Document:

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                                                                    Exhibit 10.3

                        EXCLUSIVE DISTRIBUTION AGREEMENT

      This Exclusive Distribution Agreement ("AGREEMENT") is made as of 12:01
A.M., April 1, 2004 (the "EFFECTIVE DATE"), between Adams Laboratories, a Texas
corporation, having its principal place of business at 14801 Sovereign Road,
Fort Worth, TX 76145 ("CLIENT"), and Cardinal Health PTS, LLC, a Delaware
limited liability company, by and through its Specialty Pharmaceutical Services
group with offices at 15 Ingram Boulevard, Suite 100, LaVergne, TN 37086
("CARDINAL HEALTH").

      A. Client is, among other things, in the business of developing and
marketing pharmaceutical products in the United States, the District of Columbia
and Puerto Rico (the "TERRITORY").

      B. Cardinal Health is, among other things, in the business of distributing
pharmaceutical products to wholesalers, specialty distributors, physicians,
clinics, hospitals, pharmacies, and other health care providers in the
Territory, and of providing Information Systems and other services that support
its customers' use of its distribution capabilities.

      C. Client desires to engage Cardinal Health as its exclusive distribution
agent for commercial sales of products referred to in Exhibit A in all
formulations (collectively, the "PRODUCT"), and such other pharmaceutical
products agreed to by the parties in the Territory and to perform certain other
services described in this Agreement, all upon the terms and conditions set
forth in this Agreement. However, during the first six (6) months following the
Effective Date of this Agreement, Client shall have the right to transfer the
return goods processing to another party.

      THEREFORE, in consideration of the mutual conditions and covenants set
forth herein, Cardinal Health and Client (collectively referred to as "PARTY" or
"PARTIES") agree as follows:

      1. APPOINTMENT/AUTHORIZATION.

      1.1 Upon the terms and conditions set forth in this Agreement, Client
appoints Cardinal Health as its exclusive distribution agent of Product in the
Territory to Client's customers, including, but not limited to, wholesalers,
specialty distributors, physicians, clinics, hospitals, pharmacies and other
health care providers in the Territory (collectively, "CUSTOMERS").

      1.2 Subject to the terms and conditions set forth in this Agreement,
Cardinal Health accepts the appointment to represent Client as its authorized
exclusive distribution agent of Product to Customers in the Territory.

      1.3 Right of First Refusal.

            (a) Client shall provide Cardinal Health with a right of first
negotiation and refusal with respect to the distribution of new pharmaceutical
products acquired or promoted by Client in the Territory after the Effective
Date. Client shall grant Cardinal Health an exclusive right of negotiation with
respect to the distribution of such new product for a period of thirty (30) days
after Client's notice to Cardinal Health that such new product will be available
for distribution. If the parties have not reached an agreement with respect to
the distribution of the new product within thirty (30) days from the date of
Client's notice, and entered into a definitive agreement within thirty (30) days
thereafter, or if Cardinal Health notifies Client in writing at any point during
such negotiation period that it is not
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interested or unable to distribute such new product(s), then Client shall have
no further obligation with respect to that new product under this Section 1.3.

            (b) Notwithstanding the foregoing, if the Parties negotiate in good
faith but are unable to reach an agreement with respect to terms regarding the
distribution of the new product, then after the expiration of the period
identified above, and provided that Client enters into negotiations with a third
party to provide such services, Client shall present to Cardinal Health a
definitive letter of intent or bona fide offer from another source to provide
such services, and a copy of such terms, assumptions and conditions (a
"COMPETING OFFER") and Cardinal Health shall be provided the opportunity, for a
period of not less than twenty (20) days after receipt of such notice and
documentation of such Competing Offer, to meet the Competing Offer on
substantially similar terms. If Cardinal Health substantially meets the
Competing Offer, then Client shall enter into a definitive agreement upon such
terms and conditions. If Cardinal Health does not substantially meet the
Competing Offer, then Client may obtain such services from the third party in
accordance with the terms of the Competing Offer.

      2. SERVICES.

      2.1 Cardinal Health shall provide the services set forth in the
preliminary Operating Guidelines, which include, without limitation, storage,
distribution, returns, customer support, financial support, EDI and system
access support ("SERVICES"). A copy of the Operating Guidelines is attached
hereto as EXHIBIT B and incorporated by reference. It being understood that the
Parties will agree upon mutually acceptable final Operating Guidelines and any
adjustments to Fees related to changes in the Operating Guidelines within thirty
(30) days after the effective date of this Agreement and such final Operating
Guidelines shall be inserted as Exhibit B in lieu of the current Exhibit B.

      2.2 The Operating Guidelines may be amended from time to time upon the
mutual written agreement of the Parties; provided, however, that any change,
modification or amendment to the Operating Guidelines may result in an increase
in the fees charged by Cardinal Health in Section 5.

      2.3 Cardinal Health's services shall comply with the Operating Guidelines,
provided Client's shipments of Product to Cardinal Health do not exceed its
Forecast (as hereinafter defined) by more than twenty-five percent (25%).

      2.4 All Product Returns shall be processed and handled by Cardinal Health
in accordance with the Operating Guidelines; and, any customization or
additional return services requested by Client shall be performed at an
additional fee as agreed by the Parties.

      2.5 Client is solely responsible for all Product recalls. In the event
Product is subject to recall, or Client, on its own initiative, recalls any
Product, Cardinal Health shall provide assistance to Client as set forth in the
Operating Guidelines, provided that Client shall pay to Cardinal Health an
amount equal to Cardinal Health's reasonable actual costs incurred with any such
recall services. Such cost shall be in addition to the Service Fees described in
Section 5 below.

      3. PRODUCT SUPPLY/CLIENT RESPONSIBILITIES.

      3.1 Client shall deliver Product for the first twelve months of this
Agreement, exclusively to Cardinal Health's facility at 800 Industrial Blvd.,
Suite 100, Grapevine, TX 76051 ("Grapevine Facility"). After the first twelve
months of this Agreement, Client may upon a minimum of thirty (30) days notice
to Cardinal Health deliver mutually agreeable quantities of Product to Cardinal
Health's

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facility at 15 Ingram Blvd., Suite 100, LaVergne, TN 37086 ("LaVergne
Facility"). Whichever or both of the Grapevine Facility and/or LaVergne Facility
are receiving Product shall be the "Facility" under this Agreement.

      3.2 Client shall be responsible for delivery of Product to the Facility,
including all costs, expenses and risk of loss associated with such delivery.
Title to Product shall remain with Client at all times, even when Product is
stored or warehoused at the Facility. Client shall at all times insure the
Product for damage, loss, destruction, theft or any such other property damage
("LOSS") as further set forth in Section 15 below. Except for Loss resulting
solely from the gross negligence or willful misconduct of Cardinal Health,
Client shall bear all risk of loss or damage with respect to the Product stored
or warehoused at the Facility.*

      3.3 Client shall provide Cardinal Health with a forecast of the volume of
Product to be handled by Cardinal Health under this Agreement, not less often
than semi-annually ("FORECAST"). Upon execution of this Agreement, Client shall
deliver to Cardinal Health a customer list, which sets forth the Product prices
(the "CUSTOMER PRICE LIST"). Client shall notify Cardinal Health of any change
in the Customer Price List not less than forty-eight (48) hours prior to the
effective date of any such change. Cardinal Health shall use commercially
reasonably efforts to implement such price change in accordance with Client's
instruction. Notwithstanding the foregoing, Client shall provide the initial
Forecast no later than thirty (30) days after the Effective Date of this
Agreement.

      3.4 Cardinal Health shall visually inspect each shipment of Product for
external damage or loss in transit and notify Client of any such damage or loss
within a commercially reasonable period of time following discovery.

      4. INFORMATION SYSTEM ACCESS.

      4.1 During the term of this Agreement and subject to the terms herein,
Client may use password(s) and identification number(s) provided by Cardinal
Health to remotely access Client's data maintained on Cardinal Health's web
enabled Operating System Base and certain support services associated therewith,
as further set forth in the Operating Guidelines (collectively, the "SYSTEM")
provided that such access is used solely by Client's employees and for Client's
own internal business purposes. Client shall use that access solely to access
Client's data and shall not access or attempt to access any other data, systems
or software. Client shall be responsible for all use of the passwords and
identification elements and shall ensure that they are used solely to effect the
limited access authorized herein. The limited license to access the System
granted herein does not include the right to copy, download or otherwise use any
software or non-Client data maintained on the System.

      4.2 The System shall be made available to Client at the fees set forth in
the Fee Schedule. If Cardinal Health agrees to perform any custom enhancements
to the System requested by Client, such customization services shall be billed
separately based on an hourly rate set forth in the Fee Schedule (as defined in
Section 5) and prior to such performance Cardinal Health shall notify Client of
any related increase in the periodic fees hereunder relative to the ongoing
support of the customizations.

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* Omitted information is the subject of a request for confidential treatment
  pursuant to Rule 406 under the Securities Act of 1933 and has been filed
  separately with the Securities and Exchange Commission.
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      4.3 During the term of this Agreement, Cardinal Health shall employ
reasonable security measures and policies designed to safeguard the integrity,
accessibility, and confidentiality of Client's data resident on the System and
establish and maintain reasonable disaster and emergency recovery plans designed
to minimize disruption from System operation interruptions.

      4.4 Client shall not reverse engineer, reverse assemble, decompile, create
derivative works, modify, or otherwise attempt to derive the source code of any
software on the System or copy, download, modify, or create derivative works of
such software. Also, Client shall not permit access to the System or related
documentation to any other person or entity. The System and all parts thereof,
in all of their tangible and intangible manifestations, all existing or new
enhancements, developments, derivative works, and other modifications to the
System (or any part thereof), and all related proprietary rights, are and shall
remain the exclusive property of Cardinal Health.

      4.5 THE SYSTEM, THE SOFTWARE THEREON AND ANY RESULTS OBTAINED THEREFROM
ARE PROVIDED ON AN "AS IS" BASIS, WITHOUT WARRANTY OF ANY KIND, WHETHER EXPRESS,
IMPLIED, STATUTORY OR OTHERWISE. CARDINAL HEALTH MAKES NO REPRESENTATIONS OR
WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES,
EXPRESS OR IMPLIED, RELATING DIRECTLY OR INDIRECTLY TO THE SYSTEM OR ANY PART
THEREOF INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY,
NONINFRINGEMENT AND FITNESS FOR A PARTICULAR PURPOSE.

      4.6 Cardinal Health shall use reasonable efforts to make the System
available for access twenty-four (24) hours a day, seven (7) days a week absent
scheduled and emergency maintenance periods.

      4.7 Notwithstanding anything to the contrary, in the event of Client's
breach of any of Cardinal Health's security policies or of the confidentiality
provisions in this Agreement, Cardinal Health may revoke or suspend any or all
passwords and identification numbers provided to Client hereunder.

      5. FEES.

      5.1 As compensation for the Services, Client shall pay to Cardinal Health
the fees (the "FEES") set forth on EXHIBIT C (the "FEE SCHEDULE").

      5.2 Cardinal Health shall issue an invoice to Client for the Services
rendered under this Agreement or for any other amounts due on a monthly basis.
Payment is due within twenty (20) days of the invoice date. If the Invoice is
not paid within such twenty (20) day period, a service charge on the unpaid
amount calculated at the rate of 1.5% per month (or the maximum rate permitted
by law if such rate is less than 1.5% per month) shall be imposed until such
amount is paid in full.

     5.3 The Fees shall be held firm for the first contract year. Thereafter,
Cardinal Health shall adjust the price not more often than once per contract
year by the * of (i) the increase in the Producer Price Index - All Commodities
published by the United States Department of Labor, Bureau of Statistics, as
amended from time to time ("Index") or * percent (*%) if the Index increase is
less than * percent (*%), or (ii) * percent (*%). For purposes of sub-Section
(i), the base point shall be the index level on the first day of the contract
year.

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* Omitted information is the subject of a request for confidential treatment
  pursuant to Rule 406 under the Securities Act of 1933 and has been filed
  separately with the Securities and Exchange Commission.
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      5.4 Notwithstanding the terms set forth above in Section 5.3, if Cardinal
Health can reasonably demonstrate that the costs for providing the Services have
materially increased, or are likely to materially increase in the coming year
due to the adoption of any applicable law or regulation (or any material change
in the interpretation or administration thereof), or due to unforeseen
circumstances beyond Cardinal Health's reasonable control, then upon notice from
Cardinal Health, the Parties agree to meet in good faith and negotiate a
mutually acceptable adjustment to the Fees.

      6. TERM AND TERMINATION.

      6.1 The initial term of this Agreement shall begin on the Effective Date
and shall continue for a period of three (3) years (the "INITIAL TERM"), unless
terminated earlier pursuant to this Agreement. Thereafter, this Agreement shall
automatically renew for additional terms of one (1) year each, unless written
notice of termination is given by either Party at least ninety (90) days prior
to the end of the Initial Term, or such other term, in which case this Agreement
shall terminate at the end of the then current term.

      6.2 This Agreement may be terminated:

            (a) by either Party upon one hundred eighty (180) days prior written
notice to the other Party, provided that in the event Client terminates this
Agreement, without cause, prior to the end of the Initial Term, such termination
shall be effective only upon payment to Cardinal Health of * percent (*%) of
remaining fixed Fees set forth on the Fee Schedule for the remainder of the
Initial Term, it being understood that there be no additional damages for such
termination, and provided that if Cardinal Health terminates this Agreement,
without cause, prior to the end of the Initial Term, such termination shall only
be effective upon payment to Client of an amount which is equal to * Dollars
($*) multiplied by a fraction *, it being understood that there be no additional
damages for such termination. For example, if Cardinal Health terminated
effective *.

            (b) by either party upon the breach by the other Party of a material
provision of this Agreement and that Party's failure to cure such breach within
thirty (30) days following written notice thereof from the non-breaching Party,
provided that, with respect to any failure to make any payment when due under
this Agreement, such period to cure shall be reduced to fifteen (15) days; or

            (c) by either party immediately upon notice to the other Party
following the commencement of any bankruptcy or insolvency proceeding (whether
voluntary or involuntary) with respect to such other Party or its assets, which
in the event of an involuntary proceeding, is not dismissed within sixty (60)
days, the general assignment for the benefit of creditors by such other Party,
or the appointment of a receiver, trustee or liquidator by or for such other
Party.

      6.3 Termination or expiration of this Agreement shall not relieve either
Party from any liability or obligation that accrued prior to such termination or
expiration. Upon termination or expiration of this Agreement, all Product shall
be returned to Client or a designee of Client, at Client's sole cost and expense
unless the termination is a result of a breach by Cardinal Health in which case
Cardinal Health will pay the Product return expenses. Sections 13 and 14 shall
survive termination or expiration of this Agreement.

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* Omitted information is the subject of a request for confidential treatment
  pursuant to Rule 406 under the Securities Act of 1933 and has been filed
  separately with the Securities and Exchange Commission.
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      7. AUDITS. No more than twice per calendar year, Client or its designee
shall have the right during normal business hours (i.e., 8:00 a.m. to 5:00 p.m.
local time), upon fifteen (15) business days prior written notice to Cardinal
Health, to: (a) conduct a physical audit of such parts of the Facility that
relate solely to Product stored and warehoused at the Facility under this
Agreement; and (b) review and audit records that relate solely to the storage
and distribution of the Product. Without limiting the foregoing, records review
may include, at Client's option, a review of Product receiving, storage,
picking, packing, shipping and related quality records and/or Client's Customer
records including Customer orders and Customer accounts receivable. Cardinal
Health and Client agree to participate in quarterly business reviews.

      8. COMPLIANCE WITH LAWS. Each Party shall conduct its activities in
connection with this Agreement in compliance with all applicable laws, rules,
regulations, and orders of governmental entities.

      9. REPRESENTATIONS AND WARRANTIES.

      9.1 Each Party represents and warrants to the other that:

            (a) it has full power and authority to enter into this Agreement and
perform all obligations and conditions to be performed by it under this
Agreement without any restriction by any other agreement or otherwise;

            (b) the execution, delivery and performance of this Agreement have
been duly authorized by all necessary corporate action of that Party; and

            (c) this Agreement constitutes the legal, valid and binding
obligation of that Party.

      9.2 Client further represents and warrants to Cardinal Health that the
Product:

            (a) is and shall be manufactured in conformity with the Food, Drug
and Cosmetic Act, as amended from time to time, and all other applicable laws,
rules, regulations and orders of governmental entities relating to the
manufacture, promotion, sale or distribution of the Product;

            (b) does not violate or infringe any patent, trademark, tradename or
other interest of any person or entity.

      10. TAXES. Client shall pay when due all sales, use, gross receipts,
excise, personal property taxes associated with the Product (excluding any
personal property tax associated with Cardinal Health's equipment used in
connection with the Services), and other taxes now or hereafter imposed as a
result of the transactions contemplated by this Agreement, none of which have
been included in the fees payable to Cardinal Health under this Agreement;
provided that the amounts payable by Client under this section shall not include
taxes based on the net income of Cardinal Health.

      11. TRADEMARKS. Neither Party shall have the right to use the name of the
other Party or any Affiliate of the other Party, or the other Party's or such
Affiliates' trademarks, service marks, logos, or other similar marks in any
manner except with the prior written approval of that Party; provided that the
foregoing shall not prohibit Cardinal Health's use of Client' names or marks in
connection with the performance of the Services in a manner consistent with this
Agreement. In the event Cardinal Health

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uses Client's trademarks or tradenames, Cardinal Health shall identify such as
the property of Client. Moreover, Cardinal Health may not use any third party
trademarks or tradenames with the Products without prior written approval of
Client. "AFFILIATE," as used in this Agreement, means any legal entity which,
during the Term hereof, controls, is controlled by, or is under common control
with, such Party. For purposes of this definition, an entity shall be deemed to
control another entity if it owns or controls, directly or indirectly, at least
fifty percent (50%) of the voting interest of all equity interests of the other
entity (or other such comparable ownership interest for an entity other than a
corporation).

      12. CONFIDENTIALITY.

      12.1 Each Party acknowledges that as a result of this Agreement it may
learn and have access to trade secrets and other confidential and proprietary
information of the other Party through employees, representatives and/or agents
acting on behalf of or subcontracted to either Party (collectively the
"REPRESENTATIVES"), including without limitation, financial information,
information regarding business practices and techniques, and systems and
technology information, or any information identified as confidential in writing
by either Party (the "CONFIDENTIAL INFORMATION"). Client acknowledges and agrees
that all information and materials related to the System shall constitute
Confidential Information. For purposes of this Agreement, Confidential
Information shall not include information disclosed by one Party to the other
Party to the extent that such information can be proven by written evidence: (a)
to be in the public domain or generally available in the industry in which the
disclosing Party engages in business without any violation of this Agreement by
the other Party; (b) is already legally known to the other Party or any of its
Affiliates at the time of its disclosure by the disclosing Party; (c) becomes
known to the other Party or any of its Affiliates from a third party without any
obligation of confidentiality or limitation on use; or (d) is independently
developed by the other Party or any of its Affiliates prior to the date of its
disclosure. The specific material terms of this Agreement shall be deemed to be
the Confidential Information of each Party. Confidential Information shall not
be deemed to be in the public domain or publicly known or in the receiving
Party's possession because it is embraced by more general information in the
receiving Party's possession or because it is embraced in general terms in
publications.

      12.2 Neither Party shall, directly or indirectly, at any time: (a)
disclose to any third person or entity any Confidential Information of the other
Party (whether learned before or after the date of this Agreement), or (b) use,
or permit or assist any third person or entity to use, any such Confidential
Information, excepting only: (i) disclosures required by law, rule, regulation
or order, as reasonably determined by the disclosing Party or its legal counsel,
and (ii) disclosures on a confidential basis to directors, officers, employees,
and agents of that Party or its Affiliates who have a reasonable need to know
such Confidential Information in the normal course of business of that Party or
any of that Party's Affiliates.

      12.3 The obligations of confidentiality hereunder shall survive the
termination of this Agreement for a period of three (3) years. Upon termination
of this Agreement (for any reason) each Party shall promptly: (i) return to the
other Party all documentation and other materials (including copies of original
documentation or other materials) containing any Confidential Information of the
other Party; or (ii) with the other Party's consent, which consent will not be
unreasonably withheld, certify to the other Party, pursuant to a certificate in
form and substance reasonably satisfactory to the other Party, as to the
destruction of all such documentation and other materials.

      13. INDEMNIFICATION. Each Party shall indemnify and hold harmless the
other Party and its parent and Affiliates, and each of their directors,
officers, employees, agents, and representatives from and against all claims,
liabilities, losses, damages, costs, and expenses, including, without
limitation,

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reasonable attorneys' fees ("LIABILITY") to a third party or property arising
directly or indirectly out of any failure of that Party to perform fully all
obligations and conditions to be performed by that Party pursuant to this
Agreement or any breach of any warranty made by that Party in this Agreement.
Client further agrees to indemnify and hold harmless Cardinal Health, its parent
and Affiliates and each of their directors, officers, employees, agents and
representatives from any and all Liability arising directly or indirectly out of
or relating to (i) injury or death to person or property alleged to have been
caused by Client's Product, (ii) any violation or infringement of any patent,
trademark, tradename or other interest of any person or entity relating to
Client's Product, and (iii) the manufacture, marketing, testing, shipping, sale,
possession or use of Product, provided said Liability is not solely attributable
to Cardinal Health's negligence or intentional misconduct.

      14. LIMITATION OF LIABILITY. NOTWITHSTANDING THE FOREGOING PROVISIONS OF
SECTION 13, OR ANY OTHER PROVISION OF THIS AGREEMENT TO THE CONTRARY, NEITHER
PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL (SPECIFICALLY
EXCEPTING THOSE CONSEQUENTIAL DAMAGES ARISING FROM EACH PARTY'S OBLIGATION TO
INDEMNIFY THE OTHER FOR LIABILITY ARISING OUT OF OR RELATING TO THIRD PARTY
CLAIMS IN ACCORDANCE WITH SECTION 13 ABOVE), INCIDENTAL, INDIRECT, SPECIAL, OR
OTHER SIMILAR DAMAGES ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT.
FURTHER, IN NO EVENT SHALL CARDINAL HEALTH'S TOTAL LIABILITY UNDER THIS
AGREEMENT, INCLUDING, WITHOUT LIMITATION ANY OF CARDINAL HEALTH'S INDEMNITY OR
OTHER FINANCIAL OBLIGATIONS UNDER SECTION 13 OR ANY OTHER PROVISION OF THIS
AGREEMENT, EXCEED THE TOTAL FEES PAID BY CLIENT TO CARDINAL HEALTH FOR THE
SERVICES WHICH WERE INVOLVED IN CAUSING ANY CLAIMS, DAMAGES, LOSSES, COSTS OR
EXPENSES.

      15. INSURANCE. Client shall, at its own cost and expense, obtain and
maintain in full force and effect the following insurance during the term of
this Agreement.

            (a) Products and Completed Operations Liability Insurance covering
the Product included in this Agreement with per-occurrence limits of not less
than $5,000,000; and

            (b) All-Risk Property Insurance, including transit coverage, in an
amount determined by Client in its sole discretion covering Client's property
while it is at the Cardinal Health facility or in transit to or from the
Cardinal Health facility. Client's all-risk property insurance shall apply to
all losses and be primary (with respect both to any insurance issued to Cardinal
Health and to any deductible amount or self-insured amount retained by Cardinal
Health) except for losses resulting solely from the gross negligence or
intentional misconduct of Cardinal Health.

In the event that any of the required policies of insurance are written on a
claims made basis, then such policies shall be maintained during the entire term
of this Agreement and for a period of not less than five (5) years following the
termination or expiration of this Agreement.

Client shall obtain a waiver from any insurance carrier with whom Client carries
Property Insurance releasing its subrogation rights against Cardinal Health
except for losses resulting solely from the gross negligence or intentional
misconduct of Cardinal Health. Client shall not seek reimbursement for any
property claim, or portion thereof, that is not fully recovered from insurance
except for losses resulting solely from the gross negligence or intentional
misconduct of Cardinal Health.

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Cardinal Health, LLC, and its Affiliates shall be named as additional insureds
under the Products and Completed Operations Liability insurance policies as
respects the products and completed operations outlined in this Agreement. Such
insurance shall be primary (with respect both to any insurance issued to
Cardinal Health and to any self-insured amount retained by Cardinal Health) for
the additional insureds' liability for damage arising out of those products and
completed operations for which they have been added as additional insureds.
Client shall furnish certificates of insurance for all of the above noted
policies and required additional insured status to Cardinal Health as soon as
practicable after the Effective Date of the Agreement and upon renewal of any
such policies. Each insurance policy that is required under this Section shall
be obtained from an insurance carrier with an A.M. Best rating of at least
A-VII.

      16. DISPUTE RESOLUTION. The Parties agree to use good faith efforts to
resolve all disputes within sixty (60) days of written notice that such a
dispute exists. If dispute under this Agreement cannot be resolved by the
Parties within such sixty (60) day period, the Parties agree to refer the matter
to one executive from each Party not directly involved in the dispute for review
and resolution. A copy of the terms of this Agreement, agreed upon facts and
areas of disagreement, and a concise summary of the basis for each side's
contentions will be provided to both executives who shall review the same,
confer, and attempt to reach a mutual resolution of the issue within forty-five
(45) days after receipt of the materials referenced above. If the matter has not
been resolved within such forty-five (45) day period, either or both Parties may
pursue resolution of the matter through litigation or other process available
under law or equity.

      17. MISCELLANEOUS.

      17.1 Notices. Any notice or other communication required or desired to be
given to any Party under this Agreement shall be in writing and shall be deemed
given: (a) three business days after such notice is deposited in the United
States mail, first-class postage prepaid, and addressed to that Party at the
address for such Party set forth at the end of this Agreement; (b) one business
day after delivered to Federal Express, Airborne, or any other similar express
delivery service for delivery to that Party at that address on the next morning;
or (c) when sent by facsimile transmission, with electronic confirmation, to
that Party at its facsimile number set forth at the end of this Agreement. Any
notice delivered by facsimile transmission will be deemed delivered upon
electronic confirmation provided the notice is also deposited in the U.S. mail,
first-class postage prepaid. Any Party may change its address or facsimile
number for notices under this Agreement by giving the other Party notice of such
change.

      17.2 Governing Law. This Agreement shall be construed under the laws of
the State of Texas, without regard to its conflicts of laws provisions.

      17.3 Severability. If any term of this Agreement is declared invalid or
unenforceable by a court or other body of competent jurisdiction, the remaining
terms of this Agreement will continue in full force and effect.

      17.4 Non-Waiver. No failure by either Party to insist upon strict
compliance with any term of this Agreement, to enforce any right, or to seek any
remedy upon any default of the other Party shall affect, or constitute a waiver
of, the first Party's right to insist upon strict compliance, to exercise that
option, to enforce that right, or to seek that remedy with respect to that
default or any prior, contemporaneous, or subsequent default. No custom or
practice of the Parties at variance with any provision of this Agreement shall
affect, or constitute a waiver of, that Party's right to demand strict
compliance with all provisions of this Agreement.

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      17.5 Force Majeure. If the performance of any part of this Agreement by
either Party shall be prevented, restricted, interfered with or affected for any
length of time by fire or other casualty, government restrictions, war, riots,
strikes or labor disputes, lockout, transportation delays, acts of God, or any
other causes which are beyond the reasonable control of such Party, such Party
shall not be responsible for delay or failure of performance of this Agreement
for such length of time, provided, however, that the obligation of one Party to
pay amounts due to the other Party shall not be subject to the provisions of
this Section.

      17.6 Complete Agreement. This Agreement constitutes the entire
understanding between the Parties and supersedes any contracts, agreements or
understanding (oral or written) of the Parties with respect to the subject
matter hereof. No term of this Agreement may be amended except upon written
agreement of both Parties, unless provided otherwise in this Agreement.

      17.7 Assignment. Except as set forth herein, neither Party shall have the
right to assign this Agreement, or any of such Party's rights or obligations
under this Agreement, without the prior written consent of the other Party,
provided, however, that either party may assign its rights under this Agreement
to any parent, subsidiary or affiliate without obtaining such consent. This
Agreement shall be binding upon, inure to the benefit of, and be enforceable by
and against the respective successors and assigns of the Parties.

      17.8 Independent Contractor. The relationship of the Parties is that of
independent contractors, and neither Party shall incur any debts or make any
commitments for the other Party except to the extent expressly provided in this
Agreement. Nothing in this Agreement is intended to create or shall be construed
as creating between the Parties the relationship of joint venturers,
co-partners, employer/employee or principal and agent.

      17.9 Publicity. Neither Party will make any press release or other public
disclosure regarding this Agreement or the transactions contemplated hereby
without the other Party's express prior written consent, except as required
under applicable law or by any governmental agency, in which case the Party
required to make the press release or public disclosure shall use commercially
reasonable efforts to obtain the approval of the other Party as to the form,
nature and extent of the press release or public disclosure prior to issuing the
press release or making the public disclosure.

      IN WITNESS WHEREOF, the undersigned acknowledge and accept the terms of
this Agreement and have duly executed this Agreement.

CARDINAL HEALTH PTS, LLC                    CLIENT

By /s/ Tim L. Martin                        By /s/ David Becker
   -------------------------                   -------------------------
     Tim L. Martin                          David P. Becker
     Vice President and General Manager     Chief Financial Officer
     Specialty Pharmaceutical Services      Colonial Court
     15 Ingram Boulevard, Suite 100         409 Main Street
     LaVergne, TN 37086                     Chester, NJ 07930

     Facsimile No.  (615) 793-4783          Facsimile No. (908) 879-9784

                                       10
<PAGE>
                                    EXHIBITS

                  Exhibit A        Product Listing

                  Exhibit B        Operating Guidelines

                  Exhibit C        Fee Schedule

<PAGE>
                                                                       EXHIBIT A

                               PRODUCT DESCRIPTION

                  Mucinex
                  Mucinex D
                  Mucinex DM
                  Aquatab D
                  Aquatab DM
                  Aquatab C
                  ALLERx 10 Day Dose Pack
                  ALLERx D
                  ALLERx Suspension (liquid)
                  Aquatab DM Syrup (liquid)

All SKUs and strengths

                                      - 1 -
<PAGE>
                                                                       EXHIBIT B
                              OPERATING GUIDELINES

                                    EXHIBIT A

                  ADAMS LABORATORIES/CARDINAL HEALTH PTS, INC.

                       SPECIALTY PHARMACEUTICALS SERVICES

The Operating Guidelines shall be incorporated into the Distribution Services
Agreement between Client ("Client"), and Cardinal Health PTS, Inc. ("Cardinal
Health"), dated April 1, 2004 (the "Agreement"). Capitalized terms not otherwise
defined in this Operating Guidelines shall have the same meaning as set forth in
the Agreement.

In performing its obligations under the Agreement, Cardinal Health will follow
these Operating Guidelines. The Operating Guidelines are in addition to the SOPs
that have been approved by Client for use by Cardinal Health in the performance
of Services.

1.0   WAREHOUSING

l.1   Cardinal Health will maintain its warehouse facility in accordance and
      comply with all federal, state and local laws, rules and regulations,
      including current Good Manufacturing Practices ("cGMP") as promulgated
      under the FDA.

1.2   Cardinal Health will maintain SOPs appropriate for a pharmaceutical
      distribution center operating environment. All SOPs will be appropriately
      approved and controlled under the Cardinal Health cGMP quality system.

1.3   Cardinal Health will maintain cGMP compliant documented training programs.
      These training programs will include training on all SOPs, the Operating
      Guidelines and the Quality Requirements Agreement. Client will have the
      authorization to audit the training records.

1.4   Cardinal Health will comply with all storage, handling and shipping
      conditions designated by Client for the Product.

1.5   The Product will be stored by Cardinal Health at 20 TO 25 DEGREES CELSIUS
      FOR MUCINEX PRODUCTS AND 15 TO 30 DEGREES CELSIUS FOR NON-MUCINEX
      PRODUCTS. Client shall ensure that the storage requirements are identified
      on the package label. Client shall ensure that the storage requirements,
      lot number and expiry date will be in human readable format and the
      Product NDC number will be in an acceptable barcode format on the unit
      carton. Product will be stored in areas designed to be continuously
      monitored and will be periodically validated for the temperature range
      specified for the Product. Cardinal Health will maintain daily temperature
      recordings. Cardinal Health will provide such records to Client upon
      written request.

1.6   Cardinal Health will report temperature excursions to Client promptly and
      in no event more than 48 hours from the point of discovery of the
      excursion.

1.7   Product will be stored in an area with secured access, accessible only to
      authorized Cardinal Health personnel.

2.0   RECEIVING

2.1   Client or Client's contract manufacturing agent will arrange
      transportation services to transfer the Product to Cardinal Health. Client
      will notify Cardinal Health of the specific delivery schedule.

2.2   Each shipping carton of Client's Product will be labeled with a barcode
      representing the Product's NDC number, lot number, and expiration date.
      This information will also be in human readable format. Each individual
      shipping container (unit carton) will have a barcode representing the
      Product's NDC number and will have the Product lot number and expiration
      date in human readable format.

2.3   Client's carrier will contact Cardinal Health to arrange a delivery
      appointment.

2.4   Client shall retain title and ownership to the Product at all times.
      Cardinal Health signature on the carrier's bill of lading is an
      acknowledgement only of Cardinal Health's receipt of Product.

                                      - 1 -
<PAGE>
2.5   Client will provide Cardinal Health with a Material Safety Data Sheet for
      the Product.

2.6   Client's Product will meet the following standards for carton
      identification, documentation, palletization, and uniformity:

      2.6.1 Client will provide the bill of lading, certificate of analysis and
            other documentation necessary. Cardinal Health will follow its SOP
            for receiving Product.

      2.6.2 Pallets will meet GMA standards for 40" x 48" x 46" dimensions with
            four-way entry; will be free of broken boards, treated for pests,
            and clean.

      2.6.3 Receipt of Product on non-standard pallets may require restacking
            onto conforming pallets at Client's expense.

      2.6.4 Palletized Product must be uniform and consistent with
            specifications set up in the Product master for the number of
            cartons and caches.

2.7   Cardinal Health will receive each shipment into a secure receiving area
      and perform all requirements as detailed in Cardinal Health's receiving
      SOP.

2.8   Cardinal Health will count and inspect the exterior packaging of the
      Product, noting any shortages, overages or damage on the carrier bill of
      lading. Cardinal Health will obtain the carrier's signature on the bill of
      lading acknowledging the condition of the Product upon receipt by Cardinal
      Health.

2.9   Cardinal Health will compare the Client documentation to Cardinal Health's
      receiving report. Discrepancies will be noted. Cardinal Health Quality
      Assurance will investigate and report all discrepancies to Client within
      24 hours of receipt. Client and Cardinal Health will determine corrective
      actions, if any.

2.10  Cardinal Health will fax receiving checklist and downloaded temp tale data
      to Client Quality Assurance for official lot release. Product will be held
      in quarantine until released in writing by Client Quality Assurance.

2.11  Product in unapproved or quarantine status will be physically segregated
      and flagged in Cardinal Health's warehouse management system to prevent
      unapproved Product from entering approved picking areas of the warehouse.

2.12  Client Quality Assurance will fax written documentation to Cardinal Health
      to release the lot from quarantine Product status to approved Product
      status.

2.13  Cardinal Health will post receipts in the warehouse management system
      within four business hours of delivery unless count discrepancies, missing
      paperwork, damage investigation, and other receiving anomalies interfere
      with efficient receiving and documentation. Cardinal Health will report
      this attribute periodically according to Section 21 of the Operating
      Guidelines.

2.14  Cardinal Health will move Product from the receiving area to bulk storage
      following Cardinal Health SOPs.

3.0   INVENTORY

3.1   Inventory will be received, tracked and controlled on Cardinal Health's
      warehouse management system by item number, lot number, expiration date,
      quantity, and status. Cardinal Health's warehouse management system will
      meet all cGMP requirements for lot traceability and accountability, from
      receipt of Product at Cardinal Health to shipment of Product to Client's
      Customer.

3.2   Quarantined Product will be physically segregated and appropriately
      labeled. Quarantined Product will be released from quarantine status in
      Cardinal Health's warehouse management system upon written authorization
      by Client's Quality Assurance.

3.3   Cardinal Health will assign a unique location for the Product and lot in
      storage.

3.4   Cardinal will perform a daily cycle count on forward pick locations that
      have had activity during the given day. Cardinal Health will use its
      commercially reasonable efforts to maintain accurate

                                     - 2 -
<PAGE>
      and timely inventory records. Cardinal Health will report on cycle count
      accuracy periodically according to Section 21 of the Operating Guidelines.

3.5   Inventory variances will be investigated by Cardinal Health and reported
      promptly to Client and in no event later than 48 hours. Corrective actions
      will be determined jointly by Cardinal Health and Client.

3.6   Client may conduct a complete physical inventory once per calendar year,
      upon at least ten (10) business days advance written notice prior to the
      start of a physical inventory, or more frequent if inventory variances
      exceed the standard of 99.5% accuracy, as set forth in Section 21 of the
      Operating Guidelines.

3.7   Cardinal Health will notify Client of all expired or short dated Product
      as specified by Client to be 12 months prior to expiry date.

3.8   Cardinal Health will receive returned Product according to Cardinal Health
      SOP and Client's Returned Goods Policy. Client's Quality Assurance will
      determine appropriate disposition of the returned Product. Client's
      Quality Assurance must be notified prior to disposition of the Product. If
      the disposition is to destroy the Product, Cardinal Health will
      subcontract the destruction by means of landfill, if possible, or other
      means as specified by Client, through a third party supplier. Cardinal
      Health will provide Client with the Certificate of Destruction.

4.0   DISTRIBUTION

4.1   Orders approved and available for processing (pick & pack) by 2:00 p.m.
      Central Standard Time Monday through Thursday, and on Fridays if approved
      by Client, will be shipped before the close of business the same day
      ("Standard Hours"). Orders received and processed after 2:00 p.m. Central
      Standard Time will be shipped the following business day. For order
      received after Standard Hours, Cardinal Health will fax a notification to
      the Customer alerting them that the Product will ship on the following
      business day. If the day the Product is to be received by the Customer
      falls on a holiday or weekend, then the order will be shipped on the next
      business day which will ensure the Product will not be delivered to
      Customer on a holiday or weekend.

4.2   Orders placed within Standard Hours will be shipped to Customer to arrive
      within 3 to 5 business days.

4.3   Order arrival times to SPS must allow for an even distribution of work
      within normal start times of 8:00 p.m. CST>.

4.4   Orders that have Drop Ship requirements within Standard Hours will be
      shipped via standard overnight delivery service and Customer will be
      charged a $35 shipping fee along with a $50 handling fee.

4.5   Orders placed outside Standard Hours and in which the Customer has
      requested delivery for the next day will be defined as emergency orders
      and will be shipped via priority overnight delivery. Customer will be
      charged a $35 shipping fee along with a $50 handling fee. Emergency Drop
      Ship orders will incur only one set of shipping and handling fees.

4.6   Orders placed during Standard Hours in which the Customer requests
      priority service (upgrade of shipping service) will be accommodated and
      Client will cover the cost of the increased freight charge. This will be
      accommodated on an exception basis only and not implemented as standard
      ongoing service for a particular Customer. An upgrade to priority services
      will not be considered an emergency order.

4.7   Client will be responsible for monitoring customer ordering practices.

4.8   Recognizing that order volume may fluctuate from time to time, Cardinal
      Health will staff to meet the greater of 125% of the rolling average
      number of Client orders processed over the previous two (2) calendar
      months or the Forecast as defined in the Exclusive Distribution Agreement.
      Cardinal Health will use commercially reasonable efforts to meet the
      shipping schedule outlined herein when order or unit volume exceeds 125%
      of the rolling average number of orders or units; provided, however, that
      Cardinal Health cannot guarantee daily on-time shipping standards will be
      achieved during such increased activity periods.

                                     - 3 -
<PAGE>
4.9   Cardinal Health will measure the timeliness of shipments and will report
      this attribute periodically according to Section 21 of the Operating
      Guidelines.

4.10  Cardinal Health personnel will be available for emergency Product
      shipments, via phone request, 24 hours per day, 365 days per year. For
      shipments called in after the carrier's cutoff time (approximately 8:00
      p.m. for overnight airfreight), Cardinal Health will ship the Product the
      following day.

4.11  Cardinal Health's inventory system will comply with First to-Expire,
      First-Out (FEFO) inventory allocation. Any exceptions from FEFO must be
      approved by Client in writing prior to shipment.

4.12  For the period beginning on the effective date of the Agreement through
      September 30, 2004, Client anticipates that certain Client customers will
      require Mucinex products be shipped in cases containing "inner packs".
      Client plans to differentiate the Mucinex product that contains such inner
      packs by populating the item field with the NDC number. Cardinal agrees to
      use commercially reasonable efforts to ship inner packs to those Client
      customers designated by Client. From and after October 1, 2004, all
      cartons should contain inner packs.

4.13  Cardinal Health will perform quality verification on all Client shipments
      by an individual other than the employee who picked the order. Cardinal
      Health will use commercially reasonable efforts to pick, check and ship
      accurately all Customer orders. Cardinal Health will measure picking and
      shipping accuracy and will report this attribute periodically according to
      Section 21 of the Operating Guidelines.

4.14  Cardinal Health and Client will mutually determine and agree in writing on
      the packaging requirements for shipping the Product. Cardinal Health's
      Quality Assurance will assist Client and Cardinal Health will issue
      appropriate guidelines and cGMP training to the distribution department to
      assure compliance with Client's specifications. These specific Client
      specifications will be controlled in the Cardinal Health cGMP quality
      system.

4.15  Cardinal Health will provide shipment confirmation information to Client
      through Cardinal Health's information System on the same business day on
      which the shipment occurs.

4.16  Cardinal Health will manage shipping supplies - including vendor
      selection, ordering, inventory record keeping, and storage. Cardinal
      Health will invoice Client for all shipping materials; corrugated cartons,
      insulated coolers (if specified), address labels, inner packing; as may be
      required by Client's packing specifications.

6.0   TRANSPORTATION

6.1   Cardinal Health and Client will mutually agree upon a common carrier(s)
      based on shipment size, destination, freight rates, availability of
      standard and special services, reliability of delivery, and claim history
      among other requirements.

6.2   Cardinal Health shall provide, if Client agrees, carriers under contract
      with Cardinal for discounted rates.

6.3   Shipping charges, including all special charges for insurance, proof of
      delivery, hazardous materials, service upgrades, and so forth, will be
      billed directly to Cardinal Health's account with the carrier and passed
      through to Client and will include a handling fee.

6.4   Freight terms will be F.O.B. origin.

6.5   Cardinal Health, at the request of the Client, will provide proof of
      delivery for specific Customer shipments. Fees charged by carriers for
      proofs of delivery, if any, will be passed directly to Client.

7.0   CUSTOMER SERVICE

7.1   Cardinal Health will provide a dedicated inbound phone line (or lines) for
      Client's Customers to phone in purchase orders, for inquiries, and for
      general information.

7.2   Cardinal Health will staff the inbound phone line from 7:00 a.m. - 6:00
      p.m. Central Standard Time, Monday through Friday, except for the
      following holidays: Christmas Day, New Year's

                                     - 4 -
<PAGE>
      Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and the
      day after Thanksgiving.

7.3   Cardinal Health will be responsible for training Cardinal Health's
      customer service representative(s) and backup representative(s). Client
      will provide company and Product specific information for training of the
      customer service representatives assigned to Client.

7.4   Cardinal Health will be responsible for initial set up and on-going
      maintenance of Customer master files. The initial Customer master file
      will be approved and signed by Client. Client may add Customers by
      completing the Customer profile form and forwarding to Cardinal Health for
      system entry.

7.5   Cardinal Health will accept Customer orders by electronic data interchange
      (EDI), mail or fax, Cardinal Health will maintain records of all Customer
      orders. All Customer orders must be in writing or by EDI. Cardinal Health
      will not accept telephone orders without a mail or fax confirmation.

7.6   Cardinal Health will use commercially reasonable efforts to answer inbound
      phone calls within the first thirty (30) seconds, and will report this
      attribute periodically according to Section 21 of the Operating
      Guidelines.

7.7   As a backup to the customer service representatives, a voice mail system
      will be maintained to collect messages from Customers.

7.8   Cardinal Health's customer service representatives will re-route, via warm
      transfer, all misdirected calls to the appropriate vendors designated by
      Client. In the event that a call cannot be re-routed to a particular
      vendor (e.g., due to a system outage), the customer service representative
      should warm transfer the call to the Client's operator at (800) 974-3477.

8.0   ORDER ENTRY

8.1   Client's minimum order quantity will be 1 case and any additional
      quantities can only be ordered in multiples of cases.

8.2   Client will instruct its Customers to place orders based on the contract
      between Client and Customer.

8.3   Cardinal Health will follow the Client's Customer price list.

8.4   Client will determine when Customers shall pay for premium freight,
      special handling, and emergency order processing.

8.5   Client reserves the right to limit quantities, to hold or to refuse
      orders. These decisions will be executed by Cardinal Health. It is the
      responsibility of the Client to monitor Customer ordering practices.
      Cardinal Health will train customer service reps that Client discourages
      distributors from routinely ordering more frequently than weekly.

8.6   Cardinal Health will use commercially reasonable efforts to enter orders
      accurately. Cardinal Health measures the accuracy of orders entered and
      will report this attribute periodically according to Section 21 of the
      Operating Guidelines.

9.0   CUSTOMER CREDIT

9.1   Client will establish credit limits for each Customer or groups of
      Customers.

9.2   Cardinal Health's System will monitor orders and outstanding accounts
      receivable against the Customer's credit limit and hold orders where
      credit limits are exceeded.

9.3   Client may elect to place a Customer's account on credit hold so that all
      orders are reviewed prior to shipment.

9.4   Client will review and approve all Customer orders held for credit limits
      prior to shipment.

10.0  PRICING AND TERMS

10.1  Client will publish terms and conditions of sale to wholesalers and
      warehouse chains. Standard terms are 2% -30 days, net 31 days. Contracted
      Customers may have non-standard terms.

                                     - 5 -
<PAGE>
10.2  Client will publish list prices for wholesalers and warehouse chains,
      which are subject to change from time to time at the sole discretion of
      Client.

10.3  Client will determine contract prices on a contract-by-contract basis.
      Client will notify Cardinal Health of such price changes with 24 hour
      notice for update of the Cardinal Health system files. Client will develop
      and forward Customer notifications to Cardinal Health and Cardinal Health
      will provide printing and mailing services on behalf of Client.

10.4  Cardinal Health will perform system maintenance of pricing and terms.
      Client will provide to Cardinal Health in writing any changes to prices or
      terms. Cardinal Health will be responsible for updating the Cardinal
      Health system within 24 hours of receipt of such notice or as Client may
      otherwise instruct.

10.5  Cardinal Health employees are bound by the confidentiality provisions of
      the Agreement between Cardinal Health and Client and, as such, shall not
      disclose Client sales data or pricing information outside the specific
      Cardinal Health employees who have a need to know of this information in
      the course of performing their routine job responsibilities.

10.6  Cardinal Health will provide the necessary reports within stipulated time
      frames to ensure Client can comply with the reporting requirements of
      Medicaid (OBRA), Veterans HealthCare Act, PHS Covered Entities, and state
      rebate programs. Client will define reporting requirements against which
      Cardinal Health will produce the required reports.

11.0  INVOICING

11.1  Cardinal Health will use commercially reasonable efforts to mail invoices
      the morning following shipment of Product, or transmit by electronic data
      interchange (EDI), where installed, the same day of shipment of Product,
      to Customer's billing address.

11.2  For any order shipped after the close of business, the invoice will be
      prepared and mailed the following business day.

11.3  Cardinal Health will make commercially reasonable effort to process
      invoices as timely and accurately as possible. Cardinal Health measures
      invoice accuracy and processing timeliness and will report this attribute
      periodically according to the conditions set forth in Section 21 of the
      Operating Guidelines.

12.0  CHARGEBACKS

12.1  Client may enter into prime vendor arrangements for select contract or
      government mandated pricing arrangements.

12.2  Cardinal Health, on behalf of Client, will process chargebacks daily with
      reconciliation of chargeback discrepancies within 5 working days. Cardinal
      Health's chargeback SOPs will define the parameters available to Cardinal
      Health to resolve discrepancies between Client's contract terms and
      conditions and the chargeback submitted by the wholesaler.

12.3  All chargebacks will be processed according to the chargeback policy for
      Client.

12.4  All validated chargeback submissions will be settled via credit invoice.
      Client will not make advance payments or authorize advance deductions of
      chargebacks.

12.5  Prime vendors will be instructed to report all returns from Client's
      contract Customers as a reverse chargeback.

12.6  Cardinal Health will make commercially reasonable effort to process
      chargebacks as timely and accurately as possible.

13.0  ACCOUNTS RECEIVABLE

13.1  Client will open and maintain a bank lockbox. The bank will receive
      Customer remittances invoice information on behalf of Client. Customers
      may remit payment via EFT.

13.2  Client's bank will forward information about lockbox deposits along with
      the Customer's remittance information to Cardinal Health.

                                     - 6 -
<PAGE>
13.3  Cardinal Health will reconcile and apply the cash receipt to the
      outstanding account receivable within 24 hours of receipt from the bank.

13.4  Cardinal Health will disallow discounts for payments received beyond the
      payment terms, as indicated by the receipt date. Cardinal Health will
      handle the amount of the discount as a balance due on the Accounts
      Receivable account.

13.5  Cardinal Health's standard for past due payment collection activity:

      13.5.1 Contact Customer 20 days (regardless of terms) from invoice date,
            to ensure that Customer has received invoice and invoice is setup
            for on time payment. If Customer has not received invoice, Cardinal
            Health will re-send the invoice within 24 hours.

      13.5.2 Initiate collection call when invoice becomes 8 days past due.

      13.5.3 Initiate second collection call at 16 days past due.

      13.5.4 Initiate third collection call at 30 days past due. If customer
            does not take payment action after this third call, Client will
            instruct Cardinal Health to either (i) write off the balance in
            question (ii) forward the account to an outside agency, as
            designated by Client, for collection, or (iii) carry the balance
            forward for later disposition.

13.6  Cardinal Health will maintain notes related to collection activities in an
      Accounts Receivable system file that will be accessible to Client's
      authorized personnel.

13.7  Cardinal Health will use commercially reasonable efforts effort to process
      accounts receivable as timely and accurately as possible. Cardinal Health
      will measure accounts receivable and collections activity and report these
      attributes periodically according to Section 21 of the Operating
      Guidelines.

14.0  GOVERNMENT REPORTING

14.1  Cardinal Health personnel will provide the following Government reports to
      Client within 5-8 business days following the close of a business quarter.
      Cardinal Health will measure and report this attribute periodically
      according to Section 21 to the Operating Guidelines.

14.1.1 IFF Direct Sales Report

14.1.2 IFF Indirect Sales Report

14.1.3 AMP Report

14.1.4 Non FAMP Report

14.1.5 Best Price Report

14.1.6 Most Favored Price Report

14.2  Cardinal Health will also provide supporting schedules and source
      documents to be used by Client to perform verification of the Government
      reports.

15.0  MONTH-END CLOSE

15.1  Client will complete its close by the first working day after the last day
      of the month being closed. Cardinal Health will make every effort to
      record all transactions for the month being closed by the close of
      business on the first working day (day 1) of the following month (i.e.
      March activity is posted by the end of the first working day in April.).
      Cardinal Health will measure and report this attribute periodically
      according to Section 21 of the Operating Guidelines.

15.2  Cash received by the bank on the final day of the month, and reported to
      Cardinal in the A.M. transactions of the first working day of the month
      will be applied by the end of business on day 1 to the open receivables
      for the prior month.

15.3  Open items that cannot be resolved by the close of business on day 1 will
      be communicated to the Client and will be carried over into the following
      month.

16.0  RETURNED GOODS

                                     - 7 -
<PAGE>
16.1  Returns will be processed in accordance with Client's Returned Goods
      Policy.

16.2  Cardinal Health will complete the processing of all returns and issue
      credits (if applicable) within five (5) business days of receipt of the
      return.

16.3  Cardinal Health will use commercially reasonable efforts to process
      returned goods as timely and accurately as possible. Cardinal Health will
      measure the timeliness of returned goods processing and will report this
      attribute periodically according to Section 21 of the Operating
      Guidelines.

17.0  PRODUCT COMPLAINT RETURNS

17.1  If the Product is being returned due to a Product complaint, Cardinal
      Health will obtain the following information from the end customer
      returning the Product;

      a)    # of vials/bottles/packages to be returned

      b)    physician name

      c)    fax number

      d)    identify source of product (i.e. Name of Wholesaler or whether it's
            a PAP Product)

      e)    name, address and telephone number of caller

17.2  Cardinal Health will fax instructions for returning the Product to the end
      customer, which will include, at a minimum, instructions to return the
      Product a) in a biohazard bag; b) to Client's Quality Assurance
      Department; and c) to include the Return Authorization Number provided by
      Cardinal Health on the outside of the package.

17.3  Client will notify Cardinal Health upon receipt of the Product. Upon
      notification, Cardinal Health will issue a credit to the wholesaler on the
      end customer's behalf. The credit will identify the Return Authorization
      Number and the end customer name. The end customer will be responsible for
      following-up directly with the wholesaler to ensure appropriate
      credit/replacement has been issued.

18.0  RECALL ASSISTANCE

18.1  Client is responsible for management of a recall event.

18.2  If there is a recall or withdrawal of Product, then Cardinal Health agrees
      to stop shipping recalled lots promptly, and in no event later than
      twenty-four (24) hours after Cardinal Health receives written notification
      of such recall.

18.3  If mutually agreed upon, Cardinal Health shall provide assistance to
      Client and cooperate fully in any such recall. Client shall pay to
      Cardinal Health an amount equal to Cardinal Health's actual costs incurred
      with any such recall services. Such cost shall be in addition to the fees
      described in Exhibit C to the Agreement. Such assistance shall include but
      not be limited to:

      18.3.1 Working with Client to assist in the development of a recall
            strategy

      183.2 Contacting consignees (wholesaler, customers) who may have received
            affected Product and requesting prompt quarantine of all affected
            lots pending further disposition instructions from Cardinal Health
            or Client.

      18.3.3 Storage and control of on-hand inventory of recalled Product.

      18.3.4 Receipt, storage and control of returned recalled Product.

      18.3.5 Documentation of recalled Product used, destroyed or returned to
            the distributor through established document systems at Cardinal
            Health.

      18.3.6 Preparing final Recall Report including a copy of all
            communications, if any, with FDA concerning the recall.

      18.3.7 Shipment of samples of recalled Product to Client or a designated
            testing site for analysis, if applicable.

                                     - 8 -
<PAGE>
      18.3.8 Cardinal Health shall maintain appropriate cGMP SOPs, and to the
            extent that they are not in conflict with the Operating Guidelines,
            Cardinal Health will follow its SOPs with regard to executing these
            requirements.

      18.3.9 Cardinal Health will be responsible for executing, or otherwise
            overseeing, the disposition of recalled Product in accordance with
            the decision set forth by Client's Recall Committee.

18.4  Cardinal Health will provide the necessary recall reports within two hours
      of notification by Client. Reports will contain, but not be limited to,
      the following information for each recalled Product and lot member: all
      Customer shipments by date, item number, quantity, lot number, and ship to
      address.

18.5  Cardinal Health shall provide Client Quality Assurance with signed and
      dated records documenting final disposition of the Product(s). In
      addition, Cardinal Health will assist with the following information:

      18.5.1 Name and location of distributors involved in the execution of the
      final disposition of the recalled Product

      18.5.2 Name and location of drug destruction sites (if applicable)

      18.5.3 List of applicable State or Federal licenses currently required and
            held for drug transport and/or disposal for all drug destruction
            sites (if applicable).

      18.5.4 Product disposition method

      18.5.5 Amount of product dispositioned.

      18.5.6 Date of Product disposition

      18.5.7 Documentation from each affected Distributor(s) head of Quality
            Assurance or designee attesting to the completion of the Product
            disposition functions and requirements set forth by Client's Recall
            Committee.

19.0  SYSTEMS

19.1  Client retains ownership to all Client Data in the Cardinal Health System
      but grants Cardinal Health a limited right to use such Client Data in the
      performance of its services.

19.2  Cardinal Health will use commercially reasonable efforts to maintain
      security of the Client Data in files, to segregate them and render them
      inaccessible to all third parties except those providing services or
      systems support hereunder.

19.3  Cardinal Health will provide Client with on-line access to sales
      information, inventory records, lot tracking, Customer profiles, item
      maintenance, pricing and terms, and other business critical data as
      defined in Cardinal Health's standard reports output.

19.4  Additional reporting and interfaces may be jointly defined by Client and
      Cardinal Health.

19.5  Cardinal Health will use commercially reasonable efforts to maintain all
      Systems within the change control SOPs.

19.6  Cardinal Health will use commercially reasonable efforts to make Cardinal
      Health's System accessible to the Client 24 hours per day 7 days per week
      and guaranteed between the hours of 6:00 a.m. - 7:00 p.m. Central Standard
      Time, Monday through Friday ("Accessible Hours"), except for routine,
      scheduled or emergency maintenance. Cardinal Health will provide 48 hours
      advance notification to Client of a scheduled maintenance which would
      affect Client's ability to access the System

19.7  Cardinal Health will use commercially reasonable efforts to ensure that
      unscheduled System downtime per calendar quarter shall not exceed 2% of
      the Accessible Hours. Cardinal Health will promptly notify Client of any
      System problem that might affect services and an estimated time for
      restoration of System access. Cardinal Health will measure system
      availability and report on this attribute according to Section 21 of the
      Operating Guidelines.

                                     - 9 -
<PAGE>
19.8  Full System backups will be generated on a nightly basis in conjunction
      with SOP IS-005 `Backup and Recovery'. These backup tapes will be stored
      either off-site or in a fireproof cabinet as indicated by the SOP.

20.0  AUDITS

20.1  Cardinal Health will assist Client with inspections/audits ordered by the
      FDA or other governmental or official agencies.

20.2  Client will have the right to conduct audits in accordance with the terms
      of the Agreement. Cardinal Health will assist Client with such audits.

20.3  Cardinal Health will notify Client promptly of any inspection activity by
      FDA, DEA or other government agency, as applicable to the Client or
      Client's Product.

21.0  QUALITY COUNCIL REPORT

21.1  Cardinal Health will provide Client with reports on measurable attributes
      including but not limited to those identified below. Such reports shall be
      used to track and benchmark performance.

21.2  Client and Cardinal Health will agree to meet periodically to review
      performance and to develop methods, policies, practices, and procedures
      that may improve the quality and efficiency of the Cardinal Health-Client
      relationship.

21.3  Cardinal Health will use its commercially reasonable efforts to meet or
      exceed the Client's expectation for performance based on the measured
      attributes.

21.4  Measured attributes and standards:

<TABLE>
<CAPTION>
                                                                                               REPORTING
  SECTION        PERFORMANCE ATTRIBUTE                  PERFORMANCE STANDARD                   FREQUENCY
<S>          <C>                            <C>                                             <C>
    1.0      Temperature excursions         *% excursion  - free                            Upon occurrence
    2.0      On-time receipts and data      *% within four (4) business hours for all           Monthly
             entry                          conforming receipts
    3.0      Cycle count accuracy           *%                                                  Monthly
    4.0      On-time shipping               *% same day for orders received by the              Monthly
                                            standard cut-off time
    5.0      Picking/shipping accuracy      *% for all orders processed with carton             Monthly
                                            markings meeting NWDA bar code standards
    6.0      Answer inbound phone calls     *% answered within thirty (30) seconds              Monthly
             within thirty (30) seconds
    7.0      Order entry accuracy           *%                                                  Monthly
    8.0      Invoicing accuracy and         *%                                                  Monthly
             timeliness
    9.0      Accounts receivable            *% A/R collected on or before the                   Monthly
                                            38th day
   10.0      Chargeback processing Time     *% processed in 2 days or less from                 Monthly
                                            receipt of chargeback from wholesaler
   11.0      Government Reporting           *% completed by the close of business on            Monthly
                                            the first work day of the following month
   12.0      Month-End Close                *% completed by the close of business on            Monthly
                                            the first work day of the following month
   13.0      Return goods processing        *% processed in five (5) business days or           Monthly
             cycle time                     less
   14.0      System availability            *% of normal accessible hours                    Upon occurrence
</TABLE>

                                     - 10 -

---------
* Omitted information is the subject of a request for confidential treatment
  pursuant to Rule 406 under the Securities Act of 1933 and has been filed
  separately with the Securities and Exchange Commission.
<PAGE>
                                                                       EXHIBIT C

                            ADAMS LABORATORIES, INC.
                             ESTIMATED FEE SCHEDULE

<TABLE>
<S>                                         <C>                           <C>
PROGRAM IMPLEMENTATION
     One Time Start-Up Fee (3)                   $*
DISTRIBUTION SERVICES
Storage Fee
     Ambient storage fee - Dallas (5)            $*                        Per pallet per month
Pick, pack and ship fee (1)
     Monthly distribution account                $*                        Per month
         management fee (7)
     Ambient product pick/pack/stage             $*                        Per line, per first case
     Ambient product pick/pack/stage             $*                        Per each additional case
     Return goods processing                     $*                        Per first unit, per order
     Return goods processing                     $*                        Per each additional unit, per order
     Freight Charges (6)                    Cost plus *% handling fee
     Packing/Shipping materials (4)         Cost plus *% handling fee
     Destruction Charges                    Cost plus *% handling fee
     Emergency/International Orders              $*                        Per order
INFORMATION SYSTEM
     System access and support fee (2)           $*                        Per month
     Special reports, connectivity or            $*                        Per hour
         other IT requests (per hour
         charge)
CUSTOMER SERVICE
     Customer Service Management fee             $*                        Per month
     Per order processing fee                    $*                        Per order
     Per credit memo                             $*                        Per credit memo
FINANCIAL SERVICES
     Accounts Receivable Management Fee          $*                        Per month
     AR per order processing fee                 $*                        Per order
     Chargeback Management Fee                   $*                        Per month
     Chargeback per line fee                     $*                        Per line
SAMPLE DISTRIBUTION MANAGEMENT
     Sample Distribution Management Fee          $*                        Per month
     Sample product pick/pack/stage              $*                        Per line, per first case
     Sample product pick/pack/stage              $*                        Per each additional case
     Sample order processing fee                 $*                        Per order
</TABLE>

NOTE (1): This proposal is based on distribution services for Adams
Laboratories, Inc. of approximately 16 SKUs as outlined below:

This project is expected to launch in March 2004. In Year One, an estimated
5,406 orders containing a total of 229,682 cases will be shipped. Each order
will consist of an estimated 3 SKUs and 42 cases of product. An average of 451
orders will be placed each month. The minimum unit (for ordering/billing
purposes) is one case. Each case contains either 12 or 24 units (depending upon
the SKU).

Each return is estimated to contain 12 units representing 2 SKUs of product.
Approximately 600 units are estimated to be returned each month. Approximately
220 lines of chargebacks (over 3 products) are estimated each month.

                                      - 1 -

---------
* Omitted information is the subject of a request for confidential treatment
  pursuant to Rule 406 under the Securities Act of 1933 and has been filed
  separately with the Securities and Exchange Commission.
<PAGE>
                                                                       EXHIBIT C

                            FEE SCHEDULE (Continued)

In addition, 55 orders per month will be sent to sales representatives. Each
order will consist of approximately 4 SKUs and 20 cases of product. In total,
660 orders per year containing 13,200 cases of sample product will be shipped.
The minimum unit (for ordering/billing) purposes is one case.

The orders will be shipped through the wholesale, distribution, and physician
office channels. Orders will be received via phone, fax, and other available
channels.

Other products/promotional materials requiring other types of services, or
modified distribution channels will be quoted separately. If the assumptions
change from those presented in the RFI, either party will have the right to
renegotiate the fees and basis used for quoting these services.

The pricing above has been developed based on the assumptions provided by Adams
Laboratories. This pricing serves as an outline of associated costs and will be
changed if the account characteristics change. Ninety days after implementation
SPS and Adams Laboratories will conduct an account review to assess any changes
to the previously shared account characteristics. At that time, any necessary
change to the pricing structure will be made and incorporated into the
agreement.

NOTE (2): System access fee includes licenses for two concurrent users.
Additional licenses will increase the monthly fee by $* per concurrent user.

NOTE (3): The implementation fee is to be paid in two equal installments. The
first payment is due after the first implementation meeting, and the second
following the launch. Non-standard procedures required for connectivity will be
charged at $* per hour. Additionally, the migration of previous history from
another provider to Cardinal Health - Specialty Pharmaceutical Services will be
assessed a rate of $* per hour until the entire process is complete and the data
has been validated by both parties.

NOTE (4): Supplies include tape, labels, bubble pack, etc. (approximately
$40/shipment), pallets ($6.60/pallet), boxes, and any other Adams Laboratories
requirements.

NOTE (5): Pallet storage fee is based on a daily average of pallets on hand.
Pallet storage greater than two months inventory on hand will be assessed an
additional charge of * times the standard fee. Storage is for Cardinal Health -
SPS Dallas location.

NOTE (6): Freight and supply costs are at discounted rates negotiated by
Cardinal Health plus appropriate mark-up. Acknowledgment of delivery costs are
estimated at $* per shipment, if requested.

NOTE (7): The account management fee covers the following services: logistics
management, inventory management, regulatory assurance, receiving discrepancy
resolution, standard operating procedures, validation management, supply
control, process set-ups, and process scheduling.

NOTE (8): The term of agreement will be for three years with payment terms of
Net 20.

                                     - 2 -

---------
* Omitted information is the subject of a request for confidential treatment
  pursuant to Rule 406 under the Securities Act of 1933 and has been filed
  separately with the Securities and Exchange Commission.<PAGE>

                                                                    EXHIBIT 10.4

                                SUPPLY AGREEMENT

      THIS SUPPLY AGREEMENT (this "AGREEMENT") made as of the 1st day of April,
2004 (the "EFFECTIVE DATE"), by and between Cardinal Health PTS, LLC, a Delaware
limited liability company ("CARDINAL"), and Adams Laboratories, Inc., a Texas
corporation, d/b/a Adams Respiratory Therapeutics ("ADAMS").

                                    RECITALS

      1. Concurrent with executing this Agreement, Cardinal and Adams are
completing the closing of that certain Asset Purchase Agreement between Cardinal
and Adams dated March 24, 2004 ("ASSET PURCHASE AGREEMENT") providing for the
purchase by Cardinal from Adams of certain assets related to manufacturing
activities.

      2. In connection with the Asset Purchase Agreement, Adams has agreed to
enter into this Agreement pursuant to which Cardinal will be the exclusive
supplier of certain drug products for Adams.

      NOW, THEREFORE, in consideration of the premises, which are incorporated
herein by reference, and other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, it is agreed between the parties as
follows:

                             ARTICLE I - DEFINITIONS

      1.1 "ACT" shall mean the Federal Food, Drug, and Cosmetic Act located at
21 U.S.C. Sections. 301 to 397 (2000), as it may be amended from time to time,
and regulations promulgated thereunder.

      1.2 "AFFILIATE" as applied to Cardinal or Adams shall mean any legal
entity other than Cardinal or Adams, as the case may be, in whatever country
organized, controlling, controlled by or under common control with Cardinal or
Adams. An entity is deemed to be in control of another entity (controlled
entity) if the former owns directly or indirectly at least fifty percent (50%),
or the maximum percentage allowed by law in the country of the controlled
entity, of the outstanding voting equity of the controlled entity (or other
equity or ownership interest if such controlled entity is other than a
corporation) or otherwise has the power to direct or cause the direction of the
management of the controlled entity.

      1.3 "ALTERNATE FACILITY" shall mean a processing site of Cardinal or one
of its Affiliates other than the Facility, as designated by Cardinal and
approved by Adams, such approval not to be unreasonably withheld or delayed.

      1.4 "BATCH" shall mean the regular manufacturing increment of Drug Product
pursuant to the Specifications.

<PAGE>

      1.5 "CGMPS" shall mean all applicable current Good Manufacturing Practices
promulgated by the FDA pursuant to the Act.

      1.6 "CONTRACT YEAR" shall mean a twelve (12) consecutive month period
commencing on April 1, 2004, and each succeeding April 1 during the term of this
Agreement.

      1.7 "DRUG PRODUCTS" shall mean any Mucinex(R), Mucinex(R) D, Mucinex(R) DM
products, AlleRx(R) products, Aquatab(R) products and any and all other
prescription or over-the-counter pharmaceutical or health-related products for
which Adams has, as of the date hereof, the right to market or sell; provided,
however, that "Drug Products" shall exclude any and all liquid products for
which, as of the Effective Date, Adams has the right to market or sell.

      1.8 "FACILITY" shall mean Cardinal's manufacturing site located in Fort
Worth, Texas, or such other Cardinal facility designated by Cardinal and
approved in writing by Adams, such approval not to be unreasonably withheld or
delayed.

      1.9 "FDA" shall mean the United States Food and Drug Administration, or
any successor entity thereto.

      1.10 "NEW DRUG PRODUCTS" shall mean any prescription or over-the-counter
pharmaceutical or health-related products or product kits for which Adams
acquires the right to market or sell during the term of this Agreement.

      1.11 "SPECIFICATIONS" shall mean the written specifications for the
manufacturing and packaging of the Drug Products attached hereto as Exhibit A
and made a part hereof, as such document may be revised by Adams and agreed to
by Cardinal from time to time during the term of this Agreement.

      1.12 "STARTING MATERIALS" shall mean (a) those consigned finished goods
components for inclusion in drug product kits, and (b) such other materials as
the parties hereto shall agree on in writing from time to time, which Adams
shall deliver to Cardinal.

      1.13 "THIRD PARTY" means any person, firm or corporate body other than
Adams, Cardinal, an Adams Affiliate or a Cardinal Affiliate.

                      ARTICLE II - OWNERSHIP OF PROPRIETARY
                         INFORMATION AND CONFIDENTIALITY

      2.1 Grant of License. Subject to the terms and conditions hereinafter set
forth and except as otherwise provided herein, Adams hereby grants Cardinal a
non-exclusive, worldwide, non-transferable, royalty - free license to use Adams'
intellectual property rights with respect to each of the Drug Products,
including without limitation Adams' patents, copyrights, trademarks, trade
secrets and know-how solely in connection with the performance by Cardinal of
the manufacturing services hereunder. Cardinal acknowledges that all right,
title and interest in the Drug Products and all Adams Confidential Information
(as hereinafter defined) shall remain

                                       2
<PAGE>

vested solely in Adams. All rights not expressly granted to Cardinal herein are
hereby reserved by Adams and such reserved rights may be exercised by Adams
concurrently with the rights licensed by Cardinal hereunder.

      2.2 Retention of Intellectual Property Rights. Adams acknowledges and
agrees that Cardinal owns certain intellectual property rights related to
Cardinal's manufacturing processes and that Cardinal is not transferring any
such rights to Adams.

      2.3 Confidentiality.

            (a) Whether or not disclosed prior to or after the date hereof,
Adams shall not disclose to any person (other than Cardinal or any Cardinal
Affiliate) in any manner, directly or indirectly, any confidential or
proprietary information or data of Cardinal or any Cardinal Affiliate whether of
a technical or commercial nature ("CONFIDENTIAL INFORMATION"), or use or assist
any person (other than any Cardinal Affiliates) to use, in any manner, directly
or indirectly, any Confidential Information, excepting only use of such data or
information as is at the time generally known to the public and which did not
become generally known through the breach of any provisions of this Agreement.
As used in this Agreement, Confidential Information includes but is not limited
to any and all (i) computer software proprietary to any Cardinal Affiliate,
together with all documentation for any such software, (ii) confidential,
proprietary or trade secret information submitted to any Cardinal Affiliate in
confidence by its suppliers, employees, consultants, customers or others, and
(iii) information of any Cardinal Affiliate concerning operations, customers or
prospects, terms and conditions of sale and prices, technical knowledge relating
to customer requirements, and knowledge of markets for its products and
services. Adams acknowledges that all information, whether falling within the
above definition or otherwise (unless specifically excepted above), shall be
presumed to be Confidential Information if any Cardinal Affiliate takes measures
designed to prevent it, in the ordinary course of business, from being available
to persons other than those selected by Cardinal Affiliates to have access
thereto for limited purposes. All information disclosed to Adams or its
Affiliates or to which Adams or its Affiliates obtains access, which such person
has reasonable basis to believe to be Confidential Information, or which such
person has reasonable basis to believe that any Cardinal Affiliate treats as
being Confidential Information, shall be presumed to be Confidential
Information. Notwithstanding the foregoing, this Section 2.3(a) shall not
restrict Adams from using or disclosing information related to Cardinal or any
Cardinal Affiliate properly obtained in the course of other business
relationships for any proper purpose otherwise permitted.

            (b) Whether or not disclosed prior to or after the date hereof, the
Cardinal Affiliates shall not disclose to any person in any manner, directly or
indirectly, any confidential or proprietary information or data of Adams whether
of a technical or commercial nature ("ADAMS CONFIDENTIAL INFORMATION"), or use
or assist any person (other than Adams or any of Adams's Affiliates) to use, in
any manner, directly or indirectly, any Adams Confidential Information,
excepting only use of such data or information as is at the time generally known
to the public and which did not become generally known through the breach of any
provisions of this Agreement. As used in this Agreement, Adams Confidential
Information includes but is not limited to any and all (i) computer software
proprietary to Adams, together with all documentation for any such software,
(ii) confidential, proprietary or trade secret information

                                       3
<PAGE>

submitted to Adams in confidence by its suppliers, employees, consultants,
customers or others, and (iii) information of Adams or any of its Affiliates
concerning operations, customers or prospects, terms and conditions of sale and
prices, technical knowledge relating to customer requirements, and knowledge of
markets for its products and services. Cardinal acknowledges that all
information, whether falling within the above definition or otherwise, shall be
presumed to be Adams Confidential Information if Adams or any of its Affiliates
takes measures designed to prevent it, in the ordinary course of business, from
being available to persons other than those selected by Adams or its Affiliates
to have access thereto for limited purposes. All information disclosed to
Cardinal Affiliates or to which Cardinal Affiliates obtain access, which such
person has reasonable basis to believe to be Adams Confidential Information, or
which such person has reasonable basis to believe Adams or its Affiliates treats
as being Adams Confidential Information, shall be presumed to be Adams
Confidential Information.

            (c) Cardinal shall have no right to use Seller Proprietary Rights
(as such term is defined in the Asset Purchase Agreement) except as reasonably
necessary to perform its obligations hereunder, under an agreement relating to
New Drug Products or as otherwise authorized by Adams. Adams acknowledges that
Transferred Know-How (as such term is defined in the Asset Purchase Agreement)
does not constitute Adams Confidential Information and nothing in this Agreement
shall limit Cardinal's rights relating to Transferred Know-How.

                      ARTICLE III - SUPPLY OF DRUG PRODUCTS
                              AND NEW DRUG PRODUCTS

      3.1 Supply of Drug Products. Adams will purchase exclusively from
Cardinal, and Cardinal will be the exclusive, worldwide supplier to Adams for,
all of Adams' and its Affiliates' requirements of Drug Products for the term of
this Agreement. Sales of Drug Products by Affiliates of Adams or Adams'
development or marketing collaborators shall be deemed to be made by Adams for
this purpose, and Cardinal may assign to those of its Affiliates approved in
writing by Adams, as appropriate, responsibilities for compliance or partial
compliance with Cardinal's responsibilities hereunder, such approval not to be
unreasonably withheld or delayed.

      3.2 Supply of New Drug Products;* . Concurrent with the Closing under
the Asset Purchase Agreement, the parties are entering into a Commercial
Services Agreement (the "COMMERCIAL SERVICES AGREEMENT"). During the term of
this Agreement, in connection with the supply of any New Drug Product required
by Adams, Cardinal shall be the exclusive supplier to Adams of any such New Drug
Product unless Cardinal (together with its Affiliates) does not then possess (or
cannot reasonably be expected to possess within the applicable timeframe) the
means to supply such New Drug Product to Adams. * In connection

                                       4

-------------
* Omitted information is the subject of a request for confidential
  treatment pursuant to Rule 406 under the Securities Act of 1933 and
  has been filed separately with the Securities and Exchange Commission.
<PAGE>

with any New Drug Product, Adams shall submit to Cardinal a written request for
a proposal specifying Adams's requirements for the New Drug Product, including
reasonably prescribed specifications, standards for materials, quality,
delivery, pricing and service support which shall be substantially identical to
the corresponding terms of this Agreement except to the extent that the supply
of such New Drug Product mandates otherwise (the "PERFORMANCE REQUIREMENTS").
Within sixty (60) days of the receipt of Adams' Performance Requirements,
Cardinal shall submit a proposal to Adams for the manufacture and supply of, and
provision of services in respect to, the New Drug Product including a production
plan (which shall include a milestone schedule for production of any required
testing and for commercial supply), proposed pricing and evidence of its ability
to satisfy the Performance Requirements (the "SUPPLY PROPOSAL"). The parties
shall then negotiate in good faith to reach agreement on applicable pricing
and/or any changes to the Performance Requirements and on a supply agreement for
the New Drug Product. Any such supply agreement shall include terms and
conditions that are substantially identical to the corresponding terms and
conditions set forth in this Agreement except (i) as provided above with respect
to Performance Requirements, (ii) for provisions herein that directly relate to
pricing based on profit sharing, (iii) Section 13.2(b) shall not apply, (iv)
compensation and appropriate representations shall be provided in the event that
Cardinal licenses or otherwise makes available to Adams proprietary rights of
Cardinal (e.g., proprietary drug delivery systems), and (v) as otherwise agreed
by the parties. If the parties do not reach an agreement for the supply of the
New Drug Product within sixty (60) days of Adams' receipt of the Supply
Proposal, then any unresolved matters shall be deemed to be a Dispute subject to
resolution in accordance with Section 14.4. In the case of a New Drug Product or
a finished goods component of a New Drug Product (i.e., a kit) which Cardinal is
unable to manufacture, Adams will be free to source such New Drug Product or
component, as the case may be, as a Starting Material from a Third Party. In
case of a finished goods component of a New Drug Product sourced from a Third
Party, Adams will procure and provide such Starting Material on consignment for
inclusion by Cardinal in the kit.

      3.3 Failure to Supply. In order to ensure continuity of supply, in the
event of a failure by Cardinal to supply Drug Products to Adams for a period of
thirty (30) days, Adams and its Affiliates shall be entitled to make or have
made a replacement supply of any affected Drug Product from a Third Party,
without incurring any liability under this Agreement. In such event, Cardinal
shall cooperate with Adams and such Third Party to effectuate the royalty-free
and limited transfer of manufacturing know-how from Cardinal to Adams or such
Third Party, as appropriate, to enable Adams or the Third Party to manufacture
and package the affected Drug Product. Cardinal agrees to use commercially
reasonable efforts to enable Adams or such Third Party to qualify and validate
the Third Party's facilities and to enable the Third Party to manufacture and
package the affected Drug Product(s). Notwithstanding the foregoing, the parties
hereto acknowledge and agree that no such recourse to a Third Party shall take
place so long as Cardinal or a Cardinal Affiliate shall have (x) a validated
Alternate Facility at which the affected Drug Product(s) is(are) able to be
readily manufactured and packaged in accordance with the Specifications, or (y)
safety stock inventory of the affected Drug Product(s), in the case of each of
(x) and (y), sufficient to meet any Purchase Order of Adams for the Drug
Products pursuant to Section 4.2 hereof. If Adams is forced to resort to a Third
Party supplier, Cardinal shall provide Adams with sixty (60) days' prior written
notice of the date it will be able to re-commence manufacturing Drug Product.
Such Third Party shall be entitled to continue to

                                       5
<PAGE>

manufacture and supply normal quantities of the affected Drug Product(s) to
Adams until the expiration of such sixty (60) days' notice, upon which date
manufacturing and supply operations in respect of the affected Drug Product(s)
shall be transferred back to Cardinal and the royalty-free and limited transfer
of manufacturing know-how from Cardinal to Adams or such Third Party shall be
terminated. In the event that Adams obtains any Drug Product from a Third Party
upon occurrence of any manufacturing and/or supply interruption pursuant to this
Section 3.3, then Cardinal shall reimburse Adams for the reasonable cost of such
Drug Product, including without limitation, the cost of validating the
manufacture and packaging of the Drug Products by or in connection with a Third
Party. Notwithstanding the foregoing, if Cardinal's inability to supply any Drug
Product is attributable to a breach by Adams under the Asset Purchase Agreement
or is attributable to the fault of Adams (including without limitation the
provision by Adams of forecasts that do not provide Cardinal with a reasonable
opportunity to expand and validate production capacity), then Adams shall bear
all costs and related expenses incurred by Adams in connection with obtaining
such Drug Product from a Third Party. In the event that Cardinal's inability to
supply any Drug Product is attributable in part to the fault of Adams and in
part to reasons other than the fault of Adams, then Cardinal shall be
responsible for that portion of the costs and related expenses incurred by Adams
that is reasonably allocable to the reasons other than the fault of Adams and
Adams shall be responsible for the remaining costs and related expenses. For
clarification, costs borne by Cardinal under this Section shall not constitute
Cost of Goods for purposes of determining the sharing of Gross Profits and costs
borne by Adams under this Section shall constitute Cost of Goods Sold for
purposes of determining the sharing of Gross Profits. For example, if Cardinal
bears the costs of a third party supplying Drug Products pursuant to this
Section 3.3, then the Cost of Goods for such Drug Products shall be deemed to be
zero and, accordingly, the Gross Profits for such Drug Products shall be equal
to the Net Sales of such Drug Products.

      3.4 Designated Facility. Cardinal shall manufacture the Drug Products for
the worldwide market in the Facility or an Alternate Facility. Notwithstanding
the foregoing, the parties hereto agree that the requirement to validate an
Alternate Facility and the allocation of costs and expenses related thereto
shall be borne as follows:

      (a) Cardinal shall validate an Alternate Facility for fluid bed drying
(with capacity reasonably comparable to the capacity for fluid bed drying at the
Facility) in accordance with the Specifications as soon as practicable after the
effective date of this Agreement. The cost of validating the Alternate Facility
for fluid bed drying shall be borne equally by the parties hereto.

      (b) Cardinal shall validate an Alternate Facility at which the Drug
Products are able to be readily manufactured and packaged in accordance with the
Specifications (other than the fluid bed drying pursuant to Section 3.4(a)
above):

            (i) if Cardinal, on its own accord and for reasons unrelated to
      business decisions made by Adams, chooses to validate such Alternate
      Facility, in which case Cardinal agrees to and shall bear the cost of such
      validation,

            (ii) if the forecasts under Section 4.1 hereof demonstrate
      additional capacity at the Facility (located in Fort Worth) is required
      for Cardinal to fulfill its obligations to

                                       6
<PAGE>

      Adams under this Agreement, or if Adams requires increased production
      capacity or desires such Alternate Facility for business reasons
      determined by Adams in its sole discretion, such that the Facility would
      not be able to accommodate Adams's requirements or Cardinal's obligations
      to Adams for the Drug Products or for such other business reasons of
      Adams, in which case Adams agrees to and shall bear the cost of such
      validation; or

            (iii) if the parties, for reasons other than as provided in clauses
      (i) and (ii) of this Section 3.4, mutually agree to arrange for Cardinal
      or a Cardinal Affiliate to validate such Alternate Facility, in which case
      the parties agree, in good faith, to negotiate the fair allocation of all
      costs associated with such validation, and

      (c) at Adams's sole cost and expense, Adams shall have the right, in its
sole discretion, to validate a facility of its own at which the Drug Products
are able to be readily manufactured and packaged in accordance with the
Specifications.

      3.5 Regulatory Approval. Adams will be solely responsible for and will
obtain all governmental approvals, permits and licenses necessary or desirable
in connection with the testing, marketing, sale, advertising or distribution of
the Drug Products in the United States and any other country.

                        ARTICLE IV - FORECASTS AND ORDERS

      4.1 Forecasts. In order to assist Cardinal in planning production, Adams
shall provide Cardinal with a twelve (12) month rolling forecast of the
quantities of Drug Products required by Adams, by month, for the following
twelve (12) months. It is understood that such forecasts, after the third (3rd)
month, are intended to be good faith estimates only, and shall not be binding
upon Adams. Notwithstanding the foregoing, Adams shall be bound to purchase from
Cardinal one hundred percent (100%) of those quantities of Drug Products set
forth in each such forecast as being Adams' requirements of Drug Products for
the first three (3) months of each twelve (12) month period. Further, the third
(3rd) month of any forecast may not vary by more than twenty percent (20%) of
the quantity reflected in the prior forecast for the same time period. Cardinal
shall be obligated to deliver, pursuant to Purchase Orders provided under
Section 4.2 of this Agreement, during the first two (2) months of a forecast up
to one hundred percent (100%) of Adams' estimated purchases for each of those
calendar months in the immediately preceding forecast and unless Cardinal so
informs Adams that it would have problems in meeting Adams' forecasted
requirements, during the third month in any forecast, pursuant to Purchase
Orders provided under Section 4.2 of this Agreement, up to one hundred twenty
percent (120%) of Adams' estimated purchases for that calendar month as set
forth in the immediately preceding forecast. Cardinal shall further use
commercially reasonable efforts to comply with Purchase Orders for Products in
excess of such one hundred twenty percent (120%) amount; provided, however, that
such inability to supply amounts in excess of one hundred twenty percent (120%)
shall not constitute a breach of this Agreement by Cardinal. Cardinal shall, no
later than ten (10) business days after receipt of each such forecast, notify
Adams in writing of any prospective problems of which it is aware that might
prevent it from meeting Adams' forecasted order quantities or estimated delivery
dates.

                                       7
<PAGE>

      4.2 Binding Purchase Orders. At least ninety (90) days prior to the date
on which Adams desires to have Drug Product delivered, and together with each
forecast referenced in Section 4.1, an authorized representative of Adams shall
furnish to Cardinal a binding purchase order (each, a "PURCHASE ORDER") for the
quantity (specified in terms of a whole number of Batches not less than an
amount agreed upon in writing in good faith for each Drug Product) of Drug
Products which Adams shall purchase and Cardinal shall deliver. Cardinal shall,
within five (5) business days after its receipt of such Purchase Order,
acknowledge such receipt and confirm that the Purchase Order can be supplied.
Should Cardinal fail to do so, then the Purchase Order shall be deemed to have
been accepted by Cardinal. Each such Purchase Order shall designate the quantity
of Drug Products ordered and the date by which Cardinal must deliver the Drug
Products to Adams.

      4.3 Excess Quantities; Changes in Purchase Requirements. Cardinal shall
use commercially reasonable efforts to accommodate any Adams request for any
Drug Product in excess of the quantities described in any previously-submitted
Purchase Order, or for delivery of any Drug Product sooner than as otherwise
provided in such Purchase Order; provided that, except to the extent included in
the Cost of Goods, for quantities in excess of one hundred twenty percent (120%)
Adams shall bear any and all additional costs or expenses (including but not
limited to additional costs or expenses associated with transportation or
insurance related to shipping the Drug Products above such cost and expense
allocations set forth in Section 7.1 hereof) as a result of Cardinal's
compliance with such request. Should Adams' business conditions necessitate
reduction or delay in Purchase Order requirements, then Cardinal shall use
commercially reasonable efforts to implement such requested changes; provided
that Adams shall bear any and all additional costs or expenses (including but
not limited to carrying costs or expenses associated with Raw Materials (as
defined in Section 6.2 hereof) or finished goods inventory and additional costs
or expenses associated with transportation or insurance related to shipping the
Drug Products above such cost and expense allocations set forth in Section 7.1)
as a result of Cardinal's compliance with such request. Notwithstanding the
foregoing, Cardinal shall not take any action in response to any such requests
which would result in charges to Adams in addition to those set forth in the
respective Purchase Order without Adams' prior written consent. In the event
that Adams' actual requirements during the first three months of a forecast for
any Drug Product exceed the amounts specified in the Purchase Order(s) provided
for such Drug Product for such time period pursuant to Section 4.2 and Cardinal
and its Affiliates are unable to supply Adams with such actual requirements for
such Drug Products, then Adams may obtain the amount of Drug Product that
exceeds the amount that Cardinal and its Affiliates are able to supply from a
Third Party. In such event, Cardinal shall cooperate regarding the royalty-free
and limited transfer of manufacturing know-how as provided for in Section 3.3;
provided, however, that (i) for quantities in excess of the amounts specified in
the applicable Purchase Order(s) Cardinal shall not be responsible for any costs
or expenses associated with arranging for or procuring Drug Product from the
Third Party and (ii) Cardinal shall be entitled to receive its share of Gross
Profits related to such Drug Products in the manner provided for in Exhibit C.

                            ARTICLE V - MANUFACTURING

      5.1 Specifications; Technical Assistance. Adams has delivered to Cardinal
complete

                                       8
<PAGE>

and accurate Specifications as identified in Exhibit A hereto for each Drug
Product. On and from the Effective Date and for a period of eighteen (18) months
therefrom (the "TECHNICAL ASSISTANCE PERIOD"), Adams shall provide Cardinal with
reasonable levels of technical assistance in respect of technical production
issues relating to the manufacture, quality control, and supply of the Drug
Products in accordance with the Specifications and the Production Procedures (as
defined in Section 5.2 hereof), all at no cost to Cardinal. Adams' obligations
under this Section 5.1 shall be limited to the assistance of certain specified
employees of Adams which shall be located within the Facility during the
Technical Assistance Period. Any costs and expense incurred by Adams's employees
for such training, including, without limitation, all travel and other expenses,
shall be borne by Cardinal. Should training be required at a location other than
at the Facility, the cost of such technical assistance from such Adams's
employees, including, for all reasonable travel, living and other expenses,
shall be borne by Cardinal. Any technical assistance provided by Adams to
Cardinal hereunder shall not impede the conduct of business by Adams. Following
the expiration or earlier termination of the Technical Assistance Period, all
technical assistance to Cardinal by Adams shall be charged at hourly rates
consistent with industry standards. Nothing in this Section 5.1 shall eliminate
or modify Cardinal's obligations to manufacture, package and supply the Drug
Products in accordance with this Agreement.

      5.2 Quality Agreement. Cardinal shall manufacture all Drug Products in
accordance with the Specifications and the Quality Agreement (defined below). If
Cardinal or Adams should wish to change any of the Specifications, such party
shall provide such proposed changes to the other at least ninety (90) days prior
to implementation. All such changes must be approved in writing by both parties
prior to being implemented and shall, if required, be subject to FDA approval.
In the event that regulatory action or applicable law require changes in the
Specifications then, subject to Adams' prior written agreement, Cardinal shall
use commercially reasonable efforts to implement such changes as soon as
reasonably practicable. Notwithstanding the foregoing, concomitantly with the
Closing under the Asset Purchase Agreement, the parties hereto agree to and
shall enter into a quality agreement in respect of the manufacture of the Drug
Products (the "QUALITY AGREEMENT"); it being understood that any inconsistencies
between this Section 5.2 and the Quality Agreement shall be governed by and
determined in accordance with this Agreement.

      5.3 Compliance with Environmental Laws. Cardinal represents and warrants,
and shall take all actions reasonably necessary to ensure, that the Facility,
any Alternate Facility, the equipment and practices used to perform its
responsibilities under this Agreement by or on behalf of Cardinal, or any of
Cardinal's contractors of any rank (including, without limitation, environmental
or safety and health consultants or waste management or disposal firms) will be
during the term of this Agreement, in full compliance with all health, safety
and environmental laws, statutes, ordinances, regulations, rules, permits and
pronouncements. Cardinal assumes responsibility for disposing of any and all
waste generated during the performance of its responsibilities under this
Agreement (including, without limitation, during any manufacturing, storage and
transportation activities) in accordance with all legal and professional
standards. Notwithstanding anything to the contrary herein, (a) should Cardinal
and/or any Cardinal contractor fail to comply with the obligations set forth in
this Section 5.3, then Cardinal shall be solely responsible for any claims,
suits, or liabilities resulting therefrom (including, without limitation, those
based on strict liability and joint and several liability), and Cardinal shall

                                       9
<PAGE>

indemnify, defend and save Adams (including all officers, directors, employees,
Affiliates and agents of Adams) harmless from and against any and all such
claims, suits, and liabilities; and (b) Cardinal shall indemnify, defend and
save Adams (including all officers, directors, employees, Affiliates and agents
of Adams) harmless from and against any and all claims, suits, and liabilities
which arise directly or indirectly from the storage, release, transportation or
disposal of chemicals, raw materials, product, waste or any other substance by
Cardinal and/or any Cardinal contractor. Notwithstanding the foregoing, Adams
shall (x) be solely responsible for any claims, suits, or liabilities resulting
from any violation of any health, safety and environmental laws, statutes,
ordinances, regulations, rules, permits and pronouncements in respect of its
disposal of any and all waste generated by it (including, without limitation,
any claim, suit or liability based on strict liability and joint and several
liability) which occurred prior to the Closing (as defined in the Asset Purchase
Agreement), and (y) indemnify, defend and save Cardinal (including all officers,
directors, employees, Affiliates and agents of Cardinal) harmless from and
against any and all such claims, suits, and liabilities and against any and all
claims, suits, and liabilities which arise directly or indirectly from the
storage, release, transportation or disposal of chemicals, raw materials,
product, waste or any other substance by Adams and/or any Adams contractor which
occurred prior to the Closing (as defined in the Asset Purchase Agreement).

                   ARTICLE VI - MATERIALS; PRICING ADJUSTMENTS

      6.1 Starting Materials. Adams shall deliver the Starting Materials to
Cardinal free of charge to the Facility. Any customs duties and the like arising
from importation of any Starting Material to the Facility shall be borne by
Adams. The risk of loss or damage of such Starting Materials shall remain with
Adams until the Starting Materials are received at the Facility, at which time
risk of loss or damage to the Starting Materials shall shift to Cardinal.
Cardinal shall be responsible for any loss or damage to the Starting Materials
while in Cardinal's custody other than as set forth herein. Adams shall be
compensated for losses of any Starting Materials beyond agreed upon yield
tolerances, in an amount equal to Adams's actual net cost to acquire such
Starting Materials..

      6.2 Raw Materials. Cardinal shall purchase all raw and packaging
materials, other than the Starting Materials, necessary to process the Drug
Products (the "RAW MATERIALS"), and shall use only those Raw Materials suppliers
that are pre-approved by Adams (specifically including any such suppliers
identified in the disclosure schedules to the Asset Purchase Agreement). Any new
supplier of Raw Materials proposed by Cardinal must be pre-approved in writing
by Adams prior to utilizing any such materials sourced from a new supplier in
the processing of Drug Products, such pre-approval not to be unreasonably
withheld or delayed. All purchases of the Raw Materials shall be made according
to the Specifications for each Raw Material component used in the processing of
the Drug Products. Cardinal shall purchase and schedule deliveries of the Raw
Materials as needed to produce quantities of the Drug Products in accordance
with binding Purchase Orders and the forecasts.

      6.3 Pricing Adjustments. Adams and Cardinal shall confer on a regular
basis, but no less than annually, to consider whether new technologies or new
manufacturing methods may exist which likely would reduce Cardinal's cost of
manufacturing the Drug Products. Should any

                                       10
<PAGE>

such technologies and/or methods be identified, then the parties shall mutually
agree upon how to allocate the costs of developing and implementing such
technologies and/or methods prior to implementing and/or developing the same.
Cardinal shall use commercially reasonable efforts to minimize obsolescence
(caused by such new technology) by returning Raw Materials to the sources from
which they were acquired, if possible, and employing good faith efforts to use
such obsolete Raw Materials for other purposes, if possible. Cardinal shall
submit supporting documentation on all claims of obsolescence and statements for
reimbursement thereof, and, upon Adams' request, Cardinal shall deliver, at
Adams's sole cost and expense, all such Raw Materials to Adams upon
reimbursement to Cardinal for the net cost to acquire such obsolete Raw
Materials.

                        ARTICLE VII - SHIPPING; PACKAGING

      7.1 Shipping. Title to the Drug Products and all risk of loss or damage to
the Drug Products shall be allocated as follows:

      (a) Delivery to Cardinal Affiliate. The parties desire for one of
Cardinal's Affiliates located in Grapevine, Texas and/or Lavergne, Tennessee to
distribute the Drug Products for Adams. In the event that such Cardinal
Affiliate is providing distribution services in respect of the Drug Products,
then title to the Drug Products, and all risk of loss or damage in respect
thereto, shall pass to Adams upon delivery of the Drug Products CIP (as such
term is defined and used in Incoterms 2000, ICC Official Rules for
Interpretation of Trade Terms (the "INCOTERMS 2000 RULES") to Cardinal's
Affiliate in Grapevine, Texas or Lavergne, Tennessee; it being understood that
Cardinal shall pay required insurance costs and the cost of carriage to bring
the Drug Products from the Facility to the Cardinal Affiliate location in
Grapevine, Texas and that Cardinal and Adams shall each bear fifty percent (50%)
of the insurance costs and the cost of carriage to bring the Drug Products from
the Facility to the Cardinal Affiliate location in Lavergne, Tennessee.

      (b) Delivery to Third Party. In the event that Adams uses a Third Party to
distribute the Drug Products, then title to the Drug Products, and all risk of
loss or damage in respect thereto, shall pass to Adams upon delivery of the Drug
Products FCA (as such term is defined and used in the Incoterms 2000 Rules) at
Cardinal's Facility. Upon the reasonable request of Adams, Cardinal shall
arrange for shipment of Drug Products on a freight collect basis at the sole
cost and expense of Adams.

Adams will specify its required mode of transportation and the freight forwarder
in each Purchase Order. All shipments of the Drug Products shall be accompanied
by an invoice, dated as of the date on which delivery of the Drug Products is
made to the carrier, listing the number of such Purchase Order, the item number,
the quantity and the unit price for the Drug Products, the total invoice amount
and such other information as may be required in the relevant Purchase Order or
in additional written directions provided by Adams that are not in conflict with
the terms of this Agreement. Any shipment of Drug Products shall be in
accordance with the Specifications. If Cardinal fails to deliver the Drug
Products in the quantities ordered in any Purchase Order within * days
of the date specified in such Purchase Order, then Adams shall be entitled, as
liquidated damages, and not a penalty, to a discount of * percent (*%) off

                                       11

--------------
* Omitted information is the subject of a request for confidential
  treatment pursuant to Rule 406 under the Securities Act of 1933 and
  has been filed separately with the Securities and Exchange Commission.
<PAGE>

the price of the late-delivered Drug Products for each week that delivery is
delayed, up to a maximum discount of * percent (*%).

      7.2 Packaging. Cardinal shall ship and deliver the Drug Products in such
containers and primary and secondary packaging and with such container closure
system and labeling as set forth in, and in compliance with, the Specifications.
All printed components for Drug Products shall be in accordance with the artwork
and content thereof approved by Adams in writing. Adams shall have the right to
require any special or varied packaging or labeling that it believes is
reasonably necessary to meet any regulatory requirements. Should any component
of any Drug Product packaging or labeling be rendered obsolete by artwork or
other Specification changes, Adams shall reimburse Cardinal at actual
procurement cost for any components affected by such changes which have been
purchased to enable Cardinal to fulfill its obligations with respect to the most
recent forecast estimate. Any such costs relating to obsolescence shall be
factored into the Cost of Goods sold.

                   ARTICLE VIII - RECORDS; TESTING; INSPECTION

      8.1 Records. Cardinal shall make available to Adams all processing
records, documentation and information reasonably requested by Adams: (a) to
assist Adams in determining whether any delivery complies fully with the
Specifications and the requirements of this Agreement ; (b) to assist Adams in
obtaining any and all regulatory approvals necessary to market the Drug
Products; and (c) to enable Adams to comply with any statutory or regulatory
requirements, or with a request by any governmental or regulatory authority.
Before, during and after manufacturing of each Batch hereunder, Cardinal shall,
with respect to such manufacturing: (i) record and keep on file all Batch
Records (as hereinafter defined) documentation, as well as samples of materials
supplied by Adams or Cardinal and used in manufacturing the Drug Products; (ii)
monitor, record and retain documentation of the manufacturing conditions and
environment; and (iii) keep such records for such periods of time as are
required in the Specifications, the cGMPs and any other legal requirements. For
purposes hereof, "BATCH RECORDS" means an analytical report (Certificate of
Analysis) that Cardinal agrees to warrant as accurate to a reasonable degree of
scientific certainty, a quality assurance yield analysis, quality assurance
assay release report, and a copy of all production mix change/deviations and/or
quarantine reports, if used, all prepared in conformance with the cGMPs.

      8.2 Testing. Cardinal shall test or cause to be tested as set forth on
Exhibit B each Batch of the Drug Products produced pursuant to this Agreement
before delivery to Adams. Following Adams' receipt of the Drug Products, Adams
may, at its cost and expense, test samples of each Batch of the Drug Products to
confirm that all the applicable standards and requirements contained in the
Specifications have been met.

      8.3 Inspection; Acceptance. Adams shall accept any delivery of Drug
Products hereunder unless Adams determines in its reasonable opinion that the
delivery does not comply with the terms of the relevant Purchase Order, the
Specifications, and with the requirements of this Agreement. Adams shall inspect
all Drug Products delivered hereunder within thirty (30) days of its receipt of
the Drug Products and all required documentation. Adams shall provide Cardinal
with written notice of its acceptance or rejection of the delivery within thirty
(30) days

                                       12

----------

*  Omitted information is the subject of a request for confidential treatment
   pursuant to Rule 406 under the Securities Act of 1933 and has been
   filed separately with the Securities and Exchange Commission.
<PAGE>

of receipt of the Drug Products and all required documentation. Any
notice of rejection shall specify the reason(s) therefor. Except in the event of
any investigation, corrective action or retesting of a delivery, should Adams
fail to provide Cardinal with written notice of its acceptance or rejection of
the delivery within thirty (30) days of receipt of the Drug Products and all
required documentation, then the delivery shall be deemed to have been accepted
by Adams on the thirtieth (30th) day after delivery. If Adams so notifies
Cardinal that any such delivery, or any part thereof, is rejected, then, at
Adams' option and as its sole remedy, (a) Cardinal shall, at no additional
charge, deliver replacement Drug Products to Adams as soon as reasonably
practicable thereafter (but, in any event, within ninety (90) days after the
initial notification by Adams); or (b) refund to Adams any amounts paid to
Cardinal in connection with such rejected delivery; it being understood that any
costs incurred by Cardinal associated with rejected Drug Products shall not be
included in the Cost of Goods except as set forth in Section 8.4.

      8.4 Rejection. In the event that there is a dispute as to the
justification for the rejection of any Batch of the Drug Products by Adams
pursuant to Section 8.3 hereof, after sixty (60) calendar days of analysis and
good faith negotiations, if the parties have failed to agree that such rejection
was justified, then the parties shall employ Quintiles Laboratories, located in
Kansas City, Missouri (the "INDEPENDENT LABORATORY") to resolve the matter. The
parties hereto agree that the employment of the Independent Laboratory and the
process of determining whether the rejection of any Drug Product was justified
shall operate independently of, and in parallel with, Section 8.3 of this
Agreement. Such Independent Laboratory shall test samples of the rejected Drug
Product and review records and test data previously developed by the parties
relating to the Drug Product to ascertain whether the Drug Product was actually
off-Specification and/or the root basis for the alleged failure of such Drug
Product to meet the Specifications. The findings of the Independent Laboratory
shall be binding on both parties. If the Drug Product is found to be within
Specifications, or the reason that the Drug Product was found to be
off-Specification was the result of Adams' negligence, Adams shall pay the costs
of the tests and the Independent Laboratory and, for the purposes of paying
Cardinal, shall be deemed to have accepted the Batch in question (in addition to
the costs of the replacement Drug Product) and shall pay to Cardinal the cost of
the wrongfully rejected Drug Product with interest as provided for in Section
9.1 accruing from the date that payment was originally due on such Drug
Product.. If the Drug Product was found to be off-Specification as a result of
manufacturing, or was otherwise the result of Cardinal's negligence or failure
to comply with Cardinal's representations and warranties under Section 11.1,
Cardinal shall pay the costs of the tests and the Independent Laboratory, and,
at Adams' option, the costs of preparing, inspecting, packaging and delivering
to Adams the replacement Drug Product.

                       ARTICLE IX - FEES AND TERMS OF SALE

      9.1 Payment. In consideration of the satisfactory manufacture and delivery
to Adams of the ordered quantities of the Drug Products, Adams shall pay
Cardinal for all Drug Products accepted by Adams pursuant to Section 8.5 of this
Agreement in accordance with the terms and conditions set forth in Exhibit C
hereto and subject to adjustment in accordance with this Agreement. All payments
under this Agreement shall be payable by wire transfer of immediately available
funds to such account as the receiving party shall designate in writing to the
paying party. In the event that any payment due under this Agreement is not made
when due,

                                       13
<PAGE>

the amount due shall accrue interest beginning on the fifth (5th) day following
the date on which such payment was due, calculated at the annual rate equal to
the higher of one percent (1.0%) per month or two percent (2%) above the thirty
(30)-day LIBOR for U.S. dollars reported in the Wall Street Journal for the due
date, calculated from the due date until paid in full. Such payment when made
shall be accompanied by all interest so accrued.

      9.2 Taxes. Adams shall bear the cost of any taxes of any kind, nature or
description whatsoever applicable to the sale of any Drug Products by Cardinal
to Adams (except for any taxes based upon the income of Cardinal or its
employees), unless Adams is exempt from such taxes and provides to Cardinal, at
the time of the submission of any Purchase Order, tax exemption certificates or
permits acceptable to the appropriate taxing authorities.

      9.3 Inconsistent Terms. Purchase Orders and invoices issued pursuant to
this Agreement and any other directions or instructions issued by either Adams
or Cardinal shall be consistent with this Agreement, and any additional terms or
conditions stated in any such Purchase Orders, invoices or other directions or
instructions shall not be binding upon the parties hereto unless separately
agreed to by the receiving party in writing. In the event of an inconsistency
between any such Purchase Orders, invoices or other directions or instructions
and the terms and conditions of this Agreement, the terms and conditions of this
Agreement shall prevail.

                    ARTICLE X- RIGHT OF INSPECTION AND AUDIT

      10.1 Inspections. During the term of this Agreement, duly-authorized
employees, agents and representatives of Adams shall be granted access upon at
least twenty-four (24) hours prior notice and at reasonable times during regular
business hours to only the portion of the Facility or any Alternate Facility, as
the case may be, where Cardinal manufactures the Drug Products for the purpose
of inspecting and verifying that Cardinal is manufacturing, packaging, storing,
disposing of and transporting the Drug Products in accordance with cGMPs and the
Specifications. For purposes of this Section 10.1 and Section 10.2,
duly-authorized agents and representatives shall be required to sign Cardinal's
standard Confidential Disclosure Agreement prior to being allowed access to
Cardinal's Facility or any Alternate Facility. Adams representatives shall have
no responsibility for supervision of Cardinal employees performing the
manufacture, packaging, storage, disposal or transportation operations
themselves. The inspection rights set forth in this Article X are for the
purpose of determining Cardinal's compliance with the terms of this Agreement.
Cardinal shall make available to Adams all records and reports pursuant to
Section 8.1. Such records and reports shall be subject to the confidentiality
obligations under Section 2.3 of this Agreement. Upon reasonable prior written
notice to Cardinal, Adams shall have the right to conduct inventory
reconciliation audits and other audits in respect of any Starting Materials as
reasonably required for its internal control, at Adams' sole cost and expense,
and at times reasonably acceptable to Cardinal so as to avoid any disruption to
Cardinal's business operations at the Facility or Alternate Facility. If, as a
result of any such inspection, Adams concludes that Cardinal is not in material
compliance with any of its obligations hereunder, it shall so notify Cardinal in
writing, specifying such areas of noncompliance in reasonable detail. Cardinal
shall provide to Adams, within thirty (30) days of Adams' request, a written
response to Adams' notice including, if applicable, an action plan for

                                       14
<PAGE>

those areas of material noncompliance with which Cardinal agrees, or in the
alternative a written statement setting forth Cardinal's disagreement with
Adams's conclusion that there has been noncompliance.

      10.2 Inspections by Regulatory Authorities. Cardinal shall inform Adams in
writing within twenty-four (24) hours of any notification to Cardinal of any
site visits to Cardinal's Facility, or Alternate Facility, as the case may be,
by the FDA, state or federal regulatory agencies or any other governmental or
regulatory agency, relating, directly to the manufacture of the Drug Products,
and shall provide to Adams all materials or the portion thereof directly related
thereto. For routine inspections, Adams shall have no right to participate in
any site visits. In the event of a pre-approval inspection related to a New Drug
Product, Adams shall have the option of participating in any site visit by any
governmental or regulatory agency, if the site visit relates directly to the
manufacturing, storage, disposal and transportation of the Drug Products. Should
Adams not participate in the site visit, Cardinal shall report in writing the
results of the visit to Adams within seven (7) days of the occurrence thereof.
In the event that any such governmental or regulatory agency finds that the site
is deficient or unsatisfactory in any respect, Cardinal shall cure all material
deficiencies within such cure period as ordered by the government or regulatory
agency. If all deficiencies are not cured within the required time frame, Adams
shall have the option to immediately terminate this Agreement, without
liability.

      10.3 Audits.

      (a) By Adams. Adams shall have the right, without cause, no more than one
(1) time in any twelve (12) month period upon reasonable notice and during
normal business hours, to review records of Cardinal at the Facility, or to have
a third-party consultant review such records of Cardinal, as may be necessary to
verify the accuracy of the amounts invoiced to Adams hereunder; provided,
however, that Adams shall have additional rights of review and audit as shall be
necessary to the extent that Adams shall have a reasonable basis and need for
such additional reviews and audits. Should such review disclose any overpayment
by Adams, then, at Adams' option, Cardinal shall either refund to Adams the
amount of such overpayment, or issue to Adams a credit in the amount of such
overpayment. Adams shall pay all fees of the accountants or other personnel
performing such verification unless it discloses any overstatement of amounts
invoiced of more than two percent (2%), in which case Cardinal shall bear all
reasonable costs of the audit.

      (b) By Cardinal. Cardinal shall have the right, without cause, no more
than one (1) time in any twelve (12) month period upon reasonable notice and
during normal business hours, to review such records of Adams, or to have a
third-party consultant review such records of Cardinal, as may be necessary to
verify the accuracy of the amounts paid by Adams to Cardinal hereunder;
provided, however, that Cardinal shall have additional rights of review and
audit as shall be necessary to the extent that Cardinal shall have a reasonable
basis and need for such additional reviews and audits. Should such review
disclose any underpayment by Adams, then, at Cardinal's sole option, Adams shall
either pay to Cardinal the amount of such underpayment, or Cardinal may setoff
the amount of such overpayment against any amounts owed by Cardinal or one of
its Affiliates to Adams or one of its Affiliates. Cardinal shall pay all fees of
the accountants or other personnel performing such verification unless it
discloses any

                                       15
<PAGE>

understatement of amounts invoiced of more than two percent (2%), in which case
Adams shall bear all reasonable costs of the audit.

                             ARTICLE XI - WARRANTIES

      11.1 Cardinal Warranties. Cardinal represents and warrants that:

      (a) subject to Section 11.4, at the time of shipment hereunder, the Drug
Product supplied by it hereunder shall meet the Specifications

      (b) subject to Section 11.4, the Drug Product supplied by it hereunder
shall be manufactured in accordance with cGMPs and the Specifications;

      (c) subject to Section 11.4, it shall perform its obligations hereunder in
compliance with all applicable federal, state and local laws and regulations,
including without limitation the Act, FDA's then cGMPs, and any and all health,
safety and environmental laws and regulations applicable to Cardinal's
operations and performance hereunder;

      (d) all Drug Products furnished to Adams hereunder shall have been
manufactured in all material respects in accordance with the terms of the
Quality Agreement;

      (e) the title conveyed on all Drug Products furnished to Adams hereunder
shall be good, and its transfer rightful, and the Drug Products shall be
delivered free from any security interest or other lien or encumbrance, other
than claims for payment under Section 9.1 hereof, provided that Cardinal makes
no representation with respect to any lien or other encumbrance relating to
Starting Materials delivered to Cardinal to be held on consignment;

      (f) it owns the its intellectual property or has the right to use its
intellectual property in the course of its performance hereunder (provided,
however, that Cardinal makes no representation regarding the Transferred
Know-How (as defined in the Asset Purchase Agreement)); and

      (g) it is free to enter into this Agreement; and, it has, and will
continue to have, the legal power, authority and right to perform its
obligations hereunder.

THE LIMITED WARRANTY SET FORTH IN THIS SECTION 11.1 IS IN LIEU OF ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY AND
ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE. EXCEPT FOR THE WARRANTIES
EXPRESSED IN THIS SECTION 11.1, CARDINAL MAKES NO OTHER WARRANTY, EITHER EXPRESS
OR IMPLIED, WITH RESPECT TO THE DRUG PRODUCT. IN ADDITION, CARDINAL HEREBY
DISCLAIMS LIABILITY FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES FOR BREACH OF ANY
EXPRESS OR IMPLIED WARRANTY, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY
AND ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO
DRUG PRODUCT.

                                       16
<PAGE>

      11.2 Adams Warranties. Adams represents and warrants that:

      (a) the Starting Materials supplied by it hereunder shall meet the
Specifications;

      (b) it shall perform its obligations hereunder in compliance with all
applicable federal, state and local laws and regulations, including without
limitation the Act, FDA's then cGMPs, and any and all health, safety and
environmental laws and regulations applicable to its performance hereunder;

      (c) it has, and shall have, good, complete and valid rights to the Drug
Products and Starting Materials. To its knowledge, after reasonable due
diligence, there are no patents owned by others related to the Starting
Materials or Drug Products which would be infringed or misused by Cardinal's
performance of the Agreement and, to its knowledge, no trade secrets or other
proprietary rights of others related to the Starting Materials or Drug Products
which would be infringed or misused by Cardinal's performance of this Agreement;

      (d) the title conveyed on all Starting Materials furnished to Cardinal
hereunder shall be good, and its transfer rightful, and the Starting Materials
shall be delivered free from any security interest or other lien or encumbrance;
and

      (e) it owns its intellectual property or has the right to use its
intellectual property in the course of its performance hereunder; and

      (f) it is free to enter into this Agreement; and, it has, and will
continue to have, the legal power, authority and right to grant the exclusive
rights set forth in Section 3.1 hereof and to perform its obligations hereunder.

THE LIMITED WARRANTY SET FORTH IN THIS SECTION 11.2 IS IN LIEU OF ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY AND
ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE. EXCEPT FOR THE WARRANTIES
EXPRESSED IN THIS SECTION 11.2, ADAMS MAKES NO OTHER WARRANTY, EITHER EXPRESS OR
IMPLIED, WITH RESPECT TO THE DRUG PRODUCTS. IN ADDITION, ADAMS HEREBY DISCLAIMS
LIABILITY FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES FOR BREACH OF ANY EXPRESS OR
IMPLIED WARRANTY, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY AND ANY
IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THE DRUG
PRODUCTS.

      11.3 Recalls. In the event (a) any government authority issues a request,
directive or order that any Drug Product be recalled, or (b) a court of
competent jurisdiction orders such a recall, or (c) Adams reasonably determines
after consultations with Cardinal that a Drug Product should be recalled because
the Drug Product does not conform to the Specifications, the parties shall take
all appropriate corrective actions. Cardinal shall be responsible for Cardinal's
and Adams' expenses of the recall to the extent such recall results from the
breach of Cardinal's warranties under this Agreement, PROVIDED, HOWEVER,
CARDINAL SHALL NOT BE

                                       17
<PAGE>

LIABLE IN ANY EVENT FOR SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
INCLUDING, WITHOUT LIMITATION, LOST REVENUES OR PROFITS OR DAMAGES TO BUSINESS
REPUTATION RESULTING FROM SUCH RECALL. Adams shall be responsible for all Adams'
and Cardinal's expenses of the recall to the extent that such recall results
from a cause other than Cardinal's breach of its warranties under this
Agreement, PROVIDED, HOWEVER, ADAMS SHALL NOT BE LIABLE IN ANY EVENT FOR
SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT
LIMITATION, LOST REVENUES OR PROFITS OR DAMAGES TO BUSINESS REPUTATION RESULTING
FROM SUCH RECALL. In the event that such recall results from the joint
negligence of Adams and Cardinal, each party shall be responsible for the
expenses of recall in direct proportion to each party's percentage of fault as
determined jointly by the parties, PROVIDED, HOWEVER, THAT NEITHER PARTY SHALL
BE LIABLE IN ANY EVENT FOR SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL
DAMAGES, INCLUDING, WITHOUT LIMITATION, LOST REVENUES OR PROFITS OR DAMAGES TO
BUSINESS REPUTATION RESULTING FROM SUCH RECALL. In the event of an FDA-initiated
nationwide recall where the scope of the recall is directed at all products
containing any of the active ingredients in the Drug Product and where the
purpose of such recall is not attributable to the fault of either Adams or
Cardinal, Adams shall be responsible for all Adams and Cardinal expenses of the
recall, PROVIDED, HOWEVER, THAT NEITHER PARTY SHALL BE LIABLE IN ANY EVENT FOR
SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT
LIMITATION, LOST REVENUES OR PROFITS OR DAMAGES TO BUSINESS REPUTATION RESULTING
FROM SUCH RECALL. For the purposes of this Agreement, the expenses of recall
shall include, without limitation, the expenses of notification or destruction
or return of the recalled Drug Product and Adams' or Cardinal's total,
unrecoverable, actual, internal costs for manufacturing and shipping the Drug
Product that was later subject to recall.

      11.4 Transition. As contemplated by Section 1.3.1(c) of the Asset Purchase
Agreement, the parties acknowledge that upgrades to the Facility located in Fort
Worth may be required. Accordingly, it is acknowledged that Cardinal's
warranties as of the Effective Date shall be limited to manufacturing Drug
Products at the Fort Worth Facility in accordance with the same standards to
which such Drug Products were manufactured by Adams during the period from
January 1, 2004 through the Effective Date. Thereafter during the Term, as and
when upgrades to the Fort Worth Facility are implemented and improvements to the
manufacturing process are mutually approved and implemented, Cardinal shall
warrant that Drug Products supplied at the Fort Worth Facility hereunder are
manufactured in accordance with the then-applicable Specifications. After the
date that mutually approved improvements to the manufacturing process are
implemented, but in any event no later than the second anniversary of the
Closing under the Asset Purchase Agreement (or, in the case of improvements that
require the cooperation of Adams and/or the approval of regulatory authorities,
such later date as necessary to obtain such cooperation and/or approval), the
warranties in Section 11.1(a), (b) and (c) shall no longer be qualified by this
Section 11.4.

                    ARTICLE XII - INDEMNIFICATION; INSURANCE

                                       18
<PAGE>

      12.1 Indemnity by Cardinal. Cardinal shall indemnify and hold Adams,
Adams' Affiliates, their agents, employees, officers, directors and permitted
successors and assigns (collectively, the "ADAMS INDEMNITEES") harmless from and
against any and all liabilities, losses, claims, demands, damages, costs,
expenses, settlement made or reasonably approved by Cardinal, royalty fees, and
judgments (including reasonable attorneys' fees and other costs of litigation),
however caused and/or on any theory of liability (collectively, "CLAIMS"),
incurred by or rendered against the Adams Indemnitees for personal injury,
sickness, disease or death or other damages which arise out of:

      (a) the negligence or intentional misconduct of Cardinal with respect to
its activities and those of the Cardinal Indemnitees (as defined in Section 12.2
below) under this Agreement, including, but not limited to its manufacturing,
handling and delivery of Drug Product, except to the extent such Claims result
from the breach, negligence or intentional misconduct of Adams or the Adams
Indemnitees;

      (b) the breach by Cardinal of its warranty obligations under this
Agreement;

      (c) any Claim regarding a work-related injury to any Cardinal employee;

      (d) any Claim that any of Cardinal's intellectual property (excluding
Transferred Know How) infringes any patent, trade secret, trademark, copyright,
or other proprietary interest; and/or

      (e) any other action or omission by Cardinal or the Cardinal Indemnitees
relating to this Agreement, or breach by Cardinal of its obligations under this
Agreement.

      12.2 Indemnity by Adams. Adams shall indemnify and hold Cardinal,
Cardinal's Affiliates, their agents, employees, officers, directors and
permitted successors and assigns (collectively, the "CARDINAL INDEMNITEES")
harmless from and against any and all Claims incurred by or rendered against the
Cardinal Indemnitees for personal injury, sickness, disease or death or other
damages which arise out of:

      (a) the packaging, use, sale or other distribution of Drug Product by
Adams, or any Adams Indemnitee or licensee, including, without limitation, any
personal injury or product liability claims (under any theory of product
liability, including, but not limited to, actions in the form of tort, warranty
or strict liability); except to the extent that any of the foregoing results
from the breach, negligence or intentional misconduct of Cardinal or the
Cardinal Indemnitees;

      (b) the breach by Adams of its warranty obligations under this Agreement;

      (c) any other action or omission by Adams or the Adams Indemnitees
relating to this Agreement, or breach by Adams of its obligations under this
Agreement;

      (d) any Claim regarding a work-related injury to any Adams employee;

                                       19
<PAGE>

      (e) any Claim that any Starting Materials, Drug Products or Adams
Intellectual Property or Transferred Know How infringes any patent, trade
secret, trademark, copyright, or other proprietary interest; and/or

      (f) any actions, errors, omissions, misrepresentations, or breach of
obligations made by or on behalf of Adams or the Adams Indemnitees relating to
any documentation provided to and/or required by U.S. Customs Service or
comparable foreign agencies relating to the Drug Product.

      12.3 Cooperation. Adams and Cardinal agree to cooperate with each other in
the defense of any claims made by Third Party(ies) to which this Article XII
applies. If either of the parties wishes to exercise its right to be indemnified
under Sections 12.1 and 12.2, such rights will be subject to the party seeking
indemnity:

      (a) promptly notifying the indemnifier of the claim to be indemnified;

      (b) allowing the indemnifier, if the indemnifier so requests, to conduct
and control (at the cost and expense of the indemnifier) the defense of such a
claim and any related settlement negotiations; and

      (c) affording all reasonable assistance to the indemnifier (at the cost
and expense of the indemnifier) and making no admission prejudicial to the
defense of such a claim.

      12.4 Lost Profits; Damage to Business Reputation. IN NO EVENT SHALL ADAMS
OR CARDINAL BE LIABLE TO THE OTHER FOR LOST PROFITS, OR ANY CONSEQUENTIAL,
SPECIAL, INCIDENTAL OR INDIRECT DAMAGES OR DAMAGES TO BUSINESS REPUTATION.

      12.5 Insurance.

      (a) During the Term of this Agreement, Cardinal shall obtain and maintain
the following insurance with limits not less than those specified below:

            (i)   Commercial General Liability insurance with a limit of Five
                  Million Dollars ($5,000,000) per occurrence;

            (ii)  Products and Completed Operations Liability insurance with a
                  limit of Five Million Dollars ($5,000,000) per occurrence;

            (iii) Worker's Compensation and Employers Liability Insurance with
                  statutory limits for Workers' Compensation and Employers'
                  Liability limits of One Million Dollars ($1,000,000) per
                  accident; and

            (iv)  Professional Services Liability insurance with a Two Million
                  Dollar ($2,000,000) limit per claim.

                                       20
<PAGE>

      In lieu of insurance, Cardinal may self-insure any or a portion of the
required insurance. In the event that any of the required policies of insurance
are written on a claims-made basis, then such policies shall (i) be maintained
during the entire term of this Agreement and (ii) be maintained for a period of
not less than three (3) years following the termination or expiration of this
Agreement. Cardinal shall waive subrogation rights against Adams for workers'
compensation benefits and shall obtain a waiver from any insurance carriers with
which Cardinal carries workers' compensation insurance releasing their
subrogation rights against Adams. Adams shall be named as an additional insured
under the Commercial General Liability and Products and Completed Operations
Liability insurance policies as respects Adams's liability for damages arising
from the services provided under this Agreement. Such additional insured status
shall end upon the termination or expiration of this Agreement unless the
policies are written on a claims-made basis when such additional insured status
will continue for the period of time Cardinal is required to maintain such
insurance under the terms of this Agreement. Cardinal shall furnish certificates
of insurance to Adams evidencing the required insurance and additional insured
status as soon as practicable after the Effective Date and within thirty (30)
days after renewal of such policies. Such certificates shall state that
Cardinal's insurers will endeavor to provide thirty (30) days written notice of
any cancellation prior to the policy(ies) expiration date(s). Each insurance
policy that is required under this Section 12.5(a) shall be obtained from an
insurance carrier with an A.M. Best rating of at least A-VII.

      (b) During the Term of this Agreement, Adams shall obtain and maintain the
following insurance with limits not less than those specified below:

            (i)   Commercial General Liability insurance with a limit of Five
                  Million Dollars ($5,000,000) per occurrence;

            (ii)  Products and Completed Operations Liability insurance with a
                  limit of Five Million Dollars ($5,000,000) per occurrence;

            (iii) Worker's Compensation and Employers Liability Insurance with
                  statutory limits for Workers' Compensation and Employers'
                  Liability limits of One Million Dollars ($1,000,000) per
                  accident; and

            (iv)  All Risk Property Insurance, including transit coverage, in an
                  amount equal to full replacement value covering Adams's
                  property while it is at Cardinal's Facility or in transit to
                  or from Cardinal's Facility.

      In the event that any of the required policies of insurance are written on
a claims-made basis, then such policies shall (i) be maintained during the
entire term of this Agreement, (ii) be maintained for a period of not less than
three (3) years following the termination or expiration of this Agreement. Adams
shall waive subrogation rights against Cardinal for workers' compensation
benefits and shall obtain a waiver from any insurance carriers with which Adams
carries workers' compensation insurance releasing their subrogation rights
against Cardinal. Cardinal Health, Inc. and its subsidiaries and affiliates
shall be named as additional insureds under the Commercial General Liability and
Products and Completed Operations Liability insurance policies as respects
Cardinal's liability for damages arising from the services provided

                                       21
<PAGE>

under this Agreement. Such additional insured status shall end upon the
termination or expiration of this Agreement unless the policies are written on a
claims-made basis when such additional insured status will continue for the
period of time Adams is required to maintain such insurance under the terms of
this Agreement. Adams shall furnish certificates of insurance to Cardinal
evidencing the required insurance and additional insured status as soon as
practicable after the Effective Date and within thirty (30) days after renewal
of such policies. Such certificates shall state that Adams's insurers will
endeavor to provide thirty (30) days written notice of any cancellation prior to
the policy(ies) expiration date(s). Each insurance policy which is required
under this Section 12.5(b) shall be obtained from an insurance carrier with an
A.M. Best rating of at least A-VII.

                       ARTICLE XIII - TERM AND TERMINATION

      13.1 Term. Unless earlier terminated as provided for herein, this
Agreement shall take effect as of the Closing (as defined in the Asset Purchase
Agreement) and shall run for an initial term of ten (10) years ending on March
31, 2014 (the "INITIAL TERM"). This Agreement may be renewed for one or more
additional periods of one Contract Year, provided that negotiations for renewal
are commenced by the parties at least six (6) months prior to expiration of the
Initial Term, or any extension thereof, and the parties agree in writing to
terms of renewal no less than six (6) months prior to the expiration of the
Initial Term, or any extension thereof. The Initial Term and any renewal period
shall be deemed the "TERM" of this Agreement.

      13.2 Termination.

      (a) Cardinal or Adams, as the case may be, shall have the right to
immediately terminate this Agreement if: (i) the other party files a petition in
bankruptcy, or enters into an agreement with its creditors, or applies for or
consents to the appointment of a receiver or trustee, or makes an assignment for
the benefit of creditors, or suffers or permits the entry of an order
adjudicating it to be bankrupt or insolvent and such order is not discharged
within thirty (30) days; (ii) if the other party materially breaches any of the
non-monetary provisions of this Agreement or the Commercial Services Agreement
and such breach is not cured within thirty (30) days after the giving of written
notice, the party claiming the breach shall have the right to terminate this
Agreement; (iii) if the other party materially breaches any of the monetary
provisions of this Agreement and such breach is not cured within twenty (20)
days after the giving of written notice, the party claiming the breach shall
have the right to terminate this Agreement; (iv) Cardinal is unable on *
consecutive occasions to supply the same Drug Product in accordance with Section
4.2 hereof; (v) Cardinal is unable to cure any supply and/or manufacturing
problem in accordance with Section 3.3 hereof within * years of the
commencement of such problem; or (vi) if any required license, permit or
certificate required of the other party is not approved and/or issued, or is
revoked (including, but not limited to the FDA), by any applicable governmental
regulatory authority; provided that such other party may no longer appeal such
decision or reapply or otherwise pursue such permit, license or certificate.

      (b) Adams shall have the right to terminate this Agreement upon twelve
(12) months prior written notice to Cardinal provided that on or before the
termination date, subject to the terms and conditions set forth herein, Adams
shall pay Cardinal a termination fee (the

                                       22

-------------------
*  Omitted information is the subject of a request for confidential treatment
   pursuant to Rule 406 under the Securities Act of 1933 and has been
   filed separately with the Securities and Exchange Commission.
<PAGE>

"TERMINATION FEE") equal to the sum of (1) the net book value (as defined below)
of the assets acquired under the Asset Purchase Agreement, including any capital
improvements to such assets made prior to the effective date of termination,
however, subject to appropriate adjustment to the extent that Cardinal has
disposed of, replaced or improved upon any assets acquired under the Asset
Purchase Agreement, (2) all documented and reasonable costs incurred by Cardinal
to terminate such business including without limitation severance costs, and (3)
Five Million Dollars ($5,000,000). Upon payment of the Termination Fee, Cardinal
will convey to Adams title to all of the equipment and assets included in the
calculation of net book value under clause (1) above with appropriate warranties
as to title. Adams and Cardinal agree that if Adams terminates this Agreement
prior to the expiration of the term, the amount of damages would be difficult to
ascertain. Therefore, the parties further agree that the Termination Fee
constitutes liquidated damages and is not a penalty. Notwithstanding the
foregoing, the obligation to convey assets shall not restrict Cardinal's right
to replace or otherwise dispose of such assets; it being understood, however,
that any such conveyances or dispositions shall proportionately require
adjustments to the net book value calculation under clause (1) above. For
purposes of this Section 13.2, net book value shall be determined in accordance
with Cardinal's normal carrying values for acquired assets and United States
General Accepted Accounting Principles ("GAAP"); provided, however, that such
values shall be adjusted to reflect accelerated depreciation taken by Cardinal
for billing purposes under this Agreement.

      13.3 Duties Upon Termination.

      (a) Adams' Duties. In the event Adams terminates this Agreement (other
than as a result of a breach of this Agreement by Cardinal) or if Cardinal
terminates this Agreement under Section 13.2 hereof, Adams will be required to
pay Cardinal for the direct cost of all materials, including but not limited to
Raw Materials, purchased by Cardinal pursuant to binding Purchase Orders, and
all expenses incurred by Cardinal in connection with returning all remaining
inventories of the Drug Product and Starting Materials to Adams. Adams shall
specify the location in the continental United States to which delivery, at
Adams' expense, of the foregoing is to be made.

      (b) Cardinal's Duties. In the event Cardinal terminates this Agreement
(other than as a result of a breach of this Agreement by Adams) or if Adams
terminates this Agreement under Section 13.2 hereof, Cardinal, at its expense,
will be required to return all remaining inventories of the Drug Product to
Adams. Adams shall specify the location in the continental United States to
which delivery, at Cardinal's expense, of the foregoing is to be made.
Proprietary Information exchanged between Adams and Cardinal shall be promptly
returned upon termination of the Agreement. In addition, Cardinal shall
reimburse Adams for all costs and related out-of-pocket expenses incurred by
Adams in obtaining the Drug Products from any Third Party above and beyond the
amount Adams would have paid Cardinal for the same Drug Products through the end
of the then-current Initial Term or any renewal term, as the case may be,
including without limitation, the cost of validating the manufacture and
packaging of the Drug Products at a Third Party's facilities. In order to permit
Adams to make a smooth transition to a new supplier of the Drug Products, in the
event that this Agreement should terminate for any reason, then Adams shall be
permitted, in its discretion, to continue to submit Purchase Orders to Cardinal
in

                                       23
<PAGE>

accordance with Section 4.2, and Cardinal shall continue to supply the Drug
Products to Adams in accordance with such Purchase Orders and this Agreement,
for a period of one hundred twenty (120) days after the termination of this
Agreement, and this Agreement shall remain in effect with respect to such
Purchase Orders until the expiration or termination of the Purchase Orders.

      (c)   Profit Sharing.

      (i)   If Adams terminates this Agreement pursuant to Section 13.2(b) and
            pays the Termination Fee, Adams' obligation to share profits from
            any Drug Products as provided for in Exhibit C shall apply to any
            saleable inventory or work-in-process manufactured by Cardinal as of
            the date of termination.

      (ii)  If this Agreement is terminated as a result of a breach by Cardinal,
            then Adams' obligations to share profits from any Drug Products as
            provided in Exhibit C shall apply to any Drug Products sold during
            the Initial Term or the applicable renewal term, provided, however,
            that for purposes of determining Gross Profit under Exhibit C, the
            Cost of Goods Sold shall be the higher of (A) the amount Adams would
            have paid Cardinal for the same Drug Products or (B) the actual cost
            paid by Adams for the Drug Products after the termination date.
            Cardinal shall offset the profit sharing component against the
            amounts, if any, payable to Adams under Section 13.3(b) above.
            However, in no event shall the profit sharing result in a net
            payment or liability owing from Adams to Cardinal. Adams shall use
            all commercially reasonable efforts to minimize the actual cost paid
            by Adams for Drug Products during the period for which Cardinal has
            obligations under this Section 13.3(c)(ii).

      (iii) If this Agreement is terminated as a result of a breach by Adams,
            then Adams' obligations to share profits from any Drug Products as
            provided in Exhibit C shall apply to any Drug --------- Products
            sold during the Initial Term or the applicable renewal term;
            provided, however, that for purposes of determining Gross Profit
            under Exhibit C, the Cost of --------- Goods Sold shall be the
            amount Adams would have paid Cardinal for the same Drug Products. In
            addition, if, after a termination as a result of Adams' breach,
            Adams is able to procure Drug Products at a cost less than the
            amount Adams would have paid Cardinal for the same Drug Product (the
            "Third Party Actual Cost"), Cardinal shall be entitled to the
            difference between the amount Adams would have paid Cardinal for the
            same Drug Product and the Third Party Actual Cost for the Initial
            Term or the applicable renewal term.

      13.4 Continuing Obligations. The rights and obligations of each of the
parties with respect to payment obligations incurred prior to termination and as
set forth in Section 2.1 (second and third sentences only), Section 2.2, Section
2.3, Section 8.1, Article IX, Section 10.3, Article XI, Article XII, Article
XIII, Section 14.1, and Section 14.3 of this Agreement shall continue
notwithstanding the termination of this Agreement for any reason.

                                       24
<PAGE>

                           ARTICLE XIV - MISCELLANEOUS

      14.1 Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New Jersey without regard to its
conflict of laws provisions.

      14.2 Export of Finished Product. Adams acknowledges that all Drug Products
provided by Cardinal hereunder are subject to the U.S. export control laws and
regulations. Adams will not export, re-export or otherwise dispose of Drug
Product provided pursuant to this Agreement except in strict compliance with the
letter and spirit of U.S. export laws and regulations, including but not limited
to the laws and regulations administered by the Bureau of Export Administration
of the U.S. Department of Commerce, the Office of Foreign Assets Control of the
U.S. Department of the Treasury and the Office of Defense Trade Controls of the
U.S. Department of State.

      14.3 Notices. Any and all notices provided for shall be sent to the
respective parties at the following addresses by certified or registered mail or
sent by a nationally-recognized overnight courier service:

      If to Cardinal:  Cardinal Health PTS, LLC
                       14 Schoolhouse Road
                       Somerset, New Jersey 08873
                       Attention: President, Modified Release Technologies
                       Facsimile No.: 732.537.6491

      With a copy to:  Cardinal Health PTS, LLC
                       7000 Cardinal Place
                       Dublin, Ohio 43017
                       Attention:  Vice President and Associate General Counsel,
                       Pharmaceutical Technologies & Services
                       Facsimile No.: 614.757.5051

      If to Adams:     Adams Laboratories, Inc.
                       d/b/a Adams Respiratory Therapeutics
                       Colonial Court
                       409 Main Street
                       Chester, New Jersey  07930
                       Attention: Walter E. Riehemann, Esq.,
                       General Counsel
                       Facsimile No.: 908.879.9784

      With a copy to:  Kelley Drye & Warren LLP
                       200 Kimball Drive
                       Parsippany, New Jersey  07054
                       Attention:  Christopher G. FitzPatrick, Esq.

                                       25
<PAGE>

                       Facsimile No.: 973.503.5950

or to such other addresses as may be subsequently furnished by one party to the
other in writing. Any such notice shall be deemed effective from the date of
mailing.

      14.4 Dispute Resolution. If there is a dispute, controversy or claim
arising out of or related to this Agreement, including but not limited to any
claim of breach, termination or invalidity (any such controversy, claim, or
dispute, a "DISPUTE"), the parties hereto shall use good faith efforts to
attempt to resolve such claim in accordance with this Section 14.4. The parties
will promptly seek to resolve any such claim by negotiations between executives
of the parties and an authorized representative of each party shall meet at
least once to attempt to resolve any such dispute. Either party may initiate
this procedure by requesting the other to meet within fifteen days after the
date of such request, with such meeting to be held in Morristown, New Jersey, or
such other location as may be mutually agreed. If the dispute is not resolved
within twenty (20) days after the initial meeting, the parties agree first to
try in good faith to settle the dispute by mediation administered by the CPR
Institute for Dispute Resolution under its Commercial Mediation Rules before
resorting to arbitration, litigation, or some other dispute resolution
procedure. If the dispute has not been resolved pursuant to such mediation
within sixty (60) days after the commencement of mediation, or if either party
will not participate in mediation, then either party may initiate litigation.
Nothing herein shall restrict the right of a party to seek a preliminary
injunction or other judicial relief if in that party's judgment such judicial
proceedings are necessary or appropriate to avoid irreparable damage. All
applicable statutes of limitation shall be tolled while the procedures specified
in this Section 14.4 are pending. The parties will take all such actions, if
any, which may be necessary or appropriate to effectuate such tolling.

      14.5 Equitable Relief. Notwithstanding the foregoing, the remedy at law
for any breach of the provisions of this Agreement may be inadequate, and,
accordingly, an aggrieved party seeking equitable relief or remedies for such a
breach shall have the right and is hereby granted the privilege, in addition to
all other remedies at law or in equity, to proceed directly in a court of
competent jurisdiction to seek temporary or preliminary equitable relief.

      14.6 Partial Invalidity. In the event one or more terms of this Agreement
are found to violate the provisions of any applicable statute, law or
regulation, the parties hereto shall negotiate in good faith to modify this
Agreement, but only to the extent necessary to make this Agreement valid and
enforceable, having full regard for applicable laws and the intent and purposes
of the parties entering into this Agreement.

      14.7 Independent Contractor. The parties hereto are independent
contractors under this Agreement and neither of the parties hereto shall have
any right or authority to assume or create any obligations on behalf of, or in
the name of any other party hereto or to bind the other party hereto to any
contract, agreement or undertaking with any third party without the written
consent of the other party hereto.

      14.8 Entire Agreement. This Agreement (together with the Asset Purchase
Agreement, Commercial Services Agreement and Quality Agreement) and all Exhibits
constitute the entire

                                       26
<PAGE>

agreement between the parties relating to the subject matter of this Agreement,
and this Agreement may not be varied except in writing signed by a duly
authorized representative of each party. This Agreement may be executed in
multiple counterparts, which may be delivered by facsimile, each of which shall
have the force and effect of an original.

      14.9 Assignability. Neither party shall assign this Agreement other than
to Affiliates; however, in the event of any assignment, performance shall be
guaranteed by the assignor in form satisfactory to the other party.

      14.10 Successors and Permitted Assigns. This Agreement shall be binding
upon and inure to the benefit of the permitted successors or permitted assigns
of Cardinal and Adams respectively.

      14.11 Force Majeure. Each of the parties shall be excused from the
performance of its obligations in the event such performance is prevented by a
cause beyond the reasonable control of such party, including without limitation,
act of God; regulation or law of any government or any agency thereof, including
any government, court-ordered or voluntary recall not attributable to the fault
of Adams or Cardinal; war; terrorism; insurrection or civil commotion;
destruction of production facilities or materials by earthquake, fire, flood or
storm; labor disturbance involving non-Cardinal and/or non-Cardinal Affiliate
employees; epidemic; or failure of suppliers (which Adams has required Cardinal
to use in connection with the performance of its obligations hereunder), public
utilities or common carriers. Such excuse shall continue as long as the
condition preventing the performance continues, plus thirty (30) days after the
termination of such condition. Excused non-performance shall not include any
act, omission or circumstance arising from the negligent or willful act of the
party claiming excused non-performance, or lying within such party's reasonable
commercial ability to prevent.

      14.12 Announcements. Neither party shall, without the other party's prior
written consent, make any announcement, press release or other disclosure
regarding this Agreement or that any business relationship exists between the
parties.

      14.13 Trademarks. Except for use on the Drug Products as provided in the
Specifications, Cardinal shall not use Adams' trademarks, service marks, Adams'
name or logos on any other goods or products, or on any advertising or
promotional materials, without first obtaining the prior written consent of
Adams.

      14.14 UN Convention on Contracts. The parties hereby expressly disclaim
the application of the UN Convention on Contracts for the International Sale of
Goods with respect to this Agreement.

                            [signature page follows]

                                       27
<PAGE>

      IN WITNESS WHEREOF, the parties have caused this Agreement to be entered
into by their duly authorized representatives as of the day and year first set
forth above.

CARDINAL HEALTH PTS, LLC            ADAMS LABORATORY, INC.
                                    d/b/a
                                    ADAMS RESPIRATORY THERAPEUTICS

By: /s/ Thomas J. Stuart                      /s/ David Becker
    _________________________________     By:_____________________________

Its: President, Modified Release Tech.        Chief Financial Officer
    _________________________________    Its:___________________________

                                       28
<PAGE>

                                                                       EXHIBIT A

                        SPECIFICATIONS FOR DRUG PRODUCTS

                                       29
<PAGE>

                                                                       EXHIBIT B

                 TESTING PERFORMED BY CARDINAL ON DRUG PRODUCTS

                                       30
<PAGE>

                                                                       EXHIBIT C

                                      FEES

            Cardinal shall receive a portion of the Gross Profits of the sale of
the Drug Products as further described below:

            (i) "GROSS PROFITS (OR GP)" is defined as follows: Adams' Net Sales,
Less Cost of Goods and freight and other logistics costs.

                "COST OF GOODS" means the fully burdened manufacturing costs of
Cardinal, determined using the same cost accounting methodology used by Adams as
set forth in the financial information referenced in the Asset Purchase
Agreement and, to the extent applicable, in accordance with GAAP, and shall
expressly include any costs associated with materials rendered obsolete due to a
change in Specifications including as provided for in Section 7.2. For the
avoidance of doubt, Cost of Goods shall also include the depreciation of the
cost of the Thomas Press purchased by Adams and paid for by Cardinal, over a
three year period beginning upon the date when the Thomas Press is put into
regular use for commercial production. To the extent that Cardinal utilizes one
of its Affiliates for manufacture or packaging of Drug Products under this
Agreement, Cardinal agrees that there shall be no inter-company mark-up included
in the Cost of Goods. The parties hereto agree that after the first Contract
Year a scrap materials rate shall be established and adjusted annually for each
Drug Product. After the first Contract Year, Cost of Goods shall not include
more than the scrap materials rate, except with respect to any materials that
are rendered obsolete due to a change in Specifications which shall be taken
into account in determining Cost of Goods.

                "NET SALES" means the aggregate amount invoiced by Adams or its
Affiliates or any of its sublicensees to a Third Party distributor (who is not a
sublicensee), agent, contractor or end user for the sale of the Drug Product
LESS: (a) credits, refunds and allowances separately and actually credited to
customers for defective, spoiled, damaged, outdated, and returned products, (b)
offered and taken trade volume and cash discounts and rebates (including coupons
and government charge-backs) in amounts customary to the trade, (c) sales,
excise, value added, turnover, use, and other like taxes, and customs duties,
paid, absorbed or allowed excluding net income tax, to the extent invoiced, and
(d) the royalties payable to J-Med Pharmaceuticals, Inc. ("J-MED") for the
AlleRx(TM) dose pack product ("ALLERX(TM)"). The amounts of any deductions taken
pursuant to clauses (a)-(d) shall be determined from books and records
maintained in accordance with GAAP, consistently applied. Net Sales shall not
include revenue received by Adams (or any of its Affiliates) from transactions
with an Affiliate, where the Drug Product in question will be resold to an
independent Third Party distributor, agent or end user by the Affiliate where
such revenue received by the Affiliate from such resale is included in Net
Sales.

            (ii) Gross Profits from all Drug Products shall be shared as set
forth below:

                                       31
<PAGE>

<TABLE>
<CAPTION>
Annual Gross Profit Tier            Adams' Share        Cardinal's Share
------------------------            ------------        ----------------
<C>                                 <C>                 <C>
$*                                        *%                  *%
$*                                        *%                  *%
$*                                        *%                  *%
$*                                        *%                  *%
$*                                        *%                  *%
$*                                        *%                  *%
$*                                        *%                  *%
Over $*                                   *%                  *%
</TABLE>

                  The above profit share percentages apply separately to each
Gross Profits Tier. For example, if the aggregate Gross Profits from all Drug
Products for a Contract Year are $*, then Adams would be entitled to *% of the
first $* (i.e., $*) of Gross Profit and to *% of the final $* (i.e., $*),
resulting in the Gross Profit being divided as follows: Adams would receive $*
and Cardinal would receive $*. For clarification, any royalties or similar
payments to Third Parties including in respect of intellectual property rights
or contractual obligations (excepting pre-existing royalties payable to J-Med on
AlleRx(TM)) shall be solely the responsibility of Adams and shall be payable
from Adams' share of the Gross Profits described above and shall not be included
in the calculation of Cost of Goods or Net Sales.

            (iii) Cardinal shall receive annual minimum payments (which are
fully creditable against Cardinal's share of Gross Profits) for each of the
first three Contract Years, as follows:

<TABLE>
<S>              <C>
Year 1           $4 million
Year 2           $3 million
Year 3           $3 million
</TABLE>

For interim billing purposes, Cardinal will bill Adams for each shipment of the
Drug Products in accordance with Cardinal's standard billing practices at Cost
of Goods (including a prorated portion of the charge for the Thomas Press)
multiplied by the following factors:

<TABLE>
<S>                       <C>
Year 1                     *%
Year 2                     *%
Year 3 and after           *%
</TABLE>

            (iv) At the end of each calendar quarter, a true-up calculation will
be made and the applicable party will be compensated for the shortfall or excess
difference between the required share of Gross Profit and what has been billed
to Adams, provided that if the amount billed to Adams exceeds the amount
properly required to be paid, the excess will be reflected as an adjustment on
invoices for the next period(s) rather than resulting in a refund payable to
Adams.

                                     32

---------
* Omitted information is the subject of a request for confidential treatment
pursuant to Rule 406 under the Securities Act of 1933 and has been filed
separately with the Securities and Exchange Commission.
<PAGE>

            (v) It is understood that while the above amounts and percentages
are based on annual values, there will be adjustments to accommodate quarterly
profit share calculations and payments.

            (vi) Each party shall have the right to periodically engage a
mutually agreed independent accounting firm to audit the other party's records
for purposes of determining compliance with this Exhibit C.

            (vii) Cardinal shall supply Adams with samples of the Drug Products
(including D and DM) at a price equal to the Cost of Goods to manufacture such
samples provided that the volume of such samples provided by Cardinal does not
exceed * percent (*%) of the total volume of such Drug Product manufactured by
Cardinal under this Agreement on an annual basis (the "SAMPLE FLOOR"). The price
for any samples of such Drug Products that exceed the Sample Floor shall be an
amount equal to (a) * multiplied by (b) Cardinal's Cost of Goods to manufacture
such Drug Products. For clarification, the Drug Product constitutes a sample
only if it is conspicuously marked as such in accordance with the applicable
Specifications and is not marketed or sold by Adams, its Affiliates or
sublicenses for commercial sale.

                                       33

---------
* Omitted information is the subject of a request for confidential treatment
  pursuant to Rule 406 under the Securities Act of 1933 and has been filed
  separately with the Securities and Exchange Commission.

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