or independently
generated by the Recipient or its Affiliates at any time; or (iii) the disclosed
information was received by the Recipient or its Affiliates on an unrestricted
basis from a source unrelated to either Party to this Agreement and not under a
duty of confidentiality to the other Party;

                   (c)     disclosure is made to a government regulatory agency
as part of such agency's product license approval process; or

                   (d)     disclosure is necessary to obtain or secure patent
protection of any Licensed Patents or Licensed Technology.

         10.3      PUBLICITY

         Except as otherwise provided in this Agreement or required by law, no
Party will originate any publication, news release or other public announcement,
written or oral, whether in the public press, stockholders' reports or
otherwise, relating to this Agreement or to any sublicense under this Agreement,
or to the performance under this Agreement or under any sublicense under this
Agreement, without the prior written approval of the other Party, which approval
will not be unreasonably withheld or delayed.

         10.4      SCIENTIFIC PUBLICATIONS

         Licensee may publish scientific articles about Levovirin(TM) in
scientific publications. Licensor may only do so with consent of Licensee, which
consent may not be unreasonably withheld or delayed.

                                   ARTICLE XI

                              TERM AND TERMINATION

         11.1      TERM

                   (a)     This Agreement commences as of the Effective Date
and, unless sooner terminated in accordance with this Agreement, will expire in
each country in the Territory upon the occurrence of the later of

                           (i)      the expiration or invalidation of the last
         to expire or be invalidated of the Composition of Matter Patent(s)
         which but for this Agreement would be infringed by the sale of such
         Product using such Licensed Patents in such country, including any
         extension of such Licensed Patents; and

                           (ii)     ten (10) years after the first Commercial
         Sale in such country of such Product, except for countries in the
         European Union as to which this requirement will be ten (10) years
         after the first Commercial Sale in the European Union of such Product.

                   (b)     Upon expiration of this Agreement in a country with
respect to any Product, Licensee will have a perpetual, fully paid-up, royalty
free, non-exclusive license within

                                       24
<PAGE>
the Field in such country (with the right to grant sublicenses in accordance
with Section 2.2) to develop, manufacture, have manufactured, market, import,
use, offer for sale, and sell such Product.

         11.2      TERMINATION WITHOUT CAUSE

         Licensee may terminate this Agreement without cause, on a product by
product and country by country basis, upon six (6) months' prior written notice
to Licensor; provided that such termination will not release Licensee of any of
its obligations to Licensor up to the date of effect of termination, including
payment of all amounts owed to Licensor up to such date.

         11.3      TERMINATION FOR CAUSE

                   (a)     Either Party (as such, the NON-BREACHING PARTY) may
terminate this Agreement if

                           (i)      the other Party, its Affiliates or its
         Sublicensees (as such, the BREACHING PARTY) does not comply with any of
         its material obligations contained in this Agreement;

                           (ii)     the Non-Breaching Party gives notice to the
         Breaching Party specifying the nature of the default, requiring the
         Breaching Party to cure the default, and referring to the Non-Breaching
         Party's right to terminate this Agreement pursuant to this Section
         11.3; and

                           (iii)    the default is not cured within sixty (60)
         days after the receipt of such notice.

                   (b)     In addition to its right of termination in accordance
with Section 6.1(c), Licensor may terminate this Agreement if at any time:

                           (i)      Licensee files in any court or agency
         pursuant to any statute or regulation of the United States or of any
         foreign country, a petition in bankruptcy or insolvency or for
         reorganization or for an arrangement or for the appointment of a
         receiver or trustee of Licensee or of its assets;

                           (ii)     Licensee proposes a written agreement of
         composition or extension of its debts;

                           (iii)    Licensee is served with an involuntary
         petition against it, filed in any insolvency proceeding, and the
         petition is not dismissed within sixty (60) days after filing; or

                           (iv)     Licensee makes an assignment for the benefit
         of creditors.

                   (c)     Subsection intentionally omitted.

                   (d)     Subsection intentionally omitted.

                                       25
<PAGE>
                   (e)     Upon the occurrence of any event under Section
11.3(a)(iii) or Section 11.3(b) that entitles a Party to terminate this
Agreement, such Party may deliver to the other Party written notice of
termination of this Agreement, and the termination will be effective upon
delivery of such notice. The right to terminate will be in addition to and not
in substitution for any other available remedy.

                   (f)     If Licensor has the right to terminate this Agreement
under Section 11.3(a) or (b), Licensor at its option, instead of terminating
this Agreement, may by written notice to Licensee convert the license granted
under Section 2.1 (including the right to sublicense under Section 2.2) into a
non-exclusive license (but limited to only one additional licensee in any
country). All other provisions of this Agreement will otherwise remain in
effect.

                   (g)     A Party entitled to terminate this Agreement, or
convert the license under this Agreement, under this Section 11.3 may elect to
terminate or convert with respect to a particular country or countries in the
Territory rather than the entire Territory by giving written notice of such
election in the notice of intent to terminate or convert the license.

                   (h)     Waiver by either Party of any event or succession of
events giving rise to the right of termination will not deprive the waiving
Party of the right to terminate this Agreement under this Section 11.3 on the
basis of any subsequent event giving rise to such right.

         11.4      RIGHTS AND OBLIGATIONS UPON EXPIRATION OR TERMINATION

                   (a)     Upon the termination or expiration of this Agreement:

                           (i)      if termination or expiration occurs prior to
         Product Registration of a Product in any country in the Territory,
         Licensee will provide to Licensor all reports, data, samples and, if
         specifically required by an Approval Authority, other information,
         necessary or useful to allow Licensor to file for any Production
         Registrations of any Product in such country; and

                           (ii)     if termination or expiration occurs after
         Product Registration of a Product in any country in the Territory,
         Licensee will provide to Licensor all reports, data, samples and, if
         specifically required by an Approval Authority, other information,
         necessary or useful to allow Licensor to file for Product Registrations
         of any Product in the Territory, and grant Licensor reference to any
         Product Registrations and pricing or reimbursement approvals relating
         to any Products.

                  The Parties will negotiate in good faith a fair price for any
         items that Licensee is required to provide Licensor under this Section
         11.4(a).

                   (b)     Upon termination of this Agreement under Section 11.2
or 11.3, the Party retaining continuing rights with respect to a Product will be
entitled to buy from the other Party any active ingredients on hand and trade
marks in respect of the Product held by the other Party. The Parties will
negotiate such sale in good faith.

                   (c)     Upon termination of this Agreement by Licensor
pursuant to Section 11.2 or by Licensee pursuant to Section 11.3, Licensee will
transfer and assign to Licensor all such

                                       26
<PAGE>
trademarks relating to Product for which termination has occurred. The Parties
will negotiate in good faith the appropriate price therefor.

         11.5      SURVIVING PROVISIONS

         The Parties' rights and obligations under Sections 4.5, 4.6, 4.8, 6.6,
and Articles VII-XIV will survive any termination of this Agreement. Termination
or expiration of this Agreement for any reason will be without prejudice to any
rights accrued to the benefit of either Party prior to termination or expiration
and will not relieve either Party from obligations expressly indicated to
survive termination or expiration of this Agreement. Termination or expiration
of this Agreement will not terminate Licensee's obligation to pay all royalties
accrued. Any other provisions of this Agreement required to interpret and
enforce the Parties' rights and obligations under this Agreement will also
survive to the extent required for the full observation and performance of this
Agreement by the Parties.

                                  ARTICLE XII

                             ASSIGNMENT; SUCCESSORS

         12.1      ASSIGNMENT

                   (a)     Subject to Section 12.1(d), neither this Agreement
nor any interest under this Agreement may be assigned by Licensee, its
Affiliates, or its Sublicensees, without the prior written consent of the
Licensor.

                   (b)     Subject to Section 12.1(d), neither this Agreement
nor any interest under this Agreement may be assigned by Licensor or its
Affiliates without the prior written consent of Licensee.

                   (c)     No assignment will release the Licensee, its
Affiliates or its Sublicensees from any liability under this Agreement.

                   (d)     Licensee and Licensor may assign this Agreement or
any rights under this Agreement to any wholly owned Affiliate or to any
successor by merger, consolidation or sale of substantially all of the assets
used in the business which is the subject of this Agreement.

                   (e)     Any assignment not made in accordance with this
Section 12.1 will be void.

         12.2      BINDING UPON SUCCESSORS AND ASSIGNS

         Subject to the limitations on assignment under Section 12.1, this
Agreement binds all successors in interest and assigns of Licensor and Licensee.
Any successor or assignee of Licensee's interest will expressly assume in
writing the performance of all the terms and conditions of this Agreement to be
performed by Licensee.

                                       27
<PAGE>
                                  ARTICLE XIII

                               DISPUTE RESOLUTION

         13.1      ARBITRATION

         Subject to Section 13.2, any dispute, controversy or claim arising
under, out of or in connection with this Agreement, including any subsequent
amendments, will be referred to and finally be settled under the Rules of
Arbitration of the International Chamber of Commerce, Paris, France, in force on
the date of commencement of the arbitration by three arbitrators appointed in
accordance with those Rules. The place of arbitration will be New York City, New
York, and New York law will be applied. The language to be used in the arbitral
proceedings will be English.

         13.2      PRE-LITIGATION DISPUTE RESOLUTION

         No dispute under this Agreement will be referred to arbitration under
Section 13.1 until the following procedures have been satisfied. The Chief
Executive Officer of Licensor and the head of the Pharmaceuticals Division of
Licensee will meet as soon as practicable, as reasonably requested by either
Party, to review any dispute with respect to the interpretation of any provision
of this Agreement or with respect to the performance of either Party under this
Agreement. If the dispute is not resolved by the designated representatives by
mutual agreement within thirty (30) calendar days after a meeting to discuss the
dispute, either Party may at any time provide written notice to the other Party
specifying the terms of the dispute in reasonable detail and notifying the other
Party of its decision to institute arbitration proceedings under Section 13.1.

         13.3      PROVISIONAL REMEDY

         Nothing in this Agreement limits the right of either Party to seek to
obtain in any court of competent jurisdiction any interim relief or provisional
remedy, including injunctive relief. Seeking or obtaining any interim relief or
provisional remedy in a court will not be deemed a breach or waiver of the
agreement in this Agreement to arbitrate.

                                  ARTICLE XIV

                               GENERAL PROVISIONS

         14.1      RELATIONSHIP OF THE PARTIES

         For purposes of this Agreement, the relationship of Licensor to
Licensee is that of an independent contractor. Licensor and Licensee are not
joint venturers, partners, principal and agent, master and servant or employer
and employee. With respect to the subject matter of this Agreement, Licensor and
Licensee have no power to bind or obligate each other in any manner, other than
as expressly set forth in this Agreement. A change of this relationship is not
excluded by this Agreement.

                                       28
<PAGE>
         14.2      EXCUSABLE DELAY

         The failure or omission by a Party in the performance of any obligation
under this Agreement will not be deemed a breach of this Agreement or create any
liability if it arises from any cause or causes beyond the control of the Party,
such as strikes, riots, war, acts of God, invasion, fire, explosion, floods,
delay of carrier, shortage or failure in the supply of materials, energy
shortage and acts of government or governmental agencies or instrumentalities.
If due to such an event either Party is delayed or hindered in or prevented from
the performance of its duties or doing acts required under the terms of this
Agreement, the performance of such act will be excused for the period of the
delay not to exceed ninety (90) days. A Party subject to such an excusable delay
will take all reasonable steps to resolve any condition forming the basis of the
delay.

         14.3      NOTICES

         All notices, consents, requests, waivers and other communications in
connection with this Agreement:

                   (a)     must be in writing, signed by an authorized officer
of the sender (in the case of Licensee, an authorized officer of either of
Hoffmann-La Roche Inc. or F. Hoffmann-La Roche Ltd will be sufficient), and sent
by personal delivery, fax (with confirmation copy), internationally recognized
courier, or certified or registered mail, postage prepaid (airmail where
applicable);

                   (b)     will be deemed to be given when actually received;
and

                   (c)     must be sent to the receiving Party at the address
or fax number, as applicable, set forth below, or any replacement address or fax
number notified to the sender by notice actually received by the sender:

                                    if to Licensor, to:

                                    Ribapharm Inc.
                                    3300 Hyland Avenue
                                    Costa Mesa, California 92626
                                    United States of America
                                    Attention:       President
                                    Fax:             1 (714) 641-7207

                                       29
<PAGE>

                                    with a copy to:

                                    Coudert Brothers
                                    333 South Hope Street
                                    23rd Floor
                                    Los Angeles, California 90071
                                    United States of America
                                    Attention:       Gregory Keever, Esq.
                                    Fax:             1 (213) 229-2999

                                    if to Licensee, to:

                                    Hoffmann-La Roche Inc.
                                    340 Kingsland Street
                                    Nutley, New Jersey, 07110
                                    United States of America
                                    Attention:       Corporate Secretary
                                    Fax:             1 (973) 235-3500

                                    with a copy to:

                                    F. Hoffmann-La Roche Ltd
                                    Grenzacherstrasse 124
                                    4070 Basel, Switzerland
                                    Attention:       Corporate Law Department
                                    Fax:             41-62- 688 1396

         14.4      EXPENSES

         Except as expressly provided otherwise in this Agreement, all legal and
other costs and expenses incurred in connection with the negotiation and
entering into of this Agreement and the transactions contemplated by this
Agreement will be paid by the Party incurring such costs or expenses.

         14.5      FURTHER ASSURANCES

         Except as expressly provided elsewhere in this Agreement, each Party
will at its expense promptly execute and deliver any further instruments and
documents and take any further action as the other Party may reasonably request
in order to give effect to the transactions contemplated by this Agreement.

         14.6      AMENDMENT

         This Agreement may not be altered or otherwise amended except by an
instrument in writing signed by each of the Parties.

                                       30
<PAGE>
         14.7      WAIVER

         A Party may extend the time for the performance of any obligations of
the other Party, waive any inaccuracies and representations by the other Party
in this Agreement or in any document delivered pursuant to this Agreement or
waive compliance by the other Party with any of the covenants, conditions or
performance of any of its obligations under this Agreement. Any such waiver or
failure to insist upon strict compliance with such covenant, condition or
obligation will not operate as a waiver of, or estoppel with respect to, any
subsequent or other failure.

         14.8      NO THIRD PARTY BENEFICIARIES

         This Agreement does not confer any rights, remedies, agreements,
undertakings, obligations or liabilities on any person other than their
Affiliates, Sublicensees and successors-in-interest and permitted assigns.

         14.9      ENTIRE AGREEMENT

         This Agreement constitutes the entire agreement between the Parties
with respect to its subject matter and supersedes all prior discussions,
negotiations, correspondence, agreements, and understandings, both oral and
written, between the Parties with respect to its subject matter.

         14.10     CONSTRUCTION

         The Parties have participated jointly in the negotiation and drafting
of this Agreement. If a question of intent or interpretation arises, this
Agreement will be construed as if drafted jointly by the Parties and no
presumption or burden of proof will arise favoring or disfavoring a party
because of the authorship of any provision of this Agreement.

         14.11     INCORPORATION OF EXHIBITS

         The Exhibits identified in this Agreement are incorporated by reference
and made a part of this Agreement.

         14.12     COUNTERPARTS

         This Agreement may be executed in any number of counterparts and by
facsimile, each of which will be deemed to be an original and all of which
together will constitute one and the same agreement.

         14.13     SEVERABILITY

         If any provision of this Agreement is finally determined to be invalid,
unlawful or incapable of being enforced in a jurisdiction, (i) it will be deemed
to be severed from this Agreement in such jurisdiction, (ii) every other
provision of this Agreement will remain in full force and effect in such
jurisdiction, and (iii) the Parties will negotiate in good faith to modify this
Agreement so as to achieve the original intent of the Parties as closely as
possible in an acceptable manner with respect to such jurisdiction and (iv) such
invalidity, unlawfulness

                                       31
<PAGE>
or unenforceability will not affect the interpretation or enforcement of this
Agreement in any other jurisdiction.

         14.14     JOINT AND SEVERAL LIABILITY OF LICENSOR

         The representations, warranties, covenants and liabilities of Licensee
under this Agreement are joint and several.

         14.15     BANKRUPTCY

         All rights and licenses granted under or pursuant to this Agreement by
Licensor to Licensee are, and will otherwise be deemed to be, for purposes of
Section 365(n) of the Bankruptcy Code, licenses of rights to "intellectual
property" as defined under Section 101(35A) of the Bankruptcy Code. Licensee, as
a licensee of such rights under this Agreement, will retain and may fully
exercise all of its rights and elections under the Bankruptcy Code.

         14.16     REMEDIES CUMULATIVE

         The rights and remedies of the Parties under this Agreement are in
addition to any other rights available to them at law or in equity. The use of
any right or remedy by a Party does not preclude or waive the right to use any
other remedies. This Section 14.16 does not limit the obligations of the Parties
under Section 13.1 and Section 13.2.

          14.17    GOVERNING LAW

         This Agreement will be governed by and construed in accordance with the
laws of the State of New York.

                                       32

<PAGE>

         IN WITNESS WHEREOF, the Parties have executed this Agreement by their
duly authorized representatives as of the date set forth above.

                                      RIBAPHARM INC.

                                      By: /s/ Bill A. MacDonald
                                          ______________________________
                                      Name:  Bill A. MacDonald
                                      Title: Chief Financial Officer

                                      HOFFMANN-LA ROCHE INC.

                                      By: /s/ Frederick C. Kentz, III
                                          ______________________________
                                      Name:   Frederick C. Kentz, III
                                      Title:  Vice President

                                      F. HOFFMANN-LA ROCHE LTD.

                                      By: /s/ Bertrand Lehuu
                                          ______________________________
                                      Name:    Bertrand Lehuu
                                      Title:   Vice Director

                                      By: /s/ Urs Jaisli
                                          ______________________________
                                      Name:    Urs Jaisli
                                      Title:   Vice Director - Corporate Law

                                       33
<PAGE>

         To the extent the grant provided for in Section 2.1 of the License
Agreement requires a transfer of rights from ICN Pharmaceuticals, Inc., the
undersigned hereby agrees to transfer such rights to Ribapharm Inc. To the
extent Ribapharm Inc. is liable as an Indemnifying Party to make payments to
Licensee for Material Contract Claims, ICN Pharmaceuticals, Inc. hereby assumes
such liability and will be jointly and severally liable with Ribapharm Inc.

                                      ICN PHARMACEUTICALS, INC.

                                      By: /s/ Bill A. MacDonald
                                          _______________________________
                                      Name:    Bill A. MacDonald
                                      Title:   Executive Vice President

                                       34
<PAGE>

                                    EXHIBIT A

                           EASTERN EUROPEAN COUNTRIES

                                 CZECH REPUBLIC

                                    SLOVAKIA

                                     POLAND

                                    HUNGARY

                                   SLOVENIA

                                    CROATIA

                                  BOSNIA-HERC.

                                    ALBANIA

                                  YUGOSLAVIA

                                   BULGARIA

                                    ROMANIA

                                    ESTONIA

                                     LATVIA

                                   LITHUANIA

                                     RUSSIA

                                    UKRAINE

                                       35

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