Document:

Exhibit (10.42) 

MIDWEST EXPRESS
HOLDINGS, INC. 
2003 ALL EMPLOYEE
STOCK OPTION PLAN 

        1.    
PURPOSE  

        This
2003 All Employee Stock Option Plan (the “Plan”) of Midwest Express Holdings,
Inc. (the “Corporation”) is intended to provide certain employees with an
opportunity to become owners of the Corporation in recognition of their efforts, results
and contributions to the survival and success of the Corporation or of an Affiliate and,
through that ownership interest in the Corporation, to increase their motivation for and
interest in the Corporation’s or Affiliate’s long-term success. 

        2.              EFFECTIVE
DATE  

        The
Plan was adopted by the Board on August 20, 2003, subject to approval by the shareholders
of the Corporation at a Special Meeting of the Corporation’s shareholders to be held
in late 2003. The Plan will only be effective if approved by the shareholders and will be
effective as of the date of shareholder approval. 

        3.              CERTAIN
DEFINITIONS  

        “Affiliate”
means any company in which the Corporation owns directly or indirectly 20% or more of the
equity interest (collectively, the “Affiliates”). 

        “Board”
means the Board of Directors of the Corporation. 

        A
“Change in Control” shall be deemed to have occurred if the event set
forth in any one of the following paragraphs shall have occurred: 

        (a)              any
“Person” (as such term is defined in Section 3(a)(9) of the           Exchange
Act, as modified and used in Sections 13(d) and 14(d) thereof), other           than (i)
the Corporation or any of its subsidiaries, (ii) a trustee or other           fiduciary
holding securities under any employee benefit plan of the Corporation           or any of
its subsidiaries, (iii) an underwriter temporarily holding securities           pursuant
to an offering of such securities or (iv) a corporation owned, directly           or
indirectly, by the shareholders of the Corporation in substantially the same
          proportions as their ownership of stock in the Corporation (“Excluded
          Persons”), is or becomes the “Beneficial Owner” (as defined in
          rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
the           Corporation (not including in the securities beneficially owned by such
Person           any securities acquired directly from the Corporation or its Affiliates
after           July 16, 2003 pursuant to express authorization by the Board that refers
to this           exception) representing 25% or more of either the then outstanding
shares of           Common Stock or the combined voting power of the Corporation’s
then           outstanding voting securities; or  

        (b)              the
following individuals cease for any reason to constitute a majority of the
          number of directors then serving: individuals who, on July 16, 2003,
constituted           the Board and any new director (other than a director whose initial
assumption           of office is in connection with an actual or threatened election
contest,           including but not limited to a consent solicitation, relating to the
election of           directors of the Corporation, as such terms are used in Rule 14a-11
of           Regulation 14A under the Exchange Act) whose appointment or election by the
          Board or nomination for election by the Corporation’s shareholders was
          approved by a vote of at least two-thirds (2/3) of the directors then still in
          office who either were directors on July 16, 2003 or whose appointment,
election           or nomination for election was previously so approved; or  

        (c)              the
shareholders of the Corporation approve a merger or consolidation of the
          Corporation with any other corporation or approve the issuance of voting
          securities of the Corporation in connection with a merger or consolidation of
          the Corporation (or any direct or indirect subsidiary of the Corporation)
          pursuant to applicable stock exchange requirements, other than (i) a merger or
          consolidation that would result in the voting securities of the Corporation
          outstanding immediately prior to such merger or consolidation continuing to
          represent (either by remaining outstanding or by being converted into voting
          securities of the surviving entity or any parent thereof) at least 50% of the
          combined voting power of the voting securities of the Corporation or such
          surviving entity or any parent thereof outstanding immediately after such
merger           or consolidation, or (ii) a merger or consolidation effected to
implement a           recapitalization of the Corporation (or similar transaction) in
which no Person           (other than an Excluded Person) is or becomes the Beneficial
Owner, directly or           indirectly, of securities of the Corporation (not including
in the securities           beneficially owned by such Person any securities acquired
directly from the           Corporation or its Affiliates after July 16, 2003 pursuant to
express           authorization by the Board that refers to this exception) representing
25% or           more of either the then outstanding shares of Common Stock or the
combined           voting power of the Corporation’s then outstanding voting
securities; or  

        (d)              the
shareholders of the Corporation approve a plan of complete liquidation or
          dissolution of the Corporation or an agreement for the sale or disposition by
          the Corporation of all or substantially all of the Corporation’s assets
(in           one transaction or a series of related transactions within any period of 24
          consecutive months), other than a sale or disposition by the Corporation of all
          or substantially all of the Corporation’s assets to an entity at least 75%
          of the combined voting power of the voting securities of which are owned by
          Persons in substantially the same proportions as their ownership of the
          Corporation immediately prior to such sale.  

        Notwithstanding
the foregoing, no “Change in Control” shall be deemed to have occurred if there
is consummated any transaction or series of integrated transactions immediately following
which the record holders of the Common Stock immediately prior to such transaction or
series of transactions continue to have substantially the same proportionate ownership in
an entity that owns all or substantially all of the assets of the Corporation immediately
following such transaction or series of transactions. 

        With
respect to Union Participants, if the applicable collective bargaining agreement covering
such Participants contains a different definition of a Change in Control (or term having a
similar effect) at the relevant time, then the Committee may determine that such
definition should apply in lieu of or in addition to the definition used herein with
respect to the Options granted to such Union Participants. 

2 

        “Code”
means the Internal Revenue Code of 1986 and the regulations promulgated thereunder, as
amended from time to time. Any reference to a specific provision of the Code includes any
successor provision thereto. 

        “Committee”
means the Compensation Committee of the Board, or such other committee of the Board
appointed by the Board to administer the Plan. With respect to grants made to Participants
who are subject to Section 16(b) of the Exchange Act, the Committee must be a committee
composed solely of two or more non-employee directors as so defined for purposes of Rule
16b-3 under the Exchange Act. 

        “Common
Stock” means the common stock, par value $0.01 per share, of the Corporation and
shall include both treasury shares and authorized but unissued shares and shall also
include any security of the Corporation issued in substitution, in exchange for, or in
lieu of the Common Stock. 

        “Convertible
Securities” means evidences of indebtedness, Shares or other securities that are
convertible into or exchangeable or exercisable for, with or without payment of additional
consideration, shares of Common Stock, either immediately or upon the arrival of a
specified date or the happening of a specified event (excluding the Corporation’s
preferred stock purchase rights issued pursuant to that certain Rights Agreement, dated
February 14, 1996, as amended, between the Corporation and American Stock Transfer &
Trust Company and any similar stock purchase rights that the Corporation might authorize
and issue in the future). 

        “Exchange
Act” means the Securities Exchange Act of 1934 and the rules and regulations
promulgated thereunder, as amended from time to time. Any reference to a specific
provision of the Exchange Act shall include any successor provision thereto. 

        “Financial
Closing” means that the funds committed pursuant to the New Financing have been
received by the Corporation or its subsidiaries or are available for drawdown and all
conditions precedent to drawdown (other than no default occurring after the closing of the
New Financing) shall have been satisfied or waived. 

        “Insider”
means a Participant who is required to report to the Securities and Exchange Commission
under Section 16(a) of the Exchange Act. 

        “Market
Price” means (a) the closing price of the Common Stock as of the date in
question, or, if no closing price is available on that date, then the closing price on the
immediately preceding business day on which there is a closing price, if such security is
listed or admitted for trading on any domestic national securities exchange, as officially
reported on the principal securities exchange on which the Common Stock is listed; (b) if
not reported as described in clause (a), the closing sale price of the Common Stock
as of the date in question, or, if no closing sale price is available on that date, then
the closing sale price on the immediately preceding business day on which there is a
closing sale price, as reported by The Nasdaq Stock Market, or any similar system of
automated dissemination of quotations of securities prices then in common use, if so
quoted; or (c) if not reported as described in clause (a) or quoted as described in
clause (b), then the Board shall determine in good faith and on a reasonable basis
the applicable Market Price, which determination shall be conclusive. 

3 

        “New
Financing” means any financing arrangement (including credit facilities,
subordinated credit facilities, any indebtedness evidenced by bonds, debentures, notes,
convertible notes, or similar instruments, and investments of equity capital other than
resulting from the conversion of convertible debt securities (unless and to the extent
that such conversion results in the Corporation or its subsidiaries receiving additional
equity consideration)) entered into by the Corporation or its subsidiaries following the
date hereof, but specifically excluding (a) any extensions of three hundred sixty-three
(363) days or less of existing financing arrangements, (b) any refinancings by the
existing creditors under that certain Senior Secured Revolving Credit Agreement, dated
August 31, 2001, as amended (the “U.S. Bank Credit Agreement”), among the
Corporation, as borrower, the several lenders identified on the signature pages to the
U.S. Bank Credit Agreement and such other lenders as may from time to time become a party
thereto (the “Lenders”) and U.S. Bank National Association, as agent for the
Lenders, except to the extent that any such refinancing results in an increase of credit
available to the Corporation or its subsidiaries, and then only to the extent of such
increase, or that provides for availability of credit that extends beyond three hundred
sixty-three (363) days from the presently scheduled maturity of the U.S. Bank Credit
Agreement, (c) any increased credit availability that results from Milwaukee County,
Wisconsin providing any credit support for the industrial revenue bonds issued for the
benefit of the Corporation or its subsidiaries, (d) any indebtedness to any aircraft or
equipment vendors for the purchase of goods or services, including any third-party
financing of such amounts, (e) any indebtedness to other trade creditors incurred in the
ordinary course of business, (f) any financing (including any sale-leaseback arrangement)
related to the Corporation’s corporate headquarters, or any extension or replacement
thereof, or (g) any obligations associated with programs of the Corporation or its
subsidiaries for the pre-purchase of tickets or similar prepayment programs. 

        “Option”
means a right to purchase a specified number of shares of Common Stock at a fixed option
price. None of the Options issued under this Plan are intended to qualify under Code
Section 422 or 423. 

        “Option
Agreement” means an agreement entered into between the Corporation and a
Participant setting forth the terms and conditions applicable to the Option granted to the
Participant. 

        “Option
Shares” means the aggregate number of shares of Common Stock issuable from time
to time upon exercise of an Option, as such number may be increased or decreased pursuant
to Section 7, and shall also mean any other Shares, other securities and/or
other assets otherwise deliverable upon exercise of such Option. 

        “Participant”
means each employee of the Corporation or its Affiliates on July 15, 2003 (collectively,
the “Participants”). Participants shall include both Participants whose terms
and conditions of employment are subject to a collective bargaining agreement between the
Corporation and a Union (collectively, the “Union Participants”) and
Participants whose terms and conditions are not so subject (collectively, “Non-Union
Participants”). 

        “Person”
means an individual, a corporation, an association, a joint-stock company, a business
trust or other similar organization, a partnership, a limited liability company, a joint
venture, a trust, an unincorporated organization or a government or any agency,
instrumentality or political subdivision thereof. 

4 

        “Retirement”
and “Retire” means the termination of employment from the Corporation and
its Affiliates on or after the date the Participant (i) is entitled to receive retiree
medical coverage under a retiree medical plan of the Corporation or an Affiliate or (ii)
has attained age 55 (or such lower age, if any, at which the Participant may retire under
a qualified benefit plan covering the Participant) and has been credited with ten vested
years of service under the Midwest Airlines Savings and Investment Plan (or any successor
plan thereto) as of the date of such termination of employment. 

        “Shares”
of any Person shall include any and all shares of capital stock, partnership interests,
membership interests, or other shares, interests, participations or other equivalents
(however designated and of any class) in the capital of, or other ownership interests in,
such Person. 

        “Stock
Purchase Rights” means any warrants, options or other rights to subscribe for,
purchase or otherwise acquire any shares of Common Stock or any Convertible Securities
(excluding the Corporation’s preferred stock purchase rights issued pursuant to that
certain Rights Agreement, dated February 14, 1996, as amended, between the Corporation and
American Stock Transfer & Trust Company and any similar stock purchase rights that the
Corporation might authorize and issue in the future), either immediately or upon the
arrival of a specified date or the happening of a specified event. 

        “Total
and Permanent Disability” has the same meaning ascribed in the Midwest Express
Airlines, Inc. Employees Long-Term Disability Plan (or any successor plan thereto),
provided the Committee shall make a determination of Total and Permanent Disability for
any Participant hereunder. 

        “Union”
means each of the Midwest Air Line Pilots Association, the Skyway Air Line Pilots
Association, and the Midwest Association of Flight Attendants, or any successor thereto. 

        4.    
ADMINISTRATION  

        Except
as provided herein, the Plan and all Options shall be administered by the Committee. The
Committee shall have the power to interpret and construe the Plan and any Option
Agreements. The Committee also shall have the power to promulgate rules and other
guidelines in connection with the performance of its obligations, powers and duties under
the Plan, including its duty to administer and construe the Plan and Option Agreements. 

        To
the extent permitted by applicable law, the Committee may, in its discretion, delegate to
an officer of the Corporation or another committee any or all of the authority and
responsibility of the Committee with respect to the Plan or Options, other than
Participants who are subject to the provisions of Section 16 of the Exchange Act at the
time any such delegated authority or responsibility is exercised. To the extent that the
Committee has delegated such authority and responsibility, all references to the Committee
herein shall include such officer or other committee. 

5 

        Within
60 days following the close of each calendar year that the Plan is in operation, the
Committee shall make a report to the Board specifying the employees who received Options
during the prior year, the number of Options granted to the individual employees, and the
status of prior Options. 

        5.              SHARES
SUBJECT TO THE PLAN  

        Subject
to adjustment as provided in Section 7, the number of shares of Common Stock
available for issuance under this Plan shall be 1,551,741. The shares of Common Stock
subject to the Plan may consist in whole or in part of authorized but unissued shares or
of treasury shares, as the Board or Committee may determine. Subject to the provisions of
Subsection 6(c), shares subject to Options which become ineligible for purchase
will be available for new grants under the Plan to the extent permitted by Section 16 of
the Exchange Act. 

        6.              GRANTS
OF OPTIONS  

        (a)    Selection
of Participants. The Committee shall determine and designate           from time to
time those Non-Union Participants to whom Options are to be           granted, and each
Union shall determine and designate from time to time those           Union Participants
who are represented by such Union to whom Options are to be           granted.  

        (b)    Grant
of Options. Subject to the terms of the Plan (including the           adjustment
provisions of Section 7), the Committee or Union, as           applicable, shall
determine the number of shares of Common Stock to be optioned           to each
Participant and the dates of grant subject to the following           (provided that
only the Committee, in its sole discretion, may increase           the number of shares
reserved for grants to Union Participants):  

                (i)              791,853
shares of Common Stock (or such higher number as determined by the           Committee)
are reserved for grants of Options by the Midwest Air Line Pilots           Association
to Participants who are represented by such Union;  

                (ii)              22,191
shares of Common Stock (or such higher number as determined by the           Committee)
are reserved for grants of Options by the Skyway Air Line Pilots           Association to
Participants who are represented by such Union;  

                (iii)              117,001
shares of Common Stock (or such higher number as determined by the           Committee)
are reserved for grants of Options by the Midwest Association of           Flight
Attendants to Participants who are represented by such Union; and  

                (iv)              the
remaining shares of Common Stock reserved pursuant to Section 5 may           be
granted by the Committee to any Participant.  

        (c)    Re-Grant
of Options. Subject to the terms of the Plan, and any applicable           collective
bargaining agreement terms, on each anniversary of the Plan’s           effective
date, immediately prior to a Change in Control or on such other           interim date(s)
as the Committee determines, the Committee shall determine the           number of
Options that were forfeited pursuant to Subsections 6(d) and           (f) without
being exercised during the prior year (or such other relevant           period) by
Participants who are represented by each Union. Each Union may then           re-grant
such Options to such Participants represented by the Union, and in such           number,
as the Union determines. All such re-granted Options will be subject to           the
same terms and conditions as the original Option grant.  

6 

        (d)    Period
of Option. Each Option shall expire on the earliest to occur of           the
following (except as set forth in any applicable collective bargaining
          agreement):  

                (i)              August
21, 2013;  

                (ii)              Unless
otherwise determined by the Committee, the third anniversary of the date           on
which the Participant terminates employment with the Corporation and its
          Affiliates as a result of death or Total and Permanent Disability; or  

                (iii)              90
days from the date of the Participant’s termination of employment from           the
Corporation and its Affiliates for any reason other than death, Total and
          Permanent Disability or Retirement.  

If a Participant terminates
employment from the Company and its Affiliates as a result of Retirement, the Participant
shall be entitled to retain his or her Options for the full term described in clause
(i). 

        (e)    
Option Price. Subject to adjustment as provided in Section 7, the
               option price shall be $2.89 per share of Common Stock (the “Option
               Price”).  

        (f)    
Exercisability. The Committee or applicable Union shall determine when
               each Option becomes vested and exercisable, provided that Options shall
become                vested and exercisable only as follows: up to one-third of the
Options described                in each clause of Subsection 6(b) may be
exercisable prior to August 21,                2004; up to an additional one-third of the
Options described in each clause of Subsection 6(b) may be exercisable prior to
August 21, 2005; and the                remaining Options described in each clause of Subsection
6(b) may only be                exercisable on and after August 21, 2005. Unless
otherwise determined by the                Committee, if the Participant’s
employment with the Corporation or an                Affiliate is terminated as a result
of death, Retirement, or Total and Permanent                Disability prior to the date
the Option is fully vested, the Option shall become                fully and immediately
vested and exercisable as of the date of such termination                of employment.
If the Participant’s employment with the Corporation or an                Affiliate
is terminated for any reason other than death, Retirement, or Total                and
Permanent Disability, the Option shall be exercisable only for those shares
               for which the right to purchase has vested as of the date of such
termination.  

        (g)    
Exercise after Death or Total and Permanent Disability. Upon a
               Participant’s death, the Option may be exercised by the person or
persons                to whom such Participant’s rights under the Option shall pass
by will or by                applicable law or, if no such person has such rights, by his
executor or                administrator, and all references herein or in the Option
Agreement to the                Participant shall mean such person. Upon a Participant’s
Total and                Permanent Disability, the Option may be exercised by the
personal representative                of the Participant who has appropriate authority
to handle the                Participant’s affairs.  

7 

        (h)    
Option Agreement. The Committee shall cause to be delivered to each
               Participant who receives an Option an Option Agreement evidencing the
granting                of the Option. Subject to the provisions of the Plan, the Option
Agreement shall                be in such form and shall contain such terms and
conditions as the Committee                shall from time to time approve.  

        (i)    
Termination of Employment. A termination of employment with the
               Corporation or an Affiliate to accept immediate re-employment with the
               Corporation or an Affiliate, or being placed on furlough shall not be
deemed to                be a termination of employment for purposes of the Plan. If a
Participant is                employed by an Affiliate and such entity ceases to be an
Affiliate, the                Participant will be deemed to have terminated employment
from the Corporation                and its Affiliates as of the date the entity ceases
to be an Affiliate.  

        (j)    
Change in Control. Except as the Committee may otherwise provide prior to
               a Change in Control, and subject to Section 7, in the event of a
Change                in Control, each holder of an Option who is employed by the
Corporation or an                Affiliate at such time shall have the right at any time
thereafter to exercise                the remaining portion of such Option, without
regard to the limitations in Subsection 6(f), at any time during the remaining
period of the Option.  

        (k)    
Non-transferability. During the Participant’s lifetime, Options
               shall be exercisable only by such Participant except as provided in Subsection
6(g). Options shall not be transferable other than upon the                Participant’s
death by will or the laws of descent and distribution.  

        (l)    
Exercise; Notice Thereof. A Participant may exercise his or her Option to
               the extend vested in the manner specified by the Committee. A Participant’s
               exercise shall be effective only upon receipt by the Corporation (or its
               designated agent) of a properly completed and timely filed notice of
exercise,                accompanied by payment in full of the Option Price of the shares
being acquired                and any applicable taxes due as a result of such exercise.
Payment of the Option                Price may be made (i) in cash, (ii) by a check
payable to the Corporation, (iii)                at the sole discretion of the Committee,
by tender of shares of Common Stock                that have been held by the Participant
for at least six months or acquired in                the open market to the Corporation
and having a Market Price on the transfer                date equal to the amount payable
to the Corporation, (iv) , at the sole                discretion of the Committee,
through any combination of the foregoing, or (v) at                the sole discretion of
the Committee, by any other method or means as the                Committee may
prescribe. Payment of any taxes due shall be made as provided in Section 10. The
date of exercise shall be deemed to be the date the                Corporation receives
the written notice and payment for the shares being                purchased and
applicable taxes due thereon. A Participant shall have none of the                rights
of a shareholder with respect to shares covered by such Option until the
               Participant becomes the record holder of such shares. Notwithstanding the
               foregoing, the Corporation may cancel or delay the exercise of any Options
if                such exercise would result in the disallowance of a deduction to the
Corporation                under Section 162(m) of the Code.  

        (m)    
Registration. It is contemplated that the Corporation will register
               shares sold to Participants pursuant to the Plan under the Securities Act
of                1933, as amended (the “Securities Act”), and the Corporation
may delay                any Option exercise until such effective registration is in
place.  

8 

        (n)    
Options for Nonresident Aliens. In the case of any Option awarded to a
               Participant who is not a resident of the United States or who is employed
by an                Affiliate other than an Affiliate that is incorporated, or whose
place of                business is, in a State of the United States, the Committee may
(i) waive or                alter the conditions set forth in Subsections 6(a) through
6(l) to the                extent that such action is necessary to conform such
Option to applicable                foreign law, or (ii) take any action, either before
or after the award of such                Option, which it deems advisable to obtain
approval of such Option by an                appropriate governmental entity; provided,
however, that no action                may be taken hereunder if such action would
(A) increase any benefits accruing                to any Participants under the Plan, (B)
increase the number of securities which                may be issued under the Plan, (C)
modify the requirements for eligibility to                participate in the Plan, or (D)
result in a failure to comply with applicable                provisions of the Securities
Act, the Exchange Act or the Code.  

        (o)    
Repricing Prohibited. Notwithstanding anything in this Plan to the
               contrary, and except for the adjustments provided in Section 7, the
               Committee may not decrease the Option Price for any outstanding Option
after the                date of grant nor allow a Participant to surrender an
outstanding Option to the                Corporation as consideration for the grant of a
new Option with a lower option                price.  

        7.    
               ANTI-DILUTION ADJUSTMENTS  

        (a)    
Adjustments in Case of Subsequent Issuances.  

                (i)    
               Upon any adjustment of the Option Price of an Option as provided in this
Subsection 7(a), the number of shares subject to a                Participant’s
Option shall thereafter be adjusted to that number                (calculated to the
nearest 1/100th of a share) obtained by                multiplying the Option
Price in effect immediately prior to such adjustment by                the number of
shares of Common Stock purchasable under the Option in question
               immediately prior to such adjustment and dividing the product thereof by
the                Option Price resulting from such adjustment. Until the later of August
19, 2005                or the date the Corporation has achieved Financial Closing with
respect to New                Financing in the amount of at least $30 million, if and
whenever the Corporation                subsequent to August 19, 2003 shall issue or sell
any of the following                (“Additional Securities”): (A) any
Common Stock (other than                Common Stock issued pursuant to Convertible
Securities or Stock Purchase Rights                in respect of which an adjustment was
previously made under this Subsection                7(a)) at a price per share
less than the then applicable Option Price or (B)                Convertible Securities
or Stock Purchase Rights (other than in the cases                referred to in Subsection
7(b)) entitling any Person to acquire shares of                Common Stock at a
price per share less than the then applicable Option Price,                then the
Option Price shall be adjusted to that price determined by multiplying                the
then applicable Option Price by a fraction, the numerator of which shall be
               the number of shares of Common Stock actually outstanding immediately
prior to                the issuance of such Additional Securities plus the number of
shares of Common                Stock that the offering price for such Additional
Securities would purchase at                the then applicable Option Price, and the
denominator of which shall be the sum                of the number of shares of Common
Stock actually outstanding immediately prior                to such issuance plus the
number of shares of Common Stock so issued or                issuable. For purposes of
calculating such fraction, all shares of Common Stock                that are issuable
upon conversion, exercise or exchange of those Additional                Securities that
are Convertible Securities or Stock Purchase Rights shall be                deemed
actually outstanding immediately after the issuance of such Convertible
               Securities or Stock Purchase Rights. Subject to Subsection 7(a)(ii),
such                adjustment shall be made whenever such shares of Convertible
Securities or Stock                Purchase Rights are issued. However, if any
Convertible Securities or Stock                Purchase Rights the issuance of which
resulted in an adjustment in the Option                Price pursuant to clause (B) of
this Subsection 7(a)(i) shall expire and                shall not have been
exercised in full, then, subject to Subsection                7(a)(ii), the Option
Price shall immediately upon such expiration be                recomputed and be
increased to the price that it would have been (but reflecting                any other
adjustments in the Option Price made pursuant to the provisions of                this Subsection
7(a) after the issuance of such Convertible Securities or                Stock
Purchase Rights) had the adjustment of the Option Price made upon the
               issuance of such Convertible Securities or Stock Purchase Rights been made
on                the basis of offering for subscription or purchase only that number of
shares of                Common Stock actually purchased upon the exercise of such
Convertible Securities                or Stock Purchase Rights actually exercised.  

9 

                (ii)    
               No adjustment in the Option Price shall be required unless the adjustment
would                require an increase or decrease of at least 1% in the then
applicable Option                Price; provided, however, that any
adjustments that by reason of                this Subsection 7(a)(ii) are not
required to be made shall be carried                forward and taken into account in any
subsequent adjustment. All calculations                under this Subsection 7(a)(ii) shall
be made to the nearest cent.  

                (iii)    
               This Subsection 7(a) shall not apply to the delivery of any of the
               warrants issued by the Corporation in August 2003 (the “Warrants”),
               the operation of the Warrants or the issuance of Shares pursuant to the
               Warrants.  

        (b)    
Adjustments in Case of Stock Split, Distributions, etc.  

                (i)    
               Upon any adjustment of the Option Price of an Option as provided in this
Subsection 7(b)(i) or (ii), the number of shares subject to a
               Participant’s Option shall thereafter be adjusted to that number
               (calculated to the nearest 1/100th of a share) obtained by multiplying the
               Option Price in effect immediately prior to such adjustment by the number
of                shares of Common Stock purchasable under the Option in question
immediately                prior to such adjustment and dividing the product thereof by
the Option Price                resulting from such adjustment. If and whenever the
Corporation subsequent to                August 19, 2003:  

	 	        (1)    
               declares a dividend upon, or makes any distribution in respect of, any of
its                capital stock, payable in shares of Common Stock, Convertible
Securities or                Stock Purchase Rights, or  

	 	        (2)    
               splits or otherwise subdivides its outstanding shares of Common Stock into
a                larger number of shares of Common Stock, or  

	 	        (3)    
               combines its outstanding shares of Common Stock into a smaller number of
shares                of Common Stock,  

then the Option Price shall be
adjusted to that price determined by multiplying the Option Price in effect immediately
prior to such event by a fraction (A) the numerator of which shall be the total number of
outstanding shares of Common Stock immediately prior to such event, and (B) the
denominator of which shall be the total number of outstanding shares of Common Stock
immediately after such event, treating as outstanding all shares of Common Stock issuable
upon conversions or exchanges of any such Convertible Securities issued in such dividend
or distribution and exercises of any such Stock Purchase Rights issued in such dividend or
distribution. No adjustment in the Option Price shall be required unless the adjustment
would require an increase or decrease of at least 1% in the Option Price then in effect;
provided, however, that any adjustments that by reason of this sentence are
not required to be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Subsection 7(b) shall be made to the
nearest cent. 

10 

                (ii)              If
and whenever the Corporation subsequent to August 19, 2003 declares a           dividend
upon, or makes any distribution to all shareholders generally in           respect of,
any of its capital stock, payable in cash, evidences of indebtedness           or assets,
then the Option Price shall be adjusted to that price determined by           multiplying
the Option Price in effect immediately prior to such event by a           fraction (A)
the numerator of which shall be the Market Price on the record date           for the
determination of shareholders entitled to receive the payment less the           then
fair market value (as determined in good faith on a reasonable basis by the
          Board, which determination shall be conclusive) as of such record date of the
          cash, evidences of indebtedness or assets so paid with respect to one share of
          Common Stock and (B) the denominator of which shall be the Market Price per
          share of Common Stock as of such record date; provided, however,
          that if the then fair market value (as determined in good faith by the Board,
          which determination shall be conclusive) so paid with respect to one share of
          Common Stock is equal to or greater than the Option Price per share of Common
          Stock on the record date, then in lieu of the foregoing adjustment, adequate
          provision shall be made so that a Participant shall have the right to receive
          the cash, evidences of indebtedness or assets that such Participant would have
          been entitled to receive had the Option in question been exercised in full
prior           to the record date; and provided further that no adjustment shall
be made           if the Corporation issues or distributes to such Participant the cash,
evidences           of indebtedness or assets that such Participant would have been
entitled to           receive had the Option in question been exercised in full prior to
the record           date. No adjustment in the Option Price shall be required unless the
adjustment           would require an increase or decrease of at least 1% in the Option
Price then in           effect; provided, however, that any adjustments
that by reason of           this sentence are not required to be made shall be carried
forward and taken           into account in any subsequent adjustment. All calculations
under this Subsection 7(b)(ii) shall be made to the nearest cent.  

                (iii)              If
the terms of both this Subsection 7(b) and Subsection 7(c)          would
apply to a transaction, then the transaction will be subject to Subsection 7(c) and
not this Subsection 7(b).  

        (c)    Adjustment
in Case of Consolidation, Merger or Reclassification.  

                (i)              If
and whenever subsequent to August 19, 2003 the Corporation shall effect (A)           any
reorganization or reclassification or recapitalization of the capital stock           of
the Corporation, (B) any consolidation or merger of the Corporation with or
          into another Person whether or not the Corporation is the surviving
corporation,           (C) any share exchange to which the Corporation is a party or (D)
the sale,           transfer or other disposition of all or substantially all of the
property,           assets or business of the Corporation (whether in one transaction or
a series of           transactions) as a result of which holders of Common Stock become
entitled to           receive any Shares or other securities and/or other assets of the
Corporation,           any of its subsidiaries or any other Person (including, without
limitation,           cash) with respect to or in exchange for Common Stock, there shall
thereafter be           deliverable upon the exercise of an Option (until the expiration
of the Option           in question), in lieu of the Option Shares theretofore
deliverable, the highest           number of Shares or other securities and/or other
assets (including, without           limitation, cash) that would have been deliverable
to a Participant had the           Option in question been exercised in full immediately
prior to, and such           Participant participated in, such reorganization,
reclassification or           recapitalization of capital stock, consolidation or merger,
share exchange or           sale and thereafter Subsection 7(a) shall no longer be
of any force or           effect. If the terms of both Subsection 7(b) and this Subsection
          7(c) would apply to a transaction, then the transaction will be subject to
          this Subsection 7(c) and not Subsection 7(b).  

11 

                (ii)              The
Corporation shall not consummate any transaction subject to Subsection
          7(c)(i) unless each Person whose Shares, other securities or other assets
          will be issued, delivered or paid to the holders of the Common Stock (other
than           the Corporation), prior to or simultaneously with the consummation of the
          transaction, expressly assumes, by an Option supplement or other document in a
          form substantially similar hereto, executed and delivered to the Participant,
          the obligation to deliver to the Participant such Shares, other securities or
          other assets as, in accordance with the foregoing provisions of this Subsection
7(c), the Participant is entitled to purchase, and all other           obligations
and liabilities under the Option in question, including obligations           and
liabilities in respect of subsequent adjustments that are required under           such
Option.  

                (iii)              The
above provisions of this Subsection 7(c) shall similarly apply to
          successive reclassifications and changes of Option Shares and to successive
          consolidations, mergers, leases, sales or conveyances, with necessary changes
          being made and respective differences being taken into account.  

        (d)    Adjustment
in Case of Tender Offer. If the Corporation consummates a           tender or
exchange offer (other than an odd lot offer) to acquire Common Stock           at a price
per share in excess of the Market Price of a share of Common Stock on           the day
immediately following the day on which such tender or exchange offer           expires,
then the Option Price in effect immediately prior to the day on which           such
tender or exchange offer expires shall be adjusted to a price obtained by
          multiplying such Option Price by a fraction of which (i) the denominator shall
          be the Market Price on the day immediately prior to the day on which such
tender           or exchange offer expires and (ii) the numerator shall be the result of
dividing           (A) an amount equal to (1) the product of the number of shares of
Common Stock           outstanding and the Market Price of a share of Common Stock, in
each case           immediately prior to the day on which such tender or exchange offer
expires,           minus (2) the aggregate consideration paid by the Corporation in the
tender or           exchange offer, by (B) the number of shares of Common Stock
outstanding           immediately after the day on which such tender or exchange offer
expires.  

        (e)    Other
Dilutive Event. If any event or occurrence shall occur that           actually
results in an adjustment under Section 11(a)(ii) or Section 13 of that           certain
Rights Agreement, dated February 14, 1996, as amended, between the           Corporation
and American Stock Transfer & Trust Company or corresponding           provisions
under similar stock purchase rights that the Corporation might           authorize and
issue in the future, and the provisions of this Section 7          are not
strictly applicable, but as to which the failure to make any adjustment           to the
Option Price and/or the number of Shares or other securities or other           assets
subject to an Option or the Plan would adversely affect the purchase           rights or
value represented by the Option in question in accordance with the           essential
intent and principles of this Section 7, then the Corporation           shall
determine the adjustment, if any, on a basis consistent with the essential
          intent and principles established in this Section 7, necessary to
          preserve, without dilution, the purchase rights represented by such Option. If
          such determination involves or is based on a determination of the fair market
          value of any securities or other assets, then such determination shall be made
          by the Board acting in good faith and on a reasonable basis.  

12 

        (f)    Adjustment
of Plan Reserve and Limits. If any event described in Subsections 7(a) through (c)
or 7(e) results in an adjustment in the           number of Option Shares subject to
outstanding Options, then the number of           shares of Common Stock reserved for
issuance under Section 5 and the           share limits described in Section
6(b) shall likewise be ratably           adjusted.  

        (g)    Anti-Dilution
Provisions. After the later of (i) August 19, 2005 or (ii)           the date the
Corporation has achieved Financial Closing with respect to New           Financing in the
amount of at least $30 million, if, as of that date, the           Corporation has issued
or outstanding any Stock Purchase Rights or Convertible           Securities or other
securities (excluding any Options, the Warrants and the           Corporation’s
preferred stock purchase rights issued pursuant to that           certain Rights
Agreement, dated February 14, 1996, as amended, between the           Corporation and
American Stock Transfer & Trust Company and any similar           stock purchase
rights that the Corporation might authorize and issue in the           future) containing
provisions protecting the holder or holders thereof against           dilution in any
manner more favorable to such holder or holders thereof than           those set forth
herein, then such provisions (or any more favorable portion           thereof) shall be
deemed to be incorporated in this Plan as if fully set forth           herein and, to the
extent inconsistent with any provision of this Plan, shall be           deemed to be
substituted therefor.  

        8.              EFFECT
ON OTHER PLANS  

        All
benefits under the Plan shall constitute special compensation and shall not affect the
level of benefits provided to or received by any Participant (or the Participant’s
estate or beneficiaries) as part of any employee benefit plan of the Corporation or an
Affiliate. The Plan shall not be construed to affect in any way a Participant’s
rights and obligations under any other plan maintained by the Corporation or an Affiliate
on behalf of employees. 

        9.              TERM
OF THE PLAN  

        This
Plan will terminate on the earliest to occur of: (a) August 21, 2013, (b) the date all
shares of Common Stock reserved for issuance under the Plan are so issued, or (c) the date
the Board terminates this Plan pursuant to the provisions of Subsection 10(i).
Notwithstanding the foregoing, the authority of the Committee to administer and amend the
Plan and any Option Agreements will extend beyond the date of the Plan’s termination. 

        10.              GENERAL
PROVISIONS  

        (a)    No
Right of Continued Employment. Neither the establishment of the Plan           nor
the payment of any benefits hereunder nor any action of the Corporation, its
          Affiliates, the Board or the Board of Directors of any Affiliate, or the
          Committee or Union shall be held or construed to confer upon any person any
          legal right to be continued in the employ of the Corporation or its Affiliates,
          and the Corporation and its Affiliates expressly reserve the right to discharge
          any Participant without liability to the Corporation, its Affiliates, the Board
          or the Board of Directors of any Affiliate, or the Committee, except as to any
          rights which may be expressly conferred upon a Participant under the Plan.  

13 

        (b)    Binding
Effect. Any decision made or action taken by the Corporation, the           Board or
by the Committee arising out of or in connection with the construction,
          administration, interpretation and effect of the Plan shall be conclusive and
          binding upon all persons. No member of the Board or Committee shall be liable
          for any action taken or determination made in good faith.  

        (c)    Modification
of Awards. Subject to the requirements of the Plan and any           applicable
collective bargaining requirements, the Committee may modify or amend           any
Option or waive any restrictions or conditions applicable to any Option or           the
exercise thereof, and the terms and conditions applicable to any Options may           at
any time be amended, modified or canceled by mutual agreement between the
          Committee and the Participant or any other persons as may then have an interest
          therein, so long as any amendment or modification does not increase the number
          of shares of Common Stock issuable under the Plan. Action may be taken under
          this Subsection 10(c) notwithstanding expiration of the Plan under Section 9.  

        (d)    Inalienability
of Benefits and Interest. Except as provided in Subsection 6(g), no benefit
payable or interest in the Plan shall be           subject in any manner to anticipation,
alienation, sale, transfer, assignment,           pledge, encumbrance or charge, and any
such attempted action shall be void and           no such benefit or interest shall be in
any manner liable for or subject to           debts, contracts, liabilities, engagements,
or torts of any Participant or           beneficiary.  

        (e)    Law
to Govern. All questions pertaining to the construction,           interpretation,
regulation, validity and effect of the provisions of the Plan           shall be
determined in accordance with the internal laws of the state in which           the
Corporation is incorporated at the time of the question.  

        (f)    Purchase
of Common Stock. The Corporation and its Affiliates may purchase           from time
to time shares of Common Stock in such amounts as they may determine           for
purposes of the Plan. The Corporation and its Affiliates shall have no
          obligation to retain, and shall have the unlimited right to sell or otherwise
          deal with for their own account, any shares of Common Stock purchased pursuant
          to this paragraph.  

        (g)    Use
of Proceeds. The proceeds received by the Corporation from the sale           of
Common Stock pursuant to the exercise of Options shall be used for general
          corporate purposes.  

14 

        (h)    Withholding.
As a condition to the exercise of an Option, the Participant           is required to pay
or otherwise satisfy all withholding taxes as required by           law. At the sole
discretion of the Committee, a Participant may elect to have           any portion of the
federal, state or local income tax withholding required with           respect to an
exercise of an Option satisfied by tendering to the Corporation           shares of
Common Stock that, in the absence of such an election, would have been           issued
to such Participant in connection with such exercise. In the event that           the
Market Price of the shares of Common Stock tendered to satisfy the           withholding
tax required with respect to an exercise (as determined on the date           such shares
are tendered) exceeds the amount of such tax, the excess of such           market value
over the amount of such tax shall be returned to the Participant,           to the extent
possible, in whole shares of Common Stock, and the remainder in           cash. An
election pursuant to this Subsection 10(h) shall be made in           writing and
signed by the Participant on such form as the Committee may           prescribe. An
election pursuant to this Subsection 10(h) is irrevocable.           An Insider
who exercises an Option may satisfy the income tax withholding due in           respect
of such exercise pursuant to this Subsection 10(h) only if the           Insider
also satisfies an exemption under Section 16(b) of the Exchange Act for           such
withholding.  

        (i)    Amendments;
Termination. Subject to any collective bargaining           requirements, the
Committee may amend this Plan, and the Board may terminate           this Plan, at any
time, subject to the following limitations:  

                (i)              shareholders
must approve any amendment of this Plan if the Committee determines           such
approval is required by: (A) the Exchange Act, (B) the Code, (C) the
          listing requirements of the New York Stock Exchange or any principal securities
          exchange or market on which the Common Stock is then traded, or (D) any other
          applicable law; and  

                (ii)              shareholders
must approve any of the following Plan amendments: (A) an amendment           to increase
the number of shares of Common Stock specified in Section 5          (except as
permitted by Section 7); (B) an amendment to Subsection           6(o); or
(C) an amendment to this Subsection 10(i).  

        (j)    Survival
of Options. Except as provided in Subsections 6(n) and           10(c), no
amendment, alteration, discontinuance, suspension or termination           of the Plan
shall, without the consent of the Participant, adversely change any           of the
rights or obligations under any unexpired Options. Following termination           of the
Plan, all unexpired Options shall continue in force and effect except as           they
may lapse or be terminated by their own terms and conditions.  

        (k)    Requirements
of Law. The granting of Options and the issuance of shares           under the Plan
are subject to all applicable laws, rules and regulations and to           such approvals
by any governmental agencies or national securities exchanges as           may be
required. Notwithstanding any other provision of this Plan or any Option
          Agreement, the Corporation has no liability to deliver any shares under this
          Plan unless such delivery would comply with all applicable laws and the
          applicable requirements of any securities exchange or similar entity.  

15EXHIBIT 10.60

                               ORPHAN MEDICAL INC.

                                       AND

                          CELLTECH PHARMACEUTICALS LTD.

                   XYREM(R) LICENSE AND DISTRIBUTION AGREEMENT

*    Denotes confidential information that has been omitted from the exhibit and
     filed separateley, accompanied by a confidential treatment with the
     Securities and Exchange Commission pursuant to Rule 406 of the Securities
     Act of 1933.

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE I        DEFINITIONS...................................................1
ARTICLE II       APPOINTMENT...................................................6

    2.1      Appointment as Distributor........................................6
    2.2      License Grant.....................................................7
    2.3      Right of First Negotiation for Other Indications..................7
    2.4      Subdistributors/Sublicensees......................................8
    2.5      Sales Outside the Territory.......................................8
    2.6      Option to Expand the Territory....................................9
    2.7      Competitive Product...............................................9

ARTICLE III      Regulatory Approvals; COMPLIANCE WITH LAWS AND REGULATIONS....9

    3.1      Marketing Authorizations..........................................9
    3.2      Regulatory Timelines.............................................10
    3.3      Other Approvals..................................................11
    3.4      Return of Initial Payment........................................11
    3.5      Product Changes..................................................11
    3.6      Clinical Trials..................................................12
    3.7      Compliance With Applicable Laws..................................12
    3.8      Approved Product Packaging and Labeling; Relevant Testing........12
    3.9      Steering Committee...............................................13

ARTICLE IV       ROYALTIES AND MILESTONE PAYMENTS.............................14

    4.1      Milestone Payments...............................................14
    4.2      Royalty..........................................................14
    4.3      Minimum Royalty Requirement......................................15
    4.4      Royalty and Milestone Payments...................................15
    4.5      Exchange Rates...................................................16
    4.6      Taxes............................................................16
    4.7      Reports..........................................................16
    4.8      Books and Records; Audit.........................................16

ARTICLE V        REGULATORY Compliance; product manufacture...................17

    5.1      Regulatory Reporting.............................................17
    5.2      Product Recalls..................................................17
    5.3      Adverse Event Notifications and Reporting........................17
    5.4      Correspondence/Complaints........................................17
    5.5      Translations.....................................................18
    5.6      Manufacture; Quality.............................................18
    5.7      Product Specifications...........................................18
    5.8      Manufacturing Audits by Celltech.................................18

                                       i
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE VI       MARKETING EFFORTS............................................19

    6.1      Marketing Efforts................................................19
    6.2      Approved Product Claims..........................................19
    6.3      Development of Marketing Strategy................................19
    6.4      Marketing Materials..............................................20
    6.5      Sales and Technical Literature Developed by Orphan Medical.......20
    6.6      Marketing Reports................................................20
    6.7      Cooperation......................................................20
    6.8      Named Patient Basis Sales........................................21

ARTICLE VII      PURCHASE AND DELIVERY OF PRODUCT.............................21

    7.1      Forecasts........................................................21
    7.2      Pricing..........................................................22
    7.3      Consignment of Product...........................................22
    7.4      Purchase Orders..................................................24
    7.5      Delivery From Other Than Consignment Inventory...................25
    7.6      Transfer Price Variations........................................25
    7.7      Payment Terms....................................................26
    7.8      Short Supply Allocation..........................................27
    7.9      Product Expiration...............................................27
    7.10     Certificate of Analysis..........................................28
    7.11     Storage..........................................................28
    7.12     Rejection of Shipments For Product Non-Conformance...............28
    7.13     Testing of Product Upon Receipt..................................29

ARTICLE VIII     REPRESENTATIONS AND WARRANTIES...............................29

    8.1      Orphan Medical Warranties........................................29
    8.2      Disclaimer.......................................................32
    8.3      Celltech Warranties..............................................32

ARTICLE IX       INDEMNIFICATION..............................................33

    9.1      Indemnification by Orphan Medical................................33
    9.2      Indemnification by Celltech......................................34
    9.3      Procedure........................................................34
    9.4      Insurance........................................................34

ARTICLE X        Intellectual Property Rights Perfection and Use..............35

    10.1     License Perfection...............................................35
    10.2     Quality Standards................................................35
    10.3     Use of Trademark.................................................35
    10.4     Registration and Approvals.......................................35
    10.5     Reservation of Rights............................................36

                                       ii
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE XI       INTELLECTUAL PROPERTY Infringements..........................36

    11.1     Protection of Intellectual Property..............................36

ARTICLE XII      IMPROVEMENTS.................................................37

    12.1     Improvements by Celltech.........................................37
    12.2     Improvements by Orphan Medical...................................37
    12.3     Disclosure.......................................................37

ARTICLE XIII     CONFIDENTIALITY..............................................37

    13.1     Proprietary Information..........................................37
    13.2     Exclusions.......................................................38
    13.3     Third Party Disclosure...........................................38
    13.4     Third Party Confidentiality Agreement............................38
    13.5     Confidentiality of Agreement.....................................39
    13.6     Prior Confidentiality Agreement..................................39

ARTICLE XIV      TERM AND TERMINATION.........................................39

    14.1     Term.............................................................39
    14.2     Mutual Termination...............................................39
    14.3     Termination by Orphan Medical....................................39
    14.4     Rights and Obligations on Termination............................40
    14.5     Partial Termination..............................................40
    14.6     Sell-Off Period..................................................40
    14.7     Survival.........................................................41
    14.8     Assignment of Authorizations.....................................41
    14.9     Rights on Termination for Cause..................................41
    14.10    No Compensation..................................................41

ARTICLE XV       ARBITRATION..................................................41

    15.1     Litigation Rights Reserved.......................................41
    15.2     Arbitration......................................................41
    15.3     Governing Law....................................................42

ARTICLE XVI      FORCE MAJEURE................................................42

    16.1     Events of Force Majeure..........................................42
    16.2     Notice...........................................................43
    16.3     Hardship.........................................................43

ARTICLE XVII     MISCELLANEOUS................................................43

    17.1     Notices..........................................................43
    17.2     Waiver...........................................................44
    17.3     Entire Agreement.................................................44
    17.4     Amendment........................................................44

                                      iii
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

    17.5     Headings.........................................................44
    17.6     Relationship of the Parties......................................44
    17.7     Assignment.......................................................44
    17.8     Severability.....................................................44
    17.9     Publicity........................................................45
    17.10    Counterparts.....................................................45
    17.11    LIMITATION OF DAMAGES............................................45

APPENDICES

Appendix A - Territory
Appendix B - Trademark and Patent Rights
Appendix C - Product Specifications
Appendix D - Standard Operating Procedure for Exchange of Safety Data
Appendix E - Quality Agreement
Appendix F - Celltech First Commercial Year Forecast
Appendix G - Components of Standard Manufacturing Cost and Transfer Price
Appendix H - Regulatory Assistance
Appendix I - Trademark Use Standards

SCHEDULES

ORPHAN MEDICAL
--------------
8.1(e)(ii) - Patent Rights, Trademarks and Other Intellectual Property
8.1(e)(iii) - Infringement or Conflict
8.1(f)(i) - Contracts
8.1(f)(ii) - Default, Breach or Violation
8.1(g)(i) - Claims
8.1(h) - Required Approvals

CELLTECH
--------
8.1(e)(i) - Contracts
8.1(e)(ii) - Default, Breach or Violation
8.1(f)(i) - Claims
8.2(g) - Required Approvals

                                       iv
<PAGE>

                    XYREM LICENSE AND DISTRIBUTION AGREEMENT

         This LICENSE AND DISTRIBUTION AGREEMENT (this "AGREEMENT") is made and
entered into as of October 29, 2003 ("EFFECTIVE DATE"), by and between Orphan
Medical, Inc., a corporation having its principal place of business at 13911
Ridgedale Drive, Suite 250, Minnetonka, Minnesota 55305, USA (together with its
Affiliates, "ORPHAN MEDICAL"), and Celltech Pharmaceuticals, Ltd., a
biopharmaceutical company organized under the laws of England having its
principal place of business at 208 Bath Road, Slough, Berkshire SL1 3WE, United
Kingdom (together with its Affiliates, "CELLTECH").

                                    RECITALS

         WHEREAS, Orphan Medical has developed, patented, registered with the
FDA and currently sells the Product (as defined below) in the United States, and
wishes to sell the Product to Celltech for distribution in the Territory (as
defined below);

         WHEREAS, Celltech has regulatory and marketing expertise necessary to
review and re-format regulatory pharmaceutical applications and to market
ethical pharmaceuticals targeted to specified populations of patients in the
Territory; and

         WHEREAS, Celltech wishes to register, package, label, promote, market,
sell and distribute the Product in the Territory, as hereinafter defined, and
Orphan Medical wishes to authorize Celltech to do so, all on the terms and
conditions set forth herein.

         NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, Orphan Medical and Celltech agree as follows:

                                   ARTICLE I.
                                   DEFINITIONS

         "AFFILIATE" shall mean any corporation or non-corporate business entity
controlled by, controlling or under common control with, a party to this
Agreement. For the purpose of this definition, "control" shall mean the direct
or indirect ownership or control of at least fifty percent (50%) of the voting
stock of a corporation or a) in the absence of ownership of at least fifty
percent (50%) of the voting stock of that corporation, or b) in the case of a
non-corporate business entity, if it possesses, directly or indirectly, whether
by virtue of an ownership interest of any kind, by contract or otherwise, the
power to direct or cause the direction of the management and policies of the
corporation or non-corporate business entity or to elect or cause the election
of a majority of the board of directors or other governing body of such
corporation or non-corporate business entity.

         "ADVERSE EVENT" means the ICH guideline definition as further defined
in Appendix D.

         "API" means the active pharmaceutical ingredient sodium oxybate
contained in the Product.

         "CLAIMS" shall have the meaning provided in Section 9.1.

<PAGE>

         "COMMERCIAL FORECASTS" shall have the meaning provided in Section 7.1.

         "COMMERCIALLY REASONABLE EFFORTS" means all those efforts that are
commercially reasonable under the prevailing circumstances, but in no event will
such efforts be less than those that the applicable party would undertake for
its own purposes.

         "COMPONENTS" means the dosing cups and lids, syringe, tamper resistant
seal and PIBA included in the pack issued to customers along with each bottle of
Product.

         "CONTRACT YEAR" means each twelve (12) month period during the Term of
this Agreement starting on 01 January and ending on 31 December.

         "CURRENT GOOD MANUFACTURING PRACTICES" or "CGMP" means the regulations
set forth in 21 C.F.R. Parts 210 - 211, 820 and 21 C.F.R. Subchapter C (Drugs),
Quality System Regulations and the requirements thereunder imposed by the FDA,
and the equivalent regulations and requirements applicable in the Territory.

         "DEA" means the United States Drug Enforcement Administration, or any
successor thereto, having the administrative authority to regulate the
scheduling and distribution of certain drugs in the United States.

         "EMEA" means the European Medicines Evaluation Agency or any successor
entity which coordinates the scientific review of human pharmaceutical products
under the centralized licensing procedure in the European Union.

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

         "FIRST COMMERCIAL SALE" means the first sale of the Product by or on
behalf of Celltech to a wholesaler, distributor or end-user in the Territory
following Registration of the Product in the Territory.

         "ICH" means International Conference on Harmonization of technical
requirements for registration and manufacturing of pharmaceuticals for human use
as may be amended from time to time.

         "INDEMNIFICATION AMOUNTS" shall have the meaning provided in Section
9.1.

         "INDICATION" means any medical condition or set of symptoms for the
treatment of which a medicinal product is or may be prescribed.

         "IMPROVEMENTS" means any and all inventions or discoveries (including,
without limitation, manufacturing, manufacturing processes and procedures,
analytical processes, procedures or methods and analytical results) any route(s)
of synthesis, new formulations and/or delivery forms of or with respect to the
API and/or Product (other than the current form of the Product as defined
herein), including all information and data relating thereto, whether patentable
or not, whether originating from Orphan Medical or from Celltech, including
copyrights, trademarks, patents, patent applications, trade secrets, NDAs and
Know How.

                                       2
<PAGE>

         "KNOW HOW" means data and information regarding toxicology,
pharmacology, clinical trials, analytical methodologies, and use of the Product
that is necessary or useful for Celltech to fulfill its obligations hereunder,
all of which is proprietary to Orphan Medical.

         "LICENSED INDICATIONS" means narcolepsy and its associated conditions
including without limitation cataplexy and excessive daytime sleepiness and any
other Indication(s) for which Celltech obtains the right to develop the Product
pursuant to Section 2.3 hereof.

         "LICENSED INTELLECTUAL PROPERTY" shall have the meaning provided in
Section 2.2.

         "MAJOR EUROPEAN COUNTRY(IES)" means those countries listed as such on
Appendix A hereto, as such Appendix may be amended from time to time in
accordance with Section 2.6 of this Agreement.

         "MANUFACTURING KNOW HOW" means all data, information and materials
relating to the manufacture of the Product that is not included in the Know How.

         "MARKETING AUTHORIZATION" means a Regulatory Authority approval
necessary to commercially promote and distribute the Product for a Licensed
Indication in the Territory including where applicable, price and reimbursement
approval which must be granted for the Product to be sold in such country.
Marketing Authorization as applied to any country within the Territory does not
include the approval of a treatment IND, pre-approval human use trials under a
protocol or distribution of a product under an emergency use program, e.g.,
distribution on a Named Patient Basis.

         "MARKET SALES PRICE" means the price for the Product approved by the
Regulatory Authority in each country of the Territory, or in countries where
pricing is not regulated, the price at which Celltech sells the Product.

         "MINOR EUROPEAN COUNTRY(IES)" means those countries listed as such on
Appendix A hereto, as such Appendix may be amended from time to time in
accordance with Section 2.6 of this Agreement.

         "NAMED PATIENT BASIS" means any distribution of Product by Orphan
Medical or Celltech, as its designee, for sale prior to Registration of the
Product through approval by a Regulatory Authority in the Territory or as
otherwise allowed by local law.

         "NDA" means a New Drug Application filed by Orphan Medical with the FDA
or any equivalent successor application for approval to commercially promote and
distribute the Product in the United States.

         "NET SALES" means for purposes of calculating the payments payable by
Celltech to Orphan Medical pursuant to Sections 4.1, 4.2 and 4.3 of this
Agreement, the gross sales prices received by Celltech, its Subdistributors or
Sublicensees from sales of the Product, not including Product samples, sold by
or for Celltech, its Subdistributors or Sublicensees to independent third
parties in the Territory, after in each case, deduction of the following items
allowed, given, granted, paid or borne by or for Celltech, its Subdistributors
or Sublicensees with respect to sales of the Product:

                                       3
<PAGE>

                  (a) all bona fide promotional, cash, trade and quantity
discounts and rebates;

                  (b) all bona fide allowances to end users or credits (whether
in the form of a credit or free Product) on account of price adjustments,
rejection or return, recalls, charge backs or governmental program rebates
(including without limitation to managed care organizations);

                  (c) all sales, consumption, excise and any other taxes,
tariffs, duties or government charges (including any tax such as value added or
similar tax or government charge other than income tax) with respect to sales of
the Product; and

                  (d) any charges for freight or insurance.

         For avoidance of doubt, in order to avoid any double counting when
determining Net Sales (i) Net Sales shall not include any royalties, proceeds or
other amounts paid to Celltech by any Sublicensee and (ii) if the gross sales
price received by a Subdistributor from one or more sales has been counted, then
Net Sales shall not include any royalties, proceeds or other amounts that are
paid by such Subdistributor to Celltech in connection with such sales.

         "OPTION COUNTRY" means a country listed as such on Appendix A hereto
which is not currently located in the Territory and which Celltech has the
option, in its sole discretion, to include in the Territory, if after the
Effective Date, such Option Country joins the European Union or European Free
Trade Area.

         "ORPHAN DRUG DESIGNATION" means designation by the EMEA as an orphan
drug, a drug for a specified rare disease or condition, or the equivalent
designation by a Regulatory Authority of any country of the Territory.

         "PATENT RIGHTS" means European patent Number EP 1140061 and any other
patents listed on Appendix B hereto, the inventions described and claimed
therein relating to the Product and any application for letters patent relating
thereto, including, without limitation a continuation application, a continued
prosecution application, a continuation in part application or a divisional
application, and any supplementary protection certificates, extensions,
substitutions, confirmations, divisions, continuations, continuations-in-part,
patents issuing thereon and reissues or re-examinations thereof (each which
shall be automatically incorporated in and added to this Agreement and shall
periodically be added to Appendix B attached to this Agreement and made a part
hereof).

         "PERSON" means any individual, general or limited partnership,
corporation, limited liability company, association, business trust, joint
venture, Regulatory Authority, business entity or other entity of any kind or
nature.

         "PRODUCT" means Orphan Medical's proprietary pharmaceutical product
Xyrem containing the API as its active ingredient in bulk, unlabeled bottles,
for use as a treatment for the Licensed Indications and all Components therefor
unless Celltech shall elect to source such Components from a Third Party as
contemplated by Section 2.1(d).

         "PRODUCT SPECIFICATIONS" means specifications of the Product as
approved in the Marketing Authorizations including specifications of secondary
packaging, or as otherwise

                                       4
<PAGE>

agreed upon by Orphan Medical and Celltech. The Product Specifications contained
in the NDA as of the Effective Date are attached as Appendix C hereto.

         "PROPRIETARY INFORMATION" shall mean the terms and provisions of this
Agreement and all non-public information or data relating to the Product and the
subject matter hereof first communicated by or on behalf of one party to the
other, whether in writing or orally, including without limitation, all
scientific, clinical, commercial, financial and business information and data,
know-how, compilations, formulae, processes, plans, technical information, new
product information, compounds, formulations, methods of product-delivery, test
procedures, product samples, specifications and other information or data.

         "REGISTRATION" shall have occurred and shall continue in each country
in the Territory when the Marketing Authorization required in respect of such
country shall have been issued and shall continue to be effective.

         "REGULATORY AUTHORITY" means the EMEA and each other regulatory and
drug scheduling authority equivalent to the FDA and DEA in the Territory or a
country in the Territory, which has responsibility for scheduling drugs and
approving Marketing Authorizations.

         "STEERING COMMITTEE" means the joint committee established pursuant to
Section 3.9.

         "SUBDISTRIBUTORS" means any subdistributor (exclusive of
pre-wholesalers, wholesalers and Sublicensees) of the Product in the Territory
appointed by Celltech from and after the Effective Date pursuant to this
Agreement.

         "SUBLICENSEE" means any Third Party who is licensed by Celltech to
promote, market, sell and distribute the Product in the Territory in
consideration of the payment to Celltech of a purchase price for the Product and
royalties on sales of the Product to Third Parties.

         "TERM" shall have the meaning provided in Section 14.1 hereof.

         "TERRITORY" means the Major European Countries and the Minor European
Countries set forth in Appendix A, as such Appendix may be amended from time to
time pursuant to Section 2.6 of this Agreement.

         "THIRD PARTY" means a Person who or which is neither a party to this
Agreement nor an Affiliate thereof.

         "TRADEMARK" means the trademark set forth in Appendix B.

         "TRANSFER PRICE" means the price(s) Orphan Medical charges Celltech for
Product on a per bottle and per Component basis; provided, however, that the
Transfer Price shall not exceed * for the Product, exclusive of Components plus,
when Components are being purchased, 100% of Orphan Medical's cost of
Components. The constituents comprising Orphan Medical's standard manufacturing
cost are listed on Appendix G, which also shows a Transfer Price of * for the
Product including Components as of the date hereof.

                                       5
<PAGE>

         "WEIGHTED AVERAGE LIST PRICE" means Celltech's total annual gross sales
receipts for the Product received from Celltech's customers in the Territory
calculated based on the Market Sales Price, divided by the quantity of Product
sold in the Territory.

                                   ARTICLE II.
                                   APPOINTMENT

         2.1 Appointment as Distributor. Subject to the terms and conditions of
this Agreement, Orphan Medical hereby appoints Celltech, and Celltech accepts
such appointment, as Orphan Medical's exclusive distributor of the Product in
the Territory. During the Term of this Agreement, Celltech shall purchase all of
its requirements of the Product from Orphan Medical as the sole supplier except
as follows:

                  (a) Celltech Manufacturing. Orphan Medical agrees to discuss
with Celltech the feasibility and commercial viability of transferring the
manufacture of the Product to Celltech's FDA approved facilities or qualifying
and registering Celltech as a back-up manufacturer for the Product for the
Territory and/or for the rest of the world.

                  (b) Third Party Manufacturing. If Orphan Medical is unable to
manufacture or supply the quantity of Product ordered by Celltech in accordance
with this Agreement for any reason whatsoever, including, without limitation, by
reason of an event described in Section 16.1 (Events of Force Majeure), Celltech
shall have the right at its sole election to (A) take over the manufacture of
the Product or appoint a Third Party manufacturer to fulfill Orphan Medical's
manufacturing and supply obligations under this Agreement thereafter through the
remaining Term of this Agreement and/or (B) purchase the API from Orphan Medical
and itself convert, or appoint a Third Party manufacturer to convert, the API
into Product through the Term of the Agreement; provided, however, such right
shall be exercisable only if (1) Orphan Medical's inability to manufacture or
supply the Product could reasonably be expected to result in a period of time of
at least three (3) months during which less than fifty percent (50%) of Product
ordered pursuant to Celltech's last firm purchase order would be available to
Celltech for commercial sale, (2) Celltech provides reasonable evidence of its
ability to procure a Third Party manufacturer or take over the manufacture of
the Product or the API more rapidly than Orphan Medical could restart production
and supply of Product, and (3) Orphan Medical's inability to manufacture or
supply Product did not result, wholly or in part, from a breach by Celltech of
its obligations hereunder. Orphan Medical shall provide Celltech with all
reasonable assistance in taking over or obtaining and qualifying a Third Party
manufacturer, including without limitation, licensing its Manufacturing Know-How
to Celltech and/or such Third Party manufacturer solely for the purpose of
manufacturing the API and/or the Product pursuant to this Section 2.1(b).

                  (c) Price for Manufacturing Changes. In the event Celltech
shall manufacture Product or API or cause Product or API to be manufactured
pursuant to this Agreement, a manufacturing royalty, transfer price or price of
manufacturing services to Orphan Medical, and any other related terms therefor,
shall be negotiated in good faith.

                  (d) Component Sourcing. Celltech shall be permitted at any
time during the Term on sixty (60) days prior written notice to Orphan Medical
to cease purchasing some or all Components from Orphan Medical and purchase some
or all of the Components directly from

                                       6
<PAGE>

Orphan Medical's suppliers or qualify another Third Party(ies) to supply
Components; provided that, subject to Sections 7.7 and 7.12, Celltech must
purchase all Components delivered by Orphan Medical pursuant to a firm order
regardless of whether such delivery is made after Celltech delivers notice to
Orphan Medical of its intent to purchase the Components from Orphan Medical's
suppliers or another Third Party(ies). Celltech shall bear any and all costs
associated with qualifying any Third Party(ies) to supply Components pursuant to
this Section 2.1(d); provided that if Orphan Medical desires to purchase the
same Components from such Third Party(ies) as Celltech is purchasing, then
Orphan Medical and Celltech shall each bear fifty percent (50%) of any such
costs.

         2.2 License Grant. Subject to the terms and conditions of this
Agreement, Orphan Medical hereby grants Celltech an exclusive nontransferable,
royalty-bearing right and license (with the right of sublicense, as specifically
set forth herein), to use the NDA, Know How, Trademark, Patent Rights and all
Improvements and Proprietary Information of Orphan Medical related thereto or to
the Product together with the goodwill associated therewith (the "LICENSED
INTELLECTUAL PROPERTY") during the Term, solely in the Territory, and solely for
the purposes of (i) preparing applications for Marketing Authorizations and
obtaining and maintaining Registrations and packaging, labeling, promoting,
marketing, selling and distributing the Product under the Trademark in the
Territory solely for the Licensed Indications and (ii) exercising its other
rights under this Agreement including those provided in Articles X and XI hereof
and making or having made API and/or Product but only as provided in Section
2.1. Except as set forth in Section 6.8, no license is granted to Celltech
hereunder for any rights to market the Product for other Indications. Except as
provided in Section 14.6, the license set forth above shall terminate
automatically upon termination or expiration of this Agreement. Subject only to
the foregoing express license grant and its other rights as herein provided,
Celltech shall not have and shall not assert any claim, right, title or interest
in or to the Licensed Intellectual Property.

         2.3 Right of First Negotiation for Other Indications.

                  (a) Negotiation Notice. If, during the Term of this Agreement,
Orphan Medical desires to pursue further development of the Product in the
Territory for one or more Indications other than the Licensed Indications, or in
the Option Countries or in Australia for the Licensed Indications or one or more
Indications other than the Licensed Indications, Orphan Medical shall provide
written notice to Celltech (the "NEGOTIATION NOTICE") of its intent to negotiate
an agreement therefor. The Negotiation Notice shall identify the relevant
country or countries and Indications. Delivery of a Negotiation Notice shall
create a mutual obligation to negotiate in good faith on an exclusive basis for
the grant to Celltech of exclusive rights to the Product for the specified
countries for such Indication(s). If no response is received within ninety (90)
days after delivery of the Negotiation Notice to Celltech, the offer shall be
deemed declined, and Orphan Medical may then negotiate with any Third Party for
the grant of any license for the Product for such countries for such
Indication(s) subject, however, to the last sentence of Section 2.3(b).

                  (b) Procedure of Negotiations. The parties shall have ninety
(90) days from the date Orphan Medical receives Celltech's response to the
Negotiation Notice to negotiate in good faith (and on a confidential basis), and
enter into a letter of intent, term sheet or final agreement with regard to, as
applicable, Celltech's distribution of the Product in the Territory for

                                       7
<PAGE>

the new Indication(s) or in the Option Countries or Australia for the Licensed
Indications or one or more Indications other than the Licensed Indications. In
the event that (i) Celltech shall have failed to have responded to the
Negotiation Notice within the 90-day period provided in paragraph (a) above or
(ii) within the 90-day period provided in this paragraph (b) Orphan Medical and
Celltech have not entered into such letter of intent, term sheet or final
agreement, Orphan Medical shall have no further obligation to undertake or
continue negotiations with Celltech for such license, and Orphan Medical shall
be free to commence negotiations for a license to the Product for such countries
for such Indication(s) with any Third Party subject to the following: (i) if a
letter of intent, term sheet or final agreement with a Third Party shall not
have been signed by Orphan Medical and such Third Party within two hundred
seventy (270) days of the termination of Celltech's right of first negotiation,
then Celltech's right of first negotiation shall again become effective on the
terms herein provided and (ii) without Celltech's prior written consent, the
terms and conditions agreed by Orphan Medical with such Third Party may not be
in the aggregate materially more favorable to such Third Party than those last
offered to Celltech.

                  (c) Option Countries. If Orphan Medical shall determine to
enter into a license for the Product with a Third Party in an Option Country
upon expiration of Celltech's right of first negotiation pursuant to Section
2.3(b) above, such license shall contain a provision automatically terminating
such License should such country subsequently join the European Union or
European Free Trade Area during the Term and Celltech shall have exercised its
Option under Section 2.6 as to such country.

                  (d) No Trademark License. If pursuant to this Section 2.3
Orphan Medical licenses to a Third Party the Product in the Territory for one or
more Indications other than the Licensed Indications or in the Option Countries
or Australia for one or more Indications other than the Licensed Indications,
then such Third Party shall be obligated to market the Product under a trademark
different from the Product Trademark and Orphan Medical shall not grant, license
or otherwise transfer to such Third Party any rights to the Trademark or
otherwise permit any use of the Trademark by such Third Party.

         2.4 Subdistributors/Sublicensees. Celltech may appoint Subdistributors
and Sublicensees with the prior written approval of Orphan Medical, which
approval shall not be unreasonably withheld. No such appointment or delegation
shall relieve Celltech from any obligations hereunder, and each agreement with a
Subdistributor or Sublicensee shall include terms ensuring the protection of
Orphan Medical's rights under this Agreement. Celltech shall guarantee and be
responsible for the making of all payments due, and the making of reports
required under this Agreement by its Subdistributors and Sublicensees, and their
compliance with all applicable terms of this Agreement. All agreements between
Celltech and its Subdistributors and Sublicensees shall include a provision
prohibiting the further appointment of Subdistributors or Sublicensees, as the
case may be, and a provision terminating the Subdistributor or Sublicensee
agreement to the extent such agreement relates to the Product in the Territory
upon termination of this Agreement for any reason.

         2.5 Sales Outside the Territory. Except as otherwise set forth in this
Agreement, Celltech shall not distribute, sell or otherwise provide the Product
outside of the Territory and shall not solicit customers for the Product outside
the Territory or establish any office through

                                       8
<PAGE>

which orders are solicited or any depot at which inventories of the Product are
stored outside the Territory. Celltech shall not sell the Product to customers
outside the Territory, provided that nothing herein shall preclude Celltech from
selling the Product to any customer, wherever located, who purchases Product
with a view to its use within any country of the Territory.

         2.6 Option to Expand the Territory. If, after the Effective Date, an
Option Country joins the European Union or European Free Trade Area, Celltech,
in its sole discretion, may add such Option Country to the Territory and may
designate such Option Country as a Major European Country or a Minor European
Country. Celltech shall notify Orphan Medical of its decision within thirty (30)
days after the date Celltech first learns of such country joining the European
Union or European Free Trade Area, and, if Celltech so chooses to add such
Option Country to either the Major European Countries or Minor European
Countries, then Appendix A hereto shall be amended to so reflect such addition.

         2.7 Competitive Product. Orphan Medical acknowledges that (i) Celltech
has developed and is marketing methylphenidate in certain countries within the
Territory for Indications other than the Licensed Indications, but that
methylphenidate is occasionally used on an off-label basis to treat the Licensed
Indications; (ii) Celltech is marketing dexedrine in the United Kingdom for the
Licensed Indications; and (iii) Celltech will be marketing Equasym IR in France
for the Licensed Indications. With the exception of the off-label use of
methylphenidate in the Territory, dexedrine in the United Kingdom, and Equasym
IR in France, Celltech shall not, for five (5) years from the Effective Date of
this Agreement, either directly or indirectly through subdistributors,
sublicensees or otherwise, develop, manufacture, promote, market or distribute
products in the Territory that are competitive with the Product; provided,
however, nothing herein shall prohibit Celltech from acquiring, by stock
purchase, asset purchase or merger any company, or division of a company, that
is developing, marketing, manufacturing, promoting or distributing a competitive
product where the annual sales (or in the case of a product in development, the
projected sales) of such competitive product in the Territory are less than
twenty percent (20%) of such company's or division's total annual sales. For
purposes of this Section 2.7, a competitive product shall be one that: (a) is
approved for prescription for a Licensed Indication or (b) is used off-label for
a Licensed Indication and such off-label sales comprise more than twenty percent
(20%) of such product's sales in the Territory or more than twenty percent (20%)
of the sales of the Product in the Territory.

                                  ARTICLE III.
                              REGULATORY APPROVALS;
                      COMPLIANCE WITH LAWS AND REGULATIONS

         3.1 Marketing Authorizations. Celltech shall prepare and submit to
Orphan Medical, (i) within sixty (60) days of the Effective Date, a written plan
for obtaining approval from the EMEA to commercially promote and distribute the
Product for the cataplexy Licensed Indication and (ii) within one hundred twenty
(120) days of the Effective Date, a written plan for obtaining approval to
commercially promote and distribute the Product for the cataplexy Licensed
Indication from the Regulatory Authority of each country in the Territory not
covered by an EMEA Registration. On the basis of Orphan Medical's NDA and the
Know How and related Proprietary Information delivered pursuant to Section 3.2,
Celltech shall collect, assemble, organize and format all necessary components
required to apply for such approvals, and shall

                                       9
<PAGE>

submit such materials to the appropriate Regulatory Authorities in accordance
with Section 3.2. Celltech shall maintain, at its own expense, the Registrations
and other authorizations necessary to import, label, promote, market, sell and
distribute the Product in the Territory. Orphan Medical shall provide, at its
own cost and expense (but subject to the limitations set forth in Section 3.2),
reasonable assistance to Celltech in the acquisition of such Registrations,
including without limitation, the services set forth on Appendix H hereto. All
applications for Marketing Authorizations for the Product shall be submitted in
the name of Celltech and all Marketing Authorizations for the Product shall be
assigned to Orphan Medical upon termination of this Agreement for any reason.
Celltech shall ensure that all pages of documents submitted to Regulatory
Authorities for the purpose of obtaining Registrations and Marketing
Authorizations shall be coded as confidential.

         3.2 Regulatory Timelines. (a) Within thirty (30) days of the Effective
Date, Orphan Medical shall (i) transfer the Orphan Medical Drug Designation in
the Territory from IDIS World Medicines to Celltech, and (ii) provide Celltech
with the NDA and the Know How and the related Proprietary Information to enable
Celltech to prepare and timely file the applications to commercially promote and
distribute the Product for the cataplexy Licensed Indication in the Territory.
Celltech shall use its Commercially Reasonable Efforts to cause a pre-submission
meeting to be held with the EMEA in respect of the cataplexy Licensed Indication
within one hundred eighty (180) days of the Effective Date. Within thirty (30)
days of such meeting with the EMEA, Celltech shall report to Orphan Medical
about the content of such meeting and advise Orphan Medical as to whether
additional data or documentation or additional action is required or deemed
reasonably necessary by Celltech to obtain approval from the EMEA to
commercially promote and distribute the Product for the cataplexy Licensed
Indication. If additional data or documentation or additional action is required
or deemed reasonably necessary by Celltech to obtain such approval and Orphan
Medical has or could readily produce such data or documentation or take such
additional action, Orphan Medical shall so provide the additional data or
documentation or take the additional action at its sole cost and expense;
provided, however, that in the event the cost of any single study or other
report required by the EMEA or deemed reasonably necessary by Celltech shall
exceed * or the aggregate cost of all studies or other reports required by
the EMEA or deemed reasonably necessary by Celltech shall exceed *, Celltech
and Orphan Medical shall meet and discuss in good faith the apportionment of
such costs between them. Provided that Orphan Medical's NDA and other relevant
Know How and related Proprietary Information are deemed reasonably sufficient by
Celltech, Celltech shall, at its own expense, file the application for approval
of the Product by the EMEA as an orphan drug.

                  (b) Following approval from the EMEA to commercially promote
and distribute the Product for the cataplexy Licensed Indication, Celltech shall
use Commercially Reasonable Efforts to obtain Registration of the Product for
the cataplexy Licensed Indication (i) in the Major European Countries no later
than December 31, 2005 (the "REGISTRATION DATE") and (ii) in the other countries
in the Territory within such time frames as are consistent with the regulatory
plan submitted by Celltech to Orphan Medical as provided in Section 3.1; unless,
in any such case, additional data or documentation or additional action is
required, in which case, the timeframe shall be extended by the time required to
generate the additional data or documentation or take the additional action.
Where a Regulatory Authority requires additional data or documentation or
additional action that is not within Orphan Medical's sole obligation as

                                       10
<PAGE>

delineated in paragraph (a) above and that neither party has or could readily
produce or which cannot readily be taken by either party, the parties shall
negotiate in good faith the terms upon which such data or documentation should
be generated or actions taken by either party, if at all, or failing agreement,
to terminate this Agreement in so far as it relates to a country in the
Territory not a member of the European Union or the European Free Trade Area.

                  (c) Anything herein to the contrary notwithstanding, (i)
except as provided in paragraphs (a) and (b) above, in connection with providing
additional data and documentation or taking additional actions pursuant to this
Section 3.2, each party shall be responsible for all costs and expenses of its
respective employees, agents, contractors, sublicensees and subdistributors, and
(ii) no party shall be obligated to conduct any clinical trials after the
Effective Date.

                  (d) Following the development by Orphan Medical of a
supplemental NDA for the excessive daytime sleepiness Licensed Indication, which
such supplemental NDA shall be developed by Orphan Medical as soon as
practicable after the Effective Date, a copy thereof shall be delivered to
Celltech to enable it to prepare an application to the EMEA for approval to
commercially promote and distribute the Product in the Territory for the
excessive daytime sleepiness Licensed Indication. Such application shall be
filed by Celltech no later than the later of (i) issuance of the license to
Celltech by the EMEA for the cataplexy Licensed Indication or (ii) one hundred
eighty (180) days after Orphan Medical delivers such supplemental NDA to
Celltech, unless additional data or documentation or additional action is
required from Orphan Medical or a Third Party, in which case the one hundred
eighty (180) days shall be extended by the time required to generate the
additional data or documentation or take the additional action.

         3.3 Other Approvals. Celltech undertakes and covenants that as soon as
reasonably practicable following the Effective Date it shall take all other
actions to obtain and maintain during the Term all other approvals, licenses and
permits necessary to import, promote, market, sell and distribute the Product in
the Territory.

         3.4 Return of Initial Payment. In the event that following and as a
result of the pre-submission meeting with the EMEA, the parties mutually agree
that it is not possible or commercially viable under the prevailing
circumstances to obtain Registration for the Product in the Major European
Countries, the parties may agree to terminate this Agreement, and such
termination shall be subject to the terms of Article 14. * ountries is not
possible or commercially viable under the prevailing circumstances, then they
shall submit the matter to arbitration in accordance with the provisions of
Section 15.2 of this Agreement.

         3.5 Product Changes. Orphan Medical shall give Celltech ninety (90)
days prior written notice of any major formulation or packaging change to the
Product being requested or required by the FDA, or any other U.S. Regulatory
Authority, whenever such change affects a Registration in any country within the
Territory. Orphan Medical may change the Product, or analytical test methods as
it deems appropriate, provided Orphan Medical continues to supply

                                       11
<PAGE>

Product conforming to the Product Specifications then in effect until such times
as the Marketing Authorizations are amended to reflect such changes. In the
event of such changes, Celltech shall be solely responsible for additional
submissions and/or regulatory updates which may be required by the Regulatory
Authorities in the Territory, provided that all necessary data and information
shall be furnished by Orphan Medical at Orphan Medical's expense for such
purposes, and provided; further that in no event shall Celltech's failure to
obtain any required amendments to the Marketing Authorizations to reflect such
additional submissions and/or regulatory updates, relieve Orphan Medical of its
obligation to supply Product conforming to the Product Specifications. In the
event a Regulatory Authority in any country in the Territory requires a
formulation or packaging change to the Product, Orphan Medical and Celltech
shall cooperate to develop a mutually agreeable plan to address the regulatory
requirement, and, if necessary, to include the production of separate lots, at
Celltech's expense, for the Territory. In the event Orphan Medical and Celltech
mutually agree it is not commercially reasonable to meet such requirements,
Celltech shall cease promoting, marketing, selling and/or distributing the
Product in that country in the Territory and shall promptly terminate the
Registrations in such country. If the parties are in disagreement as to whether
it is commercially reasonable to meet such requirements, then they shall submit
the matter to arbitration in accordance with the provisions of Section 15.2 of
this Agreement.

         3.6 Clinical Trials. The parties shall keep one another fully and
currently informed as to all tests and trials that they intend to carry out for
purposes of compliance with regulatory requirements in the Territory or that
might affect Marketing Authorization applications or Registrations in the
Territory. The parties shall cooperate in the design of such tests and trials in
order to ensure to the maximum possible extent that duplication of effort shall
be avoided, and that the results shall be suitable for filing with the
Regulatory Authorities in the Territory and shall otherwise be useful for
purposes of meeting all applicable regulatory requirements. Without limiting the
generality of the foregoing, the parties shall use their Commercially Reasonable
Efforts to ensure that all clinical trials undertaken after the Effective Date,
if any, shall be designed and conducted in accordance with good clinical
practices and good laboratory practices as established for both the United
States and the European Union.

         3.7 Compliance With Applicable Laws. Celltech shall comply with all
applicable laws and regulations of each country in the Territory (including,
without limitation, any laws or regulations in the Territory governing the
distribution of a scheduled drug, as designated under regulations promulgated by
the DEA). Celltech shall also comply with all U.S. laws applicable to the
Registration, promotion, marketing, sale and distribution of the Product in the
Territory, including but not limited to U.S. Export Administration Regulations,
the US Foreign Corrupt Practices Act and all regulations promulgated by the DEA.
Celltech shall comply with all Marketing Authorizations issued in the Territory.

         3.8 Approved Product Packaging and Labeling; Relevant Testing. After
the Product receives a Marketing Authorization in any country of the Territory,
Celltech shall package and label the Product and shall include all required
labeling for Product sold in such country(ies). For all orders submitted by
Celltech after Registration is received in a particular country, Orphan Medical
shall supply to Celltech unlabeled bottles, and final labeling and packaging of
Product for such country(ies) shall be completed by Celltech. After the Product
receives Marketing Authorization in a country in the Territory, Celltech shall
be solely responsible for all final

                                       12
<PAGE>

release testing in such country(ies) and for ensuring in such country(ies) that
the Product labeling and packaging complies with the Marketing Authorizations
and all other applicable laws of each such country in the Territory. Celltech
shall provide Orphan Medical with copies of all foreign language labels. To the
extent permitted by applicable laws and regulations in each country in the
Territory, all labels shall identify Orphan Medical as the manufacturer of the
Product for Celltech.

         3.9 Steering Committee. Within a reasonable period of time after the
Effective Date, Orphan Medical and Celltech shall form a Steering Committee made
up of commercial and technical employees from both companies that shall have
certain decision-making authority, and provide oversight for the administration
of this Agreement. Each party shall maintain two (2) members on the Steering
Committee with other members added as needed. The parties shall each select one
of its representatives to serve as a co-chairperson of the Steering Committee.
The Steering Committee shall have the authority to conduct the following
activities and such other activities as may be agreed to in writing by the
parties: (a) review ongoing regulatory issues, (b) review the medical aspects of
standards of care in the Territory, (c) review clinical developments across
territories, (d) review marketing campaigns and new marketing plans, (e) review
sales activities and results, (f) review aspects of Product manufacturing
campaigns and Product forecasts, consignment and non-consignment inventory
stocks and ordering, and (g) review the arrangement for distributing Product on
a Named Patient Basis. In the event and to the extent that the Steering
Committee is unable to come to a consensus on any matter relating to the
development or manufacture of the Product or the Registration, packaging,
labeling, promoting, marketing, sale or distribution of the Product outside the
Territory, the views of the Orphan Medical Steering Committee members shall
prevail. In the event and to the extent that the Steering Committee is unable to
come to a consensus on any matter relating to the Registration, packaging,
labeling, promoting, marketing, sale or distribution of the Product within the
Territory, the views of the Celltech Steering Committee members shall prevail.
Notwithstanding the foregoing, in the event a particular matter for which there
is no consensus of the Steering Committee could, in the good faith judgment of
the party who does not have the ultimate decision making authority as to such
matter (as provided in the previous two sentences), materially affect the rights
or obligations under this Agreement of such party, Orphan Medical and Celltech
agree to use Commercially Reasonable Efforts to resolve the matter in a manner
which will minimize the impact on such rights or obligations of such party.
During each Contract Year, the parties shall hold at least four (4) regular
meetings of the Steering Committee. Members of the Steering Committee may
participate in meetings of the Steering Committee in person or by conference
telephone call. At least one (1) of the four (4) Steering Committee meetings
shall be conducted in-person. Employees of each party who are not members of the
Steering Committee may attend meetings of the Steering Committee as required.
In-person Steering Committee meetings shall alternate between Orphan Medical's
designated facility and a facility designated by Celltech. The co-chairpersons
of the Steering Committee shall alternate responsibility for the preparation of
minutes setting forth discussions made at each committee meeting, with the
Orphan Medical Chairperson preparing minutes for the first Steering Committee
meeting; provided, however, that such minutes shall not become official until
agreed upon by both co-chairpersons.

                                       13
<PAGE>

                                  ARTICLE IV.
                        ROYALTIES AND MILESTONE PAYMENTS

         4.1 Milestone Payments. In consideration of the rights and licenses
granted hereunder, Celltech shall pay to Orphan Medical milestone payments
totaling $15,500,000 US Dollars according to the following schedule:

                  (a) $2,500,000 US Dollars on the Effective Date.

                      $ * .

         4.2 Royalty. (a) *

                                       14
<PAGE>

         *

         4.4 Royalty and Milestone Payments. * .

                                       15
<PAGE>

         *

         4.5 Exchange Rates. For purposes of determining the amount of Net Sales
and the amount of royalties payable pursuant to Section 4.2 during any calendar
quarter, the total of all sales in each currency during such quarter shall be
converted into US Dollar currency at the average daily exchange rate for such
calendar quarter as reported by oanda.com or, if such website is not available,
the Wall Street Journal. For purposes of determining the minimum royalty amount
for each Contract Year as provided in Section 4.3, the amounts set forth therein
shall be converted into US dollar currency at the average daily exchange rate
for such Contract Year as reported by oanda.com or, if such website is not
available, The Wall Street Journal.

         4.6 Taxes. Celltech shall be entitled to deduct from royalties paid
hereunder the amount of any withholding taxes or other taxes, levies or charges
required to be withheld by Celltech, to the extent Celltech pays to the
appropriate governmental authority on behalf, and for the account of, Orphan
Medical such taxes, levies or charges. Celltech shall use reasonable efforts
(including making, or assisting Orphan Medical in making, any relevant
application to any tax authority) to minimize any such taxes, levies or charges
which are required to be withheld by Celltech from royalties paid hereunder and
paid on behalf of Orphan Medical by Celltech. Celltech shall promptly deliver to
Orphan Medical proof of payment of all such taxes, levies and other charges,
together with copies of all communications from or with such governmental
authority with respect thereto.

         4.7 Reports. Each royalty payment made by Celltech hereunder shall be
accompanied by a report showing all revenue generated by sales of the Product to
Third Parties (including all sales by Subdistributors and Sublicensees) during
the immediately preceding quarter, the computation of Net Sales, and the
calculation of royalty payments due for such quarter, all on a
country-by-country basis. If actual Net Sales of any Subdistributor or
Sublicensee for that quarter is unavailable at the time such quarterly report is
due, Celltech shall include in its report for that quarter a good faith estimate
of such Net Sales, and an appropriate adjustment for the difference between the
actual and estimated Net Sales shall be made in the report for the following
quarter, with a corresponding adjustment in the amount of royalties payable in
respect of that quarter.

         4.8 Books and Records; Audit. Celltech shall keep for at least three
(3) years or such longer period as may be required by law following the end of
the calendar year to which they pertain, accurate and complete records showing
all sales of the Product by Celltech and its Subdistributors and Sublicensees.
Such records shall include all information reasonably necessary to verify the
total amount and computation of earned royalties hereunder, and shall be open to
inspection and audit, during reasonable business hours, to the extent necessary
to verify the amount of such royalties. Such inspection and audit shall be
conducted at the request and expense of Orphan Medical by an independent
Certified Public Accountant appointed by Orphan Medical. Such inspection and
audit shall be made not more often than once in each Contract Year. Such
Certified Public Accountant shall undertake a confidentiality obligation to
Celltech permitting it to disclose only to Orphan Medical the amount of the
royalties due hereunder, and no other information. Orphan Medical shall bear the
costs of any such inspection and audit; provided that if any inspection and
audit reveals an underpayment of more than five percent

                                       16
<PAGE>

(5%), Celltech shall reimburse Orphan Medical for its reasonable, documented
out-of-pocket costs for such inspection and audit.

                                   ARTICLE V.
                   REGULATORY COMPLIANCE; PRODUCT MANUFACTURE

         5.1 Regulatory Reporting. Celltech shall timely file all reports
relating to the Product required by the Regulatory Authorities in each country
in the Territory and shall deliver a copy of each such report in hardcopy and on
diskette, if available, to Orphan Medical within thirty (30) calendar days of
making such report in accordance with laws in the Territory regarding transfer
of data and confidentiality of patient information.

         5.2 Product Recalls. (a) Each party shall promptly notify the other
party in the event of any recall, market withdrawal or correction of Product
ordered by any Regulatory Authority, whether in the Territory, the United
States, or anywhere in the world. The parties shall cooperate in good faith to
handle and dispose of a recall, market withdrawal or correction in the
Territory.

                  (b) Subject to Section 5.2(c) below, in the event of a recall,
market withdrawal or correction (i) by reason of the failure of all or part of
the Product supplied by Orphan Medical to meet the Product Specifications, any
requirement of the FDA or any Marketing Authorization or other requirement of
applicable law that is not the result of any action or omission of Celltech or
its Subdistributors or Sublicensees as described in paragraph (c) below or (ii)
because Product that meets the Product Specifications, by whomsoever
manufactured, is inherently defective, unsafe, dangerous or may harm users of
the Product, Orphan Medical shall bear the costs of such recall, market
withdrawal or correction (including without limitation Celltech's reasonable
attorney's fees).

                  (c) In the event of a recall, market withdrawal or correction
by reason of the failure of Celltech to have obtained or properly maintained or
complied with a Marketing Authorization or as a result of Celltech's (or its
Subdistributors', Sublicensees' or Third Party manufacturers') breach of any of
their obligations under this Agreement (including without limitation Section
3.7), or the willful misconduct or negligent acts or omissions of Celltech (or
its Subdistributors, Sublicensees' or Third Party manufacturers'), Celltech
shall bear all costs of such recall, market withdrawal, or correction (including
without limitation Orphan Medical's reasonable attorneys' fees).

         5.3 Adverse Event Notifications and Reporting. The exchange of Adverse
Event reports relating to the Product between the parties shall be made
according to the procedures in Appendix D.

         5.4 Correspondence/Complaints. (a) Celltech shall promptly provide
Orphan Medical with copies of any material regulatory correspondence with
respect to the Product in the Territory and all related documentation,
information and other materials received or prepared by Celltech, including, but
not limited to, copies of the proposed applications for Marketing Authorization
prepared by or on behalf of Celltech for Registration of the Products in the
Territory and any subsequent amendments, supplements, or annual updates thereto.

                                       17
<PAGE>

                  (b) Celltech agrees to inform Orphan Medical in writing of all
significant complaints regarding the Product that relate to Product
Specifications within fifteen (15) business days after Celltech's receipt
thereof in all countries of the Territory. Celltech shall also provide written
quarterly reports of all complaints regarding the Product, regardless of
significance, in English, as well as the actions taken by Celltech to address
all such complaints. Such reports shall be delivered to Orphan Medical within
thirty (30) days after the end of each calendar quarter during the Term.

         5.5 Translations. Celltech shall provide Orphan Medical English
translations of any material regulatory correspondence received in a language
other than the English language relating to a Serious Adverse Event (as defined
in Appendix D). Furthermore, Celltech shall provide to Orphan Medical copies of
translations of any other regulatory correspondence and reports delivered
pursuant to Sections 5.1, 5.3 or 5.4 to the extent Celltech has otherwise
translated such correspondence and reports for its own purposes.

         5.6 Manufacture; Quality. Subject to Article VII, Orphan Medical agrees
to manufacture Celltech's requirements for Product as necessary to satisfy
Celltech's forecasts and purchase orders submitted by Celltech pursuant to this
Agreement. Products delivered to Celltech pursuant to this Agreement shall be
manufactured in accordance with the Quality Agreement negotiated and finalized
between Orphan Medical and Celltech prior to Marketing Authorization approval in
any country in the Territory, such agreement to be substantially in the form
attached hereto as Appendix E. Such Quality Agreement shall be agreed upon by
the parties no later than twelve (12) months after the Effective Date. The
Quality Agreement shall include the obligations and pharmaceutical
responsibilities of Orphan Medical, Orphan Medical's sub-contractors and
Celltech relating to the quality assurance requirements for the manufacture and
supply of the Product, all in accordance with cGMP and applicable regulatory
requirements.

         5.7 Product Specifications. Product supplied to Celltech by Orphan
Medical shall meet the Product Specifications that are approved by the
Regulatory Authorities in the Territory. Should the approved Product
Specifications differ from the specifications contained in Orphan Medical's NDA
which are set forth on Appendix C, the Product Specifications approved by the
Regulatory Authorities shall control.

         5.8 Manufacturing Audits by Celltech. Upon sixty (60) days prior
written notice for cause, or with one hundred eighty (180) days written notice
for an annual audit, Celltech or a representative thereof shall have the right,
if within the power of Orphan Medical to grant such right, to participate in the
conduct of compliance or other inspections, audits and/or investigations of the
operations and facilities where the Product and the raw materials and components
used to manufacture, package, inspect, test, store and supply the Product,
including, without limitation, the API and the Components, are manufactured,
packaged, inspected, tested and stored. Such inspections, audits and/or
investigations shall take place during normal business hours at the relevant
manufacturing site(s) in the presence of Celltech and Orphan Medical's
representatives and Celltech shall abide by any confidentiality requirements or
security procedures of Orphan Medical's suppliers. Orphan Medical shall
facilitate and lead the audit, and it shall be Orphan Medical's responsibility
to discuss any audit findings with its sub-contractors and suppliers. Celltech
and Orphan Medical along with any other licensing partner

                                       18
<PAGE>

will agree upon a final single audit report that will be sent to the vendor by
Orphan Medical. In the event of any disagreement among the parties relating to
the audit report, Orphan Medical shall be the deciding entity and will finalize
the audit report. Orphan Medical shall require its sub-contractors and suppliers
to take all reasonably necessary corrective actions identified by Celltech as
necessary to comply with cGMP requirements and Registrations in the Territory.
In the case where a vendor will not allow Celltech to accompany Orphan Medical
during such audit, Orphan Medical will either audit on behalf of Celltech, or
will jointly, with Celltech engage an independent third party to audit the
supplier on behalf of both parties. Orphan Medical is generally allowed one
audit each year of each vendor. If additional costs are imposed due to
accompaniment of Celltech with Orphan Medical during such audits, Celltech shall
bear the burden of any additional costs.

                                  ARTICLE VI.
                                MARKETING EFFORTS

         6.1 Marketing Efforts. Celltech shall have, directly or through its
Subdistributors or Sublicensees, the following obligations with respect to the
marketing and distribution of the Product in the Territory:

                  (a) To use its Commercially Reasonable Efforts to promote,
market, sell and distribute the Product in the countries in the Territory where
Registrations are in good standing; provided, however, * ;

                  (b) To promptly respond to all inquiries or complaints from
purchasers of the Product;

                  (c) To maintain adequate and qualified staff to enable it to
fully perform its obligations hereunder;

                  (d) To provide adequate and appropriate training to its staff
concerning the Product; and

                  (e) To conduct its business in a professional manner.

         6.2 Approved Product Claims. Celltech shall not make and shall cause
its Subdistributors and Sublicensees to not make claims to any Third Party
concerning the Product except as contained in or permitted by the relevant
Marketing Authorization or as approved in the Territory by the appropriate
Regulatory Authority.

         6.3 Development of Marketing Strategy. Celltech agrees to cooperate in
the development of a consistent message strategy to promote the Product in an
effort to protect and strengthen branding. The global positioning of the Product
for the U.S. and the Territory should be discussed before Celltech launches the
Product in a country in the Territory and at least once per year (or more
frequently if reasonably requested by Orphan Medical) to ensure a message which
is consistent with the local Marketing Authorizations and local treatment
guidelines in

                                       19
<PAGE>

such country, and, where possible, consistent with the international message.
Celltech and Orphan Medical agree to work in good faith to develop such a
strategy.

         6.4 Marketing Materials. Celltech agrees to provide Orphan Medical with
copies of all marketing and promotional materials within thirty (30) days of
first use. Celltech shall be solely responsible for the text, graphics, and
compliance of such materials with the laws and regulations of the Territory, but
may rely (without further investigation) on all Product information provided by
Orphan Medical, except that Celltech may not rely on such information to the
extent Celltech knows or reasonably should know that such information is
inaccurate.

         6.5 Sales and Technical Literature Developed by Orphan Medical. From
time to time during the Term Orphan Medical shall provide to Celltech reasonable
quantities of such training, sales and technical literature and materials
relating to the Product as Orphan Medical may have prepared, including, without
limitation, the materials set forth on Appendix H hereto, and shall make
available copies of promotional artwork it may have. The cost of printing
quantities or customizing materials shall be borne by Celltech. Orphan Medical
shall provide the same to Celltech in electronic format. Orphan Medical shall
also provide Celltech with copies of all post-marketing studies and updates to
its regulatory filings that it provides to the FDA. Celltech shall use such
materials solely as provided under this Agreement. Orphan Medical retains all
right, title and interest in and to such materials subject, however, to the
terms of this Agreement.

         6.6 Marketing Reports. (a) At least one hundred eighty (180) days prior
to the anticipated date of the First Commercial Sale, Celltech shall provide
Orphan Medical with sales and marketing plans for the Major European Countries
for the balance of the Contract Year in which such First Commercial Sale occurs;
provided, however, that in respect of Italy, Celltech shall deliver a proposal
to appoint a sub-licensee within one hundred eighty (180) days prior to the
anticipated date of the First Commercial Sale, and shall provide Orphan Medical
with a sales and marketing plan for Italy as soon as practicable after executing
an agreement with a sub-licensee relating to distribution of the Product in
Italy.

                  (b) By 31 January of each Contract Year following the year in
which the First Commercial Sale occurs, Celltech shall provide Orphan Medical
with a written report summarizing its sales and marketing activities in the
Major European Countries for the immediately preceding year, and sales and
marketing plans in the Major European Countries for the current Contract Year.
Simultaneously with delivery of each marketing report described in this Section
6.6(b), Celltech shall deliver reports as to the sales and marketing activities
in the Minor European Countries (for the same periods as provided for the Major
European Countries), provided that such reports need only outline the most
important aspects and plans of the sales and marketing in such Minor European
Countries. Each report shall include the potential market for the Product in all
countries of the Territory where Registration has been achieved and is
anticipated during the Contract Year in question, and other information that
Celltech deems helpful to determine the market for Product and the proper
marketing methods for the same.

         6.7 Cooperation. Orphan Medical and Celltech agree to maintain open
communications relating to the ongoing performance of this Agreement to ensure
joint understanding of current or new issues, data, and information. Orphan
Medical shall answer reasonable technical or marketing questions Celltech may
submit to Orphan Medical. Celltech

                                       20
<PAGE>

acknowledges that Orphan Medical does not have international marketing and
regulatory staff for preparation of regulatory submissions and marketing plans.
Orphan Medical and Celltech agree to provide each other copies of market
research study protocols and subsequent results therefrom, which studies are
designed to generate qualitative and/or quantitative data pertaining to the
Product, subject to any Third Party rights therein.

         6.8 Named Patient Basis Sales. *

                  (c) *

                                  ARTICLE VII.
                        PURCHASE AND DELIVERY OF PRODUCT

7.1      Forecasts.  *

                                       21
<PAGE>

         *

         7.2 Pricing. *

         7.3 Consignment of Product.

                  (a) General. Within a reasonable period in advance of the
anticipated date of the First Commercial Sale, to the extent importation is then
permitted under applicable law, Orphan Medical shall transfer to Celltech's
specified facility in England at least one full lot quantity * of the Product
(such Product, together with subsequent inventory of the Product to be held by
Celltech as baillee pursuant to the terms of this Section 7.3, shall be
"CONSIGNMENT INVENTORY"). Orphan Medical shall thereafter transfer to Celltech
such quantities of the Product as the parties, with input from the Steering
Committee, may subsequently agree in order that the amount of Consignment
Inventory plus the amount of finished goods inventory maintained by Celltech
shall equal approximately the next six (6) months anticipated demand for the
Product in the Territory; provided, that, Orphan Medical shall in no event be
required to transfer, and Celltech shall in no event be required to hold
Consignment Inventory of more than one and one-half full lot quantities *
without its prior written consent. Celltech shall hold the Consignment Inventory
as baillee for and on behalf of Orphan Medical. Celltech hereby acknowledges and
agrees that Celltech's holding the Consignment Inventory in its premises
pursuant to the terms of this Section 7.3 shall constitute a gratuitous bailment
and not a bailment for valuable consideration governed by the U.K. Supply of
Goods and Services Act 1982. The Product in the Consignment Inventory will at
all times remain under the control of Celltech and be held for and on behalf of
Orphan Medical by Celltech as baillee until such time as the Product is removed
from the Consignment Inventory by Celltech in fulfillment of a purchase order
placed by Celltech in accordance with Section 7.4 hereof or repossessed by
Orphan Medical or returned by Celltech in accordance with Section 7.3(e)(iii)
hereof.

                  (b) Prices and Payment.

                           (i) *

                                       22
<PAGE>

                           (ii) Celltech agrees to act as the fiscal
                  representative of Orphan Medical for purposes of customs,
                  duties and VAT, and Celltech shall be solely responsible for
                  payment of all such duties and taxes to the appropriate U.K.
                  authorities when due.

                           (iii) Celltech shall pay (or reimburse Orphan Medical
                  for) all freight charges, insurance in transit, taxes
                  (including import VAT) and import duties incurred in
                  connection with the transfer of the Consignment Inventory from
                  Orphan Medical's designated supplier in the U.S. to Celltech's
                  facilities.

                  (c) Storage and Risk.

                           (i) Celltech will at all times store the Consignment
                  Inventory in premises which have been certified by the
                  Medicines Healthcare Regulatory Authority and any other
                  relevant Regulatory Authority as suitable for U.K. Schedule 4,
                  Part 1 controlled substances and as otherwise provided in
                  Section 7.11.

                           (ii) In the event that any item of Consignment
                  Inventory is lost or damaged through no fault of Orphan
                  Medical, Celltech shall indemnify Orphan Medical in respect of
                  any such loss or damage by paying the Transfer Price for each
                  item lost or damaged, plus duties and VAT, if any.

                           (iii) Celltech will store the Consignment Inventory
                  separately from any goods that belong to Celltech or any Third
                  Party and shall clearly mark and identify the Consignment
                  Inventory as being held on behalf of Orphan Medical.

                           (iv) Celltech shall at its expense at all times
                  maintain adequate insurance covering any risk of loss or
                  damage to the Consignment Inventory for its full Transfer
                  Price and naming Orphan Medical as sole loss payee and shall
                  forward a copy of evidence of such insurance and any amendment
                  thereto to Orphan Medical.

                  (d) Records. Celltech shall maintain full and accurate records
showing the quantity of Consignment Inventory, the lot identification,
expiration dates and such other information as is necessary to enable a Third
Party to identify that each item of Consignment Inventory forms part of the
Consignment Inventory and is being held on behalf of Orphan Medical under the
supervision and control of Celltech.

                  (e) Termination.

                           (i) The bailment created pursuant to this Section 7.3
                  shall terminate with immediate effect on the last day of the
                  Term of this Agreement.

                           (ii) Orphan Medical may also terminate the bailment
                  created pursuant to this Section 7.3 with immediate effect, by
                  giving written notice to that effect to Celltech, if any
                  liquidation, receivership, administration or other insolvency
                  procedure is commenced or threatened with respect to Celltech
                  or any entity

                                       23
<PAGE>

                  which has control over Celltech. Orphan Medical may also
                  terminate this Agreement if any action is taken or threatened
                  which might jeopardise Orphan Medical's rights in the
                  Consignment Inventory.

                           (iii) Termination of the bailment for whatever reason
                  shall be without prejudice to the accrued rights of a party.
                  Celltech shall not thereafter use any items of Consignment
                  Inventory or remove any items from Consignment Inventory
                  without the specific prior written consent of Orphan Medical.
                  Upon such termination, Celltech's obligations under this
                  Section 7.3 shall continue in full force and effect until such
                  time as Orphan Medical has repossessed the Consignment
                  Inventory as provided in paragraph (f) or Celltech has
                  returned the Consignment Inventory by shipment to Orphan
                  Medical Ex Works (Incoterms 2000) at the Celltech facility at
                  which it is kept.

                  (f) Return of Consignment Inventory. Orphan Medical shall be
entitled to repossess the Consignment Inventory immediately upon termination of
the bailment or prior to termination if Orphan Medical determines in its sole
discretion that repossession is necessary for any reason. Celltech, or any
person managing Celltech's activities, shall give any duly authorised
representative or agent of Orphan Medical such access to Celltech's premises as
are required for purposes of repossessing the Consignment Inventory.

                  (g) Periodic Review. At any time and from time to time, either
party may request the other party to discuss and consider in good faith changes
in, or termination of, the arrangements for Consignment Inventory, whereupon the
parties shall be mutually obligated to negotiate in good faith as to such
matters.

         7.4 Purchase Orders.

                  (a) Content. All purchase orders placed by Celltech shall be
in writing and shall state the quantity of Product, the delivery date, shipping
information (except when the Product is to be drawn from Consignment Inventory
pursuant to Section 7.3) and such other similar information as may be reasonably
requested by Orphan Medical.

                  (b) Lead Time. *

                  (c) Number of Orders. *

                  (d) Maximum Quantities. *

                                       24
<PAGE>

*

                  (e) Miscellaneous. Orphan Medical shall use its Commercially
Reasonable Efforts to fill purchase orders that exceed the quantity limits
provided in paragraph (d) above or that are delivered to Orphan Medical less
than one hundred twenty (120) days in advance of the requested delivery date(s)
as required by paragraph (b) above in respect of purchase orders to be filled by
Orphan Medical from other than Consignment Inventory. No accepted order may be
modified or canceled by either party except as agreed in writing by the parties.
Celltech's orders (including mutually agreed change orders) shall be subject to
the provisions of this Agreement, and any terms or conditions contained therein
that conflict with the terms of this Agreement shall be deemed excluded.

         7.5 Delivery From Other Than Consignment Inventory. Where purchase
orders are to be filled by Orphan Medical from other than Consignment Inventory,
Orphan Medical shall deliver the Products no later than five (5) business days
after the date(s) indicated in the applicable purchase order and no earlier than
five (5) business days prior to such specified date(s). Orphan Medical shall
provide prompt written notice to Celltech in the event of any anticipated delays
in the scheduled delivery date and shall cooperate with Celltech to reschedule
delivery at the earliest possible date so as to minimize the impact on Celltech,
provided, however, the foregoing shall in no way modify or mitigate Orphan
Medical's obligation to supply Product properly ordered in accordance with this
Agreement or Celltech's rights and remedies under this Agreement in respect of
any failure to timely supply, including Celltech's right to assert its remedies
in respect of a breach hereof and Celltech's rights to appoint a Third Party
manufacturer in accordance with Section 2.1(b) or to terminate this Agreement in
accordance with Section 14.2(b). Orphan Medical shall send Celltech on the date
of shipment an invoice and shipping notice, in a format to be agreed upon by the
parties. All Products shall be properly packaged and shipped in accordance with
the Product Specifications and instructions included in the applicable purchase
order. Unless otherwise agreed in writing by Orphan Medical, all deliveries of
the Product from other than Consignment Inventory shall be made Ex Works
(Incoterms 2000) Orphan Medical's designated supplier in the U.S.

         7.6 Transfer Price Variations. *

                                       25
<PAGE>

*

         7.7 Payment Terms.

                  (a) General. *

                  (b) Order and Invoice Non-Conformance.

                           (i) *

                                       26
<PAGE>

                           (ii) *

                           (iii) *

         7.8 Short Supply Allocation. If Orphan Medical is unable to supply all
of Celltech's orders for Product hereunder in a timely manner, Orphan Medical
shall equitably allocate its available sources and supplies among Celltech,
Orphan Medical and Orphan Medical's other partners (distributors, licensees,
agents, etc.) and internal needs, taking into consideration the respective
requirements of each of the parties during a reasonable time period prior to
allocation and their requirements during the allocation period, provided,
however, the foregoing shall in no way modify or mitigate Orphan Medical's
obligation to supply Product properly ordered in accordance with this Agreement
or Celltech's rights and remedies under this Agreement in respect of any failure
to timely supply, including in respect of a breach hereof and Celltech's rights
to appoint a Third Party manufacturer in accordance with Section 2.1(b) or to
terminate this Agreement in accordance with Section 14.2(b).

         7.9 Product Expiration. (a) All Product supplied by Orphan Medical from
other than Consignment Inventory shall have a minimum expiration dating of
thirty-six (36) months at the time of its delivery Ex Work's Orphan Medical's
designated supplier pursuant to Section 7.5.

                  (b) The Product delivered in the initial transfer of
Consignment Inventory from Orphan Medical to Celltech made in accordance with
the first sentence of Section 7.3(a) shall have minimum expiration dating of
forty-two (42) months at the time it is delivered to Celltech's facility in
England. Thereafter, all Product delivered by Orphan Medical as Consignment
Inventory pursuant to Section 7.3 shall have minimum expiration dating of
thirty-six (36) months at the time it is delivered to Celltech's facility in
England. Celltech shall not be required to draw out of Consignment Inventory any
Product with expiration dating of less than twenty-four (24) months on the date
that it is drawn out of Consignment Inventory; provided, however, that if the
Consignment Inventory shall at any time contain Product with less than
24-month's expiration dating, Celltech shall use Commercially Reasonable Efforts
to sell such Consignment Inventory, and provided, further, however, that if
Celltech shall not be able to sell such short-dated Consignment Inventory,
Celltech shall, at Orphan Medical's direction, either return such Product to
Orphan Medical Ex Work's Celltech's facility in England or destroy the Product
and provide the certification described in Section 7.12, and in either such
event Orphan

                                       27
<PAGE>

Medical shall reimburse Celltech for all amounts paid by Celltech pursuant to
Sections 7.3(b)(ii) and (iii).

                  (c) In the event the applicable Regulatory Authority grants an
expiration date of less than thirty-six (36) months, Orphan Medical and Celltech
shall negotiate in good faith a reasonable minimum expiration, taking into
account the differing expiration dates set forth herein for Product which is and
Product which is not drawn out of Consignment Inventory.

                  (d) Celltech shall not sell any Product beyond its stated
expiration date.

         7.10 Certificate of Analysis. With each delivery of the Product into
Consignment Inventory pursuant to Section 7.3 or to Celltech from other than
Consignment Inventory, Orphan Medical shall provide to Celltech (i) a
Certificate of Analysis and Certificate of Conformity confirming that the
Product has been manufactured in accordance with cGMP and the Product
Specifications, (ii) a copy of all batch documentation from the Product
manufacturer for the first three (3) batches of Product delivered to Celltech
and (iii) a copy of the annual stability test report, provided that the
provision of the certificates and other documents listed in (i) - (iii) above
shall not release Celltech from any of its obligations hereunder, including,
without limitation, its obligation to conduct all necessary release testing to
ensure that the Products distributed in the Territory comply with all applicable
regulatory requirements in the Territory.

         7.11 Storage. Celltech shall at its own expense maintain adequate and
suitable storage facilities for the storage of Consignment Inventory and Product
delivered to Celltech from other than Consignment Inventory, in each case in
accordance with cGMP, the Marketing Authorizations, and all applicable laws and
regulations. Orphan Medical or its representative shall have the right no more
than twice per calendar year to inspect, during normal business hours, such
storage facilities upon sixty (60) days prior written notice.

         7.12 Rejection of Shipments For Product Non-Conformance. If Celltech
rejects a shipment from other than Consignment Inventory on the determination
that such shipment of Product fails to conform to the purchase order therefor or
a shipment of Consignment Inventory or Product delivered to Celltech from other
than Consignment Inventory or drawn by Celltech out of Consignment Inventory on
the grounds that it fails to conform to the Product Specifications, Celltech
shall give written notice of such rejection to Orphan Medical within fifteen
(15) days after receipt thereof, in the case of apparent non-conformance, and
sixty (60) days of the receipt of definitive test results obtained pursuant to
Section 7.13 in the case of non-conformance established by such tests. Such
notice of rejection shall specify the manner in which the Product fails to
conform to the relevant purchase order, or otherwise fails to conform to the
Product Specifications. If Celltech fails to provide Orphan Medical such notice
in respect of Product delivered to Celltech pursuant to a purchase order,
whether drawn from Consignment Inventory or otherwise, within fifteen (15) or
sixty (60) days, as the case may be, of the date of delivery, the Product shall
be deemed accepted by Celltech; provided, however, that such deemed acceptance
shall not (i) impair Celltech's right to reject shipment or recover damages in
respect of any non-conformance that is not apparent and cannot be determined by
such tests or (ii) reduce, diminish or alter Celltech's rights to
indemnification as specified in Article IX hereof or to terminate this Agreement
in accordance with Section 14.2(b). If Celltech expects to make a claim against
Orphan Medical in accordance with this Section 7.12, Celltech shall not dispose
or

                                       28
<PAGE>

allow the disposal of the Product in question without the express written
authorization and instructions of Orphan Medical. Any such instructions from
Orphan Medical, or Celltech's compliance therewith, shall not relieve Celltech
of its obligation to dispose of any Product in accordance with all applicable
laws and regulations in the relevant country in the Territory. Celltech shall
not return any rejected Product to Orphan Medical without a Return Material
Authorization ("RMA") from Orphan Medical. Orphan Medical shall promptly issue a
RMA for any reasonably rejected Product, provided, however, appropriate samples
may be retained by Celltech as evidence of the basis for such rejection by
Celltech. Proof of destruction or disposal shall be certified in writing to
Orphan Medical by an officer of Celltech. Within thirty (30) days of receipt of
a statement detailing and documenting all of Celltech's costs and expenses
associated with Orphan Medical's delivery of non-conforming Products, including
without limitation, any payments made or other Indemnification Amounts arising
out of Claims and the return, destruction or disposal of such Product pursuant
to this Section 7.12, Orphan Medical shall reimburse Celltech for all such
amounts. Any disputes between the parties relating to such reimbursement amounts
shall be resolved in accordance with the procedures set forth in Section 15.2

         7.13 Testing of Product Upon Receipt. Celltech shall, as soon as
practical after receipt of Product into Consignment Inventory or from other than
Consignment Inventory, examine the Product for any apparent non-conformance and
carry out or have carried out, routine laboratory testing and other chemical
analysis of the Product as required by the relevant Marketing Authorizations
and/or Regulatory Authority(ies). Celltech shall promptly notify Orphan Medical
if such examination or testing establishes the basis to reject the Product for
non-conformance. Any such notice shall identify the specific claims of
non-conformance and include copies of relevant test results or other materials
indicating such non-conformance. Upon receipt of a notification of
non-conformance, Orphan Medical and Celltech shall compare test results obtained
during release testing of the Product by Orphan Medical to the results Celltech
obtained during acceptance testing to evaluate the potential cause of
discrepancy. If Orphan Medical confirms such non-conformity, it shall promptly
so notify Celltech. If Orphan Medical does not confirm such non-conformity, it
shall promptly so notify Celltech, and the parties shall submit the disputed
Product shipment for testing to an independent testing laboratory or other
independent Third Party expert mutually acceptable to the parties.
Notwithstanding Section 15.2, the findings of the testing laboratory or Third
Party expert shall be binding on the parties. The expenses of such testing shall
be borne by Orphan Medical if the non-conformity is confirmed, and otherwise by
Celltech. Without limiting Celltech's other remedies as herein provided, Orphan
Medical shall promptly replace properly rejected Product. Celltech shall return
such Product or, if requested by Orphan Medical, destroy the Product and provide
the certification described in Section 7.12.

                                  ARTICLE VIII
                         REPRESENTATIONS AND WARRANTIES

         8.1 Orphan Medical Warranties. Orphan Medical represents and warrants
to Celltech that:

                                       29
<PAGE>

                  (a) It is a corporation duly organized, validly existing and
in good standing under the laws of the state of Delaware, U.S.A. and has the
corporate power to own its assets and properties and to carry on its business as
now being and heretofore conducted.

                  (b) It has all requisite power and authority (corporate and
otherwise) to enter into this Agreement and it has duly authorized, by all
necessary action, the execution and delivery hereof by the officer or individual
whose name is signed on its behalf below. Orphan Medical's execution and
delivery of this Agreement does not and will not conflict with or result in a
breach of or a default under its organizational documents or any agreement,
instrument, order, law or regulation applicable to it or by which it or the
Product may be bound. This Agreement has been duly and validly executed and
delivered by Orphan Medical and constitutes Orphan Medical's valid and legally
binding obligation, enforceable against Orphan Medical in accordance with its
terms, except as enforcement may be limited by laws of bankruptcy or insolvency
or other laws of general application relating to or affecting the enforcement of
creditor's rights and general equitable principles.

                  (c) At the time of its shipment to Celltech, each order of
Product shall have been manufactured, stored and shipped in accordance with
cGMP, the Product Specifications and the Marketing Authorizations and other
applicable laws and regulations, shall be in compliance with the Marketing
Authorizations, and shall not be adulterated or misbranded within the meaning of
the United States Food, Drug and Cosmetics Act, as in effect at the time of
shipment;

                  (d) At the time of its shipment to Celltech, each order of the
Product shall conform to the Product Specifications until the expiration of the
shelf life approved by the Regulatory Authorities.

                  (e) Patent Rights, Trademarks and Other Intellectual Property
Rights.

                           (i) Orphan Medical has good title and ownership or
                  rights to the Licensed Intellectual Property free and clear of
                  all liens. To Orphan Medical's actual knowledge, it has all
                  intellectual property rights necessary for (A) the manufacture
                  of the Product by Orphan Medical and the distribution,
                  marketing, promotion and sale by Celltech of the Product in
                  the Territory in accordance with the terms of this Agreement
                  and (B) the grant by Orphan Medical to Celltech of the rights
                  granted under this Agreement.

                           (ii) Schedule 8.1(e)(ii) hereto contains a true and
                  complete list of all Patent Rights in the Territory and all
                  Trademarks and all other intellectual property rights of
                  Orphan Medical relating to the Product in the Territory,
                  indicating for each whether it is registered or is the subject
                  of a pending application with any patent and/or trademark
                  office with jurisdiction in the Territory, and all licenses
                  and other contracts and similar rights relating thereto.

                           (iii) Except as set forth on Schedule 8.1(e)(iii), to
                  Orphan Medical's actual knowledge, the Product as manufactured
                  and delivered to Celltech by Orphan Medical for distribution
                  in the Territory pursuant to this Agreement, and Celltech's
                  use of the Licensed Intellectual Property in the Territory as

                                       30
<PAGE>

                  contemplated hereby, does not and will not infringe or
                  conflict with any intellectual property rights or trade
                  secrets of any Person.

                  (f) Contracts; No Default.

                           (i) Except for those contracts described in Section
                  6.8 or set forth on Schedule 8.1(f)(i) and Schedule 8.1(e)(ii)
                  and except for this Agreement, as of the date hereof, there
                  are no material contracts, agreements, understandings,
                  arrangements or commitments, written or oral, including
                  without limitation, manufacturing, supply, sales agency, sales
                  representative, distributor, dealer, license, supplier,
                  wholesaler, or similar contracts or agreements ("CONTRACTS")
                  of Orphan Medical relating to the Product in the Territory.

                           (ii) Except as set forth on Schedule 8.1(f)(ii),
                  Orphan Medical and, to Orphan Medical's actual knowledge, each
                  other party to Orphan Medical's Contracts referenced in clause
                  (i) above (other than Celltech) has performed in all material
                  respects, and is now performing in all material respects, its
                  obligations under, and is not in material default (and would
                  not by the mere lapse of time or the giving of notice or both
                  be in default) under, or in material breach or violation of
                  any of such Contracts; nor has Orphan Medical received notice
                  of any asserted claim of a default by any other party thereto
                  under, or a breach or violation by such other party of any of
                  such Contracts.

                  (g) Actions.

                           (i) Except as set forth on Schedule 8.1(g)(i), there
                  are no Claims pending or, to Orphan Medical's actual
                  knowledge, threatened against Orphan Medical before any
                  Regulatory Authority that (A) question or challenge the
                  validity of this Agreement or any action taken or proposed to
                  be taken by Orphan Medical pursuant hereto or in connection
                  with the transactions contemplated hereby, or (B) relate to
                  the Product or would if adversely determined, singly or in the
                  aggregate, prohibit or materially impair Orphan Medical's or
                  Celltech's ability to perform its obligations under this
                  Agreement.

                           (ii) There are no outstanding judgments, orders,
                  decrees, writs, awards, stipulations, or injunctions of any
                  Regulatory Authority against or affecting the Product or
                  Orphan Medical with respect to the Product or which would if
                  adversely determined, singly or in the aggregate, prohibit or
                  materially impair Orphan Medical's or Celltech's ability to
                  perform its obligations under this Agreement.

                  (h) Approvals. Except as contemplated by this Agreement or set
forth on Schedule 8.1(h) or as shall already have been made, obtained or given,
no approval of any Regulatory Authority or other Person is required to be made,
obtained or given by or with respect to Orphan Medical or the Product in
connection with the execution or delivery by Orphan Medical of this Agreement,
the performance by it of its obligations hereunder or the consummation by it of
the transactions contemplated hereby.

                                       31
<PAGE>

         8.2 Disclaimer. EXCEPT AS SET FORTH IN THIS ARTICLE VIII, ORPHAN
MEDICAL MAKES NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION
THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
NON-INFRINGEMENT WITH RESPECT TO THE PRODUCT OR CELLTECH'S SALE AND DISTRIBUTION
THEREOF IN THE TERRITORY. The warranties given by Orphan Medical are for the
sole benefit of Celltech and Celltech shall not extend such warranties to any
customer thereof or any Third Party. This provision does not affect the right of
any patient to pursue legal remedy in the event Orphan Medical provides Product
that is adulterated or misbranded or if Product does not meet Product
Specifications. Except as provided in Section 2.1, nothing in this Agreement
shall be construed as, and Orphan Medical expressly disclaims, any warranty or
agreement to furnish any manufacturing information beyond that required to
obtain Registrations for the Product in the Territory. Celltech agrees that as
between Celltech and Orphan Medical, Celltech alone shall be liable, to the
exclusion of Orphan Medical, for the breach of any warranties given by Celltech,
its Subdistributors or its Sublicensees to customers or others regarding the
Product, provided, however, nothing herein shall reduce, diminish or alter
Celltech's rights as herein provided including its right to assert claims
against Orphan Medical in respect of the same facts that form or might form the
basis of Claims against Celltech by its Subdistributors or Sublicensees and its
or their customers.

         8.3 Celltech Warranties. Celltech represents and warrants to Orphan
Medical that:

                  (a) It is a corporation duly organized, validly existing and
in good standing under the laws of England and has the corporate power to own
its assets and properties and to carry on its business as now being and
heretofore conducted.

                  (b) It has all requisite power and authority (corporate and
otherwise) to enter into this Agreement and it has duly authorized, by all
necessary action, the execution and delivery hereof by the officer or individual
whose name is signed on its behalf below. Celltech's execution and delivery of
this Agreement does not and will not conflict with or result in a breach of or a
default under its organizational documents or any agreement, instrument, order,
law or regulation applicable to it or by which it or the Product may be bound.
This Agreement has been duly and validly executed and delivered by Celltech and
constitutes Celltech's valid and legally binding obligation, enforceable against
Celltech in accordance with its terms, except as enforcement may be limited by
laws of bankruptcy or insolvency or other laws of general application relating
to or affecting the enforcement of creditor's rights and general equitable
principles.

                  (c) It shall and shall cause its Subdistributors, Sublicensees
and Third Party manufacturers to manufacture (if applicable), store, package,
label, promote, market, sell and distribute the Product in compliance with this
Agreement, the Registrations and all applicable laws and regulations in the
Territory.

                  (d) Celltech shall not, and shall cause its Subdistributors,
Sublicensees and Third Party manufacturers to not knowingly, infringe any Third
Party patents, copyrights, trademarks, trade secrets or other Third Party
intellectual property or proprietary rights in the performance of its
obligations hereunder.

                                       32
<PAGE>

                  (e) Contracts; No Default.

                           (i) Except for those Contracts set forth on Schedule
                  8.1(e)(i) and except for this Agreement, as of the date
                  hereof, there are no material Contracts of Celltech relating
                  to the Product in the Territory.

                           (ii) Except as set forth on Schedule 8.1(e)(ii),
                  Celltech and, to Celltech's actual knowledge, each other party
                  to Celltech's Contracts referenced in clause (i) above (other
                  than Orphan Medical) has performed in all material respects,
                  and is now performing in all material respects, its
                  obligations under, and is not in material default (and would
                  not by the mere lapse of time or the giving of notice or both
                  be in default) under, or in material breach or violation of
                  any of such Contracts; nor has Celltech received notice of any
                  asserted claim of a default by any other party thereto under,
                  or a breach or violation by such other party of any of such
                  Contracts.

                  (f) Actions.

                           (i) Except as set forth on Schedule 8.1(f)(i), there
                  are no Claims pending or, to Celltech's actual knowledge
                  threatened against Celltech before any Regulatory Authority
                  that (A) question or challenge the validity of this Agreement
                  or any action taken or proposed to be taken by Celltech
                  pursuant hereto or thereto or in connection with the
                  transactions contemplated hereby, or (B) would if adversely
                  determined, singly or in the aggregate, prohibit or materially
                  impair Orphan Medical's or Celltech's ability to perform its
                  obligations under this Agreement.

                           (ii) There are no outstanding judgments, orders,
                  decrees, writs, awards, stipulations, injunctions of any
                  Regulatory Authority against or affecting Celltech which would
                  if adversely determined, singly or in the aggregate, prohibit
                  or materially impair Celltech's ability to perform its
                  obligations under this Agreement.

                  (g) Approvals. Except as contemplated by this Agreement or set
forth on Schedule 8.2(g) or as shall already have been made, obtained or given,
no approval of any Regulatory Authority or other Person is required to be made,
obtained or given by or with respect to Celltech or the Product in connection
with the execution or delivery by Celltech of this Agreement, the performance by
it of its obligations hereunder or the consummation by it of the transactions
contemplated hereby.

                                   ARTICLE IX
                                 INDEMNIFICATION

         9.1 Indemnification by Orphan Medical. Subject to Section 9.2, Orphan
Medical shall indemnify and hold harmless Celltech and its directors, officers,
employees and agents from and against all claims, disputes, actions,
arbitrations, mediations, litigations, proceedings, suits and governmental
investigations brought by a Third Party and any appeal therefrom (the "CLAIMS")
and all liabilities, damages, losses, costs and expenses (including reasonable

                                       33
<PAGE>

attorneys' fees and expenses in respect of Claims and to enforce rights to
indemnification as herein provided ("INDEMNIFICATION AMOUNTS")) arising out of
(i) a breach by Orphan Medical of any representation, warranty or covenant
provided in this Agreement, including, without limitation, the representations
and warranties set forth in Section 8.l, (ii) an allegation that bodily injury
(including death) or tangible personal property damage was caused by, resulted
from or arose out of the use of the Product for a Licensed Indication by
whomsoever such Product was sold (including Celltech, its Subdistributors and
Sublicensees) and regardless of the legal theory on which such Claim is based,
except, however, where such bodily injury and/or property damage is due to (a) a
circumstance described in Section 9.2(i) or 9.2(iii) hereof or (b) failure of a
Third Party manufacturer appointed by Celltech pursuant to Section 2.1 to
manufacture, store or ship the Product in accordance with cGMP, the Marketing
Authorizations and other applicable laws and regulations or due to the action or
inaction of such Third Party manufacturer which causes the Product to be
adulterated or misbranded within the meaning of the United States Food, Drug and
Cosmetic Act, as in effect at the time of shipment; and (iii) negligence, gross
negligence or willful misconduct of or attributable to Orphan Medical, its
sublicensees (other than Celltech, its Subdistributors, Sublicensees or Third
Party manufacturers), contractors, manufacturers and its or their directors,
officers, agents, employees, consultants or clinical investigators in connection
with the manufacture, storage or supply of API and/or the Product.

         9.2 Indemnification by Celltech. Celltech agrees to indemnify, defend
and hold harmless Orphan Medical and its directors, officers, employees and
agents from and against all Claims and Indemnification Amounts arising out of
(i) a breach by Celltech of any representation, warranty or covenant provided in
this Agreement, (ii) an allegation that bodily injury (including death) or
tangible personal property damage was caused by, resulted from or arose out of
the Products sold by Celltech, its Subdistributors, Sublicensees or Third Party
manufacturers that were used other than for a Licensed Indication, regardless of
the legal theory on which such Claim is based, except, however, where such
bodily injury and/or property damage is due to a circumstance described in
Sections 9.1(i) and 9.1(iii) hereof, (iii) negligence, gross negligence or
willful misconduct of or attributable to Celltech, its Subdistributors,
Sublicenses or Third Party manufacturers and its or their directors, officers,
agents, employees, consultants or clinical investigators in connection with the
storage, packaging, labeling, promotion, marketing, sale and distribution of the
Product in the Territory; and (iv) any express or implied warranty, whether oral
or written, including any implied warranty or the merchantability or fitness of
the Product for a particular purpose asserted by any customer of Celltech, its
Subdistributors or Sublicensees, if such warranty was extended by or arising
from any undertaking, action or inaction of Celltech, its Subdistributors or
Sublicensees.

         9.3 Procedure. A party seeking indemnification (an "INDEMNIFIED PARTY")
shall give the other party (an "INDEMNIFYING PARTY") written notice of any Claim
promptly upon becoming aware thereof. The indemnifying party shall have sole and
exclusive control of the defense of any Claim, including the choice and
direction of legal counsel. The indemnified party shall have the right to
participate in such defense through its own counsel, at its own expense. Neither
party may settle or compromise any Claim for which indemnification is being
sought without the written consent of the other party, which may not be
unreasonably withheld.

         9.4 Insurance. *

                                       34
<PAGE>

*

                                   ARTICLE X
                          INTELLECTUAL PROPERTY RIGHTS
                               PERFECTION AND USE

         10.1 License Perfection. In the event that the execution and filing of
any document is required in connection with the license granted in Section 2.2
to Celltech for the Trademark or Patent Rights under the laws of any country in
the Territory, Celltech shall promptly notify Orphan Medical, and Orphan Medical
shall cause such document to be executed and filed, and Celltech shall sign such
document if necessary and otherwise cooperate in the filing thereof.

         10.2 Quality Standards. All Products sold and marketed under the
Trademark by Celltech or its Subdistributors or Sublicensees, including all
related advertising, promotional materials, and all other related uses of the
Trademark shall comply with the reasonable trademark use standards adhered to by
Orphan Medical in the manufacture, sale and promotion of the Product, which such
standards are set forth in Appendix I. In particular, and without limiting the
generality of the foregoing, upon reasonable request by Orphan Medical, Celltech
shall provide Orphan Medical with samples of Products bearing the Trademark, as
well as copies of all materials, including but not limited to brochures,
professional literature, packaging and consumer instructions, which are created
or intended for use by Celltech, its Subdistributors and/or Sublicensees in the
advertising, promotion, marketing or sale or other distribution of the Product
in the Territory, for examination and testing to verify compliance with the
trademark use standards set forth in Appendix I. Celltech shall also permit
Orphan Medical, not more than once per Contract Year and upon thirty (30) days
prior written notice and at reasonable times during normal business hours, to
examine stocks of the Product held by it or its Subdistributors or Sublicensees
to verify compliance with such standards. Orphan Medical shall notify Celltech
in writing of any noncompliance herewith, and Celltech shall use Commercially
Reasonable Efforts to correct the problem and bring such Products into
compliance with applicable standards.

         10.3 Use of Trademark. Celltech shall and shall cause its
Subdistributors and Sublicensees to market the Product under the Trademark;
provided, however that if the Trademark is unavailable or unusable in a
particular country in the Territory, the parties shall mutually agree on a
suitable alternative. In addition, to the extent permitted by applicable law in
each country in the Territory, all labeling for the Product shall bear a legend,
identifying Orphan Medical as the manufacturer of the Product for Celltech.

         10.4 Registration and Approvals. Attached hereto as Appendix B is a
list of the registrations and pending applications for registration for the
Trademark and Patent Rights in the Territory. Orphan Medical shall file
applications and maintain trademark registrations (including for the Trademark
and any alternative trademarks pursuant to Section 10.3) and patent

                                       35
<PAGE>

registrations (including for the Patent Rights) in each country in the Territory
including without limitation the registrations and pending applications for the
Trademark and Patent Rights in each country listed in Appendix B as shall be
reasonably useful or necessary to protect Celltech's rights under this
Agreement; provided, however, that if Orphan Medical shall fail to file a useful
or necessary application or maintain a useful or necessary registration for any
trademarks, alternative trademarks or patents in a country in the Territory, or
to maintain the Trademark and Patent Rights registrations in each country listed
in Appendix B, Celltech shall have the right to file such applications and
maintain such registrations in each such country in the Territory for such
trademarks, alternative trademarks or patents at the expense and in the name and
on behalf of Orphan Medical (or in Celltech's own name if that is not permitted
in the applicable country). Such registration and use of the Trademark and
Patent Rights shall inure to the benefit of and be on behalf of Orphan Medical.
On any termination of this Agreement pursuant to Article XIV hereof, Celltech
shall promptly assign to Orphan Medical registrations and any applications for
registration of trademarks, alternative trademarks or patents for the Product in
the Territory filed in its name pursuant to this Section 10.4.

         10.5 Reservation of Rights. Except as otherwise provided herein, (i)
nothing in this Agreement shall entitle Celltech to any right, title or interest
in or to any of the Patent Rights, Know How, Manufacturing Know How, Trademark,
Improvements, and Proprietary Information of Orphan Medical or any associated
goodwill, which is and shall remain the sole and exclusive property of Orphan
Medical and (ii) Celltech shall not take and shall cause its Subdistributors,
Sublicensees and Third Party manufacturers to not take any action that might (a)
impair any right, title or interest of Orphan Medical in and to the Patent
Rights, Know How, Manufacturing Know How, Trademark, Improvements and
Proprietary Information; or (b) create any right, title or interest in or to
such Patent Rights, Know How, Trademark, Improvements and Proprietary
Information in Celltech or any other Person. Celltech acknowledges Orphan
Medical's proprietary rights as provided in the preceding sentence, and hereby
waives in favor of Orphan Medical any right Celltech may have in and to the
Patent Rights, Know How, Manufacturing Know How, Trademark, Improvements and
Proprietary Information except as herein provided.

                                   ARTICLE XI
                       INTELLECTUAL PROPERTY INFRINGEMENTS

         11.1 Protection of Intellectual Property. Celltech shall cooperate with
Orphan Medical and take all reasonable actions which Orphan Medical may
reasonably request, at Orphan Medical's sole cost and expense, in order to
protect and enforce Orphan Medical's intellectual property rights, including,
but not limited to, carrying out any act Orphan Medical may reasonably require
in connection with any registration, enforcement or protection thereof. Celltech
shall promptly notify Orphan Medical upon becoming aware of any use in the
Territory by a Third Party of the Patent Rights, Know How, Manufacturing Know
How, Trademark, Improvements or Proprietary Information of Orphan Medical
related thereto, or any other Orphan Medical intellectual property relating to
the Product which may constitute an infringement thereof. Orphan Medical shall
have the first right, at its option, to institute proceedings against Third
Party infringers in respect of infringements occurring in the Territory. If
Orphan Medical elects not to institute such proceedings within a period of
thirty (30) days after its discovery of the infringement, Celltech shall have
the right at its option to do so. The party instituting proceedings in the
Territory pursuant to this Article XI shall bring all such

                                       36
<PAGE>

proceedings in the name of both parties. Orphan Medical shall have the exclusive
right in its sole discretion to institute proceedings solely in its name against
Third Party infringers in respect of infringements occurring outside the
Territory. Each party shall cooperate fully with the other party in connection
with any such proceedings against third-party infringers. All expenses of any
such proceedings shall be borne by the party instituting the proceedings and
damages which may be awarded or agreed upon in settlement of such action shall
be allocated first to reimburse the documented costs of the proceedings incurred
by the party bringing suit, with the balance of such amounts, if any, to be
allocated between the parties in accordance with their relative economic loss
from such infringement.

                                  ARTICLE XII
                                  IMPROVEMENTS

         12.1 Improvements by Celltech. Subject to Celltech's rights therein as
provided elsewhere in this Agreement, including without limitation Section 2.2,
Celltech hereby irrevocably assigns, releases, and transfers to Orphan Medical
its entire right, title and interest in and to any Improvement solely relating
to the API and/or Product (whether patentable or not) made or conceived solely
by Celltech employees or contractors.

         12.2 Improvements by Orphan Medical. Subject to Celltech's rights
therein as provided elsewhere in this Agreement, including without limitation
Section 2.2, Orphan Medical shall own all right, title and interest in and to
any Improvement relating to the API and/or Product (whether patentable or not)
made or conceived solely by Orphan Medical employees or by any Orphan Medical
contractor, other than Celltech, including, without limitation, any
manufacturing or analytical process, procedure or method or any source of
synthesis given to Celltech.

         12.3 Disclosure. Celltech shall promptly disclose to Orphan Medical any
and all Improvements relating to the API and/or Product by Celltech's employees
or contractors, either alone or together with Orphan Medical's employees or
contractors. Celltech shall execute at Orphan Medical's expense any assignments,
applications or other instruments or documents reasonably requested by Orphan
Medical to obtain, maintain, and otherwise to perfect Orphan Medical's interest
therein as provided by this Agreement. Celltech's and Orphan Medical's
obligations hereunder shall survive termination of this Agreement.

                                  ARTICLE XIII
                                 CONFIDENTIALITY

         13.1 Proprietary Information. During the Term hereof and for a period
of five (5) years thereafter, any Proprietary Information disclosed by one party
(the "DISCLOSING PARTY"), directly or indirectly, to the other party (the
"RECEIVING PARTY") under this Agreement shall be deemed confidential, and trade
secret information, whether so designated or not, and shall not be disclosed by
the Receiving Party to any Third Party, except as set forth below. Access to
such Proprietary Information shall be limited to employees, agents, consultants
or contractors of the Receiving Party who reasonably require such Proprietary
Information for purposes of performing the Receiving Party's obligations
hereunder and who are bound to the Receiving Party by similar obligations in
respect of confidentiality and use. Such employees, agents, consultants or

                                       37
<PAGE>

contractors shall be advised of the nature and existence of the undertakings in
respect of such Proprietary Information pursuant to this Agreement and of the
applicability of such undertakings to them. The Receiving Party shall use such
Proprietary Information only to carry out its obligations or to exercise its
rights hereunder and shall not use such Proprietary Information for its own
benefit or for the benefit of others or in any way inconsistent with this
Agreement.

         13.2 Exclusions. Information shall not be deemed Proprietary
Information which:

                  (a) at the time of disclosure, is already in the public domain
or thereafter becomes part of the public domain through no act or omission of
the Receiving Party;

                  (b) was rightfully in the possession of the Receiving Party
prior to the time of the disclosure;

                  (c) is independently disclosed to the Receiving Party by a
Third Party who has not violated any confidential obligation owed to the
Disclosing Party;

                  (d) was independently developed by the Receiving Party without
any use of or reliance on any Proprietary Information of the Disclosing Party;

                  (e) is required to be disclosed by legal process, provided
that, in each case the party so disclosing information timely informs the other
and uses its best efforts to limit the disclosure and maintain confidentiality
to the extent possible and permits the other party to attempt by appropriate
legal means to limit such disclosure;

                  (f) is information which is required to be included in patent
applications or required to be provided to the FDA or any other Regulatory
Authority in the Territory in order that Registrations for the Product can be
obtained or otherwise to comply with applicable regulatory requirements;
provided, however, that no Proprietary Information of Celltech or Orphan Medical
shall be disclosed in any such patent application or Registration without the
prior written consent of the Disclosing Party, which consent shall not be
unreasonably withheld; or

                  (g) is information which is required to be disclosed to
customers, users, and prescribers of the Product or which is reasonably
necessary to disclose in connection with the ethical marketing of the Product,
if applicable.

         13.3 Third Party Disclosure. Disclosure by the Receiving Party to a
Third Party shall be made only to the extent necessary to enable the Receiving
Party to comply with its contractual obligations to the Disclosing Party, and
only if such Third Party has executed a confidentiality agreement containing
terms that are at least as protective as the terms of this Agreement.

         13.4 Third Party Confidentiality Agreement. Each Third Party to which
Proprietary Information is disclosed other than a Regulatory Authority shall
agree in writing prior to such disclosure to keep the Proprietary Information in
strict confidence.

                                       38
<PAGE>

         13.5 Confidentiality of Agreement. Except as otherwise required by law,
applicable regulations or the terms of this Agreement or as mutually agreed upon
by the parties hereto, each party shall treat as confidential the terms and
conditions of this Agreement.

         13.6 Prior Confidentiality Agreement. The Confidentiality Disclosure
Agreement between the parties hereto dated 20 November 2002 is hereby superseded
and terminated. Any disclosure of Proprietary Information by either party
pursuant to such Confidentiality Agreement shall be deemed to have been made
hereunder and shall be subject to this Article 13.

                                  ARTICLE XIV
                              TERM AND TERMINATION

         14.1 Term. This Agreement shall become effective as of the Effective
Date and shall remain in full force and effect until the last of Orphan
Medical's Patent Rights to expire or ten (10) years from the date Celltech
receives approval from the EMEA to commercially promote and distribute the
Product, whichever is longer. This Agreement will be automatically extended
indefinitely thereafter unless and until terminated by Celltech upon not less
than twelve (12) months written notice to Orphan Medical. All references herein
to "TERM" or "TERM OF THIS AGREEMENT" shall be deemed to include both the
initial and any extended terms.

         14.2 Mutual Termination. This Agreement may be terminated prior to its
normal Term as follows:

                  (a) Either party may terminate this Agreement immediately upon
notice if the other party files a petition of any type as to its bankruptcy, is
declared bankrupt, becomes insolvent, makes an assignment for the benefit of
creditors, goes into liquidation or receivership, or otherwise loses legal
control of its business involuntarily.

                  (b) Either party may terminate this Agreement if the other
party materially defaults or commits a material breach of this Agreement and has
failed to cure such default or breach within ninety (90) days of receipt of
written notice thereof from the first party.

                  (c) Either party may terminate this Agreement in accordance
with Section 16.2 or Section 16.3.

         14.3 Termination by Orphan Medical. Orphan Medical may terminate this
Agreement upon written notice to Celltech if any of the following continues
uncured for a period of ninety (90) days following receipt of written notice
thereof from Orphan Medical:

                  (a) Celltech shall have failed to meet the applicable minimum
royalty payment requirements for the Product as provided in Article IV hereof.

                  (b) Celltech ceases to sell the Product in the Territory.

                  (c) Celltech alters any Product except as permitted hereunder
or with Orphan Medical's prior written consent.

                                       39
<PAGE>

                  (d) Except as otherwise herein provided, as to the countries
in which EMEA approval is required for a Registration, if Celltech shall have
failed to obtain a Registration in at least one Major European Country by
December 31, 2006, and as to each other country in the Territory, if Celltech
shall have failed to use Commercially Reasonable Efforts to obtain a
Registration in such country, if, in each case, such failure shall not be due to
a breach by Orphan Medical of its obligations under this Agreement.

         14.4 Rights and Obligations on Termination. In the event of termination
of this Agreement for any reason, the parties shall have the following rights
and obligations:

                           (i) Neither party shall be released from the
                  obligation to make payment of all amounts then or thereafter
                  due and payable in respect of the Term prior to such
                  termination as otherwise herein provided.

                           (ii) Except as provided in Section 14.6, Celltech
                  shall cease to market, promote, sell and distribute the
                  Product and shall return to Orphan Medical, at Celltech's
                  expense, all copies of promotional and technical materials and
                  artwork provided by Orphan Medical; provided, however, that if
                  this Agreement is terminated by Celltech pursuant to Section
                  14.2(b), Orphan Medical shall pay all expenses related to such
                  return of materials and artwork;

                           (iii) Orphan Medical may, if Celltech elects not to
                  pursue its sell-off rights under Section 14.6, repurchase
                  Celltech's inventory of non-obsolete and non-expired Product
                  at the price paid by Celltech for such Product or direct
                  Celltech to sell them to the Third Party or parties selected
                  by Orphan Medical at the price paid by Celltech; provided,
                  however, that if this Agreement is terminated by Celltech
                  pursuant to Section 14.2(b), Orphan Medical must repurchase
                  such inventory at the price paid by Celltech if Celltech
                  elects not to pursue its sell-off rights under Section 14.6;

                           (iv) Celltech shall return or, if requested by Orphan
                  Medical, destroy all of Orphan Medical's Proprietary
                  Information, including, if applicable, all electronic copies
                  thereof and shall certify in writing that it has done so; and

                           (v) Celltech shall comply with the provisions of
                  Section 10.4 regarding the assignment to Orphan Medical of
                  trademark and/or patent rights registrations filed in
                  Celltech's name.

         14.5 Partial Termination. In the event that a cause of termination
shall relate solely to any country not subject to regulation by the EMEA, then
termination of this Agreement shall be limited and applied only to such country
or portion of the Territory.

         14.6 Sell-Off Period. Notwithstanding anything to the contrary in
Section 14.4 hereto, upon expiration or termination of this Agreement, Celltech
shall have the right to continue to distribute its existing inventory of
non-expired Product for a period of six (6) months after the effective date of
expiration or the effective date of termination of this Agreement as the case
may be. Any such continued distribution shall be in accordance with all
applicable laws and regulations and the terms of this Agreement.

                                       40
<PAGE>

         14.7 Survival. The provisions of Articles I (Definitions), VIII
(Representations & Warranties), IX (Indemnification), XIII (Confidentiality),
XIV (Term and Termination), XV (Arbitration), and XVII (Miscellaneous), as well
as the provisions of Articles III (Compliance with Laws and Regulations), XI
(Intellectual Property Infringement), XII (Improvements) Article XIII
(Confidentiality), Article XIV (Termination), Article XV (Arbitration), Article
XVII (Miscellaneous) and the other provisions hereof which by their terms are
intended to survive the expiration or termination of this Agreement (including
without limitation, Sections 3.4 (Return of Initial Payment), Section 4.8 (Books
and Records) and Section 7.3(e) (Consignment of Product - Return of Consignment
Inventory) shall survive any termination or expiration of this Agreement.

         14.8 Assignment of Authorizations. As soon as possible following the
expiration or earlier termination of this Agreement, Celltech shall take all
necessary steps to ensure expeditious assignment of all Marketing Authorizations
and Orphan Drug Designations which are in Celltech's name to Orphan Medical. If
an assignment to Orphan Medical is prohibited under the laws of a country in the
Territory, Celltech agrees to and hereby grants Orphan Medical authorization to
distribute the Product under such Marketing Authorization until Orphan Medical
or its designee has obtained Marketing Authorizations and Orphan Drug
Designations in its own name for the Product in that country; provided that
Orphan Medical shall defend, indemnify and hold harmless Celltech from and
against all Claims and Indemnification Amounts of whatsoever kind or nature that
result from, arise out of or relate to Orphan Medical's distribution of the
Product under the Marketing Authorizations and Drug Designations continuing in
Celltech's name as contemplated by this Section 14.8.

         14.9 Rights on Termination for Cause. In the event of termination of
this Agreement by Orphan Medical pursuant to the provisions of Sections 14.2(a)
or (b) or 14.3 (a) - (c), Celltech shall provide to Orphan Medical, at no
expense to Orphan Medical, its then current list of prospects and customers,
including company name, contact, address and telephone number.

         14.10 No Compensation. In the event of any expiration or termination of
this Agreement for any reason, neither party shall owe any compensation to the
other party for lost profits, lost opportunities, good will, or any other loss
or damage in respect of future periods as a result of or arising from such
termination or expiration.

                                   ARTICLE XV
                                   ARBITRATION

         15.1 Litigation Rights Reserved. If any dispute arises with respect to
the unauthorized use of Proprietary Information by either Party or, Orphan
Medical's Trademark, Patent Rights, Know How, Manufacturing Know How, and
Improvements by Celltech, or with respect to acts or omissions of Celltech or
Orphan Medical relating to the Product which in the good faith discretion of
Orphan Medical or Celltech, as the case may be, negatively impact the safety of
the public, Orphan Medical or Celltech, as the case may be, may seek any
available equitable remedy from a court of competent jurisdiction.

         15.2 Arbitration. Except as provided in Sections 7.13 and 15.1, all
disputes arising between the parties in connection with this Agreement shall be
settled through friendly

                                       41
<PAGE>

consultations between the parties and if no agreement can be reached through
consultations, they shall be submitted to arbitration for settlement. The
arbitration shall take place in New York, New York, and be conducted by the
American Arbitration Association in accordance with the commercial arbitration
rules thereof (the "RULES") except as modified hereby. All necessary
determinations, including the arbitration decision, shall be made by a panel of
three arbitrators (the "PANEL"). Within ten (10) days after delivery of a notice
of arbitration, each of the two parties shall select one arbitrator as a member
of the Panel. The two parties shall select as the third member of the Panel an
independent arbitrator with no past or current business affiliations with either
party, and if the parties cannot agree on such independent arbitrator within ten
(10) days after delivery of a notice of arbitration, such independent arbitrator
shall be selected in accordance with the Rules. The Panel shall establish a
schedule of discovery and hearing such that the Panel's final written decision
shall be issued within one hundred and twenty (120) days after selection of the
independent arbitrator serving on the Panel. Each party must produce all
relevant non-privileged documents requested by the other party within thirty
(30) days after the request therefor. The Panel's decision must be in writing
and shall set forth the reasons therefor. Such decision shall be conclusive
determination of the matter and binding on the parties, shall have the effect of
an arbitration award, and shall not (to the extent permitted by applicable law)
be contested by any of them. The fees and expenses of an arbitrator selected by
a party shall be borne by such party. The fees and expenses of the third
independent arbitrator shall initially be borne equally by the parties, and
shall be allocated between the parties in accordance with the final decision of
the Panel, which decision shall allocate such fees between the parties as
determined by the Panel.

         15.3 Governing Law. This Agreement shall be governed by, and
interpreted and construed in accordance with, the laws of the State of New York,
U.S.A., excluding (i) its choice of law rules and (ii) the United Nations
Convention on the International Sale of Goods, provided that (x) enforcement and
operation of the Consignment Inventory arrangements in Section 7.3 shall be
governed by the laws of England, and (y) enforcement and operation of the
arbitration agreement contained in Section 15.2 hereof, and the enforcement of
any award rendered pursuant thereto, shall be governed by United States federal
law to the exclusion of State law.

                                  ARTICLE XVI
                                  FORCE MAJEURE

         16.1 Events of Force Majeure. Anything in this Agreement to the
contrary notwithstanding, neither party shall be liable or responsible for any
failure or delay in performance (excluding payment of sums owed hereunder) due
to causes affecting such party and, in the case of Orphan Medical, its
designated suppliers, and, in the case of Celltech, its Subdistributors,
Sublicensees and Third Party manufacturers, beyond the reasonable control of
such party, including, without limitation, any act of God; regulation or law of
any government or an agency thereof, excluding, however, if a Regulatory
Authority enjoins manufacture of the Product or otherwise closes the Product
manufacturing facilities due to Orphan Medical's failure to comply with cGMP or
any other breach by Orphan Medical of its obligations under this Agreement; war;
terrorism; insurrection or civil commotion; earthquake, tornado, fire, flood or
storm; epidemic; or failure of public utilities or common carriers. Such excuse
shall continue as long as the condition preventing the performance continues.
Upon cessation of such condition, such party shall promptly resume performance
hereunder.

                                       42
<PAGE>

         16.2 Notice. A party affected by an event of force majeure shall give
the other party prompt written notice of the occurrence of any event of force
majeure and the nature and duration thereof. An affected party shall use all
Commercially Reasonable Efforts to resume performance as quickly as possible and
to give the other party prompt written notice when it is again fully able to
perform such obligations. If such event of force majeure continues for more than
one hundred eighty (180) days, either party may terminate this Agreement by
giving ten (10) days written notice to the other party. If Celltech is the
affected party, such notice of resumption of performance shall state the
quantities of Product Orphan Medical needs to ship to enable Celltech to resume
performance of obligations.

         16.3 Hardship. In the event that, during the Term, any law or
government-enacted regulation or decree renders the performance by either party
of its respective obligations hereunder unduly onerous or infeasible to
implement, Celltech and Orphan Medical shall consult each other and show mutual
understanding with a view to making such adjustments as would appear to be
necessary and feasible. The party who considers that the change in regulation or
decree is unduly onerous or infeasible to implement, shall notify the other
within ninety (90) days of the change in regulation or decree, specifying the
specific date and change, an evaluation of the hardship which is or shall be
suffered and the proposal made by it to remedy that change if feasible. If the
parties fail to reach an agreement within ninety (90) days after the date of the
notice, either party shall at any time thereafter be entitled to terminate this
Agreement upon written notice only with respect to the country or countries
affected by such change in regulation or decree.

                                  ARTICLE XVII
                                  MISCELLANEOUS

         17.1 Notices. All notices to the parties shall be made at the following
addresses (or at such other address as shall be specified by it by like notice):

         To:  Orphan Medical, Inc.
              Attention:  Chief Executive Officer
              13911 Ridgedale Drive, Suite 250
              Minnetonka, Minnesota 55305
              United States
              Copy:  Director of International Business
              Fax:  952 540 9209

         To:  Celltech Pharmaceuticals Ltd.
              Attention: Chief Executive Officer
              208 Bath Road
              Slough, Berkshire SL1 3WE
              United Kingdom
              Copy:  Company Secretary
              Fax: 011 44 175 353 6632

              Notices permitted or required to be given hereunder shall be
deemed sufficient if given by (a) registered or certified airmail, postage
prepaid, return receipt requested, (b) private

                                       43
<PAGE>

courier service or (c) facsimile transmission with electronic confirmation of
receipt. Notices so given shall be effective (1) upon receipt by the party to
whom notice is given, or (2) on the tenth (10th) day following international
mailing, as may be the case, whichever occurs first.

         17.2 Waiver. No failure by either party to take any action or assert
any right hereunder shall be deemed to be a waiver of such right in the event of
the continuation or repetition of the circumstances giving rise to such right.

         17.3 Entire Agreement. This Agreement and the Schedules and Appendices
hereto constitute the entire agreement of the parties with respect to the
subject matter hereof, and supersede all previous agreements by and between the
parties as well as all proposals, oral or written, and all negotiations,
conversations or discussions heretofore had between the parties related to this
Agreement.

         17.4 Amendment. No modification or amendment of this Agreement shall be
binding unless in writing and signed by both parties.

         17.5 Headings. Article, section and paragraph headings used in this
Agreement are for convenience only, have no legal significance, and in no way
change the construction or meanings of the terms hereof.

         17.6 Relationship of the Parties. The parties shall be deemed
independent contractors of each other and, as such, they shall not be entitled
to any benefits applicable to employees of the other party. Nothing contained in
this Agreement shall be construed or implied to create an agency, partnership,
or employer and employee relationship between Orphan Medical and Celltech. At no
time shall one party make commitments or incur any charges or expenses for or in
the name of the other party except as specifically provided herein.

         17.7 Assignment. Neither party may assign this Agreement without the
prior written consent of the other party except that either Orphan Medical or
Celltech may assign this Agreement (a) to an Affiliate or (b) in connection with
a merger, stock sale, or the sale or transfer of all or substantially all of the
assets of such party or the division of such party manufacturing or marketing
the Product, as the case may be, provided, however, any permitted assignee shall
assume all obligations of its assignor under this Agreement and in the case of
clause (a), the assigning party shall remain primarily liable for the
performance of such Affiliate. Any purported assignment in violation of the
foregoing sentence shall be null and void. No assignment shall relieve either
party of responsibility for the performance of any accrued obligation under this
Agreement. Subject to the foregoing, this Agreement shall be binding upon and
inure to the benefit of the permitted successors or permitted assigns of
Celltech and Orphan Medical, respectively.

         17.8 Severability. If any term or condition of this Agreement is found
by a court of competent jurisdiction to violate the provisions of any applicable
statute, law or regulation, the remainder of this Agreement shall remain in full
force and effect. The parties shall then negotiate in good faith to modify this
Agreement, to the extent necessary to make the affected term or condition of
this Agreement valid and enforceable, having full regard for the original intent
of the parties.

                                       44
<PAGE>

         17.9 Publicity. This Agreement is confidential and neither party shall
issue press releases or engage in other types of publicity of any nature
(whether written or oral) dealing with the existence or details of this
Agreement without the other party's prior written approval, which approval shall
not be unreasonably withheld; provided that, approval of such disclosure shall
be deemed to be given to the extent such disclosure is required to comply with
governmental rules, regulations or requirements. In such event, the disclosing
party shall furnish a copy of such disclosure to the other party.

         17.10 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, and all of which
together shall constitute one and the same Agreement. This Agreement may be
executed and delivered via facsimile transmission with the same force and effect
as if it were executed and delivered in writing. In making proof of this
Agreement, it shall not be necessary to produce or account for more than one
fully executed counterpart.

         17.11 LIMITATION OF DAMAGES. NEITHER ORPHAN MEDICAL NOR CELLTECH SHALL
HAVE ANY LIABILITY OF ANY KIND TO THE OTHER PARTY FOR ANY SPECIAL, INDIRECT,
INCIDENTAL OR CONSEQUENTIAL LOSSES OR DAMAGES, EVEN IF ORPHAN MEDICAL OR
CELLTECH, AS THE CASE MAY BE, SHALL HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH
POTENTIAL LOSS OR DAMAGE BY THE OTHER PARTY. FOR PURPOSES OF THE LIMITATION OF
LIABILITY IN THE IMMEDIATELY PRECEDING SENTENCE, (i) LEGAL FEES AND EXPENSES
THAT ARE RECOVERABLE AS PROVIDED IN ARTICLE IX SHALL NOT BE CONSIDERED INDIRECT
DAMAGES, (ii) INDIRECT DAMAGES PAYABLE BY AN INDEMNIFIED PARTY TO A THIRD PARTY
THAT WOULD BE RECOVERABLE UNDER THE INDEMNITY PROVISIONS IN ARTICLE IX BUT FOR
SUCH LIMITATION OF LIABILITY SHALL BE RECOVERABLE NOTWITHSTANDING SAID
LIMITATION OF LIABILITY AND (III) LOST PROFITS SHALL NOT BE DEEMED TO BE
SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES EXCEPT IN RESPECT OF FUTURE PERIODS
FOLLOWING A TERMINATION OF THIS AGREEMENT IN ACCORDANCE WITH THE TERMS HEREOF.

                                       45
<PAGE>

                  IN WITNESS WHEREOF, the parties hereto have executed this
Agreement by their respective duly authorized representatives as of the
Effective Date.

                                                   CELLTECH PHARMACEUTICALS LTD.

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

                                                   ORPHAN MEDICAL, INC.

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

                                       46
<PAGE>

                                   APPENDIX A

                                    TERRITORY

MAJOR EUROPEAN COUNTRIES                                MINOR EUROPEAN COUNTRIES

France                                                  Austria
Germany                                                 Belgium
Italy                                                   Czech Republic
Spain                                                   Denmark
United Kingdom of Great Britain and Northern Ireland    Estonia
                                                        Finland
                                                        Greece
                                                        Hungary
                                                        Iceland
                                                        Ireland
                                                        Latvia
                                                        Lithuania
                                                        Luxemburg
                                                        Malta
                                                        Netherlands
                                                        Norway
                                                        Poland
                                                        Portugal
                                                        Slovak Republic
                                                        Slovenia
                                                        Sweden
                                                        Switzerland

OPTION COUNTRIES

Turkey

                                       A-1
<PAGE>

                                   APPENDIX B

                                    TRADEMARK

Xyrem(R)

European Community Trademark                     Reg. No.: 957712
                                                 Registered: 10 March 2000

Norway                                           Reg. No.: 217395
                                                 Registered: 23 January 2003

Iceland                                          Reg. No.: 679/2002
                                                 Registered: 31 July 2002

Switzerland                                      Reg. No.: 503.859
                                                 Registered: 9 October 2002

Czech Republic                                   Reg. No.: 251135
                                                 Registered: 27 January 2003

Slovak Republic                                  Application No.:  POZ 1676-2002
                                                 Registered: Pending

Poland                                           Appl. No.:  Z-251131
                                                 Registered: Pending

Hungary                                          Appl. No.: M 02 02667
                                                 Registered: Pending

                                  PATENT RIGHTS

<TABLE>
<CAPTION>
Country           Stage             Serial #         Date Filed        Patent #         Issue Date
--------------------------------------------------------------------------------------------------
<S>               <C>               <C>              <C>               <C>              <C>
European          Granted           99964320.8       12/22/99          1140061          5/2/03
Austria           Granted           99964320.8       12/22/99          1140061          5/2/03
Belguim           Granted           99964320.8       12/22/99          1140061          5/2/03
Denmark           Granted           99964320.8       12/22/99          1140061          5/2/03
Finland           Granted           99964320.8       12/22/99          1140061          5/2/03
France            Granted           99964320.8       12/22/99          1140061          5/2/03
Germany           Granted           99964320.8       12/22/99          69907508.408     5/2/03
Ireland           Granted           99964320.8       12/22/99          1140061          5/2/03
Italy             Granted           99964320.8       12/22/99          1140061          5/2/03
Netherlands       Granted           99964320.8       12/22/99          1140061          5/2/03
Spain             Granted           99964320.8       12/22/99          1140061          5/2/03
Sweden            Granted           99964320.8       12/22/99          1140061          5/2/03
Switzerland       Granted           99964320.8       12/22/99          1140061          5/2/03
United Kingdom    Granted           99964320.8       12/22/99          1140061          5/2/03
</TABLE>

                                       B-1
<PAGE>

                                   APPENDIX C

                             PRODUCT SPECIFICATIONS

Xyrem(R)(sodium oxybate) oral solution
EXPIRATION PERIOD:         48 months
STORAGE CONDITIONS:        15 - 30(Degree)C
RELEASE SPECIFICATIONS:

*

<TABLE>
<CAPTION>
-------------------------------------------- --------------------------------------------------- ----------------------
<S>     <C>    <C>    <C>    <C>    <C>    <C>
============================================ =================================================== ======================
============================================ =================================================== ======================

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

-------------------------------------------- --------------------------------------------------- ----------------------
</TABLE>

APPROVAL SIGNATURES ON FILE:

         Regulatory Affairs

VERIFIED BY: ____________________________

                                       C-1
<PAGE>

                                   APPENDIX D
            STANDARD OPERATING PROCEDURE FOR EXCHANGE OF SAFETY DATA

         The Orphan Medical and Celltech individuals in charge of
pharmacovigilance shall follow the procedure outlined below in reporting adverse
experiences.

         1. Definitions. Definitions shall be those in use by the International
Conference on Harmonization (ICH) as may be amended by ICH from time to time.
Current definitions are:

                  1.1. Adverse Event ("AE") means any untoward medical
occurrence in a patient or clinical investigation subject administered a
pharmaceutical product and which does not necessarily have to have a causal
relationship with this treatment. An AE can therefore be any unfavorable and
unintended sign (including an abnormal laboratory finding), symptom, or disease
temporarily associated with the use of a medicinal (investigational) product,
whether or not related to the medicinal (investigational) product.

                  1.2. Serious Adverse Event ("SAE") means any untoward medical
occurrence that at any dose:

                           o        results in death,

                           o        is life-threatening,

                           o        requires inpatient hospitalization or
                                    prolongation of existing hospitalization,

                           o        results in persistent or significant
                                    disability/incapacity, or

                           o        results in a congenital anomaly/birth
                                    defect.

                  1.3. Adverse Drug Reaction ("ADR")

                           o        ADRs in the clinical setting refer to all
                                    noxious and unintended responses to a
                                    medicinal product (i.e., where the
                                    relationship between an adverse event and
                                    product can not be ruled out) related to any
                                    doses.

                           o        ADRs regarding marketed medicinal products
                                    shall refer to a response to a drug which is
                                    noxious and unintended and which occurs at
                                    doses normally used in man for prophylaxis,
                                    diagnosis, or therapy of disease or for
                                    modification of physiological function.

                  1.4. Serious Adverse Drug Reaction ("SADR") means an ADR
having the characteristics described in 1.2.

                  1.5. Unexpected Adverse Drug Reaction ("UADR") means an ADR,
the nature or severity of which is not consistent with the applicable product
information

                                       D-1
<PAGE>

(e.g., Investigator's Brochure for an unapproved investigational product or
package insert for an approved product.)

         2. Transmission of data between Orphan Medical and Celltech.

                  2.1. In the context of clinical trials:

                  2.1.1. All the SAEs related (expected and unexpected) to the
drug as assessed by investigators shall be forwarded on a quarterly basis under
the form of tabulated summary in English. Such summary shall bear at least the
following information: patient's ID number, protocol identification,
Investigator Center, type of serious event, symptomatology or pathology
observed, notified SAE. These clinical or biological manifestations shall be
named according to the dictionary in use by each party (e.g. MeDRA or WHO).

                  2.1.2. Each party, upon request, may receive available
additional or follow-up data from the other party.

                  2.2. In the context of post-marketing surveillance:

                  2.2.1. In the case of SAEs, the parties shall exchange data
within five (5) days of becoming aware of such SAE. In the case of SADRs and
UADRs, the parties shall exchange data within ten (10) days after becoming aware
of such SADR or UADR. In the case of any other AE or ADR the parties shall
exchange data within thirty (30) days of becoming aware of such AE or ADR.

                  2.3. All information between the parties shall be sent using
the standard reporting format for Health Authorities in force in the respective
countries concerned.

                                       D-2
<PAGE>

                                   APPENDIX E

                                QUALITY AGREEMENT

* [25 pages omitted]

-----

                                       E-1
<PAGE>

                                   APPENDIX F

                     CELLTECH FIRST COMMERCIAL YEAR FORECAST

*

                                       F-1
<PAGE>

                                   APPENDIX G

                    COMPONENTS OF STANDARD MANUFACTURING COST
                                       AND
                                 TRANSFER PRICE

* [14 pages omitted]

-----

                                       G-1
<PAGE>

                                   APPENDIX H

                              REGULATORY ASSISTANCE

         1.       Marketing Authorizations and Registrations

         In connection with Celltech's acquisition of the Marketing
Authorizations and Registrations and in addition to Orphan Medical's obligations
set forth elsewhere in this Agreement, Orphan Medical will, at its own cost and
expense (but subject to the limitations set forth in Section 3.2), take the
following actions:

                  A.       Promptly provide Celltech with copies of the NDA(s)
                           and other relevant Know How and documentation
                           currently in Orphan Medical's possession;

                  B.       On Celltech's reasonable request, provide reasonable
                           assistance in reviewing Product clinical studies; and

                  C.       Promptly review and comment upon, as necessary, all
                           applications for Marketing Authorizations and
                           supporting documentation that Celltech shall submit
                           to Orphan Medical for review prior to filing with the
                           appropriate Regulatory Authorities in the Territory.

         2.       Training, Sales and Technical Literature.

         In addition to the materials that Orphan Medical is to provide Celltech
pursuant to Section 6.5 of this Agreement, Orphan Medical shall also provide to
Celltech in accordance with Section 6.5, the following materials:

                  A.       All training materials used by Orphan Medical during
                           the Term;

                  B.       Copies of all studies relating to the Product
                           conducted by or on behalf of Orphan Medical, and all
                           updates thereto;

                  C.       During each of the first three (3) years of the Term,
                           Orphan Medical, at its sole cost and expense, shall
                           provide five (5) eight (8) hour days of sales and
                           technical training to Celltech's employees, agents,
                           independent contractors, Subdistributors or
                           Sublicensees at the Celltech facility specified by
                           Celltech. Celltech and Orphan Medical shall use
                           Commercially Reasonable Efforts to coordinate
                           mutually convenient days for such training; provided,
                           however, if the parties cannot agree on a mutually
                           convenient time for Orphan Medical to provide such
                           services, Celltech shall designate the dates for such
                           training and notify Orphan Medical thereof at least
                           thirty (30) days prior to the first designated
                           training date.

                                       H-1
<PAGE>

                               SCHEDULE 8.1(E)(II)
            PATENT RIGHTS, TRADEMARK AND OTHER INTELLECTUAL PROPERTY
                    RELATING TO THE PRODUCT IN THE TERRITORY

PATENT(1)

<TABLE>
<CAPTION>
Country              Stage            Serial #          Date Filed        Patent #          Issue Date
------------------------------------------------------------------------------------------------------
<S>                                   <C>               <C>   <C>         <C>               <C> <C>
European             Granted          99964320.8        12/22/99          1140061           5/2/03
Austria              Granted          99964320.8        12/22/99          1140061           5/2/03
Belgium              Granted          99964320.8        12/22/99          1140061           5/2/03
Denmark              Granted          99964320.8        12/22/99          1140061           5/2/03
Finland              Granted          99964320.8        12/22/99          1140061           5/2/03
France               Granted          99964320.8        12/22/99          1140061           5/2/03
Germany              Granted          99964320.8        12/22/99          69907508.408      5/2/03
Ireland              Granted          99964320.8        12/22/99          1140061           5/2/03
Italy                Granted          99964320.8        12/22/99          1140061           5/2/03
Netherlands          Granted          99964320.8        12/22/99          1140061           5/2/03
Spain                Granted          99964320.8        12/22/99          1140061           5/2/03
Sweden               Granted          99964320.8        12/22/99          1140061           5/2/03
Switzerland          Granted          99964320.8        12/22/99          1140061           5/2/03
United Kingdom       Granted          99964320.8        12/22/99          1140061           5/2/03
</TABLE>

TRADEMARK(1)

European Community Trademark            Reg. No.: 957712
                                        Registered: 10 March 2000

Norway                                  Reg. No.: 217395
                                        Registered: 23 January 2003

Iceland                                 Reg. No.: 679/2002
                                        Registered: 31 July 2002

Switzerland                             Reg. No.: 503.859
                                        Registered: 9 October 2002

Czech Republic                          Reg. No.: 251135
                                        Registered: 27 January 2003

Slovak Republic                         Application No.:  POZ 1676-2002
                                        Registered: Pending

Poland                                  Appl. No.:  Z-251131
                                        Registered: Pending

Hungary                                 Appl. No.: M 02 02667
                                        Registered: Pending
*
--------------------------------
(1) All are registered in the name of Orphan Medical Inc.

<PAGE>

                              SCHEDULE 8.1(E)(III)
                            INFRINGEMENT OR CONFLICT

None

<PAGE>

                               SCHEDULE 8.1(F)(I)
                                    CONTRACTS

*

                                       3
<PAGE>

                               SCHEDULE 8.1(F)(II)
                          DEFAULT, BREACH OR VIOLATION

None

<PAGE>

                               SCHEDULE 8.1(G)(I)
                                     CLAIMS

None

<PAGE>

                                 SCHEDULE 8.1(H)
                               REQUIRED APPROVALS

None

<PAGE>

                               SCHEDULE 8.1(E)(I)
                                    CONTRACTS

None

<PAGE>

                               SCHEDULE 8.1(E)(II)
                          DEFAULT, BREACH OR VIOLATIONS

None

<PAGE>

                               SCHEDULE 8.1(F)(I)
                                     CLAIMS

None

<PAGE>

                                 SCHEDULE 8.2(G)
                               REQUIRED APPROVALS

None

<PAGE>

                                   APPENDIX I

                             TRADEMARK USE STANDARDS

* [2 pages omitted]

-----

                                       I-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00062-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00062-of-00352.parquet"}]]