Document:

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                                                                   EXHIBIT 10.12

                               DATED JUNE 21, 2002

                      LEO PHARMACEUTICAL PRODUCTS LTD. A/S

                                (LEO PHARMA A/S)

                                     - and -

                              PHARMION CORPORATION

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

                       LICENSE AND DISTRIBUTION AGREEMENT

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

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                                TABLE OF CONTENTS

<TABLE>
<C>                                                                                                        <C>
1.   Definitions and Interpretation.....................................................................    2

2.   Appointment of Pharmion; License Grant.............................................................    8

3.   Existing NDA and Existing IND......................................................................    9

4.   Commercialization Efforts in the Territory.........................................................   10

5.   Coordination of Development Efforts; Development for Additional Indications........................   13

6.   Consideration......................................................................................   18

7.   Manufacture and Supply of Product..................................................................   21

8.   Product Returns....................................................................................   24

9.   Monthly Reporting, Forecasting and Ordering........................................................   24

10.  Packaging and Labeling; Use of Name................................................................   25

11.  Quality of Product.................................................................................   26

12.  Delivery...........................................................................................   28

13.  Supply Price; Payment for Product Supply...........................................................   30

14.  Adverse Drug Experiences; Complaints...............................................................   31

15.  Undertakings and Warranties of Pharmion............................................................   32

16.  Undertakings and Warranties of LEO.................................................................   34

17.  Confidentiality....................................................................................   35

18.  Indemnities........................................................................................   36

19.  Duration and Termination...........................................................................   37

20.  Consequences of Termination........................................................................   39

21.  Rights and Remedies................................................................................   40

22.  Force Majeure......................................................................................   40

23.  Gross Inequities...................................................................................   41

24.  Notice.............................................................................................   41

25.  Entire Agreement/Variations........................................................................   42

26.  Counterparts; English Language.....................................................................   42

27.  Severance of Terms.................................................................................   42

28.  Publication/Presentation/Press Release.............................................................   43

29.  Partnership/Agency; Third Parties..................................................................   43

30.  Assignment.........................................................................................   43
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License and Distribution Agreement                                        Page i

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<TABLE>
<C>                                                                                                        <C>
31.  Audit Rights.......................................................................................   43

32.  Governing Law and Jurisdiction.....................................................................   44
</TABLE>

<TABLE>
<CAPTION>
Schedules:
---------
<S>                 <C>
Schedule 1          LEO Logo Guidelines

Schedule 2          Minimum Payments

Schedule 3          Trade Mark

Schedule 4          Transition Coordination Procedures

Schedule 5          Form of Technical Assistance Agreement

Schedule 6          Finished Goods Packaging Specifications

Schedule 7          Location of Initial Inventory
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License and Distribution Agreement                                       Page ii

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                       LICENSE AND DISTRIBUTION AGREEMENT

THIS AGREEMENT is made the 21st day of June 2002

BETWEEN:

(1)      LEO PHARMACEUTICAL PRODUCTS LTD. A/S (LEO PHARMA A/S), a company
         organized under the laws of Denmark and having its principal place of
         business at Industriparken 55, DK-2750 Ballerup, Denmark ("LEO") and

(2)      PHARMION CORPORATION, a company organized under the laws of the State
         of Delaware, USA and having its principal place of business at 4865
         Riverbend Road, Boulder, Colorado 80301 ("Pharmion")

RECITALS:

(A)      LEO is the owner of trade marks and owns or controls Data (as
         hereinafter defined) relating to the Product (as hereinafter defined),
         and is currently marketing and selling the Product in various global
         markets including the United States.

(B)      LEO is the holder of an Existing NDA and an Existing IND (each as
         hereinafter defined) for the Product in the United States, and is in a
         position to supply Product to Pharmion for distribution in the United
         States on the terms hereinafter described.

(C)      Pharmion's personnel have expertise and experience in the development,
         registration, marketing and distribution of pharmaceutical products in
         the United States.

(D)      Pharmion wishes to become the sponsor of the Existing NDA and to
         distribute the Product under the Trade Mark (as hereinafter defined)
         for the Initial Indication (as hereinafter defined), and to become the
         sponsor of the Existing IND (as hereinafter defined) and to develop,
         obtain supplemental NDAs for and distribute the Product using the Data
         for Additional Indications and New Presentations (both as hereinafter
         defined) in the United States, and LEO is willing to grant such rights
         to Pharmion and to supply Pharmion's requirements of the Product, all
         on the terms and conditions set out in this Agreement.

NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

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1.       DEFINITIONS AND INTERPRETATION

1.1.     In this Agreement, the following terms shall have the following
         meanings unless the context requires otherwise:

         "ADDITIONAL INDICATION" means any indication other than the Initial
         Indication.

         "ADDITIONAL NDA" means any supplemental NDA or any additional NDA

         "AFFILIATE" means any corporation, firm, partnership, organization or
         entity that directly or indirectly controls, is controlled by or is
         under common control with such entity. For the purpose of this
         definition the term "control" means direct or indirect ownership of at
         least fifty percent (50%) of the outstanding equity voting stock (or
         such lesser percentage which is the maximum allowed to be owned by a
         foreign corporation in a particular jurisdiction) of an entity.

         "AGENCY" means any governmental authority in the LEO Territory
         responsible for granting approvals and clearance for marketing and sale
         of the Product.

         "BUSINESS DAY" means every day except a Saturday, Sunday or a day which
         is a statutory holiday in Denmark or in the United States.

         "CASH DISCOUNT" means a discount for prompt payment given by Pharmion
         to its customers in the ordinary course of business, not to exceed two
         percent (2%) of the amount invoiced to such customers.

         "cGMP" means current good manufacturing practices as established, from
         time to time, by the FDA.

         "COMMERCIALLY REASONABLE EFFORTS" means efforts by a Party consistent
         with the prudent exercise of business judgments which shall not be less
         than for the development, manufacturing, registration or
         commercialization (as the case may be) of such Party's own
         pharmaceutical products of similar commercial potential.

         "CONTROL" OR"CONTROLLED" means possession of the ability to grant a
         license or sublicense of Data or other intangible rights as provided
         for herein without violating the terms of any agreement or other
         arrangement with any third party.

         "CURRENT DISTRIBUTOR" means UPS Supply Chain Solutions, Inc, 990
         Hammond Drive, Suite 400, Atlanta Georgia 30328.

         "DANISH INDEX" means the Summarisk loenindeks for den private sektor -
         Industri (the Danish Pay Index for Industry) published by Statistics
         Denmark and currently posted on the internet at www.dst.dk.

         "DATA" means information in the possession or Control of LEO relating
         to the Product and the Existing NDA and the Existing IND and Marketing
         Authorizations and necessary or desirable for the marketing and sale of
         the

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         Product in the Territory or the LEO Territory or for the clinical
         development of the Product for Additional Indications or New
         Presentations in the Territory including, without limitation,
         confidential know how, technical information, technology and trade
         secrets relating to the Product, information relating to the
         pre-clinical and clinical testing and approval of the Product,
         information relating to any suspected adverse drug experiences with the
         Product and any toxicological, pharmacological or pharmacokinetic
         studies relating to the Product.

         "DEVELOPMENT AND MARKETING COMMITTEE" means the Development and
         Marketing Committee described in Section 5.3 and 5.4

         "DEVELOPMENT PLAN" means an outline proposal for the development of the
         Product for an Additional Indication or a New Presentation, to be
         submitted to the Development and Marketing Committee in accordance with
         Section 5.5.

         "EFFECTIVE DATE" means July 12, 2002, provided, that neither Pharmion
         nor LEO shall have delivered the notice described in Section 1.3.

         "EXISTING IND" means the Investigational New Drug Application number
         59,764 currently held by LEO

         "EXISTING NDA" means the NDA as in effect on the Effective Date, NDA
         number 20-484.

         "FDA" means the United States Food and Drug Administration.

         "FINISHED GOODS" means Product Packed and ready for sale to the
         ultimate customer.

         "FIRM ORDER" shall have the meaning set forth in Section 9.3.

         "IMPROVEMENTS" means all improvements, modifications or adaptations to
         any part of the Data or the Product made or acquired by either Party
         during the term of this Agreement.

         "INITIAL INDICATION" means the treatment of acute symptomatic deep vein
         thrombosis, with or without pulmonary embolism, when administered in
         conjunction with warfarin sodium.

         "INITIAL INVENTORY" means Product labeled for the Territory that is
         available and in stock with the Current Distributor on the Effective
         Date.

         "INITIAL INVENTORY VALUE" means the value of the Initial Inventory
         based upon the application of the Price Per Vial to the total count of
         Initial Inventory as determined in accordance with Section 7.9.

         "LEO LOGO GUIDELINES" means the guidelines for use of the LEO name and
         the Assyrian Lion logo attached to this Agreement as Schedule 1.

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         "LEO PRODUCT BRANDING" means collectively: the Trade Mark, the LEO
         name, the Assyrian Lion, the LEO Product Design Concept, the LEO Logo
         Guidelines and any domain names or websites related to the Product in
         the USA.

         "LEO PRODUCT DESIGN CONCEPT" means the global design concept for
         packaging and promotional materials related to the Product developed by
         LEO and previously delivered to Pharmion.

         "LEO TERRITORY" means all countries of the world except the United
         States of America and its present possessions and territories.

         "LONG-RANGE FORECAST" has the meaning set out in Section 9.2 herein.

         "MANUFACTURE" OR"MANUFACTURING" means all the operations required to
         manufacture, test, release, handle, store, ship and destroy the
         Product, or any step thereof, as the case may be.

         "MANUFACTURER" means (i) LEO and (ii) any successor entity chosen by
         LEO for Manufacturing and Packing the Product for supply in the
         Territory in accordance with the procedures contemplated by Section 7.8
         hereof.

         "MARKETING AUTHORIZATIONS" means any approvals, product and/or
         establishment licenses, marketing authorizations or registrations of
         any federal, state or local Agency necessary for the commercial
         manufacture, use, storage, import, export, transport, marketing or sale
         of the Product in any country or regulatory jurisdiction of the LEO
         Territory.

         "MARKETING PLAN" means the annual marketing plan developed by Pharmion
         for the Product as described in Section 4.3.

         "MINIMUM PAYMENTS" means the amounts specified in Schedule 2 hereof.

         "NDA" means a New Drug Application with the FDA necessary for the
         commercial manufacture, use, storage, import, export, transport,
         marketing or sale of the Product in the Territory.

         "NEW PRESENTATIONS" means presentations for parenteral administration
         of the Product in addition to the presentation in vials described in
         the Existing NDA.

         "NET SALES" means the amount invoiced by Pharmion for sales of Product
         to a third party less deductions for: (i) shipping, freight charges or
         insurance paid to the extent separately set forth in the amount
         invoiced to Pharmion's customer; (ii) sales and excise taxes and any
         other direct taxes paid by Pharmion; (iii) retroactive price
         reductions; (iv) rebates, non-cash rebates or allowances actually
         incurred; (v) quantity discounts, Cash Discounts or chargebacks
         actually incurred in the ordinary course of business in connection with
         the sale of such Product; and (vi) allowances or credits actually
         granted to customers, not in excess of the selling price of such
         Product on account of governmental laws, written regulations

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         or code, price differences, rejection, outdating, spoiled, damaged,
         recalls or returns of such Product, with all such items in (i) through
         (vi) being incurred or accrued in accordance with U.S. generally
         accepted accounting principles. There shall be no deduction from the
         invoiced sales price for sales commissions paid to independent sales
         representatives or employees of Pharmion. To the extent that the
         Product is sold by Pharmion in combination with other products, then
         the Net Sales for such combined sales shall be calculated as follows:

                                  Net Sales = C * [P / (P+O) ],

         where "C" are the net revenues from the combined sale, "P" is the price
         of the Product which is part of such combined sale, when the Product is
         separately sold, and "O" is the price of the other components of the
         combined sale when separately sold, provided that if the fraction
         resulting from such calculation is less than 0.70, then the result
         shall be deemed for purposes of this Agreement to be 0.70.

         For the purpose of calculating Net Sales, the Parties recognize that
         (a) Pharmion's customers may include persons in the chain of commerce
         who enter into agreements with Pharmion as to price even though title
         to the Product does not pass directly from Pharmion to such customers,
         and even though payment for such Product is not made by such customers
         directly to Pharmion, and (b) in such cases, chargebacks paid by
         Pharmion to or through a third party (such as a wholesaler) can be
         deducted by Pharmion from gross revenue in order to calculate Net
         Sales. Any deductions listed above that involve a payment by Pharmion
         shall be taken as a deduction against aggregate sales for the period in
         which the payment is made.

         "PACK", "PACKED" OR "PACKING" means the operations which comprise the
         labeling and packaging of the Product or any step thereof, as the case
         may be.

         "PACKAGING" means the packaging in which the Product is supplied by LEO
         to Pharmion.

         "PARTIES" means LEO and Pharmion and "PARTY" means either of them as
         the context indicates.

         "PATENTS" means patents covering inventions that may be developed by
         either Party during the term of this Agreement and that relate
         specifically to the Product, any Improvements or any New Presentations
         and any continuations, continuations-in-part, divisions, provisionals
         or any substitute applications, any patent issued with respect to any
         such patent applications, any reissue, reexamination, renewal or
         extension (including any supplemental patent certificate) of any such
         patent, and any confirmation patent or patent of addition based on any
         such patent, and all foreign counterparts of any of the foregoing.

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         "PRICE PER NEW PRESENTATION" means, as to each New Presentation, the
         price per unit of Product in such New Presentation determined in
         accordance with Section 13.3.

         "PRICE PER VIAL" means U.S. $12.50 for each 2 ml vial containing
         twenty-thousand (20,000) anti-Xa International Units/ml, as such price
         shall be adjusted for changes in the Danish Index as called for by
         Section 13.2.

         "PRODUCT" means pharmaceutical products containing tinzaparin sodium
         for parenteral use known as INNOHEP sold under the Trade Mark and more
         particularly identified in the Existing NDA, as such product
         description may be expanded by an Additional NDA .

         "PRODUCT MARKETING MATERIALS" means all marketing materials used with
         respect to the Product in the Territory that are in existence as of the
         Effective Date, in any form, to the extent such materials are in the
         possession and Control of LEO and are legally permitted to be
         transferred to Pharmion including, without limitation, all advertising
         materials, product data, price lists, mailing lists, customer lists,
         sales materials, marketing information, promotional materials,
         scientific and commercial publications, market research, artwork for
         the production of packaging components, television masters, web sites,
         domain names and other materials associated with the Product in the
         Territory. Product Marketing Materials shall also include marketing
         materials developed by LEO during the term of the Agreement for use in
         connection with the sale of the Product in the LEO Territory or
         developed by Pharmion for use in connection with the sale of the
         Product in the Territory. Product Marketing Materials shall not,
         however, include databases of internal LEO communications regarding the
         Product.

         "SALES INCEPTION DATE" means the later of (i) July 15, 2002 or (ii) the
         date on which the count of the Initial Inventory shall have been
         completed in accordance with Section 7.9.3(a) of this Agreement.

         "SHARING PERCENTAGE" means, as to each Party, the percentage of total
         worldwide sales of the Product that was represented by the Net Sales of
         the Product in its respective territory (with the definition of Net
         Sales to be deemed appropriately modified in the case of LEO to cover
         sales of LEO in the LEO Territory) during the immediately preceding
         calendar year, provided, that in the case of the first 16 months
         following the Effective Date, the Sharing Percentage shall be 30 % in
         the case of Pharmion and 70 % in the case of LEO.

         "SHORT-DATED" means, with respect to the Initial Inventory, inventory
         having a remaining shelf life as of the Effective Date of less than
         twelve months.

         "SKU" means stock keeping unit, the unit of finished packs as prepared
         for distribution to the market.

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         "SPECIFICATIONS" means all Manufacturing, Packing, quality assurance
         and quality release specifications, standard test methods and sampling
         plans as approved by the FDA.

         "TECHNICAL ASSISTANCE AGREEMENT" means the technical assistance
         agreement to be entered into by LEO and Pharmion as described in
         Section 7.7.

         "TERRITORY" means the United States of America, including its current
         possessions and territories.

         "TRADE MARK" means the trade mark owned by LEO, including registrations
         and applications for registration thereof (and all renewals,
         modifications and extensions thereof), listed on Schedule 3 attached
         hereto, and used in connection with the Product in the Territory.

1.2.     Construction and Interpretation

         In the interpretation of this Agreement:

         1.2.1    the headings are for convenience only and shall not affect the
                  interpretation hereof;

         1.2.2    references in this Agreement to Sections, Schedules and
                  Exhibits are to the sections of, and schedules and exhibits
                  to, this Agreement;

         1.2.3    unless the context otherwise requires the singular shall
                  include the plural and vice versa, reference to any gender
                  shall include reference to the other gender, and references to
                  persons shall include bodies corporate, unincorporated
                  associations and partnerships; and

         1.2.4    this Agreement includes the Schedules and Exhibits hereto.

1.3.     Effectiveness of Agreement.

         Prior to the date of this Agreement, the Parties have agreed upon a
         protocol for the due diligence that each will conduct regarding the
         other subsequent to the date of execution of this Agreement, including
         the names of the individuals from each of the Parties that will be
         involved, a schedule of their meetings, the location of the meetings or
         facilities to be inspected, the documents to be examined and the
         subject matters to be discussed (the "Agreed Diligence Protocol")

         During the two week period immediately following the execution of this
         Agreement by both Parties, each Party will grant access to its
         personnel involved with the production, marketing and development of
         the Product and the facilities in which the Product is produced in
         order to enable the other Party and its personnel to conduct their
         final due diligence in accordance with the Agreed Diligence Protocol.
         It shall be a condition to the effectiveness of this Agreement that
         each Party shall be satisfied, in its sole discretion, with the
         information

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         gathered during such due diligence process. Such condition shall be
         deemed to have been met unless, on or prior to July 12, 2002, either
         Party delivers written notice to the other Party that it has decided
         not to proceed with the transactions contemplated by this Agreement. If
         no such notice is issued, then this Agreement shall become effective on
         the Effective Date. If either Party delivers such a notice, then this
         Agreement shall never come into effect and neither Party shall have any
         rights or obligations under this Agreement.

2.       APPOINTMENT OF PHARMION; LICENSE GRANT

2.1.     Subject to the terms and conditions of this Agreement, with effect from
         the Effective Date, LEO hereby appoints Pharmion as its exclusive
         distributor for the Product in the Territory and hereby grants to
         Pharmion the exclusive right and license:

         2.1.1    to purchase the Product from LEO for resale in the Territory;

         2.1.2    to advertise, market, promote, distribute, use and sell the
                  Product, using the Data and under and by reference to the
                  Trade Mark and the other LEO Product Branding, in the
                  Territory (i) for the Initial Indication and (ii) for any
                  Additional Indications or New Presentations that are approved
                  by the Development and Marketing Committee and covered by an
                  appropriate Additional NDA;

         2.1.3    to become the sponsor of the Existing NDA for the Product from
                  LEO as contemplated by Section 3, and to use the Data to
                  maintain the Existing NDA for the Product in the Initial
                  Indication;

         2.1.4    to develop the Product using the Data and Improvements for any
                  Additional Indications or New Presentations approved by the
                  Development and Marketing Committee, and in connection with
                  such development to become the sponsor of the Existing IND for
                  the Product and to apply for additional INDs for the Product
                  and obtain Additional NDAs for the sale of the Product for
                  such Additional Indications or New Presentations;

         2.1.5    to use the Product Marketing Materials and the LEO Product
                  Branding in connection with the advertising, marketing,
                  promotion and distribution of the Product in the Territory;

         2.1.6    to develop patient and medical personnel educational programs
                  as may be required by the FDA or deemed appropriate by
                  Pharmion for the promotion and development of the Product

2.2.     During the term of this Agreement and subject to any contrary legal
         requirement that may be imposed upon it, Pharmion will not: (i) seek
         customers or establish any branch or distribution depot for the Product
         in any country which is outside

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         the Territory, or (ii) actively export the Product to any customer
         outside the Territory or to any customer within the Territory for
         resale outside the Territory.

2.3.     During the term of this Agreement and subject to any contrary legal
         requirement that may be imposed upon it, LEO will not: (i) seek
         customers or establish any branch or distribution depot for the Product
         in the Territory, or (ii) actively export the Product outside the
         Territory for use or resale in the Territory to any person other than
         Pharmion.

2.4.     From and after the Effective Date, LEO will to the extent LEO is
         legally permitted to do so transfer or procure the transfer to Pharmion
         of such elements of the Data, as well as the then current Product
         Marketing Materials, which Pharmion may request from time to time and
         that are not otherwise contained in the materials transferred as part
         of the Existing NDA transferred in accordance with Section 3.1. During
         the term of this Agreement, each Party shall, upon the reasonable
         request of the other, transfer such data developed by such Party as
         comprise Improvements, as well as such new Product Marketing Materials
         as have been developed by such Party. All such transfers shall be
         coordinated through the Development and Marketing Committee, and each
         Party shall have the right, consistent with Agency regulations in the
         Territory or the countries within the LEO Territory, to use the Product
         Marketing Materials developed by the other to aid in developing its own
         Product Marketing Materials for use within its own territory.

3.       EXISTING NDA AND EXISTING IND

3.1.     LEO will promptly transfer sponsorship of the Existing NDA naming
         Pharmion as the NDA holder in place of LEO. LEO will transfer or
         procure the transfer to Pharmion of a complete copy of the approved
         application relating to the Product for the Territory, including
         supplements and records that are required to be kept under 21 CFR
         314.81, such documentation to include paper files and, if available,
         electronic versions to enable Pharmion to maintain the Existing NDA and
         apply for Additional NDAs in the Territory. The Parties hereby agree to
         use Commercially Reasonable Efforts to complete the filing of the
         transfer of the Existing NDA within four (4) weeks of the Effective
         Date. LEO, in collaboration, with Pharmion, will establish a mutually
         acceptable communication and interaction process to facilitate a smooth
         transfer of the Existing NDA.

3.2.     Until such time as each of the foregoing changes of holder is effected,
         LEO will maintain the Existing NDA, and LEO shall bear all costs and
         expenses incurred in connection with such maintenance.

3.3.     Following the transfer of sponsorship, Pharmion shall keep LEO informed
         of any changes to the Existing NDA and any Additional NDA which
         Pharmion wishes to make or is required to make by the FDA. Changes
         relating to the Product, Specifications, Manufacturing or Packaging
         shall be dealt with between the parties as specified in Section 11.2.
         Changes relating to Additional Indications or

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         New Presentations shall be dealt with between the parties as specified
         in Section 5.

3.4.     Pharmion will not use the Data or the NDA which it obtains except as
         required for the purposes of this Agreement and within the Territory.
         Pharmion will not grant access to the Data to any third party (other
         than a medical professional or an investigator or another consultant
         who has entered into confidentiality obligations equivalent to those
         set out in this Agreement and who requires access to such Data in
         connection with the development or distribution of the Product) or
         refer, or authorize reference, to the NDA dossier to enable it or any
         such third party to obtain a product license for any products
         whatsoever.

3.5.     LEO will promptly apply for a transfer of sponsorship of the Existing
         IND, naming Pharmion as the IND holder in place of LEO. LEO will
         transfer or procure the transfer to Pharmion a complete copy of all
         available regulatory documentation relating to the Existing IND, such
         documentation to include paper files and, if available, electronic
         versions to enable Pharmion to maintain the Existing IND and carry
         forward the research contemplated by the Existing IND. LEO, in
         collaboration, with Pharmion, will establish a mutually acceptable
         communication and interaction process to facilitate a smooth transfer
         of the Existing IND.

4.       COMMERCIALIZATION EFFORTS IN THE TERRITORY

4.1.     Pharmion's Authority/Responsibility. During the term of this Agreement,
         Pharmion shall use Commercially Reasonable Efforts to promptly
         re-launch and to promote the Product in the Territory, and, except as
         otherwise expressly herein provided, Pharmion shall have the right and
         responsibility to take such actions with respect to the Product as
         would normally be done in accordance with accepted business practices
         in the marketing of pharmaceutical products and legal requirements to
         obtain and maintain the authorization and/or ability to market a
         pharmaceutical product in the the Territory and to market the Product,
         including, without limitation, the following:

         4.1.1    conducting human clinical trials of the Product as Pharmion
                  determines are reasonable, necessary or desirable, subject to
                  the approval of the Development and Marketing Committee, as
                  contemplated by Section 5;

         4.1.2    making appropriate filings, as contemplated by Section 5, for
                  the registration of one or more Additional Indications for the
                  therapeutic use of the Product;

         4.1.3    marketing the Product at such prices and on such other terms
                  and conditions as Pharmion determines are reasonable,
                  necessary or desirable;

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         4.1.4    developing patient and medical personnel educational programs
                  as may be required by the FDA or deemed appropriate by
                  Pharmion for the promotion and development of the Product;

         4.1.5    responding to product and medical complaints relating to the
                  Product (as called for by Section 14 hereof, Pharmion shall
                  promptly advise LEO of any such complaints which it receives
                  from regulators, customers or patients);

         4.1.6    except as otherwise provided in Section 8, handling all
                  returns of the Product;

         4.1.7    handling, in accordance with Section 14.4 hereof and with the
                  cooperation of LEO, all recalls of the Product;

         4.1.8    communicating with the FDA and any state or local governmental
                  agencies and satisfying their requirements regarding the
                  authorization and/or continued authorization to market the
                  Product in the Territory; and

         4.1.9    handling Product distribution, inventory and receivables.

         Pharmion's exercise of the rights and license granted hereunder shall
         be subject to Pharmion's continuing obligation to adhere to the LEO
         Product Branding in its promotion and marketing of the Product.

4.2.     Transition Coordination. Prior to the date of this Agreement, the
         Parties have developed a proposed set of procedures for the orderly
         transition of the marketing, distribution, order processing, billing
         and collection relating to the Product in the Territory from LEO's
         Canadian Affiliate and the Current Distributor to Pharmion and such new
         wholesaling or distribution organization as Pharmion shall select. Such
         procedures are set forth in Schedule 4 to this Agreement. LEO shall be
         responsible for all costs and expenses associated with the termination
         of agreements relating to such services that LEO or its Affiliate may
         have entered into prior to the date of this Agreement.

4.3.     Annual Marketing Plan.

         4.3.1    Pharmion shall annually prepare a marketing plan for the
                  forthcoming calendar year describing the then current
                  marketing environment for the Product, including market share
                  data relating to the Product and other products in its
                  therapeutic class, and the proposed marketing programs, Other
                  Clinical Studies (as defined in Section 5.6) and medical
                  education programs which it intends to undertake in the
                  forthcoming year, as well as forecasts of the sales of the
                  Product for such year (each a "Marketing Plan"). Included in
                  each Marketing Plan shall be (a) Pharmion's proposed sampling
                  strategy for the forthcoming year including the estimated
                  number of units of Product

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                  that Pharmion proposes to deliver as samples in such year and
                  (b) Pharmion's estimate of Product that it may need to
                  contribute to compassionate use programs. The Marketing Plan
                  shall also contain a five year sales forecast, broken down on
                  a monthly basis for the first two years and on an annual basis
                  for the remaining three years. Each such Marketing Plan shall
                  be treated by both Parties as a good faith statement of
                  Pharmion's intentions for the forthcoming year and estimate
                  for subsequent year, but such Marketing Plan shall not be
                  deemed to be a contractual commitment by Pharmion to undertake
                  all of the efforts described in such Plan or to achieve the
                  goals or sales levels contained in such Plan.

         4.3.2    Pharmion shall deliver the Marketing Plan for the calendar
                  year 2003 on or before October 1, 2002 and thereafter shall
                  deliver a new draft Marketing Plan by September 1 and a final
                  plan by October 1 of each successive calendar year.

         4.3.3    The Development and Marketing Committee shall discuss each
                  such Marketing Plan at a meeting to be held no later than
                  September 15 of each year, and Pharmion shall in good faith
                  take into account changes to such Marketing Plan recommended
                  by the representatives of LEO on the Development and Marketing
                  Committee; provided, that for the calendar years 2007 and
                  onward, the Parties shall agree in good faith to each year's
                  annual Net Sales forecast.

4.4.     Pharmion Commercial Organization. Pharmion shall use Commercially
         Reasonable Efforts to establish:

         4.4.1    a sales force of not less than twenty-five full-time
                  equivalent representatives that actively promote the Product
                  with high priority;

         4.4.2    an appropriate supporting organizational structure for the
                  Product, comprised of either Pharmion employees or individuals
                  under third party contracts with Pharmion, consisting of at
                  least two regional directors, three medical liaisons, two
                  national account managers, one product manager and one
                  customer service manager

4.5.     Maintenance of Inventory. Within two full fiscal quarters following the
         Effective Date, Pharmion shall establish and thereafter use
         Commercially Reasonable Efforts to maintain an inventory of Product
         representing at least three months of supply, based upon the then most
         current Long-Range Forecast.

4.6.     Maintenance of NDA and IND. Pharmion shall bear all costs of
         maintaining the Existing NDA, Additional NDAs, if any, and the Existing
         IND for the Product in the Territory.

4.7.     LEO Cooperation. LEO shall provide such assistance and cooperation as
         Pharmion may reasonably request to re-launch the Product in the
         Territory and,

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<PAGE>

         more generally, to promote the Product in the Territory, including
         collaborating with Pharmion on developing transatlantic
         sales/marketing/scientific events and inviting Pharmion to participate
         in LEO's "international experience exchange" activities regarding the
         Product.

4.8.     Communications with Agencies. LEO shall be notified in advance of any
         meeting related to the Product between Pharmion and the FDA. Pharmion
         shall be notified in advance of any meeting related to the Product
         between LEO and any Agencies in the LEO Territory where, in the
         reasonable judgment of LEO, any such meeting could have an adverse
         effect on the development or sale by Pharmion of the Product in the
         Territory or the Manufacture and supply of the Product. Pharmion and
         LEO shall, in addition, cooperate with one another to keep the other
         Party informed of any other significant interface or communication with
         the FDA or the Agencies which might adversely affect LEO's or
         Pharmion's activities under this Agreement.

4.9.     New LEO Products. In the event that LEO develops one or more new
         products within the same therapeutic class as the Product, LEO will
         keep Pharmion informed regarding the development of such products and
         provide Pharmion with an opportunity to compete with third parties to
         obtain the rights to market such product or products in the Territory.

5.       COORDINATION OF DEVELOPMENT EFFORTS; DEVELOPMENT FOR ADDITIONAL
         INDICATIONS

5.1.     Pharmion's Development Efforts. Pharmion shall use Commercially
         Reasonable Efforts to develop the Product for any Additional
         Indications or New Presentations approved by the Development and
         Marketing Committee.

         5.1.1    Annual Development Plan. Pharmion shall annually prepare a
                  development plan for the forthcoming calendar year describing
                  the steps which Pharmion desires to take for the development
                  of Additional Indications or New Presentations for the Product
                  during the forthcoming calendar year (each a "Development
                  Plan"). Each such Development Plan shall be treated by both
                  Parties as a good faith statement of Pharmion's intentions for
                  the forthcoming year, but such Development Plan shall not be
                  deemed to be a contractual commitment by Pharmion to undertake
                  all of the efforts described in such Plan or to achieve the
                  goals contained in such Plan. Each such Development Plan shall
                  be presented for approval to the Development and Marketing
                  Committee as contemplated by Section 5.5 below.

         5.1.2    Pharmion shall deliver the Development Plan for the calendar
                  year 2003 on or before October 1, 2002 and thereafter shall
                  deliver a new draft Development Plan by September 1, and a
                  final Development Plan by October 1 of each successive
                  calendar year.

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<PAGE>

         5.1.3    The Development and Marketing Committee shall discuss each
                  such Development Plan at a meeting to be held no later than 15
                  September of each year, and Pharmion shall in good faith take
                  into account changes to such Development Plan recommended by
                  the representatives of LEO on the Development and Marketing
                  Committee. Final approval of any such Development Plan shall
                  be determined as provided in Section 5.5 below.

5.2.     Coordinators. Within thirty (30) days of the Effective Date, the
         Parties will each appoint one individual (each a "Coordinator ") who
         shall be the principal representative of such Party with respect to all
         matters arising under this Agreement and who shall be responsible to
         coordinate communications from the other Party to and within his or her
         respective organization. Each Party will notify the other as to the
         name of the individual so appointed. Each Party may replace its
         Coordinator at any time, upon notice to the other Party.

5.3.     Development and Marketing Committee.

         5.3.1    Composition of the Committee. Within thirty (30) days of the
                  Effective Date, LEO and Pharmion will establish a Development
                  and Marketing Committee. The Development and Marketing
                  Committee will be composed of the Coordinator from each Party
                  and such additional representatives from each Party as the
                  respective Coordinators shall select, it being the intention
                  of the Parties that, when required by the subject matter of
                  the meeting, each Party shall have participating in the
                  meeting of the Committee representatives with the relevant
                  expertise in areas such as clinical development,
                  manufacturing, marketing and regulatory affairs. Either Party
                  may replace any or all of its representatives at any time upon
                  written notice to the other Party. The Development and
                  Marketing Committee will meet (in person, telephonically or
                  via videoconference) at least quarterly or more frequently if
                  reasonably requested by either Party.

         5.3.2    Committee Procedures. Meetings of the Development and
                  Marketing Committee may be convened by either Party with
                  notice to the other Party, and both Parties shall use
                  Commercially Reasonable Efforts to have a representative in
                  attendance at meetings of the Committee within two (2) weeks
                  of the delivery of such notice. No meeting of the Development
                  and Marketing Committee shall, for purposes of this Agreement,
                  be validly constituted unless at least one (1) member
                  representing each Party shall be in attendance (a quorum of
                  the Committee), and no action shall be taken or deemed validly
                  taken by the Committee unless such action shall have been
                  approved by unanimous vote of the members of the Committee
                  participating at a meeting at which a quorum is present. All
                  actions validly taken by the Committee shall be duly recorded
                  in minutes of the Committee prepared by a member of the
                  Committee selected for that purpose at

                                      14
<PAGE>

                  any given meeting, with the responsibility for the preparation
                  of such minutes to alternate between the Parties at each
                  meeting. Such minutes shall be furnished to each Party within
                  two (2) weeks of any given meeting by the designated recorder
                  of the minutes and shall be retained by each Party as part of
                  its records of actions taken with respect to this Agreement.
                  Each party shall bear its own cost incurred in participation
                  in the Development and Marketing Committee.

5.4.     Functions of Development and Marketing Committee. The Development and
         Marketing Committee shall: (a) exchange information on the development
         of the Product in the LEO Territory and the Territory, including the
         exchange of information regarding ongoing and new clinical studies,
         regulatory strategy and commercial development, Improvements and new
         Product Marketing Materials; (b) discuss the need, desirability of,
         structure and/or allocation of costs of any clinical studies or other
         development efforts relating to the Product to be carried out in the
         LEO Territory or the Territory; (c) discuss actions planned by either
         Party with respect to the Product where such actions could reasonably
         be expected to have a material impact on the Product in the Territory
         or the LEO Territory; (d) discuss collaboration in the development of
         the Product in the Territory for indications other than the Initial
         Indication; (e) review and discuss each Marketing Plan as contemplated
         by Section 4.3.3; (f) review and discuss each Development Plan as
         contemplated by Section 5.1.3; and (g) discuss in good faith other
         issues relating to the marketing or development of the Product in the
         Territory.

5.5.     Development of Product for Additional Indications or New Presentations.
         Pharmion shall not proceed with the development of the Product for an
         Additional Indication or a New Presentation without first submitting a
         Development Plan to the Development and Marketing Committee. If a
         Development Plan submitted by Pharmion is not unanimously approved by
         the members of the Development and Marketing Committee, then the
         dispute shall be referred to the CEO of Pharmion and the CEO of LEO for
         resolution. In the event that the dispute is not resolved by these
         individuals, LEO shall have the final right to decide whether Pharmion
         may proceed with such Development Plan. Where the development of a
         Product for an Additional Indication or New Presentation being sought
         by Pharmion and approved by the Development and Marketing Committee
         requires process development or manufacturing changes, Pharmion will
         reimburse LEO for all reasonable costs incurred by LEO in making such
         changes unless the Parties have agreed to share the costs of such
         development pursuant to Section 5.6 below, in which case LEO's process
         development and manufacturing costs will be included in the costs to be
         divided between the Parties.

5.6.     Clinical Studies.

         5.6.1    Categorization of Studies. For purposes of this Agreement,
                  clinical studies relating to the Product shall be categorized
                  either (i) as "Registration Studies" which shall be studies
                  conducted with the

                                      15
<PAGE>

                  intention of being filed with the FDA or an Agency for the
                  purpose of obtaining an Additional Indication or (ii) as
                  "Other Studies". Such categorization shall be determined by
                  action of the Development and Marketing Committee at the time
                  that either Party proposes to conduct a clinical study
                  relating to the Product.

         5.6.2    Sharing of Data. Data from all clinical studies conducted by
                  or on behalf of either Party shall be made available to the
                  other Party for all purposes of safety reporting or other
                  compliance with compulsory regulatory reporting requirements
                  in its respective territory. Data resulting from Other
                  Clinical Studies, and Data resulting from the publication of
                  results of Registration Studies, may also be used by either
                  Party for medical marketing purposes regardless of which Party
                  funds such studies.

         5.6.3    Shared Costs. Where LEO and Pharmion agree, prior to the
                  commencement of any Registration Study related to the Product
                  proposed either by Pharmion or LEO, that the results of such
                  study may be used for the purpose of obtaining approval for a
                  New Indication in both the LEO Territory and the Territory,
                  the costs of the study shall be shared by the Parties and the
                  cost allocation, structure, timelines and other details of the
                  study shall be agreed between the Parties in good faith taking
                  account of the relative importance and value to each Party of
                  the study in question. The results of and data generated by
                  any study jointly funded by the Parties will be owned by LEO
                  but LEO hereby grants Pharmion an exclusive license to use
                  such results and Data for the purpose of obtaining an
                  Additional NDA for the Product in an Additional Indication in
                  the Territory or for such other uses in connection with the
                  sale of the Product for the Initial Indication and the
                  Additional Indication in the Territory as are permitted under
                  the laws of the Territory for the term of and subject to the
                  conditions of this Agreement.

         5.6.4    Funded Registration Studies. In the event that either Party (a
                  "Non Funding Party") is unwilling to share in the cost of any
                  Registration Study to be carried out by the other Party (the
                  "Funding Party") and approved by the Development and Marketing
                  Committee with respect to the Product, and such study
                  generates data which the Funding Party reasonably believes may
                  be used by the Non Funding Party to obtain Marketing
                  Authorization or an Additional NDA for the Product in an
                  Additional Indication in any country(ies) of the LEO Territory
                  or in the Territory, as the case may be, then the following
                  provisions shall apply:

                  The Funding Party shall, by notice, require the Non Funding
                  Party to decide within ninety (90) days of receipt of a data
                  package containing a summary of the clinical data for such
                  Additional Indication whether

                                      16
<PAGE>

                  the Non Funding Party elects to use such data for the purpose
                  of obtaining Marketing Authorization or an Additional NDA for
                  the Product in an Additional Indication in any country(ies) of
                  the LEO Territory or in the Territory, as the case may be. If
                  the Non Funding Party so elects, then:

                  (a)      the Parties shall agree upon a development program
                           for such purpose and the Non Funding Party shall
                           undertake to perform the necessary work at its own
                           cost and to reimburse the Funding Party, by means of
                           a royalty of 5% on Net Sales of the Product (with
                           such definition to be deemed appropriately modified
                           to cover sales of LEO if LEO is the Non Funding
                           Party), up to an amount equal to 50% of the
                           reasonable costs, incurred by the funding Party in
                           conducting the Registration Study from the date of
                           enrollment of the first patient, plus interest from
                           such date through the date on which such amount shall
                           have been reimbursed at LIBOR, as in effect from time
                           to time during such period; and

                  (b)      the results of and data generated by any study funded
                           by the Funding Party will be owned by the Funding
                           Party but such Party shall grant to the Non-Funding
                           Party an exclusive license during the term of this
                           Agreement to use such results and data for the
                           purpose of obtaining Marketing Authorization or an
                           Additional NDA for the Product in an Additional
                           Indication in the LEO Territory or the Territory, as
                           the case may be; provided, that if Pharmion is the
                           Funding Party, ownership of the results and data from
                           such study shall be transferred to LEO promptly
                           following termination of this Agreement.

                  If the Non Funding Party shall not elect to so share in the
                  costs of such Registration Study, then during the term of this
                  Agreement, such Non Funding Party shall not have the right to
                  utilize the Data resulting from such Registration Study to
                  apply for or obtain an Additional NDA or Marketing
                  Authorization for an Additional Indication utilizing such
                  Data; provided, that if Pharmion is the Funding Party,
                  ownership of the results and data from such study shall be
                  transferred to LEO promptly following termination of this
                  Agreement.

         5.6.5    Clinical Trial Agreements. In connection with Registration
                  Studies or Other Clinical Studies sponsored by Pharmion,
                  Pharmion will use Commercially Reasonable Efforts to ensure
                  that all clinical trial agreements with third parties,
                  including principal investigators and CROs, will be assignable
                  to LEO and that such agreements may be terminated, on no more
                  than 90 days' notice by the payment of no more than the costs
                  incurred by the third party through the date of termination.

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<PAGE>

6.       CONSIDERATION

6.1.     Purchase Price Payable on Execution. Pharmion shall pay to LEO the sum
         of seven million five hundred thousand dollars (U.S. $7,500,000) as
         payment of purchase price for the rights granted under this Agreement,
         via wire transfer within five (5) Business Days of the Effective Date,
         less the amount of two hundred thousand dollars (U.S. $ 200,000) which
         was previously paid by Pharmion to LEO in connection with a letter
         agreement dated May 23, 2002, and which LEO hereby acknowledges shall
         be fully credited against such purchase price . All of such payment
         shall be non-refundable, but a portion thereof may be creditable
         against royalties as provided in Section 6.3 below.

6.2.     Royalty. Commencing at the end of the first calendar quarter in which
         the Sales Inception Date occurs, Pharmion will pay LEO during the
         remaining term of this Agreement a royalty, payable on a quarterly
         basis, equal to (a) the Specified Percentage (as defined below) of Net
         Sales of Product in the Territory during such calendar quarter, less
         (b) Pharmion's purchase price of the units of Product sold during such
         calendar quarter (as charged to Pharmion by LEO in accordance with
         Section 13 for purposes other than clinical trials, sampling or
         compassionate use) based upon a "first-in/first-out" accounting of
         Pharmion's Product inventory, subject always to LEO's right to receive
         Minimum Payments as provided in Section 6.8. For purposes of this
         Section 6.2, the term "Specified Percentage" shall mean:

         6.2.1    thirty percent (30%) of all Net Sales up to and including $20
                  million per calendar year; and

         6.2.2    thirty-five percent (35%) of all Net Sales above $20 million
                  per calendar year.

6.3.     Royalty Credits. Two million five hundred thousand dollars ($2,500,000)
         of the amount paid under Section 6.1 shall be creditable against the
         royalties payable under Section 6.2. with respect to Net Sales recorded
         during the thirty (30) month period commencing on September 1, 2002,
         provided, however, that if Pharmion shall not have relaunched the
         Product before December 31, 2002 for reasons unrelated to the transfer
         of the Existing NDA or manufacturing or supply issues, such credit
         shall be limited to One Million Five Hundred Thousand Dollars
         ($1,500,000). In addition, if Net Sales for the calendar year 2003
         exceed sixteen million dollars (U.S. $ 16,000,000), then an additional
         one million dollars (U.S. $1,000,000) shall be creditable against the
         royalties payable under Section 6.2. with respect to Net Sales recorded
         during the twenty-four (24) month period commencing January 1, 2004.

6.4.     Withholding Tax. Any tax which Pharmion is required to pay or withhold
         from royalty payments to be made to LEO under this Agreement shall be
         deducted from the amount otherwise due, provided that, in regard to any
         such deduction, Pharmion shall give LEO such assistance as may be
         reasonably necessary to

                                      18
<PAGE>

         enable or assist LEO to claim exemption therefrom or a reduction
         thereof and shall provide LEO with an official tax certificate as soon
         as possible.

6.5.     Invoices for Royalties. If required by Pharmion, LEO shall submit a
         written invoice addressed to Pharmion for each royalty payment to be
         made by Pharmion under this Agreement. LEO shall submit these written
         invoices to Pharmion within a reasonable period following the request
         from Pharmion and based upon the last quarterly royalty report from
         Pharmion provided to LEO in accordance with Section 6.7.

6.6.     Royalty Calculation and Payment.

         6.6.1    Timing. Royalties shall be calculated and paid to LEO
                  quarterly, and shall be due forty-five (45) days following the
                  end of each calendar quarter.

         6.6.2    Currency of Payment. Royalties shall be payable in U.S.
                  Dollars.

6.7.     Royalty Reports. Commencing at the end of the first calendar quarter in
         which the Sales Inception Date occurs, Pharmion shall submit quarterly
         payment reports to LEO within (45) days following the end of each
         calendar quarter. Such reports shall include, but not be limited to:

         6.7.1    An accounting of Net Sales within the Territory during such
                  quarter;

         6.7.2    An accounting of the aggregate purchase price paid by Pharmion
                  to LEO for the units of Products sold during such quarter; and

         6.7.3    the calculation of the royalty amounts owing to LEO pursuant
                  to this Section 6, including, if applicable, the use of
                  payments creditable under either Section 6.3 or 6.8.

6.8.     Minimum Payments.

         6.8.1    For each calendar year commencing with the year ending
                  December 31, 2003, if the sum of (x) the amounts paid (or
                  credited as paid) to LEO pursuant to Section 6.2 and 6.3, and
                  (y) the amounts referred to in Section 13 (paid by Pharmion as
                  the purchase price for the relevant purchased units) shall be
                  less than the Minimum Payment for such calendar year set forth
                  in Schedule 2, then Pharmion shall make a lump sum payment to
                  LEO in the amount equal to such shortfall, with such lump sum
                  payment to be made simultaneously with the payments due to LEO
                  under Section 6.2 in respect of the fourth quarter of such
                  calendar year. All such payments shall be non-refundable.

         6.8.2    Any amounts paid under this Section 6.8 shall be creditable
                  against the amounts, if any, by which

                                      19
<PAGE>

                  (a)      the sum of (x) the amounts paid (or credited as paid)
                           to LEO pursuant to Section 6.2 and 6.3, and (y) the
                           amounts referred to in Section 13 (paid by Pharmion
                           as the purchase price for the relevant purchased
                           units) in any of the three (3) following calendar
                           years

                  shall exceed

                  (b)      the Minimum Payment applicable to such subsequent
                           year;

                  with any such credit to be applied against royalties payable
                  during the fourth quarter of such calendar year (and to the
                  extent not fully applied, the quarterly payments of the next
                  succeeding calendar year).

         6.8.3    The Minimum Payments for the years 2003 through 2006 are set
                  forth on Schedule 2. For each subsequent calendar year such
                  Minimum Payments shall be an amount equal to the royalty
                  payments (including the purchase price of the units sold)
                  called for by Section 6.2 applied to twenty-five percent (25%)
                  of the budgeted Net Sales for such year as determined by
                  reference to the final Marketing Plan delivered by Pharmion to
                  LEO as called for by Section 4.3 hereof, provided that the
                  annual Net Sales for any such calendar year shall be not less
                  than the Net Sales of the immediately prior calendar year plus
                  the average growth of the fractionated heparin market (ATC B1
                  +B2, latest available MAT figures) for the then most recently
                  available twelve month period, as measured by the data
                  published by a mutually acceptable third party market data
                  collection organization.

6.9.     Minimum Sales.

         If Net Sales for any two consecutive calendar years are less than fifty
         percent (50%) of the Net Sales forecasts for such years, either as set
         forth in Schedule 2 or as provided in Sections 4.3.3 and 6.8.3, then
         (a) Pharmion shall have the right to pay LEO an amount equal to the
         difference between (i) the payments that would have been due to LEO
         under Section 6.2 had Pharmion achieved fifty percent of such Net Sales
         for such calendar years, and (ii) the amounts paid by Pharmion to LEO
         under Section 6.8 with respect to such calendar years, with such
         payment to be made simultaneously with the payments due to LEO under
         Section 6.2 in respect of the fourth quarter of the second of such
         calendar years, and (b) if Pharmion does not make such payment, LEO
         shall have the right, for the thirty (30) day period following the date
         on which such payment would otherwise be due to terminate this
         Agreement by notice to Pharmion.

6.10.    No Other Royalties. The royalties set out in this Section 6 are the
         only royalties payable by Pharmion to LEO or to any third party in
         connection with the exclusive distributor and purchase arrangements and
         licenses granted herein.

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<PAGE>

7.       MANUFACTURE AND SUPPLY OF PRODUCT

7.1.     Exclusive Supply; Requirements. LEO will sell to Pharmion and Pharmion
         will purchase from LEO all of Pharmion's requirements of the Product
         for sale in the Territory and for conducting clinical trials, sampling,
         participation in compassionate use programs, and for such other
         purposes as Pharmion shall require.

7.2.     Supply Efforts. LEO shall use Commercially Reasonable Efforts to
         manufacture or otherwise supply sufficient quantities of the Product to
         Pharmion to satisfy Pharmion's purchase requirements. LEO will
         manufacture the Product at the facility specified in the Existing NDA
         or, after compliance with Section 11.2, such newer facility as LEO may
         establish, provided that such newer facility shall have regulatory
         compliance characteristics at least as favorable as the current
         facility and is otherwise reasonably acceptable to Pharmion. LEO will
         provide the Product to Pharmion as Finished Goods and Packed in
         accordance with the specifications as described in Section 10 and
         Schedule 6 (Finished Goods Packaging Specification).

7.3.     Inspection. Upon reasonable notice to LEO, during normal business hours
         and in a manner calculated not to unreasonably interfere with LEO's
         conduct of business, LEO shall allow Pharmion's employees or
         representatives to inspect the Manufacturing, Packaging, testing,
         storing, stability and quality control facilities and/or programs of
         LEO which relate to the Product and which Pharmion reasonably needs to
         inspect in order to discharge its obligations as the holder of the NDA
         in the Territory. To the extent Pharmion wishes to use the services of
         a consultant in connection with any such inspection, it shall (a)
         identify such consultant to LEO for its prior approval, such approval
         not to be unreasonably withheld or delayed, (b) obtain a
         confidentiality undertaking from such consultant consistent with the
         provisions of Section 17, (c) cause a Pharmion employee to accompany
         such consultant on any such inspection, and (d) use Commercially
         Reasonable Efforts to utilize the same consultant for any subsequent
         inspection of the same facility.

7.4.     Allocation of Supply. In the event that LEO anticipates a shortage of
         supply of Product for sale in the Territory and the LEO Territory, LEO
         shall notify Pharmion of such shortage as soon as possible, and LEO
         shall in good faith allocate Product between the Territory and various
         countries within the LEO Territory in a fair and equitable manner,
         taking into account: the historic sales of the Product in the various
         markets, the then current demand for the Product in the various markets
         as evidenced by customer purchase orders and levels of back-orders, and
         the relative inventory levels available in the various markets.

7.5.     Interruption of Supply. In case of any interruption of supply by LEO,
         whether as a result of force majeure events or failure of LEO for any
         reason to meet Pharmion's supply requirements, the Parties will
         cooperate to seek to provide Pharmion with an alternate source of
         supply (including seeking to validate an

                                      21
<PAGE>

         alternative manufacturing source) for the period in which (or for the
         amount of Product that) LEO is unable to supply Pharmion.

7.6.     Safety Stock. In order to reduce the risk of any gap in supply, LEO
         will produce and maintain a sufficient inventory of active drug
         substance to permit LEO to produce at least 6 months supply of Product
         for the Territory, based on Pharmion's then current Long-Range
         Forecast.

7.7.     Technical Assistance Agreement. Within 6 weeks, following the Effective
         Date of this Agreement, the Parties will enter into a technical
         assistance agreement substantially in the form of Schedule 5. To the
         extent of any conflict or inconsistency between this Agreement and such
         Technical Assistance Agreement, the terms and conditions of this
         Agreement shall control, unless otherwise agreed to in writing by the
         Parties.

7.8.     Change of Manufacturer. If at any time during the term of this
         Agreement, LEO decides to outsource the Manufacture of the Product, LEO
         will notify Pharmion promptly and in any event at least twelve (12)
         months before such transfer of Manufacture is expected to be completed,
         and the Parties will negotiate in good faith any necessary changes to
         Sections 9 and 12 of this Agreement, and any procedures developed
         thereunder. LEO shall only select a Manufacturer that holds cGMP
         certification from the FDA. LEO will use Commercially Reasonable
         Efforts to ensure that the change of Manufacturer will not affect the
         safety or efficacy of the Product. The necessary steps for the change
         of the Manufacturer will be handled within the scope of an NDA
         supplement submitted to the FDA. LEO will cooperate with Pharmion by
         providing the available Manufacturing and other data required to
         support any required supplement to the NDA. Any such change of
         Manufacturer may also require changes to the forecasting and ordering
         procedures set forth in this Agreement, and the Parties agree to make
         any reasonable changes to such procedures resulting from any such
         change of Manufacturer. Costs associated with any such change of
         Manufacturer will be borne by LEO except where such costs are
         associated with changes requested by Pharmion or where additional work
         is required only in order to comply with new regulatory or other
         requirements in the Territory, in which case such costs will be
         reimbursed by Pharmion.

7.9.     Purchase of Initial Inventory

         7.9.1    Halt of Shipments. As of the close of business on the
                  Effective Date, LEO will instruct the Current Distributor to
                  halt temporarily all shipments of Product in the Territory for
                  a period of up to five (5) Business Days pending the stock
                  taking described below.

         7.9.2    Purchase of Initial Inventory. Pharmion shall purchase, and
                  take title to, the Initial Inventory effective as of the Sales
                  Inception Date. The purchase price for the Initial Inventory
                  shall be the Initial Inventory Value which shall be determined
                  and paid for as described below.

                                      22
<PAGE>

         7.9.3    Stock Taking.

                  (a)      As soon as practicable after the Effective Date, LEO
                           shall conduct a count at those principal locations of
                           the Current Distributor at which the Initial
                           Inventory is located (as specified in Schedule 7 to
                           this Agreement) to determine the quantities of
                           Initial Inventory outstanding at such locations as of
                           the Effective Date that are neither damaged or Short
                           Dated. Pharmion and one or more of its agents or
                           representatives shall have the right to observe the
                           count and determination of the Initial Inventory.
                           Based upon such count and the Price Per Vial, LEO
                           shall prepare and deliver a statement of Initial
                           Inventory Value (the "Statement of Inventory Value")
                           to Pharmion. If Pharmion agrees with the Statement of
                           Inventory Value, it shall promptly so notify LEO,
                           whereupon the Statement of Inventory Value delivered
                           by LEO to Pharmion shall be final, binding and
                           conclusive on the parties hereto.

                  (b)      Pharmion may dispute any amounts reflected on the
                           Statement of Inventory Value, but only on the basis
                           that the Initial Inventory was not correctly counted
                           or is otherwise damaged or Short-Dated; provided,
                           however, that Pharmion shall have notified LEO in
                           writing of each disputed item, specifying the amount
                           thereof in dispute and setting forth, in reasonable
                           detail, the basis for such dispute, within five (5)
                           Business Days of LEO's delivery of the Statement of
                           Inventory Value to Pharmion. In the event of such a
                           dispute, LEO and Pharmion shall attempt to reconcile
                           their differences, and any resolution by them as to
                           any disputed amounts shall be final, binding and
                           conclusive on the parties hereto. If LEO and Pharmion
                           are unable to resolve any such dispute within five
                           (5) Business Days after Pharmion's delivery of its
                           notice of dispute to LEO, LEO and Pharmion shall
                           submit the items remaining in dispute for resolution
                           to a mutually acceptable independent accounting firm
                           of international reputation (the "Independent
                           Accounting Firm"), in accordance with the provisions
                           of Section 31.

                  (c)      The Statement of Inventory Value shall be deemed
                           final for the purposes of this Section 7.9.3 upon the
                           earlier of (i) Pharmion's notice to LEO that it
                           accepts the Statement of Inventory Value, (ii) the
                           failure of Pharmion to notify LEO of a dispute within
                           five (5) Business Days after LEO's delivery of the
                           Statement of Inventory Value to Pharmion or (iii) the
                           resolution of all disputes pursuant to Section 31.
                           Within five (5) Business Days of the Statement of
                           Inventory Value being deemed final, Pharmion shall
                           pay to LEO by wire transfer the full amount of the
                           Initial Inventory Value.

                                      23

<PAGE>

         7.9.4    Resumption of Shipments. Promptly following the completion of
                  the count of the Initial Inventory as described in Section
                  7.9.3 above, LEO will instruct the Current Distributor to
                  resume shipments of Product in the Territory, with all such
                  shipments to be for the account of Pharmion. In addition, LEO
                  shall advise the Current Distributor that from and after the
                  Sales Inception Date title in and to the Initial Inventory
                  shall vest in Pharmion.

         7.9.5    Further Assurances. To the extent deemed necessary or
                  appropriate by either Party and at its request, LEO shall
                  execute such bills of sale or other transfer documents as may
                  be so requested to evidence the transfer of title in and to
                  the Initial Inventory to Pharmion.

8.       PRODUCT RETURNS

8.1.     Returns. LEO will be fully responsible for the processing of all
         Product returns of Product previously sold in LEO or DuPont trade
         dress, and any costs or expenses associated with such returns, and LEO
         shall keep Pharmion informed, on a regular basis, of both the volume of
         such returns and the customers from whom such returned Product was
         obtained. To the extent that customers deliver such returns to
         Pharmion, and Pharmion issues credits to such customers, Pharmion shall
         notify LEO regarding such transactions and LEO shall reimburse Pharmion
         for the costs of such credits.

9.       MONTHLY REPORTING, FORECASTING AND ORDERING

9.1.     Monthly Reporting. Within five Business Days after the end of each
         calendar month during the term of this Agreement, Pharmion shall
         deliver to LEO, in written form or in such electronic form as the
         Parties shall mutually agree upon, a report of (i) the gross sales of
         Product during the such month, in both U.S. dollars and in units per
         SKU, (ii) the current level of inventory of Product held by Pharmion as
         of the end of such month in units per SKU, and (iii) the number of
         units of Product distributed by Pharmion during such month as samples,
         clinical trial supplies, or for compassionate use (each a "Monthly
         Report").

9.2.     Long-Range Forecast. On the Effective Date, and on a monthly basis
         thereafter, delivered simultaneously with its Monthly Report, Pharmion
         shall furnish LEO with a rolling monthly forecast (in a mutually
         acceptable format) of the quantities of Product by SKU that Pharmion
         intends to order during the succeeding eighteen (18) month period (the
         "Long-Range Forecast"). All monthly amounts specified in such forecasts
         shall be for quantities of Product in integral multiples of 12,000
         vials or such other batch size as LEO may, from time to time, specify
         to Pharmion in compliance with the provisions of Section 11.2.1. Each
         Long-Range Forecast shall represent Pharmion's most current estimates
         for planning purposes but, except as provided in Section 9.3 below,
         shall not be deemed to be purchase commitments.

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<PAGE>

9.3.     Firm Orders. To the extent consistent with the volume limitations set
         forth in Section 9.4 below, the first four (4) months of the Long-Range
         Forecast (consisting of the then current month and the following three
         months), as updated monthly, shall be non-cancelable legally binding
         commitments on the part of LEO to supply and on the part of Pharmion to
         purchase, the quantity of Product by SKU as set forth in the Long-Range
         Forecast (each such first 4 month commitment, a "Firm Order"). Pharmion
         shall confirm monthly each Firm Order for the next four month period in
         writing to LEO; provided, however, that Pharmion's failure to deliver
         such confirmation shall not impact Pharmion's obligation to purchase
         such quantities.

9.4.     Variations of Long-Range Forecasts. With every monthly update of the
         Long-Range Forecast, each of months five through seven can be increased
         or decreased without regard to SKU by twenty percent (20%) of the
         quantity forecast in the Long-Range Forecast of the previous month.
         Each of months eight through twelve can be increased or decreased
         without regard to SKU by fifty percent (50%) of the quantity forecasted
         in the Long-Range Forecast of the previous month. Unless consented to
         in writing by the Parties, each Firm Order must be for that quantity of
         Product that is consistent with the variations permitted in the
         Long-Range Forecasts under this Section 9.4.

9.5.     Terms of Firm Orders. Any Firm Orders, or related purchase orders,
         purchase order releases, confirmations, acceptances, advices and
         similar documents submitted by either Party in conducting the
         activities contemplated under this Agreement are for administration
         purposes only and shall not add to or modify the terms of this
         Agreement. To the extent of any conflict or inconsistency between this
         Agreement and any such document, the terms and conditions of this
         Agreement shall control as to a particular order, unless otherwise
         agreed to in writing by the Parties.

10.      PACKAGING AND LABELING; USE OF NAME

10.1.    Packaging and Labeling.

         10.1.1   Pharmion shall be responsible for all costs of developing new
                  Packaging and labeling for the Product, and shall provide LEO
                  all art work for Packing components and wording to be applied
                  to the Product, which shall be consistent with FDA approved
                  labeling for the Product in the Territory. All such artwork
                  shall be consistent with the LEO Product Design Concept
                  wherever and whenever legally possible.

         10.1.2   Pharmion shall be responsible for ensuring that all Packaging
                  and labeling, including, but not limited to, the package
                  make-up, package inserts and other elements relating to
                  Packaging, as well as all promotional material, complies with
                  all laws, regulations and codes of practice applicable to such
                  Packaging and labeling in the Territory.

                                      25
<PAGE>

         10.1.3   Pharmion shall provide the information required under this
                  Section 10 to LEO at least four (4) months prior to the
                  requested delivery of Product reflecting such information. If
                  Pharmion requests a change in any of the Packing components,
                  Pharmion shall reimburse LEO for the cost of any existing and
                  unused inventory of such materials which do not reflect such
                  change, up to a maximum of six (6) month's supply of such
                  components, upon presentation by LEO to Pharmion of a
                  statement, in reasonable detail, of the amounts of such unused
                  inventory and the cost of manufacture of such inventory.

         10.1.4   LEO shall manufacture, or contract with third parties for the
                  manufacture, of all Packing components and cause such
                  components to be so manufactured consistent with the
                  information provided to LEO by Pharmion.

         10.1.5   In case LEO requires changes to the Packaging for technical
                  reasons (e.g. changes to Packaging technology or equipment),
                  LEO shall bear all costs of such changes and the obsolete
                  inventory of Packaging and label materials, if any, resulting
                  therefrom.

         10.1.6   Promptly after each change of Packaging material, twenty-five
                  (25) samples of each new Packaging material shall be provided
                  to Pharmion, along with the date of first use of such
                  materials.

10.2.    Name and Logo Use. For the term of this Agreement, LEO grants Pharmion
         a non-exclusive limited right to use the "LEO" name and the Assyrian
         Lion, and Pharmion shall use the "LEO" name and the Assyrian Lion only
         in accordance with the LEO Logo Guidelines, for the purpose of
         identifying LEO as the originator and manufacturer on all Packaging
         materials, labels, inserts and any other printed matter included in the
         Product to the extent required by law, regulations and codes of
         practice in the Territory. Pharmion shall always use the LEO Device
         Mark and the LEO Word Mark, as identified on Schedule 1, on all
         relevant Packaging components.

11.      QUALITY OF PRODUCT

11.1.    Manufacturing Warranty. LEO warrants that (i) the Product shall be
         produced in accordance with cGMP, (ii) when shipped to Pharmion the
         Product shall not be adulterated or misbranded and (iii) the Product
         shall be otherwise manufactured in accordance with the Specifications
         and with such written manufacturing procedures and finished product
         specifications (including packaging specifications) as are contained in
         the Existing NDA, in any NDA annual reports, and in any Additional NDA
         which may be issued during the term of this Agreement. To the extent
         permitted by law, LEO HEREBY DISCLAIMS ALL OTHER WARRANTIES REGARDING
         THE PRODUCT, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF
         MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

                                      26
<PAGE>

11.2.    Manufacturing and Product Changes

         11.2.1   PRODUCT CHANGES. Except for the Required Changes defined in
                  Section 11.2.2 below, LEO shall not make or allow to be made
                  any changes to the Product, Specifications, Manufacturing or
                  Packaging that would require supplements to the NDA or
                  notification to the FDA, without the prior written consent of
                  Pharmion, such consent not to be unreasonably withheld or
                  delayed. LEO will keep Pharmion informed of Manufacturing or
                  other changes to the Product reportable to an Agency which may
                  have an impact on the NDA, and Pharmion shall be responsible
                  for making any necessary regulatory filings and obtaining any
                  necessary approvals of the resulting supplements to the NDA
                  from the FDA. LEO will use Commercially Reasonable Efforts to
                  ensure that the timing of LEO's notice to Pharmion of any such
                  change shall permit adequate time for Pharmion to make any
                  necessary regulatory filings and obtain any necessary approval
                  of the corresponding supplements to the NDA from the FDA prior
                  to the change being implemented.

         11.2.2   REQUIRED CHANGES. The following changes shall constitute
                  Required Changes: (i) changes to the Specifications or
                  Manufacturing or Packaging processes that are required by laws
                  or regulations (including, without limitation, cGMP), or by
                  medical or scientific concerns as to the quality, safety
                  and/or efficacy of the Product (collectively "Required
                  Changes"); (ii) changes to the Specifications or Manufacturing
                  or Packaging processes which arise out of the change of
                  Manufacturer from LEO to a third party as provided in Section
                  7.8; and (iii) changes which LEO reasonably considers
                  necessary or desirable and which do not change the character
                  or identity of the Product in such a way as to have an adverse
                  effect on Pharmion's interest in the Product in the Territory.
                  The Parties shall cooperate in making such Required Changes
                  promptly. If a Required Change is necessary because of laws or
                  regulations that apply in the Territory but not in the LEO
                  Territory, all costs of making such Required Change shall be
                  borne by Pharmion. Conversely, if a Required Change is
                  necessary because of laws or regulations that apply in the LEO
                  Territory but not in the Territory, all reasonable costs of
                  making such Required Change shall be borne by LEO. If a
                  Required Change is required by the FDA and Agencies in both
                  the Territory and the LEO Territory, then LEO and Pharmion
                  shall share the reasonable cost of such Required Change in
                  proportion to their respective Sharing Percentages.

                  If: (i) an FDA request disables the implementation of
                  requirements of an Agency in the LEO Territory, (ii) an Agency
                  request disables the implementation of requirements of the FDA
                  or the FDA does not approve of a change required by an Agency,
                  or (iii) despite the

                                      27
<PAGE>

                  exercise of Commercially Reasonable Efforts, LEO is unable to
                  make or have a Required Change of the FDA made without
                  material adverse effects on the Product in the LEO Territory,
                  then the Parties will negotiate in good faith to solve this
                  issue and make such adjustments to this Agreement as are fair
                  and equitable.

         11.2.3   DISCRETIONARY CHANGES. Pharmion may request changes to the
                  Specifications or Manufacturing or Packaging process that are
                  not Required Changes, including, but not limited to, changes
                  to the existing Product, New Presentations, or changes to the
                  existing or additional Packaging (collectively "Discretionary
                  Changes"). LEO shall use Commercially Reasonable Efforts to
                  make or have such Discretionary Changes made unless LEO in
                  good faith considers that such Discretionary Changes requested
                  by Pharmion will have a material adverse effect on the Product
                  or on LEO's ability to Manufacture the Product or on LEO's
                  interests in the Product in the LEO Territory.

         11.2.4   COSTS OF DISCRETIONARY CHANGES. Any and all costs associated
                  with Discretionary Changes which are not requested by LEO
                  (including internal administrative costs and the use of
                  external technical consultants by LEO with the written consent
                  of Pharmion, which shall not be unreasonably withheld or
                  delayed, in effectuating such changes) shall be borne by
                  Pharmion. Any and all costs associated with Discretionary
                  Changes initiated by LEO shall be borne by LEO.

11.3.    Stability and Record-Keeping. LEO shall:

         11.3.1   select and retain samples of each batch and lot of Finished
                  Goods and conduct an ongoing stability program in compliance
                  with cGMP and in accordance with the provisions of the
                  Existing NDA and Additional NDA on selected batches and
                  maintain all legally required samples, documents, and records
                  including, without limitation, batch and lot production,
                  quality control and stability records, for such period as is
                  required by the FDA in the Territory, and

         11.3.2   make available for review by Pharmion, at any reasonable time,
                  all records relevant to Manufacturing and Packing hereunder
                  and necessary for the discharge by Pharmion of its obligations
                  as holder of the NDA in the Territory, including written
                  investigations of any deviations that may have been generated
                  from Manufacturing, Packaging, inspection or testing
                  processes.

12.      DELIVERY

12.1.    Delivery Dates. Unless otherwise agreed to by the Parties, deliveries
         shall be made on a monthly basis. At the time Pharmion places a Firm
         Order, Pharmion

                                      28

<PAGE>

         will provide LEO with specific shipping dates, allowing in each case
         for a minimum of 90 day's production time. To the extent that such
         shipping dates are consistent with such ninety (90) day period, LEO
         shall acknowledge such shipping dates in its order confirmations,
         whereupon such shipping dates shall become binding.

12.2.    Timing of Delivery. LEO shall use Commercially Reasonable Efforts to
         meet the shipping dates and order quantities indicated in Pharmion's
         binding and accepted Firm Orders for the Product. If any circumstances
         occur that could result in any delivery delay or significant variation
         in quantity, LEO shall immediately inform Pharmion thereof in
         sufficient detail for Pharmion to assess the likelihood that such
         delivery delay or variation in quantity will adversely affect its
         inventory situation. Any shipment delivered that is within plus or
         minus ten percent (+/-10%) of the quantity ordered and/or plus or minus
         five (+/-5) Business Days of the shipping date specified on the
         relevant Firm Order will be considered as delivered on time.

12.3.    Shipping Terms. Each shipment of the Product shall be delivered to
         Pharmion FCA (Incoterms 2000) Ballerup, Denmark. LEO will cooperate
         with Pharmion and will arrange for carriage of the Product to such
         destinations as Pharmion shall direct and for insurance of the Product
         (in such amounts as Pharmion shall determine) in connection therewith,
         all at Pharmion's sole cost and expense.

12.4.    Acceptance. Pharmion shall, within forty-five (45) days of receipt of
         each shipment of Product by Pharmion or Pharmion's agent, notify LEO in
         writing of any defect by reason of which Pharmion alleges that the
         Product delivered fails to meet the specifications warranted by LEO as
         provided in Section 11.1 hereof and which should be apparent on
         reasonable inspection. If Pharmion notifies LEO of any defect in a
         shipment of Product, LEO shall have the right, but not the obligation,
         to send one or more quality control representatives to retest such
         Product in co-operation with quality control representatives of
         Pharmion. Pharmion shall store all shipments of the Product in
         accordance with storage specifications established by LEO. In the event
         of a disagreement between Pharmion and LEO regarding the quality of one
         or more shipments of Product, the parties shall submit samples of the
         shipment in question to an independent testing laboratory (selected by
         mutual agreement of Pharmion and LEO) to make a determination, which
         shall be binding upon the Parties, as to the compliance or lack of
         compliance of such shipment with the specifications warranted by LEO.
         LEO shall promptly credit Pharmion for any defective shipments. If
         Pharmion fails to give such a notice under this Section 12.4 then,
         except in respect of any defect which is not apparent on reasonable
         inspection (a "Latent Defect"), the Product shall be conclusively
         presumed to meet the specifications warranted by LEO as provided in
         Section 11.1 hereof, and accordingly Pharmion shall be deemed to have
         accepted the delivery of the Product in question.

         12.4.1   Replacement of Defective Product. If any shipment of Product
                  does not comply with the Specifications, for reasons primarily
                  attributable

                                      29
<PAGE>

                  to LEO or the Manufacturer, LEO shall remedy or have remedied
                  such defect at its own cost and in agreement with Pharmion. If
                  this is not possible or advisable for regulatory, technical,
                  quality, medical or economic reasons, the shipment shall be
                  properly destroyed and/or disposed of at LEO's expense. LEO
                  shall not be entitled to any remuneration for any such
                  unusable shipment. LEO shall use Commercially Reasonable
                  Efforts to provide a replacement delivery as quickly as
                  possible.

12.5.    Certificates of Analysis and Compliance. LEO shall deliver to Pharmion,
         together with each delivery of each batch of Product, the corresponding
         Certificate of Compliance and the Certificate of Analysis relating to
         such batch. The Certificate of Analysis shall give full analytical
         results with respect to regulatory Specifications for each batch. The
         Certificate of Compliance will confirm that the Product has been made
         and tested in accordance with the master batch record, the
         Specifications and the test methods specified in the NDA. LEO shall
         promptly inform Pharmion of significant events and/or results
         including, but not limited to, quality incidents and batch deviations
         which may have occurred during the Manufacturing and/or Packing and
         which might affect the quality of the Product.

13.      SUPPLY PRICE; PAYMENT FOR PRODUCT SUPPLY

13.1.    Price.

         13.1.1   Except as provided in clauses (2) and (3) below, Pharmion
                  shall purchase the Product from LEO at the Price Per Vial.

         13.1.2   For Product purchased by Pharmion for the purpose of
                  conducting clinical trials, the price shall equal fifty
                  percent (50%) of the Price Per Vial.

         13.1.3   For Product purchased by Pharmion for samples given by
                  Pharmion free of charge to health care professionals and
                  members of the trade, up to an aggregate amount proposed each
                  year in its Marketing Plan and approved by LEO, such approval
                  not to be unreasonably withheld or delayed, the price shall
                  equal fifty percent (50%) of the Price Per Vial.

         13.1.4   For Product purchased by Pharmion for distribution in
                  connection with compassionate use programs, up to an aggregate
                  amount estimated each year in its Marketing Plan and approved
                  by LEO, such approval not to be unreasonably withheld or
                  delayed, the price shall equal fifty percent (50%) of the
                  Price Per Vial.

13.2.    Danish Index Adjustment. On or before February 28 of each calendar year
         of the term of this Agreement, LEO shall deliver to Pharmion a
         statement setting forth the level of the Danish Index for the four
         quarters ended November of the

                                      30
<PAGE>

         immediately preceding calendar year and the percentage change in such
         Danish Index from the comparable four quarters ended November of the
         prior calendar year, and certifying that such data was the data
         published by Statistics Denmark. From and after the date of delivery of
         such statement to Pharmion, the Price Per Vial shall be changed, with
         effect from January 1 of the then current calendar year, from that
         which was applicable during the prior calendar year, either upward or
         downward, by the percentage change in the Danish Index so reported.

13.3.    Price for New Presentations. Prior to the submission of an Additional
         NDA for the Product in a New Presentation, the Parties will negotiate
         in good faith the price to be paid for each unit of Product in such New
         Presentation (as to each New Presentation, its "Price Per New
         Presentation"), as well as an appropriate amendment to the provisions
         of Sections 13.1 and 13.2 of this Agreement to accommodate such price
         in a manner consistent with the Price Per Vial.

13.4.    Payment. Payment for the Product shall be made by Pharmion to LEO in
         the following manner and provided that Pharmion has first received an
         invoice from LEO in respect thereof:

         13.4.1   payment shall be made within thirty (30) days of the end of
                  the calendar month in which LEO delivers the Product to
                  Pharmion and Pharmion accepts such Product in accordance with
                  Section 12.4; and

         13.4.2   payment shall be made by Pharmion in U.S. Dollars to such bank
                  account as LEO shall from time to time in writing designate.

13.5.    Payments not made on the due date shall bear interest beginning the due
         date and ending the payment date at the rate of 1.5% per month,
         calculated on the basis of a 365-day year, actual days elapsed.

14.      ADVERSE DRUG EXPERIENCES; COMPLAINTS

14.1.    Preparation of Standard Operating Procedure: Each Party will have
         reporting responsibility in its own territory and for exchange of drug
         related information arising out of its territory with the other Party.
         Within sixty (60) days of execution of this Agreement, the Parties
         agree to enter into a standard operating procedure to govern
         collection, investigation and reporting to regulatory authorities and
         each other of Product-related adverse drug experience reports, quality
         reports, and complaint reports, such that each of the Parties can
         comply with its legal obligations worldwide. The standard operating
         procedure will be promptly amended as changes in legal obligations
         require.

14.2.    Agency Action. The Parties agree to notify each other as soon as
         possible of any information received by a Party regarding any
         threatened or pending action by the FDA or an Agency which may affect
         the safety or efficacy claims of the Product or the continued marketing
         of the Product.

                                      31
<PAGE>

14.3.    Questions and Complaints. Each Party shall have the sole responsibility
         for responding to questions and complaints from its customers and for
         reporting adverse drug experiences (as defined by the applicable
         regulations) to the relevant health authorities in its respective
         territory, unless otherwise required by applicable laws, rules or
         regulations. Each Party is responsible for providing submissions and
         information to appropriate regulatory authorities and the other Party
         regarding regulatory issues, including pharmacovigilance and safety
         submissions concerning the Product, in their respective territories.
         Each Party will cooperate with the other Party in reporting adverse
         drug experiences as provided in this Article 14.

14.4.    Product Recalls

         If any governmental authority having jurisdiction requires or
         reasonably requests either Party to recall any Product due to a defect
         in the Manufacture, processing, Packaging or labeling of the Product or
         for any other reason whatsoever, such Party shall immediately notify
         the other Party to this Agreement. Each Party shall also have the right
         to initiate a recall in its own territory in the absence of a request
         from a governmental authority after consultation with the other Party.

         Prior to commencing any recall, the Party commencing such recall shall
         review with the other Party the proposed manner in which the recall is
         to be carried out. Each Party agrees to follow any reasonable advice of
         the other Party as to the manner of carrying out the recall, so long as
         such advice is not contrary to any instructions of any governmental
         authority involved in the recall. The Party commencing the recall shall
         carry out the recall in the manner agreed upon between LEO and Pharmion
         in as expeditious a manner as possible and in such a way as to cause
         the least disruption to sales of the Product and to preserve the
         goodwill and reputation attached to the Product and to the names of the
         Parties. Without prejudice to Pharmion's rights against LEO pursuant to
         this Agreement, Pharmion shall bear all costs of any product recall
         carried out in the Territory; provided that LEO shall promptly
         reimburse Pharmion for reasonable costs directly related to any recall
         resulting from the Product having a Latent Defect.

15.      UNDERTAKINGS AND WARRANTIES OF PHARMION

15.1.    Pharmion shall:

         15.1.1   obtain and maintain all necessary consents, permits and
                  approvals to sell the Product in the Territory, including
                  maintaining the Existing NDA and the Existing IND once it is
                  transferred to Pharmion, and comply with all relevant laws and
                  regulations in connection therewith;

         15.1.2   recognize the exclusive ownership by LEO of the Trade Mark and
                  the other LEO Product Branding;

         15.1.3   not, either while this Agreement is in effect or at any time
                  thereafter, register, use or challenge or assist others to
                  challenge the Trade Mark

                                      32
<PAGE>

                  or the other LEO Product Branding or attempt to obtain any
                  right in or to any such name, logotype or trade mark similar
                  to the LEO Product Branding;

         15.1.4   not grant sublicenses or assignments to third parties under
                  the Trade Mark or the other LEO Product Branding and not
                  pledge the Trade Mark or make them the subject of any other
                  rights in rem;

         15.1.5   not cause or permit anything which may damage or endanger the
                  Trade Mark or other intellectual property of LEO or LEO's
                  title to it or assist or allow others to do so;

         15.1.6   notify LEO of any suspected infringement of the Trade Mark
                  and/or other intellectual property of LEO and take such
                  reasonable action as LEO may direct at LEO's expense in
                  relation to such infringement.

         15.1.7   not modify or alter the Trade Mark and/or other intellectual
                  property of LEO or do anything which might reasonably be
                  expected to damage the Trade Mark and/or other intellectual
                  property of LEO;

         15.1.8   indemnify LEO from any damage claims of third parties if
                  Pharmion should use the Trade Mark and/or other intellectual
                  property of LEO contrary to the provisions of this Agreement;

         15.1.9   market, sell and distribute the Product only in livery and in
                  packaging as notified by Pharmion to LEO and agreed by LEO,
                  such agreement not to be unreasonably withheld or delayed.
                  Pharmion will be responsible for the accuracy of any
                  information which it supplies to LEO in connection with the
                  requirements for the Manufacture, packaging, labeling,
                  marketing and sale of the Product, to the extent that the
                  accuracy of such information may relate to compliance with
                  legal and regulatory requirements, and will indemnify LEO
                  against any failure on its part to fulfill its obligations
                  under this section;

         15.1.10  following the transfer of the sponsorship of the Existing NDA,
                  ensure the compliance of the Product' labels and packaging
                  with the requirements of the NDA and notify LEO of any breach
                  of those requirements.

15.2.    Pharmion hereby warrants that:

         15.2.1   This Agreement is a legal and valid obligation binding upon
                  Pharmion and enforceable in accordance with its terms. The
                  execution, delivery and performance of the Agreement by
                  Pharmion does not conflict with any agreement, instrument or
                  understanding, oral or written, to which it is a party or by
                  which it is bound, nor violate any law or regulation of any
                  court, governmental body or administrative or other agency
                  having jurisdiction over it.

                                      33
<PAGE>

16.      UNDERTAKINGS AND WARRANTIES OF LEO

16.1.    LEO shall:

         16.1.1   at its own expense, maintain the Trade Mark, including the
                  payment of all renewal fees, and, except as otherwise provided
                  in Section 30, not assign or license the Trade Mark to any
                  person without Pharmion's prior written consent, such consent
                  not to be unreasonably withheld;

         16.1.2   at its own expense, take all such steps, including initiating
                  proceedings, as Pharmion may reasonably require to stop any
                  alleged infringement of the Trade Mark or other LEO Product
                  Branding in the Territory or to defend the Trade Mark or other
                  LEO Product Branding from any attack, including any invalidity
                  or revocation proceedings; at LEO's request, Pharmion shall
                  give LEO all reasonable assistance in respect of any such
                  proceedings, subject to LEO meeting all reasonable costs and
                  expenses incurred by Pharmion in giving such assistance. If
                  LEO is not willing or interested in initiating action against
                  an infringer, Pharmion shall be entitled, but not obligated,
                  to enter an action in its own name based on the infringement
                  of the Trade Mark or other LEO Product Branding subject to
                  LEO's consent. LEO may only refuse its consent for good cause
                  and will give Pharmion all assistance as Pharmion may
                  reasonably request in connection with any such action;

         16.1.3   LEO shall have the exclusive right to enter oppositions
                  against the filing or registration of trade marks. The same
                  shall apply for petitions for cancellations and actions for
                  cancellations entered against the registration of the trade
                  marks of third parties; and

         16.1.4   not cause or permit anything which may damage or endanger the
                  Trade Mark or other LEO Product Branding or other intellectual
                  property of LEO or LEO's title to it or assist or allow others
                  to do so.

16.2.    LEO hereby warrants that:

         16.2.1   This Agreement is a legal and valid obligation binding upon
                  LEO and enforceable in accordance with its terms. The
                  execution, delivery and performance of the Agreement by LEO
                  does not conflict with any agreement, instrument or
                  understanding, oral or written, to which it is a Party or by
                  which it is bound, nor violate any law or regulation of any
                  court, governmental body or administrative or other agency
                  having jurisdiction over it.

         16.2.2   LEO has not, and during the term of this Agreement will not,
                  grant any right to any third party which would conflict with
                  the rights granted to Pharmion hereunder.

                                      34
<PAGE>

         16.2.3   it is the owner of the Trade Mark and, to the best of the
                  knowledge and belief of LEO, the use of the Data, the Trade
                  Mark and other LEO Product Branding and the supply of the
                  Product in the Territory by Pharmion will not infringe the
                  intellectual property rights of any third party; and

         16.2.4   it is the owner of, or it has the right to use, and is
                  entitled to permit Pharmion to use in accordance with the
                  terms of this Agreement, the Data.

17.      CONFIDENTIALITY

17.1.    Except to the extent expressly authorized by this Agreement or
         otherwise agreed in writing, the Parties agree that, for the term of
         this Agreement and for seven (7) years thereafter, the receiving Party
         shall keep confidential and shall not publish or otherwise disclose or
         use for any purpose other than as provided for it by this Agreement any
         Data or other information and materials furnished to it by the other
         Party pursuant to this Agreement (collectively "Confidential
         Information"), except to the extent that it can be established by the
         receiving Party that such Confidential Information:

         (a)      was already known to the receiving Party, other than under an
                  obligation of confidentiality, at the time of disclosure by
                  the other Party;

         (b)      was generally available to the public or otherwise part of the
                  public domain at the time of its disclosure to the receiving
                  Party;

         (c)      became generally available to the public or otherwise part of
                  the public domain after its disclosure and other than through
                  any act or omission of the receiving Party in breach of this
                  Agreement; or

         (d)      was disclosed to the receiving Party, other than under an
                  obligation of confidentiality, by a third party who had no
                  obligation to the disclosing Party not to disclose such
                  information to others.

17.2.    Each Party may disclose Confidential Information hereunder to the
         extent that such disclosure is reasonably necessary for exercising its
         rights and carrying out its obligations under this Agreement and in
         complying with applicable governmental regulations or conducting
         clinical trials as authorized under this Agreement, provided that if a
         Party is required by law or regulation to make any such disclosure of
         the other Party's Confidential Information it will, except where
         impracticable for necessary disclosures (for example, in the event of
         medical emergency), give reasonable advance notice to the other Party
         of such disclosure requirement and, except to the extent inappropriate
         in the case of patent applications, will use its reasonable efforts to
         secure confidential treatment of such Confidential Information required
         to be disclosed.

                                      35
<PAGE>

17.3.    This Article 17 shall survive termination or expiration of this
         agreement for a period of ten (10) years, provided, however, that
         following the termination of this Agreement LEO shall be free to use
         all Data, Improvements or other confidential information relating to
         the Product.

17.4.    Publications. As to any clinical study of the Product which is
         supported by either Party (a "Sponsoring Party") (whether for the
         Initial Indication, any Additional Indication or any New Presentation),
         such Sponsoring Party shall request that the principal investigator for
         such study agrees to send to both Parties, or permit the Sponsoring
         Party to send to the other Party (the "Receiving Party"), prior to
         submission for publication, a copy of a manuscript describing the
         results of such clinical study, and such Sponsoring Party shall use its
         Commercially Reasonable Efforts to ensure compliance with such request.
         The Receiving Party will promptly review such manuscript and send any
         comments which it may have to the Sponsoring Party, no later than
         twenty (20) days after receipt of such manuscript. Provided such
         comments are given on a timely basis, the Sponsoring Party will give
         due consideration to the comments of the Receiving Party and will use
         Commercially Reasonable Efforts to ensure that such principal
         investigator will give due consideration to the comments of the
         Receiving Party and will not submit such manuscript for publication
         until the Sponsoring Party has had an opportunity to consider the
         comments of the Receiving Party. Nothing herein contained, however,
         shall preclude the Sponsoring Party or the principal investigator from
         submitting any such manuscript for publication after the procedures
         described above have been followed, nor shall either the Sponsoring
         Party or the principal investigator be required to accept any
         amendments, additions or deletions in any such manuscript proposed by
         the Receiving Party. Following publication of any such manuscript, each
         Party shall be entitled to make such manuscript available to physicians
         in its Territory, or the LEO Territory, as the case may be.

18.      INDEMNITIES

18.1.    LEO will indemnify and hold Pharmion and its Affiliates, and their
         employees, officers and directors harmless against any loss, damages,
         action, suit, claim, demand, liability, expense, bodily injury, death
         or property damage (a "Loss"), that may be brought, instituted or arise
         against or be incurred by such persons to the extent such Loss is based
         on or arises out of: (a) the development or Manufacture of the Product
         by LEO or its Affiliates, the Manufacturer or their representatives,
         agents or subcontractors under this Agreement, or any actual or alleged
         violation of law resulting therefrom; or (b) the breach by LEO of any
         of its material covenants, representations or warranties set forth in
         this Agreement; provided that the foregoing indemnification shall not
         apply to any Loss to the extent such Loss is caused by the negligent or
         willful misconduct of Pharmion or its Affiliates.

18.2.    Pharmion will indemnify and hold LEO and its Affiliates, and their
         employees, officers and directors harmless against any Loss that may be
         brought, instituted or

                                      36
<PAGE>

         arise against or be incurred by such persons to the extent such Loss is
         based on or arises out of the development, use, sale, storage or
         handling of the Product by Pharmion or its Affiliates or their
         representatives, agents or subcontractors under this Agreement, or any
         actual or alleged violation of law resulting therefrom; or (b) the
         breach by Pharmion of any of its material covenants, representations or
         warranties set forth in this Agreement; provided that the foregoing
         indemnification shall not apply to any Loss to the extent such Loss is
         caused by the negligent or willful misconduct of LEO or its Affiliates.

         Each Party entitled to be indemnified by the other Party (an
         "Indemnified Party") pursuant to Section 18.1 or 18.2 hereof shall give
         notice to the other Party (an "Indemnifying Party") promptly after such
         Indemnified Party has actual knowledge of any threatened or asserted
         claim as to which indemnity may be sought, and shall permit the
         Indemnifying Party to assume the defense of any such claim or any
         litigation resulting therefrom; provided that counsel for the
         Indemnifying Party, who shall conduct the defense of such claim or any
         litigation resulting therefrom, shall be approved by the Indemnified
         Party (whose approval shall not unreasonably be withheld) and the
         Indemnified Party may participate in such defense at such Party's
         expense (unless (i) the employment of counsel by such Indemnified Party
         has been authorized by the Indemnifying Party; or (ii) the Indemnified
         Party shall have reasonably concluded that there may be a conflict of
         interest between the Indemnifying Party and the Indemnified Party in
         the defense of such action, in each of which cases the Indemnifying
         Party shall pay the reasonable fees and expenses of one law firm
         serving as counsel for the Indemnified Party, which law firm shall be
         subject to approval, not to be unreasonably withheld, by the
         Indemnifying Party); and provided further, that the failure of any
         Indemnified Party to give notice as provided herein shall not relieve
         the Indemnifying Party of its obligations under this Agreement to the
         extent that the failure to give notice did not result in harm to the
         Indemnifying Party. No Indemnifying Party, in the defense of any such
         claim or litigation, shall, except with the approval of each
         Indemnified Party which approval shall not be unreasonably withheld,
         consent to entry of any judgment or enter into any settlement which (i)
         would result in injunctive or other relief being imposed against the
         Indemnified Party; or (ii) does not include as an unconditional term
         thereof giving by the claimant or plaintiff to such Indemnified Party
         of a release from all liability in respect to such claim or litigation.
         Each Indemnified Party shall furnish such information regarding itself
         or the claim in question as an Indemnifying Party may reasonably
         request in writing and shall be reasonably required in connection with
         the defense of such claim and litigation resulting therefrom.

19.      DURATION AND TERMINATION

19.1.    This Agreement will come into force on the Effective Date and, subject
         to the Parties' rights of termination in Sections 19.2 and 19.3
         hereunder, will continue in force for a period of ten (10) years from
         the Effective Date. If LEO intends to continue to supply the Product to
         the Territory following such ten year term, LEO

                                      37
<PAGE>

         shall so advise Pharmion at least twenty-four (24) months prior to the
         end of the original term of this Agreement, and the Parties shall
         negotiate in good faith an extension to the term of this Agreement for
         a reasonable period of time, not to exceed five (5) years, on terms
         substantially similar to those which applied during the original ten
         year term.

19.2.    In addition to its rights of termination in accordance with Section 22,
         Pharmion shall have the right at any time by giving notice in writing
         to LEO to terminate this Agreement forthwith if LEO:

         19.2.1   commits a material breach of this Agreement which is not
                  remedied within thirty (30) days of receipt of a notice from
                  Pharmion specifying the breach and requiring it to be remedied
                  (or, in the case of a breach not capable of being remedied
                  within such 30-day period, LEO has failed within such period
                  to take good faith steps to remedy such breach); or

         19.2.2   enters into liquidation whether compulsorily or voluntarily
                  (otherwise than for the purposes of amalgamation or
                  reconstruction), compounds with its creditors, has a receiver
                  or manager appointed in respect of all or any part of its
                  assets, or is the subject of an application for an
                  administration order or undergoes any analogous or similar act
                  or proceeding under the laws of any other jurisdiction in
                  consequence of debt.

19.3.    In addition to its rights of termination in accordance with Section 22,
         LEO shall have the right at any time by giving notice in writing to
         Pharmion to terminate this Agreement forthwith:

         19.3.1   in accordance with the provisions of Section 6.9;

         19.3.2   if Pharmion commits a material breach of this Agreement which
                  is not remedied within thirty (30) days of receipt of a notice
                  from LEO specifying the breach and requiring it to be remedied
                  (or, in the case of a breach not capable of being remedied
                  within such 30-day period, Pharmion has failed within such
                  period to take good faith steps to remedy such breach); or

         19.3.3   if Pharmion enters into liquidation whether compulsorily or
                  voluntarily (otherwise than for the purposes of amalgamation
                  or reconstruction), compounds with its creditors, has a
                  receiver or manager appointed in respect of all or any part of
                  its assets, or is the subject of an application for an
                  administration order or undergoes any analogous or similar act
                  or proceeding under the laws of any other jurisdiction in
                  consequence of debt.

                                      38
<PAGE>

         Without limiting the foregoing provisions, the failure by Pharmion to
         pay any required Minimum Payments shall be deemed a material breach of
         this Agreement.

20.      CONSEQUENCES OF TERMINATION

20.1.    Subject to the provisions of this Section 20, upon termination or
         expiry of this Agreement:

         20.1.1   Except as provided in Section 20.2 below, Pharmion shall cease
                  to make use of the Trade Mark, the other LEO Product Branding,
                  the Data and Improvements, and all rights in the Trade Mark,
                  the other LEO Product Branding, the Data, the Improvements and
                  all other information relating to the Product will promptly
                  revert to LEO and be transferred to LEO free of charge;

         20.1.2   If Pharmion is then the owner of any Patents, Pharmion shall
                  transfer such ownership to LEO free of charge;

         20.1.3   If Pharmion is then the owner of any Data, then Pharmion shall
                  transfer to LEO any Data related to any study for which it was
                  the Funding Party, as provided in Section 5.6.4, and all
                  restrictions imposed by Section 5.6.4 on the use by LEO of any
                  clinical data previously delivered by Pharmion to LEO shall be
                  released. At such time, LEO shall have the right, but not the
                  obligation, to have assigned to LEO any then pending third
                  party clinical trial agreements, and if LEO will assume such
                  agreements and, if LEO elects to terminate such agreements,
                  LEO shall bear the cost of such terminations.

         20.1.4   Pharmion shall transfer the sponsorship of the Existing NDA
                  and any Additional NDA and any then pending IND from Pharmion
                  to LEO or a third party designated by LEO at the end of such
                  period of time as shall permit, in the reasonable judgment of
                  both Parties, an orderly transition of the distribution of the
                  Product in the Territory from Pharmion to LEO or such third
                  party, such period not to exceed six months from the date of
                  any such termination or the date of expiry. Simultaneously
                  with such transfer, Pharmion shall also return to LEO all Data
                  and other information relating to the Product provided to
                  Pharmion by LEO pursuant to this Agreement; and

         20.1.5   If such termination results from the commission by Pharmion of
                  a material breach of this Agreement, then, in addition to any
                  amounts owed by Pharmion to LEO in respect of Firm Orders as
                  of the date of termination, Pharmion shall pay LEO the
                  reasonable costs actually incurred by LEO, if any, in
                  connection with the production of units of Product called for
                  by months five through twelve of the then most recent
                  Long-Range Forecast up to an amount not to exceed 50% of the

                                      39
<PAGE>

                  aggregate Price Per Vial of the units called for by months
                  five through seven of the then most recent Long-Range Forecast
                  and 20% of the aggregate Price Per Vial of the units called
                  for by months eight through twelve of the then most recent
                  Long-Range Forecast. The Parties agree that the above amounts
                  constitute a genuine pre-estimate of the loss that would be
                  incurred by Leo in this situation and would not operate as a
                  penalty.

20.2.    Notwithstanding the provisions of Section 20.1, upon termination or
         expiry of this Agreement, Pharmion will be entitled:

         20.2.1   to fulfill orders it has received for the Product in the
                  Territory up to and including the date of termination; and

         20.2.2   to use any inventory of Product in its possession or ordered
                  from LEO as at the date of termination to fulfill any orders
                  referred to in Section 20.2.1.

                  Where Pharmion supplies any Product in accordance with this
                  Section 20.2, it shall be entitled to do so under and by
                  reference to the Trade Mark and shall supply such Product
                  subject to the terms and conditions of this Agreement.

20.3.    Termination or expiry of this Agreement for any reason shall be without
         prejudice to the accrued rights of either Party.

21.      RIGHTS AND REMEDIES

21.1.    The failure on the part of either Party hereto to exercise or enforce
         any rights conferred upon it by this Agreement shall not be a waiver of
         any such rights nor shall any single or partial exercise of any right,
         power or privilege or further exercise thereof operate so as to bar the
         later exercise or enforcement thereof.

21.2.    The rights and remedies herein provided are cumulative and not
         exclusive of any rights or remedies provided by law.

22.      FORCE MAJEURE

         Neither Party shall be in breach of this Agreement if there is any
         total or partial failure of performance by it of its duties and
         obligations under this Agreement by reason of force majeure. If either
         Party is unable to perform its duties and obligations under this
         Agreement as a direct result of force majeure, such Party shall give
         written notice to the other of such inability stating the reason in
         question. The operation of this Agreement shall be suspended during the
         period in which the force majeure continues. Forthwith upon the reason
         ceasing to exist, the Party relying upon it shall give notice to the
         other of this fact. If the force majeure continues for a period of more
         than ninety (90) days, the Party not

                                      40
<PAGE>

         relying on force majeure shall be entitled to terminate this Agreement
         forthwith by written notice to the other.

23.      GROSS INEQUITIES

         It is the intent of the parties hereto that they shall mutually benefit
         from the terms, conditions and provisions of this Agreement, and in the
         event that either party shall suffer a gross inequity resulting from
         such terms, conditions or provisions, or from a substantial change in
         circumstances or conditions, the parties shall negotiate in good faith
         to resolve or remove such inequity. It is mutually agreed, however,
         that nothing herein shall be construed to relieve either party of any
         of its obligations under this Agreement.

24.      NOTICE

24.1.    Any notice or other document required to be given under this Agreement
         shall be in writing and shall be served by:

         24.1.1   delivery by hand;

         24.1.2   sending the same by first class post or express or air mail or
                  other fast postal services or registered or recorded delivery
                  post, in each case with return receipt requested; or

         24.1.3   facsimile transmission (together with postal confirmation);

         addressed:

         if to LEO:                 LEO Pharmaceutical Products Ltd. A/S
                                    (LEO Pharma A/S)
                                    Industriparken 55
                                    DK-2750 Ballerup
                                    Denmark
                                    Attention: President
                                    Fax: +45 44 64 15 80

         if to Pharmion:            Pharmion Corporation
                                    4865 Riverbend Road
                                    Boulder, Colorado 80301 USA
                                    Attention:  Chief Executive Officer
                                    Fax: +1 720 564-9191

                                    with a copy to:

                                    Peter H. Jakes, Esq.
                                    Willkie Farr & Gallagher
                                    787 Seventh Avenue
                                    New York, New York 10019 USA
                                    Fax: +1 212 728-9230

                                      41
<PAGE>

                  or to such other address as may be designated in writing from
                  time to time by either Party to the other.

24.2.    Any notice given under Section 24.1 shall be deemed to have been
         received:

         (i)      in the case of delivery by hand, when delivered;

         (ii)     in the case of pre-paid post, on the third Business Day
                  following the day of posting; or

         (iii)    in the case of facsimile, on acknowledgement by the recipient
                  facsimile receiving equipment provided that the facsimile is
                  confirmed by post.

25.      ENTIRE AGREEMENT/VARIATIONS

25.1.    This Agreement constitutes the entire agreement and understanding
         between the parties and supersedes all prior oral or written
         understandings, arrangements, representations or agreements between
         them relating to the subject matter of this Agreement. No director,
         employee or agent of either of the parties is authorized to make any
         representation or warranty to the other not contained in this
         Agreement, and each of the parties acknowledges that it has not relied
         on any such oral or written representations or warranties.

25.2.    No variations, amendments, modifications or supplements to this
         Agreement shall be valid unless made in writing in English and signed
         by a duly authorized representative of each of the parties.

26.      COUNTERPARTS; ENGLISH LANGUAGE

         This Agreement may be executed in any number of counterparts, each of
         which shall be deemed an original but all of which together shall
         constitute one and the same instrument. This Agreement is entered into
         in the English language. In the event of any dispute concerning the
         construction or meaning of this Agreement, reference shall be made only
         to this Agreement as written in English and not to any translation
         hereof into any other language, and this English language version shall
         be controlling for all purposes.

27.      SEVERANCE OF TERMS

27.1.    If the whole or any part of this Agreement is or shall become or be
         declared illegal, invalid or unenforceable in any jurisdiction for any
         reason whatsoever:

         27.1.1   in the case of the illegality, invalidity or unenforceability
                  of the whole of this Agreement, it shall terminate in relation
                  to the jurisdiction in question; or

         27.1.2   in the case of the illegality, invalidity or unenforceability
                  of part of this Agreement, such part shall be severed from
                  this Agreement in the jurisdiction in question, and such
                  illegality, invalidity or

                                      42
<PAGE>

                  unenforceability shall not in any way whatsoever prejudice or
                  affect the remaining parts of this Agreement, which shall
                  continue in full force and effect.

28.      PUBLICATION/PRESENTATION/PRESS RELEASE

         The text of any press release or other communication to be published by
         or in the media by or on behalf of either of the parties concerning the
         subject matter of this Agreement shall require the approval of both
         parties, which approval shall not be unreasonably withheld or delayed.

29.      PARTNERSHIP/AGENCY; THIRD PARTIES

29.1.    None of the provisions of this Agreement shall be deemed to constitute
         the relationship of partnership or agency between the parties, and
         neither shall have any authority to bind the other in any way except as
         provided in this Agreement.

29.2.    The Parties agree that no person which is not a Party to this Agreement
         is intended to benefit from or shall have any right to enforce any
         provision of this Agreement by virtue of the Contracts (Rights of Third
         Parties) Act.

30.      ASSIGNMENT

         Neither Party may assign the benefit or burden of this Agreement
         without the prior written consent of the other Party except, in the
         case of Pharmion, to a successor to all or substantially all of the
         business of Pharmion, and except, in the case of LEO, to a successor to
         all or substantially all of the business of LEO or all or substantially
         all of the business of LEO relating to the Product. .

31.      AUDIT RIGHTS

         Each Party shall maintain books of account relating to its payment
         obligations and reimbursement rights pursuant to this Agreement all in
         accordance with International Accounting Standards with appropriate
         controls to insure that transactions are properly recorded. Each Party
         shall have the right, at its own expense, to have an independent
         certified public accountant of its own selection, reasonably acceptable
         to the other Party, examine at a time reasonably acceptable to the
         other, during normal business hours but not more than once each
         calendar year, the relevant books and records of account of the other,
         to determine whether appropriate accounting has been made hereunder.
         Such independent certified accountant shall treat as confidential and
         shall not disclose to the Party engaging such accountant any
         information other than that which is relevant to the rights of the
         engaging Party hereunder or the performance by the other Party of its
         obligations hereunder. In the event of a dispute between the
         independent certified public accountants of Pharmion and LEO with
         respect to any matter called for by this Agreement, the parties shall
         select a third independent public accounting firm to arbitrate the
         dispute, provided, that such firm shall have the authority only to
         select from among the positions of the original two firms that position
         which it

                                      43
<PAGE>

         deems most accurate. The fees of such third firm shall be borne by the
         Party whose position is not approved of by such arbitrator.

32.      GOVERNING LAW AND JURISDICTION

         The validity, interpretation and performance of this Agreement as well
         as any disputes connected herewith shall be construed in accordance
         with the laws of England, excluding the United Nations Convention on
         Contracts for the International Sale of Goods. In relation to any
         dispute or difference between the Parties arising out of or in
         connection with this Agreement or any legal action or proceedings to
         enforce this Agreement, each of the Parties irrevocably submits to the
         exclusive jurisdiction of the English courts and waives any objection
         to proceedings in such courts on the grounds of venue or on the grounds
         that the proceedings have been brought in an inconvenient forum.

AS WITNESS, the hands of the parties or their duly authorized representatives
the day and year first above written.

LEO PHARMACEUTICAL PRODUCTS LTD. A/S           PHARMION CORPORATION
(LEO PHARMA A/S)

By: /s/ Ernst Lunding                         By: /s/ Patrick J. Mahaffy

Name: Ernst Lunding                           Name: Patrick J. Mahaffy

Title: President & CEO                        Title: President & CEO<PAGE>

                                                                   EXHIBIT 10.13

                         5-AZACYTIDINE LICENSE AGREEMENT
                            DATED AS OF JUNE 7, 2001

BETWEEN:

         PHARMION CORPORATION, having an address of 4865 Riverbend Road,
Boulder, Colorado 80301,

         ("Pharmion Corporation"), and

         PHARMION GMBH, a wholly owned subsidiary of Pharmion Corporation having
an address of Centralbahnstrasse 7, PO 206, CH 4010 Basel, Switzerland,

         ("Pharmion GmbH" and, together with Pharmion Corporation, "Pharmion")

AND:

         PHARMACIA & UPJOHN COMPANY, having an address of 100 Route 206N,
Peapack, New Jersey 07977,

         ("Pharmacia")

WHEREAS:

                  A.       Pharmacia has developed and owns a chemical entity
and pharmaceutical product formulation known as 5-azacytidine (defined below),
and Pharmacia has previously conducted, and /or facilitated the conduct of Phase
II/III clinical studies for the treatment of myelodysplastic Syndrome ("MDS")
with 5-azacytidine, as well as other clinical studies with 5-azacytidine;

                  B.       Pharmion has developed U.S. and international
regulatory, marketing and information technology capabilities for the purpose of
developing, marketing and selling pharmaceutical products discovered by third
parties;

                  C.       The parties hereto have agreed that Pharmacia will
grant to Pharmion an exclusive worldwide license to the 5-azacytidine Technology
(as defined below) and all related Data (as defined below) for all therapeutic
and diagnostic applications, but with an option for Pharmacia to participate in
the development, manufacture, marketing, distribution, promotion, and sale and
use in any manner of the Product (as defined below) at a later date;

                  D.       Pharmion Corporation shall acquire the rights granted
hereunder, and shall discharge the obligations hereunder, relating to North
America, and Pharmion GmbH shall acquire the rights granted hereunder, and shall
discharge the obligations hereunder, relating to the rest of the world;

                  E.       The obligations of Pharmion Corporation and Pharmion
GmbH hereunder shall be joint and several; and

<PAGE>

                  F.       The parties wish to enter into this Agreement (as
defined below) to set out the terms and conditions of their agreement with
respect to the development and Commercialization (as defined below) of the
Product and the licenses and other rights granted with respect thereto.

         NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the
mutual covenants contained in this Agreement and other good and valuable
consideration, the receipt and sufficiency of which is acknowledged, the parties
hereto agree as follows:

         1.       DEFINITIONS, SCHEDULES AND INTERPRETATION

                  1.1      DEFINED TERMS. In this Agreement, unless the context
otherwise requires:

                  (a)      "ADVERSE DRUG REACTION REPORTS" shall mean reports
concerning or alleging side-effects, injury, significant failure of expected
pharmacological action, toxicity or sensitivity reaction including unexpected or
increased frequency or severity thereof, associated with commercial or clinical
uses, studies, investigations or tests on animals or human beings of the
Product, whether or not determined to be attributable to the Product or to any
other pharmaceuticals.

                  (b)      "AFFILIATE" means, at any time, any person, company
or legal entity then directly or indirectly controlled by, controlling or under
common control with the Party with respect to which the term is associated,
where "control" means:

                           (i)      The ownership, whether direct or indirect,
         of 50% or more of the shares of the Party with respect to which the
         term is associated, or

                           (ii)     In the absence of ownership of 50% or more
         of the shares of the Party with respect to which the term is associated
         or in the case of a non-corporate entity, the ability to direct or
         cause the direction of the management and policies of the Party with
         respect to which the term is associated.

                  (c)      "AGREEMENT" shall mean this 5-azacytidine License
Agreement dated as of June 7, 2001 between Pharmion and Pharmacia (including all
Schedules attached hereto), as the same may be amended, modified or supplemented
from time to time.

                  (d)      "APPROVAL" means any and all licenses, permits,
certificates of authority, authorizations, approvals (including, without
limitation, any applicable governmental price and reimbursement approvals),
registrations, and similar consents granted or issued by any Governmental or
Regulatory Authorities and necessary for the importation, exportation,
development, manufacture, distribution, sale, marketing, promotion, storage,
transport or use in any manner of the Product.

                  (e)      "BUSINESS DAY" shall mean a day, other than Saturday
or Sunday, on which banks are open for business in New York, New York.

                  (f)      "CGMP" shall mean all laws, guidelines and
regulations applicable to the manufacture of the Product within the respective
Country of Sale, including the current Good

<PAGE>

Manufacturing Practice regulations as promulgated under Federal Food, Drug and
Cosmetic Act (21 CFR), as the same may be amended , modified or supplemented
from time to time, or similar manufacturing guidelines and regulations
applicable outside the United States.

                  (g)      "COMMERCIALIZATION PLANS" means all marketing plans
retained by Pharmacia, if any, relating to the proposed marketing and sale of
5-azacytidine, together with all available sales and financial projections, if
any, related to such marketing plans, developed by Pharmacia during the three
years prior to the date of this Agreement.

                  (h)      "COMMERCIALIZE" AND "COMMERCIALIZATION" mean the
manufacture, distribution, promotion, marketing, sale, export, import, storage
and use of the Product in any manner related to providing the Product in Final
Form (as defined below).

                  (i)      "CONFIDENTIAL INFORMATION" shall have the meaning set
forth in paragraph 8.1.

                  (j)      "COUNTRY OF SALE" means the country where the Product
is being sold to unaffiliated customers.

                  (k)      "DATA" means all information owned by Pharmacia and
contained in or arising from clinical study protocols, and results of clinical
studies conducted, for 5-azacytidine in any form or formulation, including,
without limitation, Regulatory Data.

                  (l)      "CRITICAL DECISION PERIOD" means the 75- day period
specified in paragraph 7.3.

                  (m)      "DROPPED PRODUCT LICENSE" means the license to
develop and Commercialize the Product ( including, without limitation, the right
to use any and all trademarks and tradenames of the Product) as specified in
paragraphs 10.4 and 10.5.

                  (n)      "DROPPED PRODUCT OPTION" means the exclusive,
irrevocable option from Pharmion to Pharmacia to use commercially reasonable
efforts to negotiate in good faith the Dropped Product License as specified in
paragraph 10.4.

                  (o)      "EFFECTIVE DATE" means the date of this Agreement,
written at the start of this Agreement.

                  (p)      "FDA" means the United States Food and Drug
Administration.

                  (q)      "FINAL FORM" means a finally finished and packaged
form of the Product suitable for ultimate consumer use.

                  (r)      "FIRST COMMERCIAL SALE" means, with respect to each
Country of Sale, the first sale of the Product to an unaffiliated customer in
such Country of Sale after the Governmental or Regulatory Authorities within
such country have granted all applicable Approvals, if any.

<PAGE>

                  (s)      "5-AZACYTIDINE" means the proprietary chemical entity
known as 5-azacytidine having the Structure set forth in SCHEDULE B attached to
this Agreement.

                  (t)      "5-AZACYTIDINE TECHNOLOGY" means all information and
know-how developed by or on behalf of Pharmacia or its Affiliates, or acquired
by Pharmacia or its Affiliates, prior to the Effective Date, whether or not
patented, with respect to 5-azacytidine, including, without limitation,
information which describes or identifies 5-azacytidine, the proprietary
synthetic processes for 5-azacytidine, methods of use of 5-azacytidine,
formulations for 5-azacytidine, all information and results of laboratory,
preclinical and clinical studies conducted by or on behalf of Pharmacia with
respect to 5-azacytidine in any form or formulation and all other Data and any
and all Commercialization Plans. Without limiting the foregoing, the
"5-azacytidine Technology" includes the Pharmacia Patents, if any.

                  (u)      "GOVERNMENTAL OR REGULATORY AUTHORITY" shall mean any
court, tribunal, arbitrator, authority, agency, department, bureau, commission,
official or other instrumentality of the U.S., any foreign country or
multinational organization or any domestic or foreign state, province, county,
city or other political subdivision.

                  (v)      "IND" means an Investigational New Drug application
filed with the FDA seeking authority to test a product in human clinical
studies.

                  (w)      "JOINT DEVELOPMENT AND PROMOTION AGREEMENT" means the
agreement to be negotiated and entered into by Pharmion and Pharmacia pursuant
to paragraph 7.4 regarding the continued development and Commercialization of
the Product in the event that Pharmacia exercises the Participation Option (as
defined below).

                  (x)      "LIABILITIES" means any and all liabilities, claims,
losses, damages, costs, fines, fees, penalties, deficiencies and expenses
(including, without limitation, interest, court costs and reasonable fees of
attorneys).

                  (y)      "NDA" means a New Drug Application pursuant to 21
U.S.C. Section 505 (b)(1) and any amendments or supplements thereto, filed with
the FDA, or any successor application or procedure, seeking Approval for the
Product, or any similar application, amendment, supplement, successor
application or procedure filed in any other country to the Governmental or
Regulatory Authorities charged with responsibility for regulating approval to
market a product for the treatment of humans.

                  (z)      "NDA FILING NOTICE" means written notice from
Pharmion to Pharmacia delivered pursuant to paragraph 7.2, whereby Pharmion
notifies Pharmacia that the FDA has accepted for filing an NDA for the Product.

                  (aa)     "NET SALES" means the actual gross invoiced sales
price of the Product billed to unaffiliated customers, less:

                           (i)      To the extent such amounts are included in
         the invoiced sales price, actual credited allowances and/or
         charge-backs for spoiled, damaged, out-dated and returned Product,

<PAGE>

                           (ii)     Quantity and other trade discounts and early
         settlement discounts (where such discounts are effectively
         non-discretionary and are given as a matter of course) actually allowed
         and taken,

                           (iii)    Sales, value-added and other direct taxes
         incurred (except for taxes based on Pharmion's income),

                           (iv)     Customs duties and surcharges and other
         governmental charges incurred in connection with the exportation or
         importation of the Product, and

                           (v)      Legally mandated rebates.

                  (bb)     "OPTION EXPIRY DATE" means the date specified in the
first sentence of paragraph 7.3.

                  (cc)     "ORALLY AVAILABLE PRODUCT" means any orally available
therapeutic formulation of the Product.

                  (dd)     "PARTICIPATION OPTION" means the exclusive,
irrevocable option granted by Pharmion to Pharmacia pursuant to paragraph 7.1,
the exercise of which permits Pharmacia to participate with Pharmion in the
continued development and Commercialization of the Product on the terms and
conditions set out in Section 7.

                  (ee)     "PARTICIPATION OPTION EXERCISE NOTICE" means written
notice from Pharmacia to Pharmion of the exercise by Pharmacia of the
Participation Option, pursuant to paragraph 7.3.

                  (ff)     "PHARMACIA" means Pharmacia & Upjohn Company (a party
to this Agreement).

                  (gg)     "PHARMACIA PATENTS" means:

                           (i)      The patents and patent applications listed
         in SCHEDULE A to this Agreement,

                           (ii)     Any and all continuations,
         continuations-in-part, divisionals, reissues, re-examinations or
         improvements of or to the aforesaid patents and patent applications
         listed in clause (i),

                           (iii)    All foreign applications and patents
         corresponding to the patents and patents applications listed in clauses
         (i) and (ii) above which have been or may be filed and which directly
         relate to 5-azacytidine,

                           (iv)     Any supplementary protection certificates or
         equivalent patent term extension rights which directly relate to
         5-azacytidine, its manufacture or use, and

                           (v)      Author certificates, inventor certificates,
         utility certificates, certificates of addition, re-filings, renewals,
         patents of addition, extensions,

<PAGE>

         substitutions, confirmations, registrations or revalidations which
         directly relate to 5-azacytidine, its manufacture or use, or additions
         of or to any of the above which directly relate to 5-azacytidine, its
         manufacture or use, and all foreign counterparts of the above which
         directly relate to 5-azacytidine, its manufacture or use.

                  (hh)     "PHARMACIA REPRESENTATIVE" means the one
representative of Pharmacia on Pharmion's Project Management Team (as defined
below).

                  (ii)     "PHARMION" means, collectively, Pharmion Corporation
and Pharmion GmbH (each a party to this Agreement).

                  (jj)     "PRODUCT" means any and all Pharmion therapeutic or
diagnostic formulations of 5-azacytidine in Final Form (including Orally
Available Product).

                  (kk)     "PRODUCT PATENTS" means:

                           (i)      Any and all patent applications and patents
         filed by or on behalf of, and/or issued to Pharmion or its Affiliates
         either prior to or during the Term (as defined below) or licensed in by
         Pharmion, which contain claims covering inventions which are necessary
         or useful for the development or Commercialization of the Product or
         the Final Form of the Product,

                           (ii)     Any and all continuations,
         continuations-in-part, divisionals, reissues, re-examinations or
         improvements of or to the patents and patent applications listed in
         clause (i) above,

                           (iii)    All foreign applications and patents
         corresponding to the patents and patent applications listed in clauses
         (i) and (ii) above,

                           (iv)     Any supplementary protection certificates or
         equivalent patent term extension rights which relate to the patents and
         patent applications listed in clauses (i) and (ii) above and

                           (v)      Author certificates, inventor certificates,
         utility certificates, certificates of addition, re-filings, renewals,
         patents of addition, extensions, substitutions, confirmations,
         registrations or revalidations which relate to the Product or the Final
         Form of the Product, its formulation, manufacture or use or additions
         of or to any of the above and all foreign counterparts of the above .

Notwithstanding the foregoing, the "Product Patents" exclude all 5-azacytidine
Technology and Pharmacia Confidential Information.

                  (ll)     "PRODUCT TECHNOLOGY" means all information and
know-how developed by or on behalf of Pharmion or its Affiliates, or acquired by
Pharmion or its Affiliates, prior to or during the Term, whether or not
patented, with respect to the Product, including, without limitation,
information which describes or identifies the Product, proprietary synthesis
processes for the Product, methods of use of the Product, formulations for the
Product and all information and results of laboratory, preclinical and clinical
studies conducted by or on behalf of Pharmion

<PAGE>

or its Affiliates with respect to the Product in any form or formulation. The
"Product Technology" includes any and all Product Patents, but excludes all
5-azacytidine Technology and Pharmacia Confidential Information.

                  (mm)     "PROJECT MANAGEMENT TEAM" means Pharmion's project
management team for the development and Commercialization of the Product.

                  (nn)     "PUBLICATION" means any proposed publication or other
such public disclosure, written or oral, concerning or relating to the
5-azacytidine Technology.

                  (oo)     "REGULATORY DATA" means all regulatory submissions
made by Pharmacia with respect to 5-azacytidine with Governmental or Regulatory
Authorities in any part of the world prior to the Effective Date, all
correspondence with such Governmental or Regulatory Authorities relating to any
such submissions and all notes of verbal communications from such Governmental
or Regulatory Authorities relating to such submissions; provided, however, that
"Regulatory Data" shall not include any proprietary or confidential information
of any third party. Without limiting the generality of the foregoing,
"Regulatory Data" shall include any data or submissions filed by Pharmacia to
obtain "orphan drug" status or other similar special product approvals.

                  (pp)     "RULES" means the Commercial Arbitration Rules of the
American Arbitration Association.

                  (qq)     "STRUCTURE" means the chemical structure for
5-azacytidine as set forth in Schedule B.

                  (rr)     "TERM" means the term of this Agreement, as more
specifically set out at paragraph 10.1.

                  (ss)     "THIRD PARTY CLAIM" means a claim made or any
litigation or other proceeding or action brought or threatened by any claimant
(other than any Affiliate of a Party) not a party to this Agreement.

                  (tt)     "TRADEMARK NOTICE" means written notice from Pharmion
to Pharmacia pursuant to paragraph 6.4 regarding Pharmion's top choices for each
trademark or trade name for the Product.

                  (uu)     "VALID CLAIM" means a claim of an issued unexpired
patent included within the Pharmacia Patents, if any, which has not been held
permanently revoked, unenforceable or invalid by a decision of a court or other
government agency of competent jurisdiction, un-appealable or unappealed within
the time allowed for appeal, and which has not been admitted to be invalid or
unenforceable.

                  1.2      ADDITIONAL DEFINITIONS. Any words defined elsewhere
in this Agreement shall have the particular meaning assigned thereto.

                  1.3      SCHEDULES. The following are the schedules to this
Agreement and are incorporated into and deemed to form a part of this Agreement:

<PAGE>

                  SCHEDULE A - Pharmacia Patents and Patent Applications

                  SCHEDULE B - Chemical Structure of 5-azacytidine

                  SCHEDULE C - Quantities of 5-azacytidine Material to be
                  Transferred to Pharmion

                  SCHEDULE D - Insurance

                  1.4      OTHER INTERPRETIVE PROVISIONS. In this Agreement,
unless the context otherwise requires:

                  (a)      TENSE/GENDER - Words denoting the singular shall
include the plural and vice versa and the masculine gender shall include the
feminine gender and neuter and vice versa;

                  (b)      AMENDMENTS - Reference to any statute, law, rule,
regulation or document shall be a reference to that statute, law, rule,
regulation or document and all amendments, consolidations, modifications or
reenactments thereof from time to time;

                  (c)      NUMBERS - Where numbers are referred to in full as
well as in figures, the full description shall prevail over the actual figures
in the event of any inconsistencies; and

                  (d)      PARTY - Pharmacia and Pharmion may be referred to
herein individually as a "Party" or collectively as the "Parties". For purposes
of this Agreement, Pharmion Corporation and Pharmion GmbH, together, shall
constitute a "Party" under this Agreement and the obligations of Pharmion
Corporation and Pharmion GmbH under this Agreement shall be joint and several.
In addition, all notices and/or consents required to be given to or by Pharmion
under this Agreement and all amounts required to be paid to or by Pharmion under
this Agreement shall be deemed to be duly given to or received by, or duly paid
to or by, Pharmion if duly given to or received by, or duly paid to or by,
either Pharmion Corporation or Pharmion GmbH.

         2.       LICENSE GRANTS

                  2.1      GRANT OF LICENSE TO THE 5-AZACYTIDINE TECHNOLOGY.
Pharmacia hereby grants to Pharmion, and Pharmion hereby accepts, an exclusive
worldwide license to use the 5-azacytidine Technology to develop and
Commercialize the Product for all therapeutic and diagnostic applications.

                  2.2      FURTHER ASSURANCES. Subject to the terms and
conditions of this Agreement, each of the Parties agrees to use its commercially
reasonable efforts to take, or cause to be taken, all actions and to do, or
cause to be done, all things necessary or desirable to consummate the
transactions contemplated by this Agreement, including, without limitation,
using their respective commercially reasonable efforts to cause the National
Cancer Institute ("NCI") and the Cancer and Leukemia Group - B ("CLGB") to
transfer to Pharmion the right to use their respective proprietary and/or
confidential information relating to 5-azacytidine.

                  2.3      SUB-LICENSES

                  (a)      CONTRACT MANUFACTURING SUB-LICENSE -Pharmion shall
have the right at any time during the Term of this Agreement to sub-license
rights under this Agreement to one or more contract manufacturers for the
purposes of permitting such manufacturer(s) to make the

<PAGE>

Product for Pharmion. Any such contract manufacturers shall be reasonably
satisfactory to Pharmacia.

                  (b)      NO SUB-LICENSES BEFORE EXPIRY OF THE PARTICIPATION
OPTION - Except as provided in subparagraph 2.3(a), Pharmion shall not have the
right, without the prior written consent of Pharmacia, to grant sub-licenses
under this Agreement until after expiry of the Participation Option.

                  (c)      RIGHT TO SUB-LICENSE - Subject to the provisions of
subparagraphs 2.3(a) and (b), Pharmion shall have the right to sub-license any
of the rights under this Agreement, subject to the following terms and
conditions:

                           (i)      NOTICE - Pharmion shall provide notice in
         writing to Pharmacia of any sub-licenses granted under this Agreement.

                           (ii)     NO RELIEF - Sub-licensing shall not relieve
         Pharmion of any obligations (financial or other) under this Agreement
         and Pharmion shall make all required payments to Pharmacia as if the
         sublicensed activities were conducted by Pharmion.

                           (iii)    SIMILAR PROVISIONS - Pharmion shall ensure
         that each sub-license contains all of the same payment, reporting,
         record keeping, audit and liability provisions as are contained in this
         Agreement, which provisions shall allow access and audits by Pharmacia
         as if the sub-licensee had contracted directly with Pharmacia.

                           (iv)     COMPULSORY SUB-LICENSES - Notwithstanding
         the provisions of clauses (ii) and (iii) above, if Pharmion is required
         pursuant to law to grant a sub-license of its rights under this
         Agreement to a government or third party in a country where Pharmion is
         selling or offering for sale the Product, Pharmion will use reasonable
         commercial efforts to negotiate a sub-license that complies with the
         terms of this subparagraph 2.3(c). The Parties acknowledge and agree
         that it may not be possible for Pharmion to negotiate a complying
         sub-license, and in this case, Pharmion will negotiate and/or enter
         into a sub-license on the best terms and conditions as Pharmion is able
         to negotiate. In this situation, Pharmacia and Pharmion will reasonably
         agree on the compensation that will accrue to each Party under such
         compulsory sub-license.

                  2.4      RESERVED RIGHTS. All rights not specifically granted
under this Agreement to Pharmion are reserved to Pharmacia.

                  2.5      NONCOMPETE. During the Term, Pharmion and its
Affiliates shall not directly or indirectly develop, license, manufacture,
distribute, promote, market, sell, export, import or use in any manner any
product if such activity would adversely and materially affect the sale of the
Product.

                  2.6      PRIORITY. Pharmion shall give as high a priority to
the development and commercialization of the Product as it would to promising
compounds originating from its own research. Pharmion shall diligently pursue
development and Commercialization efforts with respect to the Product and shall
use all commercially reasonable efforts to devote adequate

<PAGE>

personnel and other resources to develop and Commercialize the Product with a
view to obtaining all applicable Approvals as quickly as possible.

         3.       ROYALTIES

                  3.1      PARTICIPATION OPTION NOT EXERCISED. If Pharmacia does
not exercise the Participation Option set forth in Section 7, Pharmion shall pay
Pharmacia, on a country-by-country basis, a royalty of twenty percent (20%) of
Net Sales of the Product in each Country of Sale for the longer of the period
of:

                           (i)      The date of the First Commerical Sale of the
         Product (which shall be the date of invoice of the first such sale) in
         such Country of Sale through the date of the last to expire of the
         Valid Claims in such Country of Sale; or

                           (ii)     ten (10) years from the date of First
         Commercial Sale (which shall be the date of invoice of the first such
         sale) in such Country of Sale;

provided, however, that if the Data (including, without limitation all
information and data obtained by NCI and/or CLGB in connection with
5-azacytidine) are deemed insufficient by the FDA to support an approval of the
Product as a treatment for MDS patients or any sub-group of MDS patients (other
than any refinements and/or minor supplements to the Data or Class 1
re-submissions required or requested by the FDA to obtain FDA approval) and
Pharmion must conduct another Phase III clinical trial for such indication prior
to initial FDA approval, then the royalty rate shall be eight percent (8%) of
Net Sales; and provided, further, that if a product containing 5-azacytidine is
sold in a similar formulation to the Product in any Country of Sale as a generic
drug or branded generic drug, then from and after the date that such generic
product has attained a greater than 10% market share in such Country of Sale (as
determined by evidence provided by Pharmion and satisfactory to Pharmacia), the
royalty rate in such Country of Sale shall be five percent (5%) of Net Sales.
Notwithstanding the foregoing, the royalty rate on Net Sales of Orally Available
Product in each Country of Sale shall be five percent (5%). In the event that
Pharmion is required to pay any royalty to NCI and/or CLGB in connection with
Pharmion's use of any NCI or CLGB information and/or data related to
5-azacytidine and required for FDA approval of the NDA for the Product, Pharmion
and Pharmacia agree to reasonably negotiate appropriate changes to the royalty
payments hereunder.

                  3.2      PARTICIPATION OPTION EXERCISED. If the Parties
execute the Joint Development and Promotion Agreement, Pharmion will not be
obligated to pay any royalty payments to Pharmacia pursuant to this Section 3
after the date of such execution.

                  3.3      NET SALES CALCULATION. The Parties acknowledge and
agree that any part of Net Sales received by Pharmion that is computed in a
currency other than United States dollars will be translated into United States
dollars at the average of the exchange rate applicable on the last business day
of the month prior to the month of such Net Sales, and the exchange rate
applicable on the last business day of the month in which such Net Sales were
made, in each case, as published in the United States edition of the Wall Street
Journal.

                  3.4      WITHHOLDING TAX. Any tax (other than any tax based on
Pharmion's income) which Pharmion is required by law to pay or withhold from
royalty payments to be made to

<PAGE>

Pharmacia under this Agreement shall be deducted from the amount otherwise due;
provided that, in regard to any such deduction, Pharmion shall give Pharmacia
such assistance as may be reasonably requested by Pharmacia to enable or assist
Pharmacia to claim exemption therefrom or a reduction thereof and shall provide
Pharmacia with an official tax certificate as soon as possible. Proof of all
withholding tax payments in form satisfactory to Pharmacia shall be provided by
Pharmion to Pharmacia as evidence of such payments.

                  3.5      INVOICES FOR ROYALTIES. If requested by Pharmion,
Pharmacia shall submit a written invoice addressed to Pharmion for each royalty
payment to be made by Pharmion under this Agreement. Pharmacia shall submit
these written invoices to Pharmion promptly upon receipt of the quarterly
royalty report from Pharmion as specified in subparagraph 4.1(b).

                  3.6      ROYALTY CALCULATION AND PAYMENT.

                  (a)      TIMING - During the Term, royalties for the sale of
the Product shall be calculated and paid by Pharmion to Pharmacia quarterly, and
shall be due (i) as to Net Sales within the United States, not later than 45
days following the end of each calendar quarter and (ii) as to Net Sales outside
the United States, not later than 90 days following the end of each calendar
quarter; provided, however, that if any such royalties are not paid when due,
Pharmion shall pay to Pharmacia interest on such overdue amount for the period
from and including the due date to but excluding the date on which such amount
(royalty and interest) is paid to Pharmacia in full. The interest rate payable
by Pharmion to Pharmacia on such overdue amount shall be equal to the lesser of
(i) the prime commercial lending rate as announced by Citibank N.A. at its
principal office in New York, New York and (ii) the maximum rate permitted by
applicable law.

                  (b)      CURRENCY OF PAYMENT - All royalties shall be payable
by Pharmion to Pharmcia in immediately available funds in United States currency
by wire transfer to an account designated in writing by Pharmacia.

                  3.7      NO OTHER ROYALTIES. The royalties set out in this
Section 3 are the only royalties payable by Pharmion to Pharmacia (or to any
Pharmacia licensor) in connection with the licenses granted under paragraph 2.2
of this Agreement.

                  3.8      ROYALTY REDUCTION AS PER THIS AGREEMENT. The Parties
acknowledge and agree that all of the royalty payment provisions of this Section
3 are subject to the provisions of paragraph 9.6 of this Agreement.

                  3.9      PAID UP LICENSES. At the time of expiry of the
periods for the payment of royalties on the sale of the Product in each Country
of Sale as set out in this Section 3, Pharmion shall have a fully paid-up right
and license under paragraph 2.2 in such Country of Sale with respect to the
Product.

         4.       REPORTS AND RECORD KEEPING

                  4.1      REPORTS. During the Term, Pharmion shall have the
following reporting requirements to Pharmacia:

<PAGE>

                  (a)      PROGRESS REPORTS - Pharmion shall submit semi-annual
progress reports to Pharmacia, such reports to summarize in reasonable detail
Pharmion's progress with development and Commercialization of the Product during
each six-month period. These reports shall be delivered to Pharmacia no later
than 45 days after each six-month period. The Parties agree that the first such
report shall be delivered to Pharmacia not later than 45 days after June 30,
2001. In addition, Pharmion shall provide to a limited number of Pharmacia
personnel physical access (by telephone, facsimile, e-mail and through personal
visits) at reasonable times during regular business hours to a reasonable number
of Pharmion personnel who are knowledgeable about such progress reports and who
will provide such Pharmacia personnel with additional information about such
progress reports, as reasonably requested by Pharmacia.

                  (b)      ROYALTY REPORTS - After First Commercial Sale in any
Country of Sale and for the remainder of the Term, Pharmion shall submit
quarterly payment reports to Pharmacia (as to Net Sales within the United
States, not later than 45 days following the end of each calendar quarter and,
as to Net Sales outside the United States, not later than 90 days following the
end of each calendar quarter, in each case at the same time as it transfers to
Pharmacia the royalty payments due and payable for such quarter). Such reports
shall include, but not be limited to:

                           (i)      An accounting of Net Sales for the Product
         in each Country of Sale (in United States currency) on a country-by-
         country basis and the calculation of Net Sales from the gross revenues
         for the Product in each Country of Sale, and

                           (ii)     An accounting of worldwide Net Sales (in
         United States currency) and the calculation of the royalty amounts
         owing to Pharmacia pursuant to Section 3 (in United States currency),
         including, if applicable, the exchange rates used in determining the
         royalty amounts due in United States currency.

                  4.2      RECORD KEEPING. Pharmion shall keep complete and
accurate written financial and accounting records with respect to Sections 3 and
4 of this Agreement, in accordance with generally accepted accounting practices
and consistently applied across all Pharmion products, sufficient for Pharmacia
to ascertain and verify the accuracy and completeness of the accounting and the
amounts owing pursuant to this Agreement. Pharmion shall preserve these written
records for a period of at least six years after creation of such records.

                  4.3      AUDITS. Not more than once per year during the Term,
Pharmion shall permit independent auditors (chosen by Pharmacia and reasonably
acceptable to Pharmion) to inspect, copy and abstract Pharmion's books, records
and accounts and all or any part of its operations and activities as may be
necessary to determine the completeness and accuracy of the reports and payments
made or required to be made under this Agreement. Pharmacia shall give
reasonable notice to Pharmion of its request for an audit pursuant to this
provision, and such audit shall be conducted during normal business hours.
Pharmacia shall be responsible for the cost of such audit; provided, however,
that if the independent auditors conducting such audit conclude that the royalty
payments made hereunder were understated by an amount in excess of five percent
(5%) during any calendar year, Pharmion will pay the cost of such audit. If such
audit determines that additional payments were owed during such period, Pharmion
shall pay the

<PAGE>

additional amounts to Pharmacia not later than 45 days after the date of the
delivery of the audit report to Pharmion. The Parties acknowledge and agree that
the confidentiality provisions of Section 8 will apply to audits conducted
pursuant to this paragraph 4.3 and Pharmacia shall ensure that its auditors
(including all audit personnel working on the audit) are bound by
confidentiality provisions at least equivalent to the confidentiality provisions
of Section 8.

         5.       PHARMACIA OBLIGATIONS

                  5.1      TECHNOLOGY TRANSFER. To the extent not already
provided by Pharmacia to Pharmion, promptly after execution of this Agreement,
Pharmacia shall disclose and make available to Pharmion the 5-azacytidine
Technology, and all documentation retained by it relating to the 5-azacytidine
Technology sufficient to enable Pharmion to exercise its rights and perform its
obligations under this Agreement. In addition, during the Term, Pharmacia shall
provide to a limited number of Pharmion personnel physical access (by telephone,
facsimile, email and through personal visits) at reasonable times during regular
business hours to a reasonable number of Pharmacia personnel (at Pharmion or
Pharmacia facilities) and to materials and information pertaining to the
5-azacytidine Technology, as more specifically set out below:

                  (a)      PHARMACEUTICAL DEVELOPMENT - For the first six months
after the Effective Date, Pharmacia will use its reasonable efforts to provide
ongoing assistance to Pharmion pharmaceutical development personnel with respect
to 5-azacytidine material to be supplied by Pharmacia to Pharmion pursuant to
paragraph 5.2, if any, including the provision of documentation certifying cGMP
compliance of the 5-azacytidine material to be supplied to Pharmion,or, to the
extent 5-azacytidine is manufactured by a third party, to provide reasonable
assistance to Pharmion in monitoring of the synthesis, production and cGMP
compliance of such third party. Pharmion estimates that the assistance required
from Pharmacia under this subparagraph 5.1(a) should not be more than two days
initially and then some periodic questions, but in no event exceeding in total
20 person-hours of Pharmacia time.

                  (b)      REGULATORY - For the first 12 months after the
Effective Date, Pharmacia will use its reasonable efforts to provide ongoing
assistance (not to exceed 20 person-hours of Pharmacia time) to Pharmion
regulatory personnel in the form of answering questions that may arise from time
to time with respect to the IND filed for 5-azacytidine. As well, for a period
of 12 months after the filing by Pharmion of its IND (and the European
equivalent) for the Product, Pharmacia will use its reasonable efforts to
provide ongoing assistance (not to exceed 20 person-hours of Pharmacia time) to
Pharmion regulatory personnel in the form of assisting with questions that the
FDA or other Governmental or Regulatory Authorities may have on Pharmion's IND
(and the European equivalent). The Pharmacia assistance required by Pharmion
regulatory personnel pursuant to this subparagraph 5.1(b) shall not exceed a
total of 40 person-hours. In addition to the foregoing, if requested by
Pharmion, and to the extent permissable by the FDA or any similar Governmental
or Regulatory Authorities outside the United States, Phamacia will cooperate
reasonably with Pharmion in the transfer of any IND (and the European
equivalent) for 5-azacytidine to Pharmion. If such transfer is not permitted,
Pharmacia will provide reasonable assistance to Pharmion to allow Pharmion to
cross-reference any IND (and the European equivalent) pertaining to
5-azacytidine from any IND (or European equivalent) filed by Pharmion for the
Product.

<PAGE>

                  (c)      MANUFACTURING - For the first 24 months after the
Effective Date, Pharmacia will use reasonable efforts to provide three days per
calendar quarter (excluding travel time) of consultation and advice from
Pharmacia personnel to Pharmion's manufacturing personnel (not to exceed a total
of approximately 180 person-hours of assistance during such period). From time
to time during this 24 month period, Pharmion manufacturing personnel will
request this consultation and advice from Pharmacia and the assistance will be
provided at times agreeable to the Pharmion and Pharmacia personnel, both acting
reasonably. The support to be provided by Pharmacia to the Pharmion
manufacturing personnel under this subparagraph 5.1(c) shall be from Pharmacia
personnel knowledgeable with the chemical synthesis of 5-azacytidine, if any,
who can assist Pharmion with the transfer of the chemical synthesis of
5-azacytidine from Pharmacia to a third party contract manufacturer chosen by
Pharmion in accordance with subparagraph 2.3(a).

         All out-of-pocket costs associated with all personnel visits under this
paragraph 5.1 shall be reimbursed by Pharmion to Pharmacia, unless otherwise
agreed by the Parties, and all such visits shall be at mutually agreeable times,
both Parties acting reasonably.

                  5.2      MATERIAL TRANSFER. As soon as practicable after the
Effective Date and in any event no later than 21 Business Days after the
Effective Date, Pharmacia shall transfer to Pharmion existing quantities of
5-azacytidine compound, if any, previously synthesized in accordance with cGMP
processes by or on behalf of Pharmacia and in Pharmacia's possession as more
specifically set out in SCHEDULE C.

                  5.3      NO FURTHER RESEARCH BY PHARMACIA. Except in the event
of exercise by Pharmacia of the Participation Option, the Parties acknowledge
and agree that Pharmacia shall have no obligation to conduct further research or
development in connection with 5-azacytidine under this Agreement.

         6.       PHARMION OBLIGATIONS

                  6.1      DEVELOPMENT ACTIVITIES. Except in the event of
exercise by Pharmacia of the Participation Option, Pharmion shall have sole
responsibility and liability for obtaining all Approvals necessary to develop
and Commercialize the Product in each Country of Sale. In addition, Pharmion
shall have sole responsibility and discretion, and shall use all commercially
reasonable efforts at its sole cost and expense, to develop and Commercialize
the Product, including, without limitation:

                  (a)      CLINICAL - Conduct human clinical trials of the
Product as Pharmion determines are reasonable, necessary or desirable;

                  (b)      REGULATORY - Obtain all applicable Approvals for the
Product;

                  (c)      PRODUCT AND MANUFACTURING PROCESS DEVELOPMENT -
Develop (and/or contract out for) a manufacturing and process development
package for the Product as Pharmion determines is reasonable, necessary or
desirable; and

<PAGE>

                  (d)      MARKET - Subject to paragraph 2.6, Commercialize the
Product in such regions, at such prices and on such other terms and conditions
as Pharmion determines are reasonable, necessary or desirable.

Notwithstanding the above development and Commercialization provisions of this
paragraph 6.1, but subject to paragraph 2.6, Pharmion shall not be obligated to
undertake any particular activity and shall not be obligated to continue
development and Commercialization of the Product. Notwithstanding any other
provision of this Agreement, in the event that the date of the First Commercial
Sale of the Product (which shall be the date of invoice of the first such sale)
shall not have occurred during the five (5) year period immediately succeeding
the Effective Date, then, upon thirty (30) days prior written notice to
Pharmion, Pharmacia may terminate this Agreement, and the provisions of
paragraph 10.3 shall thereafter apply.

                  6.2      PHARMACIA REPRESENTATIVE. During the Term and prior
to the Option Expiry Date, Pharmion shall permit the Pharmacia Representative to
participate, as a non-voting member, on Pharmion's Project Management Team.
Pharmacia acknowledges that Pharmion's preference is that the Pharmacia
Representative be a project management employee. Except for the acknowledgment
set out above, Pharmacia shall be solely responsible for the designation of the
Pharmacia Representative and shall be solely responsible for any expenses of the
Pharmacia Representative in connection with the Pharmacia Representative's
participation on the Project Management Team. Pharmion will ensure that written
notice of Project Management Team meetings are given to the Pharmacia
Representative, but will not be obligated to alter Project Management Team
meetings or activities to accommodate the schedule of the Pharmacia
Representative. Pharmion will provide to the Pharmacia Representative all
documents and other materials distributed or otherwise made available to any
other members of the Project Management Team. The Pharmacia Representative shall
continue to participate on the Project Management Team after the Option Expiry
date if Pharmacia exercises the Participation Option; provided, however, that
Pharmion shall have no further obligation to permit the Pharmacia Representative
to participate on the Project Management Team under this paragraph 6.2 after the
Option Expiry Date if Pharmacia does not exercise the Participation Option.

                  6.3      EXPENSES. Except in the event of the Parties
executing the Joint Development and Promotion Agreement, Pharmion shall be
solely responsible for all costs and expenses of the development and
Commercialization of the Product.

                  6.4      TRADEMARKS.

                  (a)      PHARMION'S RESPONSIBILITY - During the Term, except
as set out below at subparagraph 6.4(b), Pharmion shall be responsible for, in
its sole discretion and at its sole expense, prosecution and maintenance of the
trademarks and trade names for the Product.

                  (b)      NOTICE TO PHARMACIA - Pharmion agrees that it will
give Trademark Notice to Pharmacia, notifying Pharmacia of Pharmion's top
choices (not to exceed five) for a trademark or trade name for the Product. If
Pharmacia has a preference for the choice of trademark or trade name for the
Product, Pharmacia shall provide written notification of this preference within
45 days of receipt of such Trademark Notice. Pharmion will reasonably consider
Pharmacia's input into the choice of each trademark or trade name for the
Product.

<PAGE>

Pharmion is not obligated to chose any trademark or trade name recommended by
Pharmacia, but agrees that it will not choose a trademark or trade name to which
Pharmacia has a reasonable objection.

Pharmion shall have no further obligation to consult with Pharmacia under this
paragraph 6.4 after the Option Expiry Date if Pharmacia does not exercise the
Participation Option.

                  6.5      NO OTHER CONSULTATION REQUIRED. Except as provided in
this Agreement, in the event Pharmacia does not exercise the Participation
Option, any additional consultation between Pharmion and Pharmacia with respect
to development of the Product will be from time to time on an as needed basis,
where and when appropriate and as the Parties may mutually agree and neither
Party will be obligated to discuss or consult with the other Party on Product
development matters.

         7.       PARTICIPATION OPTION

                  7.1      GRANT OF PARTICIPATION OPTION. Pharmion hereby grants
the Participation Option to Pharmacia, as specified in this Section 7. The
Participation Option may be exercised by Pharmacia as set out in paragraph 7.3.

                  7.2      DELIVERY OF NDA FILING NOTICE. Promptly after its
filing with the FDA of its first NDA for the Product, Pharmion shall deliver to
Pharmacia the NDA Filing Notice.

                  7.3      OPTION EXERCISE PERIOD. Pharmacia may exercise the
Participation Option at any time up to and including the Option Expiry Date
which shall be the date occurring 75 days after the date of receipt by Pharmacia
of (i) the NDA Filing Notice and (ii) all preclinical, clinical, regulatory,
manufacturing, financial, marketing, royalty and other data relating to the
Product, including photocopies of documentation pertaining to the development
and Commercialization of the Product in order to assist Pharmacia to make its
decision with respect to the Participation Option. Pharmacia may exercise the
Participation Option by giving the Participation Option Exercise Notice to
Pharmion.

                  (a)      INFORMATION SHARING - During the Critical Decision
Period, Pharmion shall promptly disclose and make available to Pharmacia such
information as Pharmacia may reasonably request. In addition, during the
Critical Decision Period, Pharmion will provide physical access (by telephone,
facsimile, email and through personal visits) for a reasonable number of
Pharmacia personnel to all materials and information pertaining to the Product
and, during any Pharmacia visit, Pharmion personnel will be available to respond
to inquiries with respect to the Product. All visits by Pharmacia shall be at
the expense of Pharmacia and shall be at mutually agreeable times, both Parties
acting reasonably. Notwithstanding the above provision for information sharing
and access, Pharmacia acknowledges and agrees that its requests for information
and access under this subparagraph 7.3(a) will be reasonable and will not unduly
interfere with Pharmion personnel's other day to day work obligations.
Notwithstanding the generality of the foregoing, the Parties acknowledge and
agree that Pharmacia has the right during the Critical Decision Period to audit
Pharmion's books, records and accounts and all or any part of Pharmion's
operations and activities as may be reasonably requested by Pharmacia for
Pharmacia to gather the information it requires during the Critical

<PAGE>

Decision Period. Pharmacia acknowledges that if it does not exercise the
Participation Option, Pharmion's obligation to share information and provide
access to Pharmacia under this subparagraph 7.3(a) will expire after the Option
Expiry Date. If Pharmacia exercises the Participation Option, Pharmion's
obligation to share information and provide access to Pharmacia under this
subparagraph 7.3(a) will continue throughout the six-month period for
negotiation of the Joint Development and Promotion Agreement as set forth in
paragraph 7.4.

                  7.4      NEGOTIATION PERIOD.

                  (a)      NEGOTIATION - If Pharmacia gives the Participation
Option Exercise Notice to Pharmion, Pharmion Corporation and Pharmacia shall
have six months from the date of receipt by Pharmion of the Participation Option
Exercise Notice to negotiate in good faith the Joint Development and Promotion
Agreement. Such agreement will contain provisions:

                           (i)      calling for Pharmacia promptly to reimburse
         Pharmion for fifty percent (50%) of Pharmion's fully allocated cost
         (determined in accordance with United States generally accepted
         accounting principles and further specified in the Joint Development
         and Promotion Agreement) for the development and Commercialization of
         the Product during the Term of this Agreement through the date of
         execution of the Joint Development and Promotion Agreement,

                           (ii)     providing for the equal sharing of all
         profits and losses derived from the distribution and sale of the
         Product and all costs and expenses of the continued development and
         Commercialization of the Product, in each case on a 50:50 basis between
         Pharmacia and Pharmion, and

                           (iii)    providing for such other terms and
         conditions as would typically be found in agreements between
         pharmaceutical companies for the joint development and co-promotion of
         a product.

Pharmion will continue to share Product data and other information (as set out
at subparagraph 7.3(a) above) with Pharmacia during such six-month negotiation
period.

                  (b)      FAILURE TO REACH AGREEMENT - If during such six-month
negotiation period of the Joint Development and Promotion Agreement, Pharmion
Corporation and Pharmacia fail to reach agreement on any term or condition of
the Joint Development and Promotion Agreement, the Parties shall submit the
dispute to the Chief Executive Officer of Pharmion Corporation and [the Senior
Vice President, Corporate Licensing] of Pharmacia who shall meet with respect to
such dispute and who shall thereafter negotiate in good faith with each other to
resolve such dispute.

         8.       CONFIDENTIALITY AND PUBLICATION

                  8.1      CONFIDENTIALITY; EXCLUSIONS. All data, information,
documents and other proprietary materials transmitted by a Party hereto to the
other Party in connection with this Agreement, including without limitation, all
Data, 5-azacytidine Technology, Product Technology, and all other scientific,
technical and clinical data, information reports, financial or business reports
and forecasts and information gathered, generated or transferred by a Party to

<PAGE>

the other Party during the course of this Agreement shall be deemed confidential
(hereinafter, "Confidential Information"). Each Party hereto shall hold in
confidence all Confidential Information received from the other Party and shall
not disclose any such Confidential Information to any third party pursuant
hereto; provided, however, that the confidentiality obligations of this Section
8 shall not extend to information which:

                  (a)      PUBLIC DOMAIN - Is now or later made known to the
public through no fault of the receiving Party of its obligations under this
Agreement;

                  (b)      RECEIVED FROM A THIRD PARTY - Is received by the
receiving Party from a third party not under an obligation of confidentiality to
the disclosing Party regarding such information;

                  (c)      INDEPENDENTLY DEVELOPED - Is independently developed
by the receiving Party or its Affiliates (as evidenced by written records)
without reliance on information provided by the disclosing Party; or

                  (d)      REQUIRED DISCLOSURE - Is required to be disclosed by
law, regulation, order, decree or subpoena or other legal process; provided,
that the receiving Party has used reasonable efforts to obtain a protective
order or other applicable protection against further disclosure of such
Confidential Information.

                  8.2      OBLIGATION OF CONFIDENTIALITY. Each Party shall use
the same degree of care (and in any event not less than reasonable care) to
safeguard the confidentiality of the other Party's Confidential Information that
it uses to protect its own Confidential Information.

                  8.3      PUBLICATION. Without limiting the confidentiality
provisions of this Section 8, neither Party shall publish, in written or oral
form, a Publication concerning or relating to the 5-azacytidine Technology,
without the express written consent of the other Party. Any proposed Publication
by a Party shall be provided by such Party to the other Party at least 60 days
prior to submission for publication. Such other Party shall review the proposed
Publication and shall inform the publishing Party within the 60 day period
whether or not it consents to the proposed Publication. In any event,
Publication shall only occur with the written consent of the other Party, which
consent shall not be unreasonably withheld. Contributions by either Party shall,
at such Party's request, be acknowledged in any Publication.

                  8.4      ANNOUNCEMENTS/PROMOTION. Pharmion and Pharmacia agree
that neither Party will make any press releases, announcements or create any
publicity regarding the existence or subject matter of this Agreement or release
any advertising, promotional or sales literature which mentions the name of the
other Party or discloses any terms or condition of, or subject matter of, this
Agreement without the prior written consent of the other Party (which consent
shall not be unreasonably withheld). It is acknowledged and agreed by the
Parties that at such time as shares of Pharmion stock become publicly traded
Pharmion may be required by applicable law, statute, rule or regulation to file
this Agreement with the U.S. Securities and Exchange Commission in connection
with its reporting obligations; provided that, unless otherwise agreed to in
writing by Pharmacia, Pharmion will seek confidential treatment for the
provisions of this Agreement.

<PAGE>

                  8.5      PERMITTED DISCLOSURES. Nothing in this Section 8 is
intended to prohibit a receiving Party from disclosing information to any
Governmental or Regulatory Authorities as required by applicable law, statute,
rule or regulation for securing applicable Approvals for the Product, or to
patent agents or attorneys and government patent offices as required by
applicable law, statute, rule or regulation for securing applicable patents in
connection with this Agreement.

                  8.6      RETURN OF INFORMATION. Upon expiration or termination
of this Agreement, the receiving Party will upon request from the disclosing
Party promptly return to the disclosing Party all Confidential Information of
the disclosing Party in the receiving Party's possession, as well as all written
information and materials that incorporate such Confidential Information;
provided, however, that the receiving Party may keep one (1) copy of such
Confidential Information, or as required by any applicable laws, statutes, rules
or regulations, subject to the confidentiality provisions contained herein.

         9.       PATENT PROSECUTION, MAINTENANCE AND ENFORCEMENT

                  9.1      PHARMACIA PATENTS - PROSECUTION AND MAINTENANCE.

                  (a)      PHARMACIA'S RESPONSIBILITY - During the Term, except
as set out below at subparagraph 9.1(b), Pharmacia shall be responsible for, in
its sole discretion and at its sole expense, prosecution and maintenance of any
and all Pharmacia Patents.

                  (b)      NOTICE TO PHARMION - Pharmacia shall notify Pharmion
in writing of its intentions with regard to ceasing prosecution or maintenance
of patent protection for any Pharmacia Patent not less than 45 days prior to any
such cessation to allow Pharmion to continue prosecuting or maintaining the
patent protection at its own discretion and expense, in which case Pharmacia at
Pharmion's expense, will execute such documents and otherwise cooperate with
Pharmion as may be necessary to perfect and maintain such patent protection.

                  9.2      PRODUCT PATENTS - PROSECUTION AND MAINTENANCE.

                  (a)      PHARMION'S RESPONSIBILITY - During the Term, except
as set out below at subparagraph 9.2(b), Pharmion shall be responsible for, in
its sole discretion and at its sole expense, prosecution and maintenance of the
Product Patents.

                  (b)      NOTICE TO PHARMACIA - Pharmion shall notify Pharmacia
in writing of its intentions with regard to ceasing prosecution or maintenance
of patent protection for any Product Patent not less than 45 days prior to such
cessation to allow Pharmacia to continue prosecuting or maintaining the patent
protection at its own discretion and expense, in which case, Pharmion at
Pharmacia's expense, will execute such documents and otherwise cooperate with
Pharmacia as may be necessary to perfect and maintain such patent protection.

                  9.3      PHARMACIA PATENTS - INFRINGEMENT.

                  (a)      NOTICE - Each of Pharmion and Pharmacia agrees that
during the Term it will promptly notify the other Party in the event that it
becomes aware of any infringement or potential infringement of any Pharmacia
Patents.

<PAGE>

                  (b)      PHARMACIA TO PROSECUTE - Pharmacia agrees that during
the Term it will, at Pharmacia's sole cost and expense, protect its interests in
the Pharmacia Patents from infringement by third parties and that it will
prosecute infringers of the Pharmacia Patents or otherwise act to eliminate
infringement of the Pharmacia Patents by third parties when, in the sole
judgment and discretion of Pharmacia, such action is necessary, proper and
justified. If Pharmacia fails to prosecute or otherwise act to eliminate such
infringement, Pharmacia shall give notice in writing to Pharmion of its election
not to bring a claim or suit or take action, within ten (10) days following such
election, and of the circumstance of such infringement or unauthorized use,
including such evidence of infringement as Pharmacia may possess and the numbers
of Pharmacia Patents so infringed. Pharmion may, but is not required to, (i)
obtain a discontinuance of the alleged infringing operation or unauthorized use
or, (ii) bring any claim, suit or action against such third party within six (6)
months of the date of receipt by Pharmion of the aforesaid notice. Any claim,
suit or action by Pharmion shall be either in the name of Pharmion, or in the
name of Pharmacia, or jointly by Pharmion and Pharmacia, as may be required by
the law of the forum.

                  9.4      PRODUCT PATENTS - INFRINGEMENT.

                  (a)      PHARMION TO PROSECUTE - Pharmion agrees that during
the Term it will, at Pharmion's sole cost and expense, protect its interests in
the Product Patents from infringement by third parties and that it will
prosecute infringers of the Product Patents or otherwise act to eliminate
infringement of the Product Patents when, in the sole judgment and discretion of
Pharmion, such action is necessary, proper and justified. If Pharmion fails to
prosecute or otherwise act to eliminate such infringement, Pharmion shall give
notice in writing to Pharmacia of its election not to bring a claim or suit or
take action, within ten (10) days following such election, and of the
circumstance of such infringement or unauthorized use, including such evidence
of infringement as Pharmion may possess and the numbers of Product Patents so
infringed. Pharmacia may, but is not required to, (i) obtain a discontinuance of
the alleged infringing operation or unauthorized use or, (ii) bring any claim,
suit or action against such third party within six (6) months of the date of
receipt by Pharmion of the aforesaid notice. Any claim, suit or action by
Pharmacia shall be either in the name of Pharmacia, or in the name of Pharmion,
or jointly by Pharmion and Pharmacia, as may be required by the law of the
forum.

                  (b)      NOTICE - Each of Pharmacia and Pharmion agrees that
during the Term it will promptly notify the other Party if it becomes aware of
any infringement or potential infringement of any Product Patents.

                  9.5.     COSTS AND EXPENSES. It is understood and agreed that
the Party to this Agreement that institutes any claim, suit or action in
accordance with paragraphs 9.1, 9.2, 9.3 or 9.4 shall bear solely all costs and
expenses associated therewith and shall be entitled to retain and keep any and
all sums received, obtained, collected or recovered whether by judgment,
settlement or otherwise, as a result of such claim, suit or action. In addition,
with respect to any such claim, suit or action, the Party that did not institute
such claim, suit or action shall render all reasonable assistance to the other
Party that did institute such claim, suit or action (at such other Party's cost
and expense) including, but not limited to, executing all documents as may be
reasonably requested by such other Party.

<PAGE>

                  9.6      THIRD PARTY PATENTS. Each Party hereto shall notify
the other Party promptly in the event of the receipt of notice of any action,
suit or claim alleging infringement by 5-azacytidine or the Product, or the
manufacture or use thereof, of any patent held by a third party and the Parties
shall meet to discuss how to respond to any such action, suit or claim. In the
event such alleged infringement involves 5-acytidine, or the manufacture or use
thereof, Pharmacia, upon request of Pharmion, shall retain counsel reasonably
satisfactory to Pharmion to represent Pharmion and shall pay the fees and
expenses of such counsel related to such proceeding. In any such proceeding,
Pharmion shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of Pharmion unless (i)
Pharmacia and Pharmion shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both Pharmacia and Pharmion and representation of
both Parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. All such fees and expenses shall be
reimbursed as they are incurred. Pharmacia shall not be liable for any
settlement of any proceeding effected without its written consent.

         In the event such alleged infringement involves the Product, or the
manufacture or use thereof, Pharmion, upon request of Pharmacia, shall retain
counsel reasonably satisfactory to Pharmacia to represent Pharmacia and shall
pay the fees and expenses of such counsel related to such proceeding. In any
such proceeding, Pharmacia shall have the right to retain its own counsel, but
the fees and expenses of such counsel shall be at the expense of Pharmacia
unless (i) Pharmion and Pharmacia shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both Pharmion and Pharmacia and representation of
both Parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. All such fees and expenses shall be
reimbursed as they are incurred. Pharmion shall not be liable for any settlement
of any proceeding effected without its written consent.

         Notwithstanding any other royalty payment provision of this Agreement,
in the event that any such action, suit or claim results in a determination by a
court of competent jurisdiction of infringement of the intellectual property
rights of a third party, and results in the payment of royalties or other
compensation by Pharmion to such third party, Pharmion may reduce its royalty
payments to Pharmacia after the date of determination of such infringement, the
reduction to be in the amount equal to one-half of the royalties or other
compensation paid to such third party, up to a maximum of one-half the royalties
payable to Pharmacia under Section 3 with respect to the Country(ies) of Sale
for which payments are being made to such third party.

         10.      TERM AND TERMINATION

                  10.1     TERM. The Term shall continue on a country-by-country
basis in each Country of Sale and shall commence on the Effective Date and end
on the later of:

                           (i)      the expiration date of the last Valid Claim
         in such Country of Sale; and

<PAGE>

                           (ii)     the date of expiry of the ten-year period
         commencing on the date of the First Commercial Sale (which shall be the
         date of invoice of the first such sale) in such Country of Sale;

unless earlier terminated pursuant to paragraph 10.2.

                  10.2     EARLY TERMINATION. This Agreement may be terminated
prior to expiry of the Term in any of the circumstances set out in this
paragraph 10.2:

                  (a)      EXERCISE OF THE PARTICIPATION OPTION - If Pharmacia
exercises the Participation Option, this Agreement shall terminate on the
effective date of the Joint Development and Promotion Agreement.

                  (b)      BANKRUPTCY, ETC. - If a Party becomes bankrupt or
insolvent, petitions any judicial body under any bankruptcy or insolvency laws,
or has any proceeding commenced against it for insolvency, bankruptcy or
liquidation and such proceeding is not dismissed within 60 days, the other Party
may terminate this Agreement by providing not less than ten days written notice
to such Party.

                  (c)      PHARMION TERMINATION - Pharmion will have the right
to arbitrarily terminate this Agreement for any or no reason by providing 120
days notice in writing to Pharmacia.

                  (d)      PHARMACIA TERMINATION - Except as provided in the
last sentence of paragraph 6.1 and in subparagraphs 10.2(a) and 10.2(b) above,
Pharmacia will have the right to terminate this Agreement only in the event of
material breach by Pharmion of any of its representations, warranties or
obligations under this Agreement (including, without limitation, nonpayment of
any royalties due to Pharmacia in accordance with Section 3 and which are not
then being disputed in good faith) by providing 45 days prior notice in writing
to Pharmion. Pharmion shall have the opportunity to cure such breach within the
45 day period to avoid termination of this Agreement. In the event that payment
of any royalty amount is being disputed in good faith, such dispute shall be
submitted to the Chief Executive Officer of Pharmion Corporation and the Senior
Vice President, Licensing of Pharmacia for resolution. If such Parties fail to
resolve such dispute within 60 days following such submission, such dispute
shall be submitted for arbitration pursuant to section 12.

                  10.3     EFFECT OF EARLY TERMINATION. In any of the situations
set out in paragraph 10.2, this Agreement shall end as of the effective date of
the termination and Pharmion shall have no further right to develop or
Commercialize the Product pursuant to this Agreement and all licensing rights
and interests and sublicensing rights and interests granted by Pharmacia to
Pharmion pursuant to paragraph 2.2 of this Agreement shall terminate.
Notwithstanding early termination of this Agreement and provided the Product
poses no safety issues, Pharmion shall be permitted for a period of six months
following the effective date of the termination to sell off its existing
inventory of Product subject to the payment of royalties as set forth in Section
3. Except as set forth in this paragraph 10.3, early termination of this
Agreement shall not affect any rights or obligations of either Party accrued
prior to the effective date of the termination, including, without limitation:

<PAGE>

                  (a)      PROPRIETARY PROPERTY - Rights to its proprietary
property (including without limitation, all its Confidential Information)
generated pursuant to this Agreement prior to the effective date of the
termination.

                  (b)      CONFIDENTIALITY AND PUBLICATION - The confidentiality
provisions of Section 8 which shall survive for a period of five years after the
effective date of the termination.

                  (c)      INDEMNIFICATION - The indemnity provisions of
paragraphs 11.5 through 11.11, inclusive.

                  10.4     DROPPED PRODUCT OPTION. Pharmion hereby grants to
Pharmacia the Dropped Product Option. Except as provided in paragraph 10.5, the
terms of the Dropped Product License shall be reasonably negotiated between the
Pharmion Corporation and Pharmacia at the time of exercise of the Dropped
Product Option, but may include, without limitation, access to proprietary
information with respect to the Product generated under this Agreement. The
Dropped Product Option may be exercised at any time during the period commencing
on the effective date of the termination of this Agreement pursuant to
subparagraph 10.2(b) and expiring 6 months after the effective date of the
termination. If the Dropped Product Option is not exercised within this 6 month
period, and the Parties do not reasonably agree in writing to extend such
period, the Dropped Product Option shall expire and the Parties shall have no
further rights or obligations under this paragraph 10.4. The period for
negotiation of the Dropped Product License shall be 6 months from the effective
date of the termination of this Agreement and during this negotiation period
both Parties will use commercially reasonable efforts to negotiate and complete
the Dropped Product License (the total period for exercise of the Dropped
Product Option and negotiation and completion of the Dropped Product License
shall be 6 months from the effective date of the termination of this Agreement
and the Parties may use this period for exercise of the Dropped Product Option
or such negotiation of the Dropped Product License, in Pharmacia's discretion).
If the Parties, acting reasonably, do not reach agreement on and execute the
Dropped Product License during such negotiation period and the Parties do not
reasonably agree in writing to extend the negotiation period, Pharmion shall use
commercially reasonable efforts to assign or sublicense its rights and
obligations under this Agreement to a third party, subject to Pharmacia's prior
written consent which shall not be unreasonably withheld. If Pharmion is unable
to assign or sublicense such rights and obligations within 90 days following the
end of such negotiation period, the Parties will have no further rights or
obligations under this paragraph 10.4 and the rights granted by Pharmacia to
Pharmion pursuant to paragraph 2.1 shall become non-exclusive rights to use the
5-azacytidine Technology in accordance with this Agreement.

                  10.5     DROPPED PRODUCT RIGHT. In the event of early
termination of this Agreement by Pharmacia pursuant to paragraph 10.2(c) or
paragraph 10.2(d), Pharmion shall automatically grant the Dropped Product
License, which shall be an exclusive, worldwide, royalty-free and fully paid-up,
irrevocable license (including the right to sub-license) to Pharmacia, at no
costs, fees or expenses to Pharmacia, to develop and Commercialize the Product
for all therapeutic and diagnostic applications, and including the use of all
trademarks and tradenames and all Confidential Information (including, without
limitation, all Product Technology) with respect to the Product generated under
this Agreement prior to the effective date of termination. No further
documentation will be required to make this Dropped Product

<PAGE>

License effective but both Parties agree to use reasonable efforts to execute
such relevant documents deemed necessary by Pharmacia to give effect to this
paragraph 10.5.

                  10.6     EXPIRY OF THE TERM. As set out in paragraph 3.10, at
the expiry of the periods for the payment of royalties on the sale of the
Product in each Country of Sale pursuant to Section 3, Pharmion shall have fully
paid-up rights and licenses in each such Country of Sale under this Agreement.
Expiration of this Agreement shall not affect these fully paid-up rights and
licenses and shall not affect the following provisions which will survive
expiration of this Agreement at expiry of the Term:

                  (a)      PROPRIETARY PROPERTY - A Party's rights to
proprietary property of such Party generated pursuant to this Agreement prior to
expiry of this Agreement.

                  (b)      CONFIDENTIALITY AND PUBLICATION - The confidentiality
and publication provisions of Section 8 shall survive expiry of this Agreement
for a period of five years.

                  (c)      INDEMNIFICATION - The indemnity provisions of
paragraphs 11.5 through 11.11, inclusive.

         11.      REPRESENTATIONS. WARRANTIES AND INDEMNIFICATION

                  11.1     PHARMACIA'S REPRESENTATIONS. Pharmacia represents and
warrants to Pharmion as follows:

                  (a)      INCORPORATION AND ORGANIZATION - Pharmacia is a
corporation duly incorporated and organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation.

                  (b)      CORPORATE POWER - Pharmacia has all requisite
corporate power and capacity to own its property and assets and to carry on its
business as now being conducted by it and as presently contemplated to be
conducted by it.

                  (c)      AUTHORITY - Pharmacia has due and sufficient right
and authority and has taken all action necessary to enter into this Agreement on
the terms and conditions set forth in this Agreement and to carry out the terms
of this Agreement.

                  (d)      VALID OBLIGATIONS - This Agreement constitutes a
valid obligation of Pharmacia, legally binding on it and enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium, reorganization or similar laws, from time to time in effect,
affecting creditor's rights generally.

                  (e)      OWNERSHIP OF 5-AZACYTIDINE TECHNOLOGY - Pharmacia
owns or has the right to use the 5-azacytidine Technology and has the right to
grant the license to the 5-azacytidine Technology as set out in paragraph 2.1 of
this Agreement.

                  (f)      NO CONFLICTING AGREEMENTS - It is not under any
obligation (contractual or otherwise) to any third party that conflicts with or
is inconsistent with the provisions of this

<PAGE>

Agreement or impedes its ability to grant the license rights of this Agreement
or to carry out its obligations under this Agreement.

                  (g)      NO INFRINGEMENT - As of the Effective Date, Pharmacia
has not been notified by a third party that the use of the 5-azacytidine
Technology to manufacture, use or sell 5-azacytidine infringes the proprietary
rights of such third party.

                  11.2     NO REPRESENTATION. Except as expressly set out at
subparagraph 11.1(g) above, Pharmacia makes no representation or warranty
whatsoever that the exercise of the rights and licenses granted to Pharmion
under this Agreement will not infringe any patents of third parties. In
addition, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, PHARMACIA MAKES NO
OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO 5-AZACYTIDINE, INCLUDING
THE MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, OR WITH RESPECT TO THE
ACCURACY OR COMPLETENESS OF THE 5-AZACYTIDINE TECHNOLOGY OR ANY OTHER DATA,
INFORMATION OR REGISTRATION MATERIAL TRANSFERRED TO PHARMION UNDER THIS
AGREEMENT AND/OR PREVIOUSLY SUBMITTED TO ANY REGULATORY AGENCY IN ANY COUNTRY.
ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION THE
IMPLIED WARRANTIES AND MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE OF
5-AZACYTIDINE, ARE DISCLAIMED BY PHARMACIA.

                  11.3     PHARMION'S REPRESENTATIONS. Each of Pharmion
Corporation and Pharmion GmbH represents and warrants to Pharmacia as follows:

                  (a)      INCORPORATION AND ORGANIZATION - It is a corporation
duly incorporated and organized, validly existing and in good standing under the
laws of the state of its incorporation or organization.

                  (b)      CORPORATE POWER - It has all requisite corporate
power and capacity to own its property and assets and to carry on its business
as now being conducted by it and as presently contemplated to be conducted by
it.

                  (c)      AUTHORITY - It has due and sufficient right and
authority and has taken all action necessary to enter into this Agreement on the
terms and conditions set forth in this Agreement and to carry out the terms of
this Agreement.

                  (d)      VALID OBLIGATIONS - This Agreement constitutes its
valid obligation, legally binding on it and enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, moratorium, reorganization
or similar laws, from time to time in effect, affecting creditor's rights
generally.

                  (e)      NO CONFLICTING AGREEMENTS - It is not under any
obligation (contractual or otherwise) to any third party that conflicts with or
is inconsistent with the provisions of this Agreement or impedes its ability to
carry out its obligations under this Agreement.

<PAGE>

                  11.4     LIMITATIONS ON LIABILITY. Pharmion acknowledges and
agrees that Pharmacia will not be liable to Pharmion, successors or assigns of
Pharmion, or to any third party with respect to:

                  (a)      USE OF THE TECHNOLOGY - Any claim arising from use of
the 5-azacytidine Technology by Pharmion or its sub-licensees;

                  (b)      PRODUCT - Any claim arising from the development or
Commercialization of 5-azacytidine or the Product by or on behalf of Pharmion or
its sub-licensees; or

                  (c)      OTHER DAMAGES - Any claim by Pharmion for loss of
profits, loss or interruption of business, or for indirect, incidental, special
or consequential damages of any kind.

Each Party will be liable for the performance of its obligations under this
Agreement and for the veracity of its representations and warranties contained
in this Agreement.

                  11.5     INDEMNIFICATION. Except as set out below, Pharmion
agrees to defend, protect, indemnify and hold harmless Pharmacia and its
Affiliates, and its officers, directors, employees and agents against any and
all Liabilities arising from any claim, suit or action arising out of or related
to the development or Commercialization of the Product by or on behalf of
Pharmion and/or arising out of or related to Pharmion's use of the 5-azacytidine
Technology in any manner. The indemnity set out in this paragraph 11.5 shall not
apply to any Liabilities:

                  (a)      GROSS NEGLIGENCE - To the extent arising out the
gross negligence or willful misconduct of Pharmacia; or

                  (b)      BREACH OF REPRESENTATIONS - To the extent arising out
of a material breach by Pharmacia of its representations and warranties
contained in this Agreement.

                  11.6     NOTICE OF CLAIM. Subject to paragraph 11.7, in the
event that Pharmacia asserts a claim for indemnification under paragraph 11.5,
Pharmacia shall give reasonably prompt written notice to Pharmion specifying the
facts constituting the basis for such claim and the amount, if known, of such
claim.

                  11.7     NOTICE OF THIRD PARTY CLAIMS. If Pharmacia asserts a
claim for indemnification under paragraph 11.5 because of a Third Party Claim,
Pharmacia shall give reasonably prompt written notice thereof to Pharmion, but
in no event more than seven (7) days after the Third Party Claim is actually
known to Pharmacia.

                  11.8     FAILURE TO GIVE NOTICE. Failure to give the notice
required by paragraphs 11.6 and/or 11.7 shall be deemed a waiver by Pharmacia of
its claim for indemnification under this Agreement but only to the extent that
such delay materially prejudices Pharmion's ability to defend any claim, suit or
action related to such claim for indemnification.

                  11.9     ACTIONS RE: THIRD PARTY CLAIM. Pharmion shall have
the right to investigate Third Party Claims and, upon written notice to
Pharmacia, and using counsel reasonably satisfactory to Pharmacia, to secure,
contest or settle the Third Party Claim; provided that Pharmacia may participate
voluntarily, at its own expense, in any Third Party Claim through

<PAGE>

representatives and counsel of its own choice; provided, further that Pharmacia
may choose its own counsel (at Pharmion's expense) if representation by counsel
retained by Pharmion would be inappropriate due to actual or potential differing
interests between Pharmion and Pharmacia. Except as expressly provided in
paragraph 11.10, Pharmacia shall not settle or compromise any Third Party Claim
for which it seeks indemnification under paragraph 11.5 without the prior
written consent of Pharmion (which consent will not be unreasonably withheld)
unless the litigation or other proceeding was instituted against Pharmacia and
Pharmion has not taken control of the defense of the Third Party Claim after
notification of such claim as set out above in paragraph 11.7.

                  11.10    OTHER INDEMNITY PROVISIONS. Except as otherwise
provided in these indemnity provisions, Pharmion shall bear all costs of any
Third Party Claim and shall indemnify and hold Pharmacia harmless against and
from all Liabilities of the Third Party Claim. Unless and until Pharmion elects
to defend or settle the Third Party Claim, Pharmacia shall have the full right,
at its option, to defend or settle the Third Party Claim and Pharmion shall
reimburse Pharmacia promptly for the amount of the costs, fees and expenses, if
any, of defending the Third Party Claim. The failure of Pharmion to respond in
writing to Pharmacia's notice with respect to a Third Party Claim within 20 days
after receipt of the notice shall be deemed an election not to defend the Third
Party Claim. If Pharmion does not assume the defense of any Third Party Claim,
including any litigation or other proceeding resulting from the Third Party
Claim or if representation by counsel retained by Pharmion would be
inappropriate due to actual or potential differing interests between Pharmion
and Pharmacia:

                  (a)      PHARMACIA MAY DEFEND - Pharmacia may defend against
the Third Party Claim in such manner as it may deem appropriate, including, but
not limited to, settling the Third Party Claim, after giving notice of the same
to Pharmion, on such terms as Pharmacia may deem appropriate; and

                  (b)      PHARMION MAY PARTICIPATE - Pharmion shall be entitled
to participate in (but not to control) the defense of the Third Party Claim,
with its own counsel at its own expense. If Pharmion thereafter seeks to
question the manner in which Pharmacia defended the Third Party Claim or the
amount or nature of any settlement, Pharmion shall have the burden to prove by a
preponderance of the evidence that Pharmacia did not defend or settle the Third
Party Claim in a reasonably prudent manner.

                  11.11    INFORMATION SHARING FOR THE INDEMNITY. The Parties to
this Agreement shall make available to each other all relevant information in
their possession relating to any Third Party Claim and shall cooperate in the
defense of all Third Party Claims.

         12.      DISPUTE RESOLUTION

                  12.1     ARBITRATION. Any dispute arising out of or relating
to this Agreement, or any alleged breach of this Agreement, shall be settled by
binding arbitration in accordance with the Rules, except as modified by this
Section 12. Each arbitration shall be conducted by three arbitrators, consisting
of one arbitrator chosen by each Party and the third arbitrator chosen by the
first two. In the event that the first two arbitrators are not able to agree
upon and chose a third arbitrator, the third arbitrator shall be appointed in
accordance with the Rules. The

<PAGE>

arbitration proceeding shall be conducted in the English language in New York,
New York, unless the Parties agree in writing to conduct the arbitration in
another location. The costs of arbitration, including administrative and
arbitrators' fees, shall be shared equally by the Parties. Each Party shall bear
its own costs and attorneys' and witness' fees.

                  12.2     ARBITRATION DECISION. The arbitration decision shall
be binding and not appealable to any court in any jurisdiction. The prevailing
Party may enter the arbitration decision in any court specified in paragraph
13.7.

                  12.3.    PROVISIONAL REMEDIES. Each Party has the right before
or during arbitration to seek and obtain from the appropriate court provisional
remedies including, without limitation, attachment, preliminary injunction and
replevin, to avoid irreparable harm, maintain the status quo or preserve the
subject matter of arbitration. Notwithstanding the foregoing, each Party waives
its right to trial of any issue by jury.

         13.      MISCELLANEOUS

                  13.1     CURRENCY. The Parties agree that, unless otherwise
indicated, all dollar amounts referred to in this Agreement are in United States
currency.

                  13.2     FURTHER ASSURANCES. The Parties agree to execute such
further documents and do such further acts as may be necessary to implement and
carry out the intent of this Agreement.

                  13.3     INUREMENT. The Parties agree that in all situations,
including, without limitation, in the case of a takeover or merger of either
Party, this Agreement shall inure to the benefit of and be binding upon each of
them, their successors and permitted assigns and all of their employees and
agents.

                  13.4     ASSIGNMENT. Except as set out below and in paragraph
10.4, the Parties agree that this Agreement and the rights, duties and
obligations of the Parties under this Agreement shall not be assigned by either
of them without the prior written consent of the other Party, and any attempt to
assign the rights, duties or obligations without this consent will be of no
effect; provided, however, that Pharmion GmbH may assign its rights, duties and
obligations to Pharmion Corporation after written notice to Pharmacia. This
provision shall not operate to restrict Pharmion's ability to grant sub-licenses
pursuant to the provisions of paragraph 2.3. As well, either Pharmion
Corporation or Pharmacia may, without the prior written consent of the other
Parties, assign this Agreement as a whole to:

                  (a)      SURVIVING CORPORATION - A surviving corporation in
the event of a merger or consolidation between such Party and the surviving
corporation;

                  (b)      ASSETS - An entity that purchases all or
substantially all of the assets of such Party and assumes all of the obligations
of such Party under this Agreement; or

                  (c)      AFFILIATES - Any entity that is an Affiliate of such
Party as of the Effective Date;

<PAGE>

provided, further,that in the event of subparagraph (c) above, such Party shall
continue to remain liable for the performance of all its obligation under this
Agreement unless otherwise agreed by the Parties in writing.

                  13.5     NOTICE. The Parties agree that any notice required to
be given under this Agreement shall be in writing and shall be delivered
personally or by overnight courier to the addresses set forth on page 1 of this
Agreement or by facsimile transmission (receipt confirmed), in each case to the
attention of the following persons:

                  (a)      IF TO PHARMION - Attn.: Patrick Mahaffy, President
and Chief Executive Officer, Fax No. (720) 564-9191;

                  (b)      IF TO PHARMACIA - Attn.: Senior Vice President,
global Licensing, Fax No.: (908) 901-1813, with a copy to Attn: General Counsel,
Fax No.: (908) 901-1810;

or to such other addresses and persons as may from time to time be notified in
writing by the Parties in accordance with this paragraph 13.5. Any notice
delivered personally or by overnight courier shall be deemed to have been given
and received at the time of delivery. Any notice delivered by facsimile
transmission shall be deemed to have been given and received on the next
Business Day following the date of transmission.

                  13.6     SEVERANCE. The Parties agree that if a provision of
this Agreement is wholly or partially invalid, this Agreement shall be
interpreted as if the invalid provision had not been a part hereof.

                  13.7     GOVERNING LAW; JURISDICTION. The Parties agree that
this Agreement shall be governed by and construed in accordance with the laws of
the State of New York. Subject to Section 12, each Party agrees and hereby
submits to the exclusive jurisdiction of the courts located in the State of New
York or in the United States District Court for the Southern District of New
York with respect to any dispute arising under or in connection with this
Agreement, and each Party hereby waives any objection it may now have or
hereafter have to such jurisdiction or the laying of venue in such courts.

                  13.8     RECITALS/SCHEDULES. The Parties agree that the
recitals and the schedules to this Agreement and all other instruments
supplementary to this Agreement are incorporated into this Agreement and form an
integral part of this Agreement.

                  13.9     ENTIRE AGREEMENT. The Parties agree that the
provisions contained in this Agreement constitute the entire agreement between
the Parties with respect to the subject matter and supersede all previous
communications, representations and agreements (whether verbal or written)
between the Parties with respect to the subject matter hereof.

                  13.10    PRODUCT RECALLS. After the Effective Date and unless
otherwise provided in the Joint Development and Promotion Agreement, in the
event, (i) any Governmental or Regulatory Authorities in any Country of Sale
issues a request, directive or order for the recall, withdrawal or field
correction of the Product, (ii) a court of competent jurisdiction in any Country
of Sale orders such recall, withdrawal or field correction, or (iii) Pharmion
shall reasonably determine that there should be such a recall, withdrawal or
field correction in any

<PAGE>

Country of Sale (in which case, Pharmion shall notify the appropriate
Governmental or Regulatory Authorities), then Pharmion shall (x) provide
Pharmacia with written notice within five (5) Business Days of such request,
order or determination, (y) initiate all appropriate investigations, and (z)
take all appropriate corrective actions surrounding any such recall, withdrawal
or field correction. Pharmion shall be solely responsible for all costs and
expenses related to or arising from any recall, withdrawal or field correction
of the Product that occurs after the Effective Date.

                  13.11    MEDICAL/SCIENTIFIC PRODUCT INQUIRIES. After the
Effective Date and unless otherwise provided in the Joint Development and
Promotion Agreement, (i) Pharmion shall be solely responsible for responding to
all medical questions and inquiries relating to the Product in each Country of
Sale and (ii) in conjunction with the marketing and sale of the Product in a
Country of Sale, Pharmion shall be solely responsible for providing (A) medical,
technical and scientific information concerning the Product to healthcare
professionals, managed care organizations, sales representatives, medical
publishers, consumers, patient assistance programs and others that may request
such information, and (B) after-hours coverage to address emergency requests for
medical, technical and such scientific information concerning the Product.

                  13.12    ADVERSE MEDICAL EVENTS AND COMPLAINTS. After the
Effective Date and unless otherwise provided in the Joint Development and
Promotion Agreement, Pharmion shall have the sole authority and responsibility
for the handling of any adverse drug experience involving the Product in each
Country of Sale, and shall be solely responsible for complying with all
applicable Governmental or Regulatory Authorities reporting requirements,
including without limitation, Adverse Drug Reaction Reports, in each Country of
Sale regarding adverse drug events.

                  13.13    INDEPENDENT PARTIES. This Agreement shall not be
deemed to create any partnership, joint venture or agency relationship between
the Parties. Each Party shall act hereunder as an independent contractor.

                  13.14    WAIVER. Any term or condition of this Agreement may
be waived at any time by the Party that is entitled to the benefit thereof, but
no such waiver shall be effective unless set forth in a written instrument duly
executed by or on behalf of the Party or Parties waiving such term or condition.
No waiver by any Party of any term or condition of this Agreement, in any one or
more instances, shall be deemed to be or construed as a waiver of the same or
any other term or condition of this Agreement on any future occasion. All
remedies, either under this Agreement or by law or otherwise afforded, will be
cumulative and not alternative.

                  13.15    FORCE MAJEURE. A Party shall not lose any rights
hereunder or be liable to any other Party for damages or losses on account of
failure to perform by the defaulting Party if the failure is caused by any acts
of God, acts of government, war, fire, explosion, flood, earthquake, embargo,
labor dispute or any other similar force majeure events beyond the reasonable
control of such Party; provided, however, that the Party claiming any such force
majeure event has exerted all reasonable efforts to avoid such force majeure
event and has given prompt notice to the other Party of such force majeure
event. The Party giving such notice shall

<PAGE>

be excused from its obligations hereunder as it is disabled from performing for
so long as it is disabled; provided, that such Party shall commence and continue
to take reasonable and diligent actions to cure and remedy such force majeure
event; provided, further that if such Party is unable to cure and remedy such
force majeure event within one (1) year of such notice, this Agreement shall
terminate in accordance with paragraph 10.3. In the event of any such force
majeure event, the Parties shall meet promptly to determine an equitable
solution to the effects of such force majeure event. The Term shall not be
extended by any force majeure event.

                  13.16    INSURANCE. Pharmion Corporation and Pharmion GmbH
shall, as of the Effective Date , obtain and keep in force throughout the Term
of this Agreement and for a period of five (5) years from the date of expiration
or termination of this Agreement, policies of insurance from carriers reasonably
acceptable to Pharmacia providing coverage as specified in Schedule D. The
obligation to maintain insurance after the expiration or termination of this
Agreement shall only apply with respect to insurance policies that are on a
"claims-made" basis. Pharmion shall submit a certificate of such insurance
(which shall include, without limitation, such information as set forth in
Schedule D) to Pharmacia not later than thirty (30) days after the Effective
Date of this Agreement.

                  13.17    CAPTIONS. The Parties agree that the captions
appearing in this Agreement have been inserted for reference and as a matter of
convenience only and in no way define, limit or enlarge the scope or meaning of
this Agreement or any provision.

                  13.18    AMENDMENTS. Any amendment, modification or supplement
to this Agreement shall only be effective if such amendment, modification or
supplement is in writing and is signed by Pharmion and by Pharmacia.

                  13.19    COUNTERPARTS. This Agreement may be executed in
facsimile counterparts, each of which shall be deemed to be an original and both
of which together shall constitute one and the same Agreement.

<PAGE>

         IN WITNESS WHEREOF the Parties have executed this Agreement as of the
day and year first written above.

PHARMION CORPORATION                          PHARMACIA & UPJOHN COMPANY

By: /s/ Patrick J. Mahaffy                  By: /s/ Gabriel G. Leung
    -------------------------------             ---------------------------
    Name: Patrick J. Mahaffy                    Name: G. Leung
    Title: President and CEO                    Title: Group VP, Oncology

PHARMION GMBH

By: /s/ Patrick J. Mahaffy
    --------------------------------
    Name: Patrick J. Mahaffy
    Title: President

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