Document:

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                                                                   EXHIBIT 10.16

                                           *** TEXT OMITTED AND FILED SEPARATELY
                                    PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST
                                            UNDER 17 C.F.R. SECTION 200.80(b)(4)
                                               AND RULE 406 UNDER THE SECURITIES
                                                         ACT OF 1933, AS AMENDED

                                  23 JULY 2004

                           PATENT AND KNOW HOW LICENSE

                                     BETWEEN

                               SHIRE BIOCHEM INC.

                               TANAUD IRELAND INC.

                            TANAUD INTERNATIONAL B.V.

                                       AND

                            STRUCTURAL GENOMIX, INC.

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

                           PATENT AND KNOW HOW LICENSE
        Relating to the development, registration and sale of TROXATYL(R)

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

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PATENT AND KNOW HOW LICENSE

DATE:    23 JULY 2004

PARTIES:

(1)  SHIRE BIOCHEM INC., a company incorporated in Canada, whose address is 275
     boul. Armand-Frappier, Laval, QC, Canada H7V 4A7 ("SHIRE BIOCHEM");

(2)  TANAUD IRELAND INC., a company incorporated in Ireland, whose address is
     Shannon Airport House, Shannon, County Clare, Ireland ("TANAUD IRELAND");

(3)  TANAUD INTERNATIONAL B.V., a company incorporated in the Netherlands, whose
     address is Fred Roeskestraat 123, First Floor, 1076 EE Amsterdam, The
     Netherlands ("TANAUD BV"); and

(4)  STRUCTURAL GENOMIX, INC., a company incorporated in Delaware, whose address
     is 10505 Roselle Street, San Diego, CA 92121, U.S.A. ("LICENSEE").

BACKGROUND

(A)  Shire BioChem (formerly BioChem Pharma Inc.) is a pharmaceutical company
     engaged in, among other things, the research and development of certain
     pharmaceutical products including the Licensed Product (as defined below).

(B)  During the course of its research and development of the Licensed Product,
     Shire BioChem generated the Compound Patents, the Background Patents and
     the Shire Know-How (each defined below) in connection with the Licensed
     Product.

(C)  On 3 January 1996, Shire BioChem entered into the License Agreement (as
     defined below) which, among other things, granted Shire BioChem the
     exclusive right to use the University Patents (as defined below).

(D)  The Licensee is engaged in, among other things, the research and
     development of certain pharmaceutical products.

(E)  The Licensee has requested, and Shire agrees to grant, an exclusive license
     to make, have made, use, supply and sell the Licensed Product in the
     Territory (as defined below) on the terms and conditions set out in this
     Agreement.

OPERATIVE PROVISIONS

1.   INTERPRETATION

1.1  In this Agreement:

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         "ACCELERATED APPROVAL" means approval for Marketing Authorisation of
         the Licensed Product in the United States of America on the basis of an
         application made to the FDA pursuant to the Code of Federal
         Regulations, Title 21, Part 314 (subpart H - accelerated approval of
         new drugs for serious or life threatening illnesses) or its equivalent
         in any jurisdiction;

         "AFFILIATE" means any firm, person or company which controls, is
         controlled by or is under common control with a Party to this Agreement
         and for the purpose of this definition the term "control" means the
         possession, directly or indirectly, of the power to direct or cause the
         direction of the management and policies of such firm, person or
         company, whether through the ownership of voting securities, by
         contract or otherwise or the ownership either directly or indirectly of
         more than 50% of the voting securities of such firm, person or company;

         "BACKGROUND PATENTS" means the patents and patent applications owned by
         or licensed to Shire Biochem, Tanaud Ireland or Tanaud BV as set out in
         Part I of Schedule 2;

         "BUSINESS DAY" means any day other than Saturday or Sunday on which the
         banks in New York are open for business;

         "CANADIAN TERRITORY" means Canada;

         "CHANGE OF CONTROL" means a transaction or series of related
         transactions (other than an equity financing the principal purpose of
         which is to raise new capital for the Licensee or an IPO or follow-on
         public offering), that result directly or indirectly in the change of:

         (a)      control of more than half of the voting power of the issued
                  share capital of the Licensee; or

         (b)      control of more than half of the issued share capital
                  (excluding any part thereof which carries no right to
                  participate beyond a specified amount in the distribution of
                  either profit or capital) of the Licensee; or

         (c)      control of the power to direct or cause the direction of the
                  management and policies of the Licensee, by virtue of any
                  power conferred under the articles of association or other
                  documents relating to the Licensee;

         "CLAIMS" shall have the meaning given in clause 14.1;

         "CLINICAL PROOF OF CONCEPT" means either (a) completion of the
         [...***...] patient phase II study of the Compound [...***...] Acute
         Myelogenous Leukemia (AML) patients with a complete response rate (CR
         and CRp in aggregate) [...***...] AML patients of at least [...***...]%
         with a CR rate of at least [...***...]%; or (b) continuation of such
         phase II study with additional patients or Initiation of a phase III
         study. For the purposes of this Agreement, "CR" shall have the meaning
         given to it in Journal of Clinical Oncology, Vol. 21, 2003: 4642-4649:
         "Morphologic complete remission: A CR designation requires that the
         patient achieve the morphologic leukemia-free state and have an
         absolute neutrophil count of more than 1,000/uL and platelets of
         100,000/uL. Hemoglobin concentration or hematocrit has no bearing on
         remission status, although the patient must be red cell and platelet
         transfusion

                                       3     ***CONFIDENTIAL TREATMENT REQUESTED
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         independent (no red cell transfusion for 2 weeks and no platelet
         transfusion for 1 week). The bone marrow would have less than 5% blasts
         and no Auer rods. There is no requirement for bone marrow cellularity.
         There should be no residual evidence of extramedullary leukemia," and
         "CRp" means CR but with platelets of >25,000/uL and
         <100,000uL;

         "COMMERCIAL SALE" means any sale of the Licensed Product to a third
         party in any country in the Territory after the receipt of the
         Marketing Authorization for that country;

         "COMMITTEE MEMBERS" shall have the meaning given in clause 4.1;

         "COMPETING PRODUCT" means any pharmaceutical product (other than the
         Licensed Product) indicated for the treatment of acute myeloid leukemia
         that is marketed or near to market (phase II clinical development or
         later) which in Shire's reasonable opinion is likely to compete with
         the Licensed Product to the detriment of the Licensed Product, but
         excluding:

         (a)      any pharmaceutical product which is a kinase inhibitor owned
                  or licensed by the Licensee; and

         (b)      pharmaceutical products with scientifically documented
                  evidence, demonstrating the potential for use in combination
                  with the Licensed Product.

         "COMPOUND" means the compound troxacitabine;

         "COMPOUND PATENTS" means the patents and patent applications set out in
         Part II of Schedule 2;

         "CONFIDENTIAL INFORMATION" means any scientific, technical,
         formulation, process, manufacturing, clinical, non-clinical,
         regulatory, marketing, financial or commercial information or data
         relating to the business, projects or products of either Party and
         provided by one Party to the other by written, oral, electronic or
         other means in connection with this Agreement;

         "CONSULTANCY AGREEMENT" means the consultancy agreement dated 20
         February 1996 between BioChem Therapeutic Inc. and [...***...];

         "DEVELOPMENT COMMITTEE" means the committee set up by the Parties in
         accordance with clause 4.1;

         "DEVELOPMENT DATA" means any data, charts, studies, summaries,
         analyses, reports, know-how and other information created, generated or
         discovered in connection with the Development Plan or any other
         pre-clinical or clinical trials or studies of the Licensed Product
         conducted by or on behalf of the Licensee;

         "DEVELOPMENT PLAN" means the plan for the development of the Licensed
         Product by the Licensee as set out in Schedule 1 including the
         anticipated Timelines and development budget for the phase II study of
         the Licensed Product;

                                        4    ***CONFIDENTIAL TREATMENT REQUESTED

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         "EFFECTIVE DATE" means the date of this Agreement;

         "EXCLUDED PATENTS" means the patents and patent applications identified
         in Schedule 9 which are excluded from the license granted to the
         Licensee under this Agreement;

         "FDA" means the United States Food and Drug Administration and any
         successor thereto;

         "FIELD" means all pharmaceutical uses of the Licensed Product except
         that in relation to the University Patents and University Technology,
         "Field" means the treatment of cancer only;

         "FORCE MAJEURE" means in relation to either Party any circumstances
         beyond the reasonable control of that Party;

         "GENERIC PRODUCT" means any pharmaceutical product that is recognized
         by a Regulatory Authority in a particular country in the Territory as
         "AA or AB" rated (or the equivalent rating in any jurisdiction) against
         the Licensed Product or is substitutable at the pharmacy by a
         pharmacist for a prescription written for the Licensed Product;

         "IMPROVEMENT" means any and all discoveries, developments, inventions,
         enhancements or modifications, patentable or otherwise, specifically
         relating to the Licensed Product and for use in the Field created,
         generated or discovered by or on behalf of either Party or its
         Affiliates during the term of this Agreement, but excluding the
         Development Data and any regulatory material generated in connection
         with an application for Marketing Authorization;

         "INTELLECTUAL PROPERTY RIGHTS" means patents, trade marks, service
         marks, logos, trade names, rights in designs, copyright, utility
         models, rights in know-how and other intellectual property rights, in
         each case whether registered or unregistered and including applications
         for registration, and all rights or forms of protection having
         equivalent or similar effect anywhere in the world;

         "INITIATION" means the date of first dosing of the first patient in the
         relevant clinical study;

         "IPO" means an initial public offering of the Licensee's equity
         securities for admission to listing or trading on a recognized
         securities exchange or listing or trading on a recognized securities
         market;

         "LAUNCH" means the commencement of Commercial Sale of the Licensed
         Product in any country of the Territory;

         "LICENSE AGREEMENT" means the license agreement dated 3 January 1996
         between the University of Georgia Research Foundation Inc., Yale
         University, Shire BioChem Inc. (formerly BioChem Pharma Inc.), Tanaud
         Holdings (Barbados) Limited and Tanaud LLC, as amended from time to
         time;

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         "LICENSED PRODUCT" means any pharmaceutical formulations that contain
         the Compound alone as a therapeutically active ingredient, or in
         combination with any other pharmaceutically active ingredient;

         "MARKETING AUTHORIZATION" means the grant of all necessary permits,
         authorizations, licenses, approvals (including pricing and
         reimbursement approvals, if applicable) or waivers from any relevant
         Regulatory Authority required for the research, development,
         manufacture, marketing, storage, import, export, transport, use or sale
         of the Licensed Product in any country of the Territory;

         "MARKETING PLAN" means the marketing plan for the Launch, marketing and
         commercialization of the Licensed Product in each country of the
         Territory prepared in accordance with clause 6.2;

         "MEMORANDUM OF UNDERSTANDING" means a memorandum of understanding
         between the University and the Licensee substantially in the form of
         Schedule 7;

         "MINIMUM SALES FORECASTS" means [...***...]% of the [...***...];
         [...***...]% of the [...***...]; [...***...]% of the [...***...]; and
         [...***...]% of the [...***...];

         "MILESTONE EVENT" means the event identified in Schedule 3 which
         triggers a payment under clause 7.2;

         "MILESTONE PAYMENT" means the payment by the Licensee to Shire of the
         sums identified in Schedule 3 on the occurrence of a Milestone Event;

         "MILESTONE PAYMENT TERMS" means the payment of any Milestone Payment or
         other applicable payment under clause 7, to Shire as follows:
         [...***...]% of such payment to Tanaud Ireland; [...***...]% of such
         payment to Tanaud BV; and [...***...]% of such payment to Shire
         BioChem;

         "NDA" means a new drug application and all supplements filed with the
         FDA, including all documents, data and other information concerning the
         Licensed Product which are necessary for, or included in, a Marketing
         Authorization to use, sell, supply or market the Licensed Product in
         the United States of America;

         "NET SALES" means the gross amount invoiced by the Licensee, its
         Affiliates or Sub-Licensees to third parties in respect of sales of the
         Licensed Product, less:

         (a)      trade, quantity and cash discounts or rebates actually allowed
                  and taken, provided that such discounts or rebates are not
                  applied disproportionately to the Licensed Product as compared
                  with similar products of the selling entity, including those
                  granted for rejected, damaged and recalled goods;

         (b)      freight, shipping and related insurance charges, provided that
                  such charges are no more than 1% of Net Sales;

                                       6     ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (c)      tax, tariff or customs duties or other government duties
                  (other than income tax) levied on the sale, transportation or
                  delivery of the Licensed Product; and

         (d)      credits, rebates, charge backs or similar payments granted or
                  given to wholesalers or other third party distributors, health
                  care insurance carriers, pharmacy benefit management companies
                  or health care organizations.

                  For the avoidance of doubt, sales or other transfers between
         the Licensee and its Affiliates or its Sub-Licensees are not sales to
         third parties, but Net Sales shall include any subsequent sales of the
         Licensed Product by such Affiliates or Sub-Licensees to any third
         parties. Where the Licensed Product is sold otherwise than on an arms
         length basis, the amount that would have been charged in an arms length
         sale shall be deemed to be the invoice price for such Licensed Product
         and where the Licensed Product is disposed of for consideration other
         than cash, such consideration shall be valued at the fair market value.

         "OTHER TERRITORIES" means throughout the world, except for the Canadian
         Territory and the US Territory;

         "PARTY" AND "PARTIES" means respectively Shire or the Licensee, or as
         the case may be, both such parties;

         "PREMIUM ON EQUITY" means in relation to the acquisition by any third
         party of any equity (or any form of security convertible into equity)
         in the Licensee or its Affiliates in connection with any Sub-License
         Agreement, the excess of actual purchase price paid for such equity
         over the fair market value of such equity. For clarity, if the fair
         market value of the equity is $8.00 and the amount paid by the third
         party is $10.00, the Premium on Equity is $2.00. Any dispute over the
         fair market value of the Licensee's stock shall be resolved through the
         dispute resolution procedure set out in clause 24.2;

         "PRINCIPAL MARKETS" means the United States of America, Canada, Japan,
         the United Kingdom, Germany, France, Italy and Spain;

         "QUARTER" means a three month period ending on the last day of March,
         June, September or December in any calendar year;

         "REASONABLE COMMERCIAL EFFORTS" means commercial efforts consistent
         with normal business practices and effort used by the Licensee in
         connection with other products of similar market size or importance
         which the Licensee intends to launch or has launched and sold in the
         Territory, or in the absence of any such similar products then such
         effort shall be assessed by reference to good business practice in the
         light of all the circumstances;

         "REGULATORY AUTHORITY" means any competent government agency,
         regulatory authority or other administrative body responsible for
         granting Marketing Authorization in a particular country or
         multinational group of countries in the Territory, including the FDA;

         "REMEDIES" shall have the meaning given in clause 12.2;

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         "SALES FORECASTS" means the sales of the Licensed Product anticipated
         by the Licensee for a 4 year period from Launch of the Licensed Product
         in the US Territory as set out in Schedule 4;

         "SEC" means the Securities Exchange Commission in the United States of
         America and any successor thereto;

         "SHIRE" means Shire BioChem, Tanaud Ireland or Tanaud BV or
         collectively Shire BioChem, Tanaud Ireland and Tanaud BV as the case
         may be;

         "SHIRE INTELLECTUAL PROPERTY" means the Shire Patents, the University
         Patents, University Technology and the Shire Know-How;

         "SHIRE KNOW-HOW" means all information, procedures, instructions,
         techniques, data, technical information (including toxicological,
         pharmaceutical, non-clinical, clinical and medical data, health
         registration data and marketing data), processing specifications,
         pricing studies and market evaluation materials owned by Shire or its
         Affiliates (other than Shire Laboratories Inc.) and reasonably
         necessary for the development, or in the case of pricing and market
         evaluation materials, for commercialization, of the Licensed Product in
         the Territory;

         "SHIRE MATERIALS" means the Compound and other materials identified in
         Schedule 5;

         "SHIRE PATENTS" means the Compound Patents and Background Patents and
         including, in each case, any divisionals, extensions, reissues,
         substitutions, renewals, continuations, continuations-in-part,
         provisionals, re-examinations and foreign counterparts thereof
         (including European supplementary protection certificates) and patents
         issuing thereon;

         "SUB-LICENSEE" means any non-Affiliate third party sub-licensee of the
         rights (or any part of the rights) granted to the Licensee under this
         Agreement;

         "SUB-LICENSE AGREEMENT" means any agreement between the Licensee and
         the Sub-Licensee granting the right or license under the Shire
         Intellectual Property (or any part of it) to develop, manufacture, have
         manufactured, use, sell, offer for sale, import or supply the Licensed
         Product;

         "SUB-LICENSE INCOME" means any consideration in any form received by
         the Licensee or its Affiliates in connection with a Sub-License
         Agreement, but excluding royalties on Net Sales and amounts received
         under arms length non-convertible debt instruments negotiated on
         standard commercial terms, including (a) upfront fees, milestone
         payments, license maintenance fees, distribution or joint marketing
         fees, development funding (in excess of the Licensee's cost of
         performing such development), and any investment in the Licensee, and
         (b) exchange products, cross-licensed products, options, marketing
         rights and such other forms of non-cash consideration that may be
         deemed to have value;

         "SUB-LICENSEE MOU" means a memorandum of understanding between Shire
         and a Sub-Licensee substantially in the form of Schedule 7;

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       "TERRITORY" means the Canadian Territory, the US Territory and the Other
       Territories;

       "THIRD PARTY ACTION" shall have the meaning given in clause 13.1;

       "TIMELINES" means the timelines for the research, development,
       registration and Launch of the Licensed Product as set out in the
       Development Plan;

       "TRADE MARKS" means the trade marks and applications for trade marks set
       out in Schedule 6;

       "UNIVERSITY" means each of the University of Georgia Research Foundation
       Inc. and Yale University;

       "UNIVERSITY PATENTS" means the patents and patent applications set out in
       Part III of Schedule 2 and including, any divisionals, extensions,
       reissues, re-examinations, continuations, and foreign counterparts
       thereof and patents issuing thereon;

       "UNIVERSITY TECHNOLOGY" means the "Licensed Technology" as defined in the
       License Agreement; and

       "US TERRITORY" means the United States of America and its territories and
       possessions.

1.2    In this Agreement, unless the context requires otherwise:

       (a)    the headings are included for convenience only and shall not
              affect its construction;

       (b)    references to "persons" includes individuals, bodies corporate
              (wherever incorporated), unincorporated associations and
              partnerships;

       (c)    words denoting the singular shall include the plural and vice
              versa;

       (d)    references to the word "including" are to be construed without
              limitation;

       (e)    words denoting one gender shall include each gender and all
              genders; and

       (f)    any reference to an enactment or statutory provision is a
              reference to it as it may have been, or may from time to time be
              amended, modified, consolidated or re-enacted.

1.3    The Schedules comprise part of and shall be construed in accordance with
       the terms of this Agreement. In the event of any inconsistency between
       the Schedules and the terms of this Agreement, the terms of this
       Agreement shall prevail.

2.     GRANT OF LICENSE

2.1    Subject to the terms of this Agreement, Shire hereby grants the Licensee:

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       (a)    an exclusive license under the Shire Patents and Shire Know-How to
              develop, manufacture, have manufactured, use, sell, offer for
              sale, import and supply the Licensed Product in the Territory and
              in the Field; and

       (b)    an exclusive sub-license under the University Patents and
              University Technology to develop, manufacture, have manufactured,
              use, sell, offer for sale, import and supply the Licensed Product
              in the Territory and in the Field.

2.2    Except to the extent necessary to enable Shire to perform its obligations
       under this Agreement and subject to the terms of the License Agreement
       (and in particular the University's rights under Articles 2.2 and 2.4 of
       the License Agreement) the term "exclusive" for the purposes of clause
       2.1, means to the exclusion of all others, including Shire and its
       Affiliates.

2.3    This Agreement and the grant of any license pursuant to clauses 2.1 and
       10.1 shall in all respects be conditional upon the Licensee receiving
       US$12 million in cash from its investors and providing documentary
       evidence, to Shire's reasonable satisfaction, of receipt of such sum by
       no later than September 30, 2004. If such condition subsequent is not
       fulfilled (or waived) on or before September 30, 2004, this Agreement
       shall automatically terminate, Shire shall be entitled to retain any
       upfront payment received and neither party shall have a claim of any
       nature whatsoever against the other party under this Agreement (except in
       respect of any rights or liabilities of the parties which have accrued
       prior to termination).

2.4    The Licensee undertakes to:

       (a)    use all reasonable efforts to ensure that the condition subsequent
              in clause 2.3 is fulfilled as soon as reasonably practicable and
              in any event by September 30, 2004; and

       (b)    keep Shire informed of the progress towards satisfaction of such
              condition precedent and in particular promptly disclose in writing
              to Shire anything which will or may prevent the condition
              subsequent from being satisfied.

3.     SUB-LICENSING

3.1    The Licensee shall have the right to sub-license the rights granted under
       this Agreement to its Affiliates or any third party, provided that:

       (a)    the Licensee provides Shire the opportunity to review the
              Sub-License Agreement (which, subject to the disclosure to the
              University to the extent required under the License Agreement and
              subject to the Universities' confidentiality obligations
              thereunder, Shire shall treat as Confidential Information of the
              Licensee) prior to its execution and considers in good faith any
              reasonable amendments to the Sub-License Agreement requested by
              Shire and subject to clause 3.1A, shall obtain the University's
              prior consent (such consent not be unreasonably withheld or
              delayed);

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       (b)    any Sub-License Agreement shall be in writing and, with the
              exception of the financial terms, be consistent with the terms of
              this Agreement (except that the Sub-Licensee shall not have the
              right to sub-license, unless Shire and the University have
              consented to such right, which consent, if requested by the
              Licensee, shall not be unreasonably withheld or delayed); and

       (c)    the Licensee shall remain responsible to Shire with respect to all
              the operations of its Sub-Licensee relevant to the use Licensed
              Product under this Agreement as if such operations were carried
              out by the Licensee, including the provision of Reasonable
              Commercial Efforts in the development, manufacture, registration
              and Launch of the Licensed Product, the making of any payments
              under this Agreement, the provision of indemnities, the provision
              of insurance and compliance with applicable law.

3.1A   The Licensee may enter into a Sublicense Agreement without the prior
       consent of the University if:

       (a)    the relevant territory of the Sub-License Agreement is outside the
              Principal Markets; or

       (b)    the relevant territory of the Sub-License Agreement is within the
              Principal Markets, provided that, the Sub-Licensee, at the time of
              grant:

              (i)    is listed on a recognized securities exchange and has
                     market capitalization of not less than U.S.$ [...***...]
                     million, or is a private company with cash of not less than
                     U.S.$ [...***...] million; and

              (ii)   has a current marketing authorization for at least one
                     other regulatory-approved pharmaceutical oncology product
                     in any country in the Principal Markets prior to the date
                     of the Sub-License Agreement.

3.2    Shire shall use reasonable endeavours to procure that the University
       signs a Memorandum of Understanding, and shall provide the same to the
       Licensee on the Effective Date for countersignature by the Licensee. Upon
       request by the Licensee, Shire shall consent (which consent shall not be
       unreasonably withheld or delayed) to signing a Sub-Licensee MOU, provided
       that, the reason for the termination of this Agreement does not relate in
       any way to any act or omission of the Sub-Licensee, its Affiliates,
       representatives or sub-licensees.

3.3    In the event that the Licensee enters a Sub-License Agreement pursuant to
       clause 3.1, the Licensee shall promptly after execution of such
       Sub-License Agreement, provide Shire with a copy of the final form of the
       Sub-License Agreement, which Shire shall treat as Confidential
       Information of Licensee.

3.4    The Licensee shall not, and shall procure that its Affiliates and
       Sub-Licensees shall not:

       (a)    utilize any part of the Shire Intellectual Property in the making
              of any patent application, except as otherwise agreed in writing
              by the Parties pursuant to the terms of this Agreement; or

                                       11    ***CONFIDENTIAL TREATMENT REQUESTED

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         (b)      manufacture, supply, market or sell, or knowingly assist any
                  third party to manufacture, supply, market or sell any
                  Competing Product anywhere in the Territory; unless in the
                  event of a Change of Control of Licensee, the new controlling
                  party has a Competing Product and Shire does not terminate the
                  Agreement pursuant to clause 19.2(c), in which event, this
                  sub-clause 3.3(b) shall not apply.

3.5    Shire agrees not to terminate the License Agreement without the prior
       written consent of the Licensee (which consent shall not be unreasonably
       withheld or delayed). Shire further agrees that within 5 Business Days
       after a request from Licensee, Shire shall provide the University with
       the written notice under clause 2.2(a) of the Memorandum of
       Understanding, provided that the reason for the termination of the
       License Agreement by the University does not relate in any way to any act
       or omission of the Licensee, its Affiliates, representatives or
       Sub-Licensees.

4.     THE DEVELOPMENT COMMITTEE

4.1    The Parties shall establish a Development Committee consisting of 4
       individuals ("COMMITTEE MEMBERS"); 2 of whom shall be nominated by Shire;
       and 2 of whom shall be nominated by the Licensee. Either Party may
       replace its Committee Members by notice to the other Party. The Committee
       Members shall be appropriately qualified and experienced in order to make
       a meaningful contribution to Development Committee meetings.

4.2    The purpose of the Development Committee is to provide a forum for the
       Parties to share information and knowledge on the on-going research,
       development and commercialisation of the Licensed Product including
       monitoring the progress of non-clinical and clinical studies, reviewing
       clinical trial programmes, considering proposed regulatory filings,
       Launch plans, marketing and promotional plans, reviewing competitor
       activity and discussing any regulatory, technical, quality assurance or
       safety issues in relation to the Licensed Product. The Development
       Committee shall conduct its discussions in good faith with a view to
       operating to the mutual benefit of the Parties and in furtherance of the
       successful development and commercialisation of the Licensed Product.

4.3    The Development Committee shall meet as often as the Committee Members
       may determine, but in any event not less than once per calendar year. The
       Committee Members may invite individuals with special skills to attend
       such meetings where it is considered to be relevant and appropriate. The
       quorum for Development Committee meetings shall be 2 Committee Members,
       comprising 1 Committee Member from each Party.

5.     DEVELOPMENT AND MARKETING AUTHORIZATIONS

5.1    Shire shall use reasonable efforts within 90 days from the Effective
       Date:

       (a)    to deliver to the Licensee (or its nominee) the Shire Know-How to
              the extent that it is reasonably necessary for the research and
              development of the Licensed Product by the Licensee in accordance
              with the Development Plan, the University Technology under Shire's
              possession or control;

       (b)    to deliver to the Licensee (or its nominee) the Shire Materials;

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       (c)    transfer the investigational new drug application (filed with the
              FDA) relating to the development and use of Licensed Product to
              the Licensee; and

       (d)    transfer its rights and obligations to the Licensee under the
              clinical research services agreements relating to the phase I
              clinical studies ([...***...] and [...***...]) of the Licensed
              Product between Shire Pharmaceutical Development Inc. and
              Quintiles Inc. From the Effective Date, the Licensee shall bear
              the cost of and risk in such phase I studies.

5.2    For a period of 3 months following the Effective Date, Shire shall
       provide the Licensee with a reasonable amount of access during normal
       business hours to [...***...], and [...***...], as is reasonably
       necessary to teach the Shire Know-How to the Licensee, provided that, the
       personnel remain employed or engaged by Shire and such access is limited
       to no more than an aggregate of 25 person working days and no more than 2
       working days in any working week. Shire shall not terminate the
       employment or engagement of any of the above personnel for 3 months
       following the Effective Date. Shire shall promptly inform the Licensee
       if, during such period, any of the relevant personnel cease to work for
       Shire. In the event that the Licensee requires additional access to Shire
       personnel, the Parties shall in good faith negotiate the cost to the
       Licensee of such access.

5.3    The Licensee shall:

       (a)    at [...***...], use its Reasonable Commercial Efforts to perform,
              or procure the performance of, the activities and services in the
              Development Plan;

       (b)    perform, or procure the performance of, any such activities and
              services with reasonable care and skill and ensure that personnel
              employed or engaged by it in the provision of any such activities
              and services are competent and have appropriate professional
              qualifications, training and experience;

       (c)    complete the Development Plan as expeditiously as reasonably
              possible using its Reasonable Commercial Efforts to meet and
              comply with the Timelines; and

       (d)    update Shire at regular intervals, to be agreed between the
              Parties, on the progress of the Development Plan and submit a
              written report to Shire and the University every [...***...] as
              soon as reasonably practicable after [...***...] of each year and
              in any event by [...***...] respectively, detailing its progress
              of the research, development, registration and commercialisation
              of the Licensed Product and the amount of direct expenditures
              associated with the development of the Licensed Product for the
              previous [...***...] months.

5.4    Upon completion of the Development Plan, the Licensee shall, at
       [...***...], use, or cause its Affiliates and Sub-Licensees to use,
       Reasonable Commercial Efforts to prepare, file, prosecute and maintain
       all applications for Marketing Authorization and any other necessary
       licenses, permits, authorizations and approvals (or waivers) required by
       any Regulatory Authority for the Launch, use, promotion, import, sale,
       distribution or commercialisation of the Licensed Product in the
       Principal Markets. The Licensee shall file its application for

                                         13  ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       NDA in the United States of America no later than [...***...] following
       completion of the Development Plan with respect to that country.

6.     LAUNCH AND MARKETING EFFORTS

6.1    The Licensee shall, at [...***...] use its Reasonable Commercial Efforts,
       or procure that its Affiliates or Sub-Licensees use their Reasonable
       Commercial Efforts, to:

       (a)    Launch the Licensed Product in the Principal Markets as soon as
              reasonably practicable following receipt of Marketing
              Authorization in the relevant country and in any event Launch the
              Licensed Product no later than [...***...] following receipt of
              Marketing Authorization in such country; and

       (b)    research, develop, manufacture, distribute and sell, or cause its
              Affiliates or Sub-Licensees (except for third party contract
              research organisations or pharmaceutical manufacturers) to
              research, develop, manufacture, distribute and sell the Licensed
              Product in the Principal Markets.

6.2    The Licensee shall, within [...***...] from filing the NDA for the
       Licensed Product, provide the Development Committee with its Marketing
       Plan setting out its strategy for the Launch of the Licensed Product
       including revised Sales Forecasts (if applicable), anticipated pricing
       levels and reimbursement levels, if appropriate, and marketing and
       promotion plans and spend, in relation to the Licensed Product for the
       calendar year following approval of the NDA. Thereafter, and on or before
       31 October of each calendar year, the Licensee shall provide the
       Development Committee with its Marketing Plan for the next calendar year.
       Each Marketing Plan shall include net sales targets, projections with
       respect to sales force staffing levels, marketing research strategies,
       marketing and promotion plans, physician education plans and general
       advertising and related budgets for sales of the Licensed Product in the
       relevant calendar year.

6.3    Licensee shall:

       (a)    perform, or procure the performance of, the activities set out in
              the Marketing Plan;

       (b)    use Reasonable Commercial Efforts to meet the Sales Forecasts; and

       (c)    on reasonable request from Shire, provide it with copies of the
              packaging, packaging inserts and any advertising or promotional
              materials (including translations, if necessary) used in
              connection with the sale of the Licensed Product in the Territory.

6.4    The Licensee acknowledges that the Sales Forecasts are its good faith
       estimates of sales of the Licensed Product in the Territory based on
       information available to the Licensee at the Effective Date.

6.5    The Licensee may, on submitting the first Marketing Plan and subject to
       the terms of this Agreement, revise the Sales Forecasts. Any reduction in
       the Sales Forecasts must be based on the following:

                                         14  ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       (a)    an unexpected and materially adverse change in the market for the
              Licensed Product in the Territory;

       (b)    unexpected clinical data generated from the Development Plan or an
              unexpected pricing decision from a Regulatory Authority which, in
              each case, has an adverse effect on the anticipated sales of the
              Licensed Product; or

       (c)    advice from a Regulatory Authority which specifies restrictions to
              the use of the Licensed Product that reduces the anticipated
              market for the Licensed Product in the Territory.

6.6    Notwithstanding anything contained in clause 6.5, any such reduction in
       the Sales Forecast in the first Marketing Plan must:

       (a)    be supported by a written report explaining, to Shire's reasonable
              satisfaction, the reasons for such reduction;

       (b)    not be due to reasons which could have reasonably been foreseen by
              the Licensee at the Effective Date and shall not, in any event, be
              less than the [...***...] identified at the Effective Date; and

       (c)    be more than [...***...]% of the initial Sales Forecast before the
              Licensee shall be entitled to seek such a reduction.

6.7    In the event that the Licensee fails to meet a Minimum Sales Forecasts in
       any calendar year, the Licensee shall pay Shire, within 30 days from the
       end of the relevant calendar year, an additional payment representing
       [...***...] that [...***...] on the [...***...] the [...***...] for the
       [...***...] and the [...***...].

7.     ROYALTY AND MILESTONE PAYMENTS

7.1    In consideration of the rights granted under this Agreement, the Licensee
       shall pay Shire (or its nominee) the non-creditable and non-refundable
       sum of US$3 million within 3 Business Days from the Effective Date and
       the non-creditable and non-refundable sum of US$1 million within 5
       Business Days of the first anniversary of the Effective Date, in
       accordance with the Milestone Payment Terms.

7.2    Upon the occurrence of each Milestone Event, the corresponding
       non-refundable Milestone Payment shall be made by the Licensee to Shire
       in accordance with the Milestone Payment Terms. For the avoidance of
       doubt, each Milestone Payment shall be made no more than once with
       respect to the achievement of a Milestone Event, but shall be payable the
       first time the Milestone Event is achieved. [...***...]% of any
       development Milestone Payments (but not sales Milestone Payments) shall
       be creditable against royalties due to Shire under sub-clauses 7.3(a),
       7.3(b), 7.3(c), 7.3(d) (but not royalties under sub-clause 7.3(e)), and
       if applicable, sub-clauses 7.4(a), 7.4(b), 7.4(c), 7.4(d) (but not
       royalties under sub-clause 7.4(e)), provided that, in no event will the
       credit for such development Milestone Payments reduce the royalties
       payable to Shire in any Quarter by more than [...***...]%. Any amount
       that has not been so credited

                                       15    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       may be credited against royalties due in subsequent Quarters, subject to
       the limitation described in the previous sentence. For the avoidance of
       doubt, upon expiry or termination of this Agreement, Shire shall not be
       liable to the Licensee for any credit amount accrued and not credited.

7.3    Subject to clauses 7.4, 7.7(b) and 8.2, during the term of this
       Agreement, the Licensee shall pay Shire:

       (a)    a royalty of [...***...]% of the first US$[...***...] of Net Sales
              of the Licensed Product in the Territory in any calendar year;

       (b)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (c)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (d)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] in the Territory in any calendar year; and

       (e)    any royalties or other payments to be made by Shire or its
              Affiliates under the License Agreement or the Consultancy
              Agreement, incurred after the Effective Date, other than payments
              under Articles 4.5 and 4.6 of the License Agreement. [...***...]%
              of any payments made by the Licensee for milestone payments
              properly paid by the Licensee under Article 4.2(c) of the License
              Agreement shall be creditable against royalties in accordance with
              clause 7.2 above.

7.4    At any time during calendar year [...***...], Licensee shall have the
       right to pay to Shire the non-creditable and non-refundable sum of
       US$[...***...] in accordance with the Milestone Payment Terms and in such
       event, Licensee shall have no obligation to make any payments to Shire
       under clause 7.3, but instead shall pay Shire the following:

       (a)    a royalty of [...***...]% of the first US$[...***...] of Net Sales
              of the Licensed Product in the Territory in any calendar year;

       (b)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (c)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (d)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] in the Territory in any calendar year; and

       (e)    any royalties or other payments to be made by Shire or its
              Affiliates under the License Agreement or the Consultancy
              Agreement, incurred after the Effective Date, other than payments
              under Articles 4.5 and 4.6 of the License Agreement.

                                       16    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

7.5    In the event that the Licensee supplies a Licensed Product to any
       customer as part of a package or combination of products, then the Net
       Sales of the Licensed Product shall be whichever is the higher of:

       (a)    [...***...] of such Licensed Product when sold [...***...]; or

       (b)    [...***...] the selling price of such package of products which is
              [...***...].

7.6    For the purposes of clause 7.5, [...***...] means the value of Licensed
       Product sold to similar customers in the Territory with similar pricing
       and reimbursement structures and for similar quantities. Any dispute as
       to the determination of [...***...] or proportion of the selling price of
       a package of products attributable to the Licensed Product shall be
       resolved through the dispute resolution procedure set out in clause 24.2.

7.7    Subject to clauses 7.9 and 8.2, in the event that Licensee or its
       Affiliates enters into a Sub-License Agreement in any Territory, then
       Licensee shall pay to Shire in addition to the Milestone Payments:

       (a)    subject to clause 7.10, [...***...]% of any Sub-License Income;
              and

       (b)    in lieu of royalties under clauses 7.3 or 7.4 applicable to Net
              Sales by such Sub-Licensee in its particular territory, the
              greater of:

              (i)    [...***...]% of any royalty payments received by Licensee
                     or its Affiliates from the Sub-Licensee or its Affiliates
                     for sales of Licensed Products by or on behalf of the
                     Sub-Licensee; or

              (ii)   [...***...]% of Net Sales by the Sub-Licensee and its
                     Affiliates.

7.8    In the event that Sub-License Income corresponds to a Milestone Payment
       under this Agreement which has not already been paid by the Licensee and
       such Sub-License Income is greater than the respective Milestone Payment,
       the Licensee shall pay Shire on the occurrence of the Milestone Event the
       full Milestone Payment plus [...***...]% of the difference between the
       Sub-License Income and the relevant Milestone Payment.

7.9    In addition to any payments made by the Licensee under clause 7.7, the
       Licensee shall pay any royalties or other payments to be made by Shire or
       its Affiliates under the License Agreement and the Consultancy Agreement,
       incurred after the Effective Date, other than payments under Articles 4.5
       and 4.6 of the License Agreement.

7.10   In the event that the Licensee or its Affiliates receives any Sub-License
       Income by way of cash consideration in relation to the acquisition of
       equity (or any form of security convertible into equity) in the Licensee
       or its Affiliates or non-cash consideration upon which payment would be
       due to Shire under clause 7.7, the Licensee shall pay Shire:

       (a)    in relation to the acquisition of equity (or any form of security
              convertible into equity) in the Licensee or its Affiliates the
              greater of:

                                       17    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

              (i)    [...***...]% of the Premium on Equity; or

              (ii)   [...***...]% of the total amount received or to be received
                     by the Licensee or its Affiliates; or

       (b)    in relation to the payment of non-cash consideration, [...***...]%
              of the fair market cash value of such non-cash consideration at
              the date of receipt of the non-cash consideration by the Licensee
              or its Affiliate.

8.     PAYMENT TERMS

8.1    Unless otherwise expressly stated, payments due under this Agreement
       shall be made by the Licensee to Shire (or its nominee) as follows:

       (a)    in respect of any development Milestone Payments, within
              [...***...] days from identification of the occurrence of the
              development Milestone Event by the Licensee;

       (b)    in respect of any sales Milestone Payments, within [...***...]
              days from the end of the Quarter in which the relevant Milestone
              Event occurred;

       (c)    in respect of Net Sales royalty payments during any Quarter,
              within [...***...] days from the end of that Quarter;

       (d)    in respect of any payments under clause 7.7, within [...***...]
              days from receipt of the Sub-Licensing Income by the Licensee or
              its Affiliates from the Sub-Licensee, or in relation to royalties
              on Net Sales within [...***...] days from the end of the relevant
              Quarter; and

       (e)    in respect of any payments to be made under the License Agreement
              during any Quarter, within [...***...] days from the end of the
              Quarter.

8.2    The payment of all Net Sales royalty revenue from the Licensee, its
       Affiliates or its Sub-Licensees, to Shire shall:

       (a)    in respect of sales of the Licensed Product in the US Territory,
              be paid to Tanaud Ireland;

       (b)    in respect of sales of the Licensed Product in the Canadian
              Territory, be paid to Shire BioChem; and

       (c)    in respect of sales of the Licensed Product in the Other
              Territories, be paid to Tanaud BV.

8.3      All payment sums due under this Agreement to Shire shall be paid in US
         dollars. Net Sales shall be determined in the currency in which the
         Licensed Product was sold and shall be converted into US dollars using
         the spot rate on the last day of the relevant Quarter as

                                       18    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       published by the Wall Street Journal for the relevant Quarter for which
       such payment is being determined.

8.4    At the same time as payment of any Net Sales royalty falls due, the
       Licensee shall submit to Shire a statement in writing recording the
       calculation of the amounts payable and including:

       (a)    the number of Licensed Products which have been supplied in each
              country of the Territory during the previous Quarter;

       (b)    the Net Sales generated in each country of the Territory during
              the previous Quarter; and

       (c)    the amount of royalties due and payable to Shire in relation to
              sales of the Licensed Product in the US Territory, the Canadian
              Territory, the Other Territories, and the Territory as a whole
              (including where appropriate the exchange rate used).

8.5    Interest shall be payable by the Licensee on any amounts payable to Shire
       under this Agreement which are not paid by the due date for payment. All
       interest shall accrue and be calculated on a daily basis (both before and
       after any judgment) at the rate of [...***...]% per annum above the base
       rate of Barclays Bank plc from time to time, for the period from the due
       date for payment until the date of actual payment.

8.6    Notwithstanding any other provision of this Agreement, if at any time
       legal restrictions prevent the prompt remittance of part or all of the
       payments required hereunder in any country, payment shall be made through
       such lawful means as Shire may determine.

8.7    Any tax that the Licensee, its Affiliates or Sub-Licensees are required
       to withhold to comply with relevant laws with respect to the royalties
       and other payments due under this Agreement, shall be deducted from said
       payments prior to remittance; provided, however, that in regard to any
       tax so deducted, the Licensee shall give or cause to be given to Shire
       such assistance, including documentary evidence, as may reasonably be
       necessary to enable Shire to claim exemption therefrom or credit
       therefor, and in each case, the Licensee shall furnish to Shire proper
       evidence of the taxes paid on its behalf. Unless otherwise expressly
       stated, all sums due under this Agreement shall be paid without
       deduction, set-off or counterclaim.

8.8    The obligation of the Licensee to pay royalties and any other payments
       due under this Agreement, shall continue on a country-by-country basis
       for the term of this Agreement. Subject to clause 8.9, in the event that
       there are no issued Shire Patents or University Patents covering the use
       of the Licensed Product in a country in the Territory, the royalty
       payments due to Shire (but not those due to the University under the
       License Agreement) for Net Sales in such country shall be reduced by
       [...***...]%, provided that:

       (a)    one or more Generic Products have been granted marketing
              authorization and are being sold in such country; and

                                       18    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       (b)    IMS data demonstrates that the market share for the Licensed
              Product in such country has been reduced by [...***...]% or more
              in any two consecutive Quarters following the launch of the
              Generic Product in such country.

8.9    In the event that after the grant of marketing authorization of the
       Generic Product any Shire Patent or University Patent application is
       issued, and such patent is able to prevent the sale of the Generic
       Product in the relevant country the royalty payments due to Shire for Net
       Sales in such country shall return to the royalty rates set out in clause
       7.3 or 7.4 as applicable.

9.     RECORDS AND REPORTS

9.1    During the term of this Agreement, and for a period of [...***...] years
       after its expiry or termination, the Licensee shall, and shall procure
       that its Affiliates and Sub-Licensees shall, keep at its or their normal
       place of business detailed, accurate and up to date records and books of
       account showing the sales of the Licensed Product in each country in the
       Territory sufficient to ascertain:

       (c)    any Net Sales generated in connection with the sale of the
              Licensed Product and royalties payable to Shire under this
              Agreement; and

       (d)    the achievement or progress towards achievement of any Milestone
              Event, provided that, in the event that the Milestone Event
              relates to the development of the Licensed Product, the Licensee
              has failed to meet the Timelines and, in Shire's reasonable
              opinion, the Licensee has failed to adequately explain the reasons
              for the delay.

9.2    On no less than [...***...] Business Days notice from Shire, the Licensee
       shall make, or procure that its Affiliates or Sub-Licensees make, such
       records and books of account available for inspection by Shire (or its
       nominee) for the purpose of audit to confirm payments due under this
       Agreement, but not more than [...***...] in any calendar year in relation
       to royalties payable to Shire under this Agreement and not more than
       [...***...] in any calendar year in relation to the achievement of any
       Milestone Event. Shire (or its nominee) shall be entitled to take copies
       or extracts from such records or books of account during any such review
       or audit.

9.3    Shire shall be solely responsible for its costs and expenses in making
       any such review or audit, unless Shire identifies a discrepancy in the
       sums paid in any calendar year from those payable under this Agreement
       for that calendar year of greater than [...***...]%, in which event the
       Licensee shall pay Shire's costs and expenses incurred in connection with
       the review or audit, and make good the deficit in the payments (including
       any interest amount calculated in accordance with clause 8.5).

9.4    All information disclosed by the Licensee, its Affiliates or its
       Sub-Licensees pursuant to this clause 9 shall be deemed Confidential
       Information of Licensee, its Affiliates or its Sub-Licensees, as
       applicable.

                                       20    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

10.      TRADE MARKS

10.1     Shire hereby grants the Licensee an exclusive license, with the right
         to sublicense, to use the Trade Marks in relation to the sale,
         promotion and marketing of the Licensed Product in the Territory for
         the term of this Agreement. The Licensee shall:

         (a)      use the Trade Marks only in a manner which conforms to the
                  reasonable directions and standards notified to it by Shire
                  from time to time;

         (b)      market the Licensed Product throughout the Territory under the
                  Trade Marks and ensure that all marketing materials for the
                  Product shall display the Trade Marks;

         (c)      not use, register or attempt to register any trade marks,
                  company, business or trading names or domain names which are
                  identical or similar to (or which incorporate) any of the
                  Trade Marks, any aspect of them, or any other trade marks or
                  trade names used by Shire, without Shire's prior written
                  consent; and

         (d)      not do anything which could, in Shire's reasonable opinion,
                  bring the Trade Marks or Shire into disrepute or which could
                  otherwise damage the goodwill attaching to the Trade Marks or
                  any other trade marks or trade names of Shire.

10.2     Shire shall, [...***...], maintain the registrations for the Trade
         Marks, and shall use reasonable efforts to prosecute any applications
         for registration of the Trade Marks through to grant in the Territory.

10.3     The Licensee acknowledges that:

         (a)      it shall not acquire, nor claim, any right, title or interest
                  in or to any of the Trade Marks or the goodwill attaching to
                  them by virtue of this Agreement or its use of the Trade
                  Marks, other than the rights specifically granted to it under
                  clause 10.1; and

         (b)      all goodwill arising from use of the Trade Marks by the
                  Licensee before, during or after the term of this Agreement
                  shall accrue and belong to Shire, and the Licensee shall, at
                  Shire's request and cost, promptly execute all documents
                  required by Shire to confirm this.

11.      INTELLECTUAL PROPERTY, IMPROVEMENTS AND PATENTS

11.1     Except as set out in this Agreement and the License Agreement, all
         right, title and interest in the Shire Intellectual Property and the
         Trade Marks shall belong to Shire, and the Licensee shall not have any
         right, title or interest in the Shire Intellectual Property or the
         Trade Marks.

11.2     All Intellectual Property Rights in the Development Data shall belong
         to the [...***...]. The Licensee shall disclose reasonably detailed
         summaries of the Development Data to Shire through the Development
         Committee.

11.3     Shire shall, at its sole option, file, prosecute, maintain or extend
         the Shire Patents. Subject to the terms of the License Agreement, Shire
         shall:

                                       21    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (a)      keep the Licensee reasonably informed of any material
                  developments or notices in connection with the prosecution of
                  any Shire Patents or University Patent applications, but only
                  to the extent that the material developments or notices relate
                  to the Licensed Product;

         (b)      give the Licensee a reasonable opportunity to comment on any
                  Shire response to such developments or notices that are
                  intended to be filed in any patent office in relation to the
                  Compound Patents and consider in good faith any such comments;
                  and

         (c)      give the Licensee a reasonable opportunity to liaise and
                  cooperate with the University in the prosecution and
                  maintenance of the University Patents.

11.4     Any expenses incurred after the Effective Date in the filing,
         prosecution or maintenance of:

         (a)      the University Patents, shall borne by the [...***...];

         (b)      the Compound Patents shall be borne by the [...***...] and
                  shall be creditable (but non-refundable) against royalty
                  payments due from Licensee to Shire under clause 7 (including
                  for the avoidance of doubt, payments under clause 7.7(b)),
                  provided that, in no event will any credit amount under this
                  Agreement reduce the royalties payable to Shire in any Quarter
                  by more than [...***...]% (and any amount that has not been so
                  credited may be credited against royalties due in subsequent
                  Quarters, subject to the limitation described in the previous
                  sentence); and

         (c)      the Background Patents, shall be borne by [...***...].

11.5     In the event that Shire elects not to continue to file, prosecute or
         maintain patent protection for any of the Compound Patents, the
         Licensee shall have the right, at its option, to maintain such Compound
         Patents on behalf of Shire. Without limiting the generality of the
         foregoing, in no event shall Shire provide the Licensee with notice of
         abandonment of any Compound Patents less than 30 days prior to its date
         of lapse.

11.6     Shire shall maintain patent protection for all Background Patents
         identified as [...***...] and [...***...] in the Principal Markets.

11.7     Shire reserves all of its rights not expressly granted to the Licensee
         under this Agreement. The Licensee shall not, and shall not attempt or
         purport to file or prosecute in any country any patent application
         which claims, or purports to claim, any Shire Intellectual Property,
         except as permitted under clause 11.5. Additionally, the Licensee shall
         not, directly or indirectly prevent or attempt to prevent Shire from
         filing or prosecuting in any country any patent application which
         claims, discloses or uses or purports to claim, disclose or use any
         Shire Intellectual Property.

12.      INFRINGEMENT OF SHIRE INTELLECTUAL PROPERTY RIGHTS

12.1     Each Party shall promptly notify the other, with such details as it has
         in its possession, on becoming aware of any third party infringement,
         or suspected infringement, of any part of the Shire Intellectual
         Property or the Trade Marks in the Territory.

                                       22    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

12.2     Subject to the terms of the License Agreement, Shire shall have the
         first right, but not the obligation, to take action in respect of any
         infringements of the Shire Intellectual Property or the Trade Marks,
         including any injunctive, compensatory or other remedies or relief
         (collectively "REMEDIES") as may be necessary or desirable to prevent
         such infringement and preserve the Shire Intellectual Property. The
         Licensee shall permit any such Remedies to be brought in its name if
         permitted or required by law. Shire may compromise or settle any of the
         Remedies at its sole discretion, provided that, Shire shall not make
         any settlement or compromise that adversely affects the interests of
         the Licensee in respect of the Licensed Products in the Territory
         without the prior written consent of the Licensee, such consent not to
         be unreasonably withheld or delayed.

12.3     In the event that Shire does not pursue any Remedies with respect to
         the Shire Intellectual Property or the Trade Marks within 60 days
         following notice of alleged infringement or 10 days before the time
         limit, if any, for the filing of any infringement action, whichever is
         sooner, then the Licensee shall, subject to the terms of the License
         Agreement, have the right but, not the obligation, to pursue the
         Remedies against such third party infringer at its sole cost, provided
         that, the Licensee does not make any settlement or compromise that
         adversely affects the interests of Shire without the prior written
         consent of Shire, such consent not to be unreasonably withheld or
         delayed. For the avoidance of doubt, the Licensee's right to pursue any
         Remedies with respect to the infringement, or suspected infringement,
         of any part of the Shire Intellectual Property is limited to the extent
         that such infringement, or suspected infringement relates to the
         Compound.

12.4     In the event that either Party pursues the Remedies under clauses 12.2
         or 12.3:

         (a)      the other Party shall provide reasonable assistance to and
                  cooperate with the Party pursuing such Remedies, including
                  providing access to relevant documents and personnel and
                  furnishing a power of attorney if required by law;

         (b)      the Party that pursues the Remedy shall keep the other Party
                  fully informed of the progress of, and developments in, any
                  proceedings including any settlement discussions with the
                  defendants or potential defendants of such proceedings;

         (c)      each Party shall bear its own costs and expenses relating to
                  its pursuit of the Remedies or in providing assistance and
                  cooperation; and

         (d)      any damages or other amounts awarded or obtained by either
                  Party shall, subject to the terms of the License Agreement, be
                  distributed as follows:

                  (i)      firstly to cover any legal costs and expenses
                           incurred by the Party that pursued the Remedies; and
                           then

                  (ii)     to cover those legal costs and expenses, if any,
                           incurred by the other Party relating to the pursuit
                           of such Remedies; and then

                  (iii)    any remaining amount identified as damages for lost
                           sales of the Licensed Product, after the deductions
                           set out above, shall be paid to Licensee except that

                                       23
<PAGE>
                           Shire shall receive a portion equivalent to the
                           royalties it would have received under this Agreement
                           if such amount were deemed Net Sales; and then

                  (iv)     any remaining amount of damages awarded, other than
                           for damages for lost sales, shall be divided
                           [...***...], with Licensee receiving [...***...]% and
                           Shire receiving [...***...]%.

12.5     Notwithstanding anything contained in this Agreement, Shire reserves
         the right to control, at its sole expense, any opposition, protest,
         claim, proceedings, challenge or litigation relating to the validity of
         the Background Patents. The Licensee shall, and shall procure that its
         Affiliates and Sub-Licensees shall, provide such reasonable assistance
         and co-operation to Shire, at Shire's reasonable expense, as is
         necessary for the conduct of any such opposition, protest, claim,
         proceedings, challenge or litigation. The Licensee may participate in
         the defence or settlement of any opposition, protest, claim,
         proceedings, challenge or litigation relating to the validity of the
         Background Patents at its own cost with counsel of its choice, provided
         that:

         (a)      Shire has control of the conduct of such opposition, protest,
                  claim, proceedings, challenge or litigation relating to the
                  validity of the Background Patents; and

         (b)      the Licensee shall not, and shall procure that its Affiliates
                  and Sub-Licensees shall not, during the course of such
                  proceedings make any statement or admission that compromises
                  the validity of the Background Patents.

13.      INFRINGEMENT OF THIRD PARTY RIGHTS

13.1     In the event that any third party commences or threatens to commence
         patent, trade secret or other patent infringement action against the
         Licensee during the term of this Agreement, alleging that its use of
         the Licensed Product in the Territory infringes the third party's
         Intellectual Property Rights ("THIRD PARTY ACTION"), the Licensee shall
         by written notice promptly inform Shire of the Third Party Action,
         providing all such details of the Third Party Action as are in its
         possession. Upon receipt of the notice, the Parties shall promptly
         discuss the best way to respond to the Third Party Action.

13.2     The Licensee shall, [...***...] and in its sole discretion, defend and
         control the defence of any such Third Party Action using counsel of its
         own choice, provided that:

         (a)      Shire may participate in the defence or settlement of the
                  Third Party Action [...***...] with counsel of its choice; and

         (b)      the Licensee shall not settle the Third Party Action in a
                  manner adverse to Shire, except as agreed in writing by Shire,
                  such agreement not to be unreasonably withheld or delayed.

13.3     In any Third Party Action under this clause 13, the Parties shall
         cooperate with each other in connection with any such claim, suit or
         proceeding and shall keep each other reasonably informed of any
         material development in connection with the Third Party Action,
         including providing access to relevant documents, personnel or other
         evidence.

                                       24    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

14.      INDEMNIFICATION AND INSURANCE

14.1     The Licensee shall defend, indemnify and hold harmless Shire, its
         Affiliates and its and their directors, officers, employees and
         contractors ("SHIRE PARTIES") from and against any and all claims,
         actions, demands, losses, damages, costs and reasonable expenses
         (including reasonable legal, counsel and expert fees) made or brought
         by any third parties ("CLAIMS") arising from or in connection with the
         research, development, testing, manufacture, marketing, distribution,
         sale or use of the Licensed Product by Licensee or its Affiliates or
         its or their Sub-Licensees, except to the extent that such Claims
         result from the negligence or willful default of the Shire Parties.

14.2     Shire shall promptly:

         (a)      inform the Licensee by written notice of any Claims or the
                  discovery of a fact upon which Shire intends to base a request
                  for indemnification;

         (b)      provide the Licensee with copies of all papers and official
                  documents received in respect of any Claims; and

         (c)      cooperate as reasonably requested by the Licensee in the
                  defence against any Claims.

14.3     The Licensee shall have the sole control over the defence of any
         Claims, provided that, the Licensee shall obtain the written consent of
         Shire, prior to settling or otherwise disposing of such Claims if as a
         result of the settlement or Claim disposal Shire's interests are in any
         way adversely affected. Any costs and expenses, incurred by Shire in
         connection with any Claims shall be reimbursed by the Licensee on a
         Quarterly basis, subject to an obligation of reimbursement if it is
         determined by a court of competent jurisdiction that such Claims are
         not subject to indemnification under clause 14.1.

14.4     Shire shall defend, indemnify and hold harmless Licensee, its
         Affiliates and its and their directors, officers, employees and
         contractors ("LICENSEE PARTIES") from and against any and all Claims
         resulting from a breach of clause 16.2.

14.5     Notwithstanding anything contained in this Agreement, in no event shall
         either Party or their respective Affiliates be liable for special,
         indirect, incidental or consequential loss or damage based on contract,
         tort or any other legal theory arising out of this Agreement. Nothing
         in this Agreement shall limit either Party's liability to any person
         for death or personal injury caused by negligence.

14.6     The Licensee shall, at its own cost, during the term of this Agreement
         and for a period of [...***...] thereafter, maintain insurance which is
         reasonable and customary in the United States of America pharmaceutical
         industry for companies of comparable size and activities, and in any
         event:

         (a)      listing Shire and the Indemnitees (as defined in the License
                  Agreement) as additional insureds on the policy by no later
                  than October 1, 2004;

                                       25    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (b)      covering product liability in relation to the studies
                  undertaken in connection with the development of the Licensed
                  Product in amounts no less than US$[...***...] per incident
                  and US$[...***...] annual aggregate; and

         (c)      covering comprehensive product liability insurance and general
                  commercial liability insurance with respect to the
                  manufacture, use or sale Licensed Product from receipt of
                  Marketing Authorization in amounts not less than
                  US$[...***...] per incident and US$[...***...] annual
                  aggregate.

14.7     Upon reasonable request from Shire, the Licensee shall provide, or
         procure that its Sub-Licensees provide documents from its insurer
         confirming the existence and renewal of the relevant insurance policies
         conforming with the requirements of clause 14.6.

15.      CONFIDENTIALITY AND PUBLICATIONS

15.1     The Parties, their Affiliates and their respective directors, officers,
         employees, officers and consultants shall keep and maintain any
         Confidential Information supplied by the other Party during the term of
         this Agreement strictly confidential. The confidentiality obligations
         contained in this Agreement shall not apply to the extent that such
         Confidential Information is:

         (a)      at the time of disclosure by one Party to the other in the
                  public domain or otherwise publicly known;

         (b)      after disclosure by one Party to the other becomes part of the
                  public domain, other than by breach of any obligation of
                  confidentiality;

         (c)      information which the receiving Party can establish by
                  documentary evidence was already in its possession at the time
                  of receipt or was independently developed by the receiving
                  Party without use of the Confidential Information of the
                  disclosing Party; or

         (d)      received from a third party who was lawfully entitled to
                  disclose such information without an obligation of
                  confidentiality.

15.2     Notwithstanding clause 15.1, the Party receiving Confidential
         Information may disclose such Confidential Information:

         (a)      to Regulatory Authorities or other government agencies to gain
                  approval to conduct clinical trials in relation to the
                  Licensed Product or to file, prosecute and maintain the
                  Marketing Authorizations and any other required filings for
                  the Licensed Product, provided that, the disclosure is limited
                  to the extent reasonably necessary to obtain such
                  authorizations or approvals;

         (b)      to the extent that such disclosure is required by any
                  applicable law, regulation, court of competent jurisdiction or
                  governmental authority (including the FDA and the SEC),
                  provided that, the Confidential Information may be disclosed
                  only to the extent

                                       26    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                  required and wherever practicable, the disclosing Party has
                  been given sufficient written notice in advance to enable it
                  to seek protection or confidential treatment of such
                  Confidential Information;

         (c)      to Affiliates, actual or potential Sub-Licensees,
                  sub-contractors, employees, consultants and agents who have a
                  need to know the information for the purposes of this
                  Agreement, and are bound by obligations of confidentiality no
                  less protective than those contained in this Agreement; or

         (d)      to Third Parties in connection with due diligence
                  investigations in relation to the Licensee (for example,
                  potential investors), provided that, such Third Parties are
                  bound by confidentiality obligations no less protective than
                  those contained in this Agreement; or

         (e)      representatives of the University, provided that, such
                  representatives are bound by confidentiality obligations no
                  less protective than those contained in this Agreement.

15.3     The Parties shall consult with each other, in advance, with regard to
         the terms of all proposed press releases, public announcements and
         other public statements relating to any Confidential Information or the
         transactions contemplated under this Agreement. Shire acknowledges that
         in connection with any public offering of the stock of Licensee,
         Licensee may be required to file this Agreement with the SEC, subject
         to confidential treatment requests.

16.      WARRANTIES

16.1     Shire and the Licensee each warrant that:

         (a)      it has obtained all corporate authorisations required to enter
                  into and perform its obligations under this Agreement; and

         (b)      this Agreement is valid and binding obligation enforceable
                  against it in accordance with its terms and conditions.

16.2     At the Effective Date, Shire warrants that:

         (a)      the Shire Patents are owned by Shire and the University
                  Patents are exclusively licensed to Shire under the terms of
                  the License Agreement;

         (b)      all renewal and maintenance fees in relation to the Shire
                  Patents and University Patents have been paid on or before the
                  due date for payment;

         (c)      so far as it is aware, there are no current oppositions or
                  interferences relating to the Shire Patents or University
                  Patents;

         (d)      it has not received any notice from any third party in the
                  last [...***...] alleging that the Compound infringes any
                  third party Intellectual Property Rights;

                                       27    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (e)      it has not sent any notice to any third party in the last
                  [...***...] alleging that the third party is infringing the
                  Shire Intellectual Property with respect to the Compound;

         (f)      so far as it is aware, Shire has no royalty or other license
                  payment obligations to third parties with respect to the
                  research, use, manufacture or sale of the Compound other than
                  under the License Agreement and Consultancy Agreement; and

         (g)      except for the Excluded Patents, the list of Licensed Patents
                  in Schedule 2 of this Agreement is a complete list of the
                  patents and patent applications owned by or licensed to Shire
                  containing claims relating to the Compound.

16.3     Notwithstanding anything contained in this Agreement, Shire gives no
         warranty and makes no representation that any patent application
         identified in Schedule 2 shall proceed to grant or will be valid and
         enforceable.

16.4     Except for the warranties set out in clause 16, no warranty, condition,
         term, undertaking or representation (express or implied, statutory or
         otherwise) is given by Shire to the Licensee in respect of the Shire
         Intellectual Property, the Licensed Product or any other products
         developed, manufactured, sold or supplied by the Licensee using the
         Shire Intellectual Property and all such warranties, conditions, terms,
         undertakings and representations are to the extent permitted by law
         expressly excluded.

17       COMPLIANCE WITH LAW

17.1     In exercising its rights and obligations under this Agreement, the
         Licensee shall comply with, or shall procure compliance by its
         Affiliates and Sub-Licensees with, all applicable national and local
         laws, rules and regulations including but not limited to the
         requirements of any Marketing Authorization s or any relevant laws,
         rules or regulations concerning the research, development, manufacture,
         delivery, transport, import, advertising, packaging, labelling,
         storage, sale or use of the Licensed Product in the Territory or any
         part of it.

17.2     The Licensee shall use reasonable efforts to promptly inform Shire of
         any new laws, rules or regulations in the Territory (or any part of it)
         or any amendments, or proposed amendments to the current laws, rules or
         regulations that may have material impact on the use, distribution or
         sale of the Licensed Product.

17.3     In performing any of their respective rights and obligations under this
         Agreement, each Party shall comply with all applicable data protection
         laws and regulations.

18       TERM

18.1     This Agreement commences on the Effective Date and, subject to earlier
         termination in accordance with clause 19, shall with respect to each of
         the countries in the Territory expire on the last to occur of:

         (a)      expiry of the last to expire of the issued Shire Patents or
                  the University Patents in the applicable country, including
                  patents issued on patent applications within Shire Patents or
                  University Patents as the case may be; or

                                       28    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (b)      [...***...] from the date of first commercial sale in that
                  country.

19       TERMINATION

19.1     Either Party shall be entitled to terminate this Agreement by written
         notice to the other if:

         (a)      the other Party commits a material breach of this Agreement,
                  and in the case of a breach which is capable of remedy fails
                  to remedy it within 60 days of receipt of notice from the
                  first Party of such breach and of its intention to exercise
                  its rights under this clause; or

         (b)      an order is made or a resolution is passed for the winding up
                  of the other Party (other than voluntarily for the purposes of
                  solvent amalgamation or reconstruction) or an order is made
                  for the appointment of an administrator to manage the other
                  Party's affairs, business and property or if a receiver (which
                  expression shall include an administrative receiver) is
                  appointed over any of the other Party's assets or undertaking
                  or if circumstances arise which entitle the court or a
                  creditor to appoint a receiver or manager or which entitle the
                  court to make a winding-up order or if a voluntary arrangement
                  is proposed in respect of the other Party or if the other
                  Party takes or suffers any similar or analogous action in
                  consequence of debt, and such order, appointment or similar
                  action is not removed within 90 days.

19.2     This Agreement may be terminated by Shire by notice in writing to the
         Licensee at any time (except as provided in clause 19.2(a)) if:

         (a)      the Licensee fails to make the upfront payment of
                  US$3 million to Shire within 3 Business Days from the
                  Effective Date pursuant to clause 7.1, with immediate effect
                  from receipt of the notice from Shire; which right of
                  termination will terminate on the earlier of (i) payment by
                  Licensee of the upfront payment of US$3 million to Shire or
                  (ii) 28 days from the expiration of the 3 Business Days from
                  the Effective Date;

         (b)      the Licensee, its Affiliates or its Sub-Licensees fail to make
                  any Milestone Payments or other payments of any sums due under
                  this Agreement (other than the upfront payment pursuant to
                  clause 7.1) within 30 days of receiving notice from Shire
                  requiring such payment;

         (c)      the Licensee, its Affiliates or its Sub-Licensees, directly or
                  indirectly, challenge the validity of the Shire Intellectual
                  Property or the Trade Marks or the right of Shire to use or
                  license the use of any of such Shire Intellectual Property or
                  the Trade Marks, or the Licensee assists any third party to
                  challenge the validity of such Shire Intellectual Property or
                  the Trade Marks;

         (d)      subject to clause 19.3, in the event of a Change of Control
                  where the new controlling party of the Licensee owns or
                  licenses a Competing Product;

         (e)      the Licensee ceases or threatens by written notice to cease to
                  carry on its business relating to oncology products;

                                       29    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (f)      in the event that the Licensee or its Affiliates or
                  Sub-Licensees has not commenced a [...***...] of the Licensed
                  Product in the United States of America within [...***...]
                  from the Effective Date;

         (g)      subject to clause 19.4, in the event that the Licensee or its
                  Affiliates or Sub-Licensees has not filed for [...***...] or
                  commenced a [...***...] of the Licensed Product in the United
                  States of America by [...***...];

         (h)      in the event that the Licensee or its Affiliates or
                  Sub-Licensees has not filed an [...***...] by [...***...],
                  provided that, Shire may not terminate this Agreement under
                  this sub-clause if the Licensee can reasonably demonstrate
                  that such delay or failure to file an [...***...] by
                  [...***...] is due to circumstances directly relating to
                  Development Plan and beyond its reasonable control, in which
                  event the Licensee shall have a further period of [...***...]
                  to achieve such event;

         (i)      in the event that for a reason attributable to the Licensee,
                  its Affiliates or its Sub-Licensees any [...***...] in the
                  Principal Markets lapses or is revoked by any competent
                  Regulatory Authority in the Territory; or

         (j)      in the event that the Licensee fails to provide Shire with any
                  [...***...] reports under clause 5.3(d).

19.3     In the event of Change of Control, where the new controlling party of
         the Licensee owns or licenses a Competing Product, the Licensee shall
         by written notice inform Shire of the Change of Control and Shire shall
         have 90 days from receipt of such notice to exercise its right of
         termination under clause 19.2(c). Notwithstanding anything contained in
         this clause, the Parties agree that Shire may not terminate this
         Agreement pursuant to clause 19.2(c) if the new controlling party
         agrees to divest such Competing Product and in fact so divests such
         Competing Product within 6 months from the date of completion of the
         Change of Control (subject to extension for an additional 3 months if
         the new controlling party has entered into a binding agreement with
         respect to such divestiture within such 6 month period). If the new
         controlling party is unable or unwilling to divest the Competing
         Product within such period, Shire shall be entitled to terminate this
         Agreement by 30 days written notice to the Licensee.

19.4     In the event that the [...***...] is unsuccessful, the Licensee shall
         have [...***...] from date of receipt of the [...***...] notice to
         commence a [...***...] of the Licensed Product in the United States of
         America, failing which, Shire may terminate this Agreement by written
         notice with immediate effect.

19.5     This Agreement may be terminated by Licensee by 90 days written notice
         to Shire, at any time after the second anniversary of the Effective
         Date, if:

         (a)      after making a reasonable evaluation of the safety, efficacy
                  or other data generated during the Development Plan, the
                  Licensee determines that the Licensed Product is not a
                  scientifically or commercially viable for further development
                  or commercialisation; or

                                       30    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (b)      the Licensee reasonably believes it will be unable to obtain
                  [...***...] in the United States of America after diligent
                  pursuit of such [...***...].

19.6     If the Licensee, its Affiliates or any Sub-Licensee, after having
         Launched the Licensed Product in any country in the Territory,
         discontinues the sale of the Licensed Product in such country for a
         period of [...***...] or more for reasons unrelated to Force Majeure or
         regulatory or safety issues in relation to the use of the Licensed
         Product, and subsequently fails to resume sales of any Licensed Product
         in such country within [...***...] of having been notified in writing
         of the failure to supply by Shire, then Shire may terminate the rights
         granted to the Licensee under this Agreement and the Trade Mark license
         solely with respect to such country by written notice to the Licensee.
         For the purpose of this clause, sales of minimal or commercially
         insignificant quantities of Licensed Product in a country shall be
         deemed to constitute a discontinuation of sales in such country.

20       CONSEQUENCES OF TERMINATION

20.1     On termination of this Agreement by either Party the license and
         sub-license (subject to the terms of the Memorandum of Understanding
         and Sub-Licensee MOU) granted under this Agreement shall immediately
         cease and the Licensee shall, and shall procure that its Affiliates and
         Sub-Licensees shall:

         (a)      subject to clause 20.4, immediately cease to carry out any of
                  the activities permitted by this Agreement (or any relevant
                  Sub-License Agreement) and cease to use or exploit in any way
                  the Licensed Product, the Trade Marks or the Shire
                  Intellectual Property;

         (b)      within 60 days of the date of the termination notice make all
                  outstanding payments including any royalty payments due to
                  Shire at the date of termination; and

         (c)      promptly return, or at Shire's option, destroy any Shire
                  Know-How and any materials containing the Shire Know-How in
                  its possession, custody or power except for such records as
                  may be required to be retained by the Licensee by any national
                  or local laws, rules or regulations.

20.2     On termination of this Agreement by either Party for any reason, other
         than by the Licensee under clause 19.1, the Licensee shall, and shall
         procure that its Affiliates and, Sub-Licensees subject to the terms of
         the Sub-Licensee MOU, shall:

         (a)      promptly deliver up to Shire any Development Data,
                  Improvements or other materials generated by the Licensee, its
                  Affiliates or Sub-Licensees in the development, registration
                  or commercialization of the Licensed Product;

         (b)      within 90 days from the date of termination, assign to Shire
                  (or its nominated Affiliate) all right, title and interest in
                  any Marketing Authorization in the Territory; and

                                       31    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

         (c)      grant Shire an exclusive, royalty free, worldwide, irrevocable
                  and perpetual license to use (with the right to sub-license)
                  the Development Data and any registration materials developed
                  or acquired by or on behalf of the Licensee its Affiliates or
                  Sub-Licensees during the term of this Agreement.

20.3     On expiry of this Agreement, Shire shall grant, the Licensee an
         exclusive, royalty-free, worldwide, irrevocable and perpetual license
         to use and exploit (with the right to sub-license) the Shire Know-How,
         including the right use the Shire Know-How to make, have made, use,
         offer for sale, sell and import the Licensed Products.

20.4     The Licensee, its Affiliates and Sub-Licensees shall be entitled to
         continue to sell existing stocks of the Licensed Products in the
         Territory for a period of not longer than 6 months following the date
         of termination, provided that, the Licensee pays Shire any royalties
         due in respect of such sales in accordance with the provisions of this
         Agreement.

20.5     Subject to clause 20.6, on termination of this Agreement by Shire under
         Sections 19.1 or 19.2, the Licensee hereby grants Shire an option to
         exclusively license any Intellectual Property Rights owned or licensed
         (with the right to sublicense) by the Licensee that claim or cover any
         Improvements generated by the Licensee during the term of this
         Agreement ("OPTION"). The Option shall be exercisable by Shire at any
         time within [...***...] from the date of notice of termination. Within
         15 days from receipt by the Licensee, of notice from Shire confirming
         the exercise of the Option, Shire and the Licensee shall negotiate in
         good faith for a period not to exceed [...***...] the grant to Shire of
         a exclusive, royalty bearing, worldwide, license to use (with the right
         to sub-license) the Improvement developed or acquired by or on behalf
         of the Licensee during the term of this Agreement, on commercially
         reasonable terms.

20.6     In the event that this Agreement is terminated as a result of the
         termination of the License Agreement by the University, and no license
         for the University Patents is granted to the Licensee pursuant to the
         Memorandum of Understanding, the Licensee shall grant the University
         the Option rights set out in clause 20.5 instead of to Shire under
         clause 20.6.

20.7     Subject to any separate agreement with the Sub-Licensee pursuant to
         clause 3.2, upon the termination or expiry of this Agreement, the
         Licensee shall, and shall procure that its Affiliates and Sub-Licensees
         shall execute such documents as Shire may reasonably require to record
         at all appropriate patent offices throughout the Territory that the
         Licensee or the relevant Sub-Licensee has ceased to be entitled to use
         and exploit the Licensed Patents.

20.8     In the event that the Licensee wishes to continue the use of the Trade
         Mark for the sale of the Licensed Product after the expiration of this
         Agreement, Shire shall grant to the Licensee an exclusive
         non-transferable license for the Trade Mark in the Territory on terms
         to be agreed between the Parties, provided that the Licensee notifies
         Shire within [...***...] of the date of such expiry that it wishes to
         take such a license and the Licensee shall pay Shire a perpetual Trade
         Mark royalty of [...***...]% of the Net Sales of the Licensed Product
         in accordance with clause 8.2.

                                       32    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

20.9     The termination or expiry of this Agreement shall not release either of
         the Parties from any liability which at the time of termination or
         expiry has already accrued to the other Party, nor affect in any way
         the survival of any other right, duty or obligation of the Parties
         which is expressly stated elsewhere in this Agreement to survive such
         termination or expiry.

20.10    Clauses 1, 9, 14, 15.1, 15.2, 16.3, 16.4, 20, 22, 23, and 24 shall
         survive the termination or expiry of this Agreement.

21       FORCE MAJEURE

21.1     Neither Party shall be entitled to terminate this Agreement or shall be
         liable to the other under this Agreement for loss or damages
         attributable to any Force Majeure, provided that, the Party affected
         shall give prompt notice thereof to the other Party. Subject to clause
         21.2, the Party giving such notice shall be excused from such of its
         obligations hereunder for so long as it continues to be affected by
         Force Majeure.

21.2     If such Force Majeure continues unabated for a period of at least 90
         days, the Parties will meet to discuss in good faith what actions to
         take or what modifications should be made to this Agreement as a
         consequence of such Force Majeure in order to alleviate its
         consequences on the affected Party.

22       NOTICES

22.1     Any notice or other document given under this Agreement shall be in
         writing in the English language and shall be given by hand or sent by
         prepaid airmail or by fax transmission to the address of the receiving
         Party as set out in clauses 22.3 below unless a different address or
         fax number has been notified to the other in writing for this purpose.

22.2     Each such notice or document shall:

         (a)      if sent by hand, be deemed to have been given when delivered
                  at the relevant address;

         (b)      if sent by prepaid airmail, be deemed to have been given 7
                  days after posting; or

         (c)      if sent by fax transmission be deemed to have been given when
                  transmitted provided that a confirmatory copy of such
                  facsimile transmission shall have been sent by prepaid airmail
                  within 24 hours of such transmission.

22.3     The address for services of notices and other documents on the Parties
         shall be:

           TO SHIRE BIOCHEM                      TO THE LICENSEE
           275 boul. Armand-Frappier,            ADDRESS:   10505 Roselle Street
           Laval, QC,                                       San Diego, CA 92121
           Canada H7V 4A7                                   U.S.A.

           FAX:      +1 450 978 7767             FAX:       +1 858 558 3402

                                       33
<PAGE>

           ATTENTION: Claude Perron              ATTENTION:  Michael Grey

           COPY TO:   Shire Legal Department     COPY TO:    Legal Department
                      +44 (0)1256 894 710                    +1 858 558 3402

           TO TANAUD IRELAND                     TO TANAUD BV

           Shannon Airport House,                Fred Roeskestraat 123,
           Shannon, Co Clare,                    First Floor, 1076 EE Amsterdam,
           Ireland                               The Netherlands

           FAX:       +353 61 472 060            FAX:         +31 20 577 1188

           ATTENTION: Alan Kane                  ATTENTION:   Dirk Stolp

23       ASSIGNMENT

23.1     Subject to clause 23.2, the Licensee shall not assign or transfer any
         of its rights or obligations under this Agreement without the prior
         written consent of Shire, such consent not to be unreasonably withheld
         or delayed; provided that the Licensee may assign or transfer this
         Agreement and its rights and obligations hereunder without Shire's
         consent in connection with the sale or transfer of all or substantially
         all of the Licensee's business to which this Agreement relates to a
         third party, whether by merger, sale of stock, sale of assets or
         otherwise. In the event of any such transaction however, Intellectual
         Property Rights of the acquiring party under such transaction shall not
         be included in the Intellectual Property Rights subject to this
         Agreement.

23.2     The Licensee may sub-license all or any of its rights under this
         Agreement provided that the Licensee complies with its obligations set
         out in clause 3.

23.3     Shire shall be entitled to assign all or any of its rights or
         obligations under this Agreement to an Affiliate.

24       GENERAL PROVISIONS

24.1     Nothing in this Agreement is deemed to constitute a partnership between
         the Parties nor constitute either Party the agent of the other Party
         for any purpose.

24.2     Any disagreement between Shire and the Licensee on the interpretation
         of this Agreement or any aspect of the performance by either Party of
         its obligations under this Agreement shall be resolved in accordance
         with the dispute resolution procedure set out in Schedule 8 provided
         that either Party shall have the right to seek urgent injunctive or
         other equitable relief in any court of competent jurisdiction.

24.3     Each of the Parties shall do execute and perform and shall procure to
         be done executed and performed all such further acts deeds documents
         and things as the other Party may reasonably require from time to time
         to give full effect to the terms of this Agreement.

                                       34
<PAGE>

24.4     Each Party shall pay its own costs, charges and expenses incurred in
         connection with the negotiation, preparation and completion of this
         Agreement.

24.5     This Agreement sets out the entire agreement and understanding between
         the Parties in respect of the subject matter of this Agreement and
         supersedes any heads of agreement which shall cease to have any further
         force or effect. It is agreed that:

         (a)      no Party has entered into this Agreement in reliance upon any
                  representation, warranty or undertaking of the other Party
                  which is not expressly set out in this Agreement;

         (b)      no Party shall have any remedy in respect of misrepresentation
                  or untrue statement made by the other Party or for any breach
                  of warranty which is not contained in this Agreement; and

         (c)      this clause shall not exclude any liability for, or remedy in
                  respect of, fraudulent misrepresentation.

24.6     Nothing in this Agreement shall operate to:

         (a)      exclude any provision implied into this Agreement by law and
                  which may not be excluded by law; or

         (b)      limit or exclude any liability, right or remedy to a greater
                  extent than is permissible under law.

24.7     No variation of this Agreement shall be valid unless it is in writing
         and signed by or on behalf of both Parties.

24.8     Unless expressly agreed, no variation shall constitute a general waiver
         of any provisions of this Agreement, nor shall it affect any rights,
         obligations or liabilities under or pursuant to this Agreement which
         have already accrued up to the date of variation, and the rights and
         obligations of the Parties under or pursuant to this Agreement shall
         remain in full force and effect, except and only to the extent that
         they are so varied.

24.9     If and to the extent that any provision of this Agreement is held to be
         illegal, void or unenforceable, such provision shall be given no effect
         and shall be deemed not to be included in this Agreement but without
         invalidating any of the remaining provisions of this Agreement.

24.10    No failure or delay by either Party in exercising any right or remedy
         provided by law under or pursuant to this Agreement shall impair such
         right or remedy or operate or be construed as a waiver or variation of
         it or preclude its exercise at any subsequent time and no single or
         partial exercise of any such right or remedy shall preclude any other
         or further exercise of it or the exercise of any other right or remedy.

                                       35
<PAGE>

24.11    The rights and remedies of each of the Parties under or pursuant to
         this Agreement are cumulative, may be exercised as often as such Party
         considers appropriate and are in addition to its rights and remedies
         under general law.

24.12    If in any jurisdiction the effect of any provision of this Agreement or
         the absence from this Agreement of any provision would be to prejudice
         the Licensed Patents or any remedy under the Licensed Patents, the
         Parties will make such amendments to this Agreement and execute such
         further agreements and documents limited to that part of the Territory
         which falls under such jurisdiction as may be necessary to remove such
         prejudicial effects.

24.13    This Agreement may be executed in any number of counterparts and by the
         Parties on separate counterparts, each of which is an original but all
         of which together constitute one and the same instrument.

24.14    The Licensee, or any Sub-Licensee or assignee, shall not create, assume
         or permit to exist any lien, pledge, security interest or other
         encumbrance on this Agreement or any Sub-License Agreement, provided
         that, Licensee or any Sub-Licensee shall be permitted to create, assume
         or permit to exist any lien, pledge, security interest or other
         encumbrance on this Agreement or any Sub-License Agreement:

         (a)      pursuant to obligations to its creditors outstanding as of the
                  Effective Date; and

         (b)      pursuant to the Loan and Security Agreement dated as of July
                  23, 2004 between the Licensee and its creditors thereto.

24.15    This Agreement and the obligations of the Parties shall be governed by
         and construed in accordance with the laws of the state of New York and
         subject to the jurisdiction of the New York courts.

         The rest of this page has been left intentionally blank.

                                       36
<PAGE>

AS WITNESS this Agreement has been signed by the duly authorised representatives
of the Parties on the day and year first before written.

SIGNED for and on behalf of     )            /s/ Angus Russell
SHIRE BIOCHEM INC.              )            -----------------------------------
                                )
                                             Angus Russell, Director
                                             -----------------------------------
                                             PRINT NAME AND TITLE

SIGNED for and on behalf of     )            /s/ Joseph Rus
TANAUD IRELAND INC.             )            -----------------------------------
                                )
                                             Joseph Rus, Director
                                             -----------------------------------
                                             PRINT NAME AND TITLE

SIGNED for and on behalf of     )            /s/ Joseph Rus
TANAUD INTERNATIONAL B.V.       )            -----------------------------------
                                )
                                             Joseph Rus, Director
                                             -----------------------------------
                                             PRINT NAME AND TITLE

SIGNED for and on behalf of     )            /s/ M.G. Grey
STRUCTURAL GENOMIX, INC.        )            -----------------------------------
                                )
                                             M.G. Grey, President
                                             -----------------------------------
                                             PRINT NAME AND TITLE

                                       37
<PAGE>

                                   SCHEDULE 1

                          DEVELOPMENT PLAN AND TIMELINE

ACTIVITY                                                      ANTICIPATED TIMING

Initiate Transition Plan                                           July 2004

AML

Complete Open Phase 1 Trial                                       [...***...]

Last cohort of patients dosed at [...***...] days
   [...***...] was [...***...] with [...***...]
   [...***...] had [...***...] the [...***...] of [...***...]
   An increase in [...***...]
   [...***...] to be [...***...] days)
   [...***...]
   [...***...]

Commence [...***...] Trial                                        [...***...]

Patient Population
   [...***...]
   [...***...]

Trial Size
   [...***...]
   [...***...]

Study Endpoints
   [...***...]
   [...***...]

Treatment Centers
   [...***...]

Complete [...***...] Trial                                        [...***...]

[...***...]                                                       [...***...]
   [...***...] for [...***...]
   [...***...] if [...***...] in the [...***...] is [...***...]
   [...***...] to [...***...]
   [...***...]

                                       38    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

Complete [...***...] Trial                                        [...***...]

Commence [...***...] Trial ([...***...])                          [...***...]

Patient Population
   [...***...] over [...***...] of age
   [...***...]

Treatment and Trial Size
   [...***...] at [...***...]
   [...***...] at [...***...]

Treatment Centers
   [...***...]

Study Endpoints
   [...***...] is [...***...] of [...***...]
   [...***...] is [...***...] of [...***...]

Complete [...***...] Trial                                        [...***...]

BLAST PHASE CML

Based on review of clinical opportunities with CML experts:

Commence [...***...] Trial                                        [...***...]

Patient population
   [...***...] CML-BP [...***...] or [...***...]

   Treatment and trial size
        [...***...] at [...***...]
        ~[...***...]

   Study Endpoints
        [...***...] to [...***...] CML [...***...]
        [...***...] of [...***...]

Complete [...***...] Trial                                        [...***...]

Evaluate next steps                                               [...***...]

MDS

Based on review of clinical opportunities with MDS experts:

                                       39    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

Commence [...***...] MDS Trial                                    [...***...]

SOLID TUMOR

Evaluate Open Phase 1 solid tumor
Continuous infusion study                                         [...***...]

Complete Phase 1 if existing data are supportive                  [...***...]

Initiate Phase 2                                                  [...***...]

                                       40    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 2

                                LICENSED PATENTS

PART I - BACKGROUND PATENTS

[...***...], SYNTHESIS AND USE THEREOF

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       41    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...] AND USE THEREOF

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PROCESS FOR [...***...] SYNTHESIS OF NUCLEOSIDES

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       42    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       43    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PROCESS FOR DIASTEREOSELECTIVE SYNTHESIS OF NUCLEOSIDES

<Table>
<Caption>
DOCKET NUMBER       APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       44    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
DOCKET NUMBER       APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

STEREOSELECTIVE SYNTHESIS OF [...***...] USING [...***...] INTERMEDIATE

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       45    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHOD AND COMPOSITIONS FOR THE SYNTHESIS OF [...***...] WITH [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       46    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       47    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

STEREOSELECTIVE SYNTHESIS OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PROCESS FOR PRODUCING [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       48    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

STEREOSELECTIVE PROCESS FOR THE PRODUCTION OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PART II - COMPOUND PATENTS

METHOD OF TREATING [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       49    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHODS OF TREATING CANCER USING A [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PHARMACEUTICAL [...***...] FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       50    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

[...***...] FOR IMPROVED [...***...] DELIVERY

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHODS OF TREATING [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       51    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

PHARMACEUTICAL [...***...] AND METHODS FOR THE TREATMENT OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHODS OF [...***...] OF TROXACITABINE

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHOD FOR THE TREATMENT OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PART III - UNIVERSITY PATENTS

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       52    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       53    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       54    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 3

                     MILESTONE EVENTS AND MILESTONE PAYMENTS

<Table>
<Caption>

NO.           MILESTONE EVENT                                                       MILESTONE PAYMENT (US$)
----------    -------------------------------------------------------------------   ------------------------
<S>           <C>                                                                   <C>

              DEVELOPMENT MILESTONES

1.            On the Licensee obtaining [...***...]                                       $[...***...]

2.                                                                                        $[...***...]
              The earlier of:

              o      the [...***...] of the [...***...] of the [...***...]; or

              o      the [...***...] of the [...***...] after [...***...] for
                     the [...***...]; or

              o      [...***...] of [...***...] that the [...***...].

3.            The earlier of:

              o      the [...***...] the [...***...] of the [...***...] for
                     [...***...]; or

              o      the [...***...] the [...***...] of the [...***...] for the           $[...***...]
                     [...***...]; or

              o      [...***...] of [...***...] that the [...***...].

4.            File for Marketing Authorization for first indication
              ([...***...]) of the Licensed Product in any of the [...***...].            $[...***...]

5.            File for Marketing Authorization for [...***...] of the Licensed
              Product in any of the [...***...].                                          $[...***...]

6.            Receipt of Marketing Authorization from any Regulatory Authority
              for the first indication ([...***...]) of the Licensed Product in
              any of the                                                                  $[...***...]
</Table>

                                       55    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<S>           <C>                                                                   <C>
              [...***...].

7.            Receipt of Marketing Authorization from any Regulatory Authority      $[...***...]
              for the [...***...] of the Licensed Product in any of the
              [...***...]

8.            Receipt of Marketing Authorization from any Regulatory Authority
              for the second indication ([...***...]) of the Licensed Product in    $[...***...]
              any of the [...***...]

8.            Receipt of Marketing Authorization from any Regulatory Authority
              for the [...***...] of the Licensed Product in any of the             $[...***...]
              [...***...]

              SALES MILESTONES

9.            The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

10            The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

11.           The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

12.           The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

</Table>

                                       56    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 4

                        SALES FORECASTS AND MINIMUM SALES

<Table>
<Caption>
   No.     YEAR                                     SALES FORECAST          MINIMUM SALES FORECAST
-------    ------------------------------------     -------------------     ----------------------
<S>        <C>                                      <C>                     <C>
    1.     First year following Launch              US$[...***...]               US$[...***...]

    2.     Second year following Launch             US$[...***...]               US$[...***...]

    3.     Third year following Launch              US$[...***...]               US$[...***...]

    4.     Fourth year following Launch             US$[...***...]               US$[...***...]

</Table>

                                       57    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 5

                                 SHIRE MATERIALS

<Table>
<Caption>
                                                                          EXPIRY
                                                                       DATE/RETEST
MATERIAL DESCRIPTION                 LOT NUMBER          QUANTITY          DATE          WAREHOUSE SITE
-----------------------------        -----------       -----------      -----------     ----------------
<S>                          <C>    <C>    <C>    <C>    <C>    <C>

Troxatyl 2 mg IMP                    [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl 10 mg IMP                   [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl 2 mg IMP                    [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl 10 mg IMP                   [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl API                         [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl API                         [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl API                         [...***...]       [...***...]      [...***...]       [...***...]
API Reference Standard               [...***...]       [...***...]      [...***...]       [...***...]
Ongoing Compound stability samples
including available impurities
standards (samples to remain at
stability testing site)
</Table>

                                       58    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 6

                                   TRADE MARKS

<Table>
<Caption>
NO.        TRADE MARK      OWNER                 COUNTRY          CLASS        NUMBER         APP/REG DATE    STATUS
---------- ------------    -----------------     -----------      ----------   -----------    ------------    ------------
<S>        <C>             <C>                   <C>              <C>          <C>            <C>             <C>

1.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
2.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
3.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
4.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
5.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
6.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
7.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
8.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
9.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
10.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
11.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
12.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
13.        TROXATYL        Shire BioChem         [...***...]                                  [...***...]     [...***...]
14.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
15.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
16.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
17.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
18.        TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
</Table>

                                       59    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 7

                           MEMORANDUM OF UNDERSTANDING

MEMORANDUM OF UNDERSTANDING

DATED:   23 JULY 2004

BETWEEN:

(1)      UNIVERSITY OF GEORGIA RESEARCH FOUNDATION, INC., a nonprofit Georgia
         corporation with offices located in Boyd Graduate Studies Research
         Center, The University of Georgia, Athens, Georgia 30602 ("UGARF");

(2)      YALE UNIVERSITY located in New Haven, Connecticut ("YALE"); and

(3)      STRUCTURAL GENOMIX, INC., a company incorporated in Delaware, whose
         address is 10505 Roselle Street, San Diego, CA 92121, U.S.A.
         ("SUB-LICENSEE").

BACKGROUND:

(A)      On 3 January 1996, UGARF and Yale entered into a license agreement with
         Shire BioChem Inc. (formerly BioChem Pharma Inc.), Tanaud Holdings
         (Barbados) Limited and Tanaud LLC (collectively "SHIRE") under which
         the University Patents and Licensed Technology (as defined below) were
         exclusively licensed to Shire ("HEAD LICENCE").

(B)      On 23 July 2004, Shire entered into a licence agreement with the
         Sub-Licensee under which certain patents and know how were exclusively
         licensed to the Sub-Licensee and the University Patents and Licensed
         Technology were sub-licensed to the Sub-Licensee ("SHIRE LICENCE").

(C)      Yale and UGARF have agreed to grant a licence under the University
         Patents and Licensed Technology to the Sub-Licensee on the same
         financial terms to the Head Licence in the event that the Head Licence
         is terminated as more specifically set out in this Memorandum of
         Understanding ("MEMORANDUM").

OPERATIVE PROVISIONS

1        DEFINITIONS

1.1      In this Memorandum:

         "AFFILIATE" means any firm, person or company which controls, is
         controlled by or is under common control with a Party to this Agreement
         and for the purpose of this definition the term "control" means the
         ownership either directly or indirectly of more than 50% of the voting
         securities of such firm, person or company;

                                       60
<PAGE>

         "COMPOUND" means the compound troxacitabine;

         "FIELD" means use of the Licensed Product in the treatment of cancer;

         "LICENSED PRODUCT" means any pharmaceutical formulations that contain
         the Compound alone as a therapeutically active ingredient, or in
         combination with any other pharmaceutically active ingredient;

         "LICENSED TECHNOLOGY" shall mean all designs, technical information,
         know-how, knowledge, data, specifications, test results and other
         information, whether or not patented, which are licensed by UGARF and
         Yale under the Head Licence and are useful for the development,
         commercialization, manufacture, use or sale of any Licensed Product;

         "UNIVERSITY" means UGARF or Yale or collectively UGARF and Yale as the
         case may be; and

         "UNIVERSITY PATENTS" means the patents and patent applications set out
         in Part III of Schedule 2 and including, any divisionals, extensions,
         reissues, re-examinations, continuations, and foreign counterparts
         thereof and patents issuing thereon;

1.2      In this Memorandum, unless the context requires otherwise:

         (a)      the headings are included for convenience only and shall not
                  affect its construction;

         (b)      references to "persons" includes individuals, bodies corporate
                  (wherever incorporated), unincorporated associations and
                  partnerships;

         (c)      words denoting the singular shall include the plural and vice
                  versa;

         (d)      words denoting one gender shall include each gender and all
                  genders; and

         (e)      any reference to an enactment or statutory provision is a
                  reference to it as it may have been, or may from time to time
                  be amended, modified, consolidated or re-enacted.

2        AGREEMENT TO GRANT LICENCE

2.1      Subject to clause 2.2, the parties agree that, in the event the
         University terminates the Head Licence, and provided that the reason
         for such termination does not relate in any way to any act or omission
         of the Sub-Licensee, its Affiliates, representatives or sub-licensees,
         the University shall grant the Sub-Licensee (or its nominated
         Affiliate), from the date of such termination, an exclusive worldwide
         licence under the University Patents and Licensed Technology to
         develop, manufacture, have manufactured, use, sell, offer for sale,
         import and supply the Licensed Product in the Field on the same
         financial terms as the Head Licence and substantially similar due
         diligence and other terms as those contained in the Shire Licence ("NEW
         LICENCE").

                                       61

<PAGE>

2.2      This Agreement and the grant of any licence under the University Patent
         and Licensed Technology pursuant to clauses 2.1, shall in all respects
         be conditional upon the University receiving the following:

         (a)      written notice from Shire, confirming that the Sub-Licensee is
                  in compliance with its obligations under the Shire Licence;

         (b)      copies of any arrangements, agreements or related transactions
                  (and any amendments thereto) between the Sub-Licensee and
                  Shire relating to the Licensed Product or any rights licensed
                  to the Sub-Licensee under the Shire Licence;

         (c)      written representation from Sub-Licensee, confirming that the
                  Sub-Licensee is in compliance with its obligations under the
                  Shire Licence;

         (d)      a detailed written update on the development and
                  commercialization of the Licensed Product that shall include,
                  without limitation, a summarized budget for development plan
                  expenses;

         (e)      documentary evidence confirming, to the University's
                  reasonable satisfaction, that the Sub-Licensee has sufficient
                  funds to carry on the development or commercialization of the
                  Licensed Product for not less than [...***...] months; and

         (f)      copies of agreements between the Sub-Licensee and any third
                  party relating to the sublicense of the rights granted to the
                  Sub-Licensee (or any part of such rights) under the Shire
                  Licence.

2.3      If each of the conditions precedent identified in clause 2.2 are not
         fulfilled (unless waived by the University) within 60 days of the
         termination of the Head Licence, the University shall have no
         obligation to the Sub-Licensee to grant the licence under clause 2.1,
         and neither party shall have a claim of any nature whatsoever against
         the other party under this Agreement.

2.4      The Sub-Licensee undertakes to use all reasonable efforts to ensure
         that the conditions precedent in clause 2.2 are fulfilled as soon as
         reasonably practicable following termination of the Head Licence, and
         in any event within 60 days from the date of termination of the Head
         Licence.

2.5      Yale and UGARF shall notify Sub-Licensee if a notice of termination of
         the Head Licence has been provided to Shire and the parties shall
         promptly meet to discuss in good faith to arrange for the finalisation
         and execution of the New Licence.

2.6      Yale and UGARF each agree that activities of the Sub-Licensee, its
         Affiliates and sublicensees shall constitute activities of Shire for
         the purposes of Article 3 of the Head License.

                                       62    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

3        FURTHER ASSURANCES

3.1      Each party shall do all acts and execute all documents as may be
         reasonably necessary to give effect to the grant of the New Licence and
         the exercise of the rights granted therein.

4        LAW AND JURISDICTION

4.1      This Memorandum and the obligations of the Parties shall be governed by
         and construed in accordance with the laws of the state of New York and
         subject to the jurisdiction of the New York courts.

AGREED by the parties through their duly authorised representations on the date
written above:

SIGNED for and on behalf of      )       /s/ Gordhan L. Patel
UNIVERSITY OF GEORGIA            )       ---------------------------------------
RESEARCH FOUNDATION, INC.        )
                                         Gordhan L. Patel, Executive Vice
                                         President
                                         ---------------------------------------
                                         PRINT NAME AND TITLE

SIGNED for and on behalf of      )       /s/ Jon Soderstrom
YALE UNIVERSITY                  )       ---------------------------------------
                                 )
                                         Jon Soderstrom, Managing Director, OCR
                                         ---------------------------------------
                                         PRINT NAME AND TITLE

SIGNED for and on behalf of      )       /s/ Tim Harris
STRUCTURAL GENOMIX, INC.         )       ---------------------------------------
                                 )
                                         CEO
                                         ---------------------------------------
                                         PRINT NAME AND TITLE

                                       63
<PAGE>

                                   SCHEDULE 1
                             THE UNIVERSITY PATENTS

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       64    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       65    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 8

                          DISPUTE RESOLUTION PROCEDURE

1.       NEGOTIATION

1.1      Representatives of the Parties shall, within 10 Business Days of
         receipt of a written request from either Party, convene a meeting of
         the Development Committee (with additional members from each Party as
         appropriate for the particular dispute) to discuss and in good faith
         try to resolve any claim, dispute, controversy, or disagreement between
         the Parties arising out of or in connection with the terms (or
         interpretation of the terms) of this Agreement (DISPUTE) without
         recourse to legal proceedings.

1.2      If resolution of the Dispute does not occur within 20 Business Days
         from the Development Committee meeting, the matter shall be escalated
         for determination by the respective Group Legal Counsel or heads of
         applicable business units of the Parties (OFFICERS) who may resolve the
         matter themselves or jointly appoint a mediator. The Officers shall
         negotiate in good faith to achieve a resolution of the Dispute referred
         to them within 20 Business Days after such notice is received.

1.3      If the Officers are unable to settle the Dispute between themselves
         within 20 Business Days from referral, the Officers shall report to the
         Parties on the progress of the negotiations in writing and the Dispute
         shall then be referred to mediation in accordance with sections 2.1 -
         2.4.

2.       MEDIATION

2.1      If the Parties have failed to resolve the Dispute by negotiation
         pursuant to sections 1.1 - 1.3, the Dispute shall be referred to
         mediation to be resolved in accordance with the rules of the American
         Arbitration Association ("AAA"). The place of the mediation shall be
         New York, United States and the language of the mediation shall be
         English.

2.2      To initiate a mediation, either Party shall give notice in writing
         (NOTICE) to the other Party in accordance with the provisions of clause
         22, requesting.

2.3      If the Dispute is not resolved within 60 days (or such longer period as
         the parties may agree) from the giving of the Notice, or if one of the
         Parties refuses to participate in mediation, the dispute shall be
         referred to arbitration in accordance with the provisions of section 3.

2.4      If Notice is not given prior to the commencement of arbitration, the
         Party commencing the arbitration must serve Notice on the other party
         to the arbitration within 21 days.

3.       ARBITRATION

                                       66
<PAGE>

3.1      If after the procedures set forth in sections 1 and 2, the Dispute has
         not been resolved, either Party may decide to institute arbitration
         proceedings by written notice to that effect to the other Party. Any
         unresolved Dispute shall be referred to and finally resolved by
         arbitration under the Rules of Arbitration of the International Chamber
         of Commerce (ICC) , which rules are deemed to be incorporated by
         reference into this clause.

3.2      The Tribunal shall consist of three arbitrators to be appointed having
         experience in the pharmaceutical industry: Shire and the Licensee shall
         each appoint one arbitrator and the third arbitrator, who shall be the
         Chairman of the tribunal, shall be appointed by the two-Party appointed
         arbitrators.

3.3      The place of arbitration shall be New York and the language of the
         arbitration shall be English.

3.4      Each Party shall bear its own costs and expenses incurred in connection
         with any arbitration proceeding and the Parties shall equally share the
         cost of the mediation and arbitration levied by the AAA or the ICC.

                                       67
<PAGE>

                                   SCHEDULE 9

                                EXCLUDED PATENTS

STEREOSELECTIVE SYNTHESIS OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
Any patents or patent applications owned or licensed by [...***...]
</Table>

                                       68   ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

SHIRE BIOCHEM INC.
2250 Alfred-Nobel Blvd., Suite 500
Ville Saint-Laurent, Quebec  H4S 2C9 Canada
Tel. 514 787-2300  Fax 514 787-2427
www.shire.com

                                                                    (SHIRE LOGO)

                                                                   Claude Perron
                                              Vice President and General Manager
                                            Tel.: 514-787-2345 Fax: 514-787-2428
                                                    e-mail: cperron@ca.shire.com

March 8, 2005                                                         By Courier
                                                                      ----------

Structural GenomiX, Inc
Attention:  Mr. Michael Grey, President
10505 Roselle Street
San Diego, CA 92121
USA

Re: Amendment to the License Agreement
--------------------------------------------------------------------------------

Dear Sir:

We refer to the patent and know how license between Shire BioChem Inc., Shire
Pharmaceutical Development Limited, Tanaud International BV (together SHIRE) and
Structural GenomiX, Inc. (SGX) dated 23 July 2004 as amended (LICENSE
AGREEMENT).

Shire and SGX desire to amend the License Agreement and this letter sets out the
agreed amendment to the License Agreement. All capitalised terms in this letter
shall, unless the context requires otherwise, have the meaning given to them in
the License Agreement.

Shire and SGX agree and acknowledge that from the date of this letter the
License Agreement shall be amended by deleting the definition of "Compound"
under clause 1.1 and replacing it with the following new definition:

         "COMPOUND" means the compound troxacitabine and its prodrugs;

Except as expressly amended by the terms of this letter, the terms and
conditions of the License Agreement shall remain in full force and effect,
unamended.

Please confirm your acceptance of the above amendment to the License Agreement
by signing, dating and returning to Shire a copy of this letter.

Yours faithfully,

/s/ Claude Perron
Claude Perron
Vice President and General Manager

<PAGE>

Amendment to the License Agreement                                       Page 2
--------------------------------------------------------------------------------

Agreed to:                              Agreed to:

/s/ Claude Perron                       /s/ Matthew Emmens
---------------------------------       ----------------------------------------
Claude Perron, Vice President and       Matthew Emmens
General Manager                         Director
For and on behalf of                    For and on behalf of
SHIRE BIOCHEM INC.                      SHIRE PHARMACEUTICAL DEVELOPMENT LIMITED

Agreed to:                              Agreed to:

/s/ Joseph Rus                          /s/ Stephen K. Burley
---------------------------------       ----------------------------------------
Joseph Rus                              Stephen K. Burley
Director                                CSO
For and on behalf of                    For and on behalf of
TANAUD INTERNATIONAL BV                 STRUCTURAL GENOMIX, INC.
<PAGE>

THIS NOVATION AGREEMENT is made the 19th day of January, 2005

BETWEEN:

1.       Shire BioChem Inc. (formerly known as BioChem Pharma Inc.) of 2250
         Alfred-Nobel Blvd., Suite 500, Ville Saint-Laurent, Quebec, H4S 2C9,
         Canada ("SBI");

2.       Tanaud International B.V. of Fred Roekestraat 123, First Floor, 1076 EE
         Amsterdam, The Netherlands ("TANAUD BV");

3.       Structural Genomix, Inc. of 10505 Roselle Street, San Diego, CA 92121,
         U.S.A. ("GENOMIX"); and

4.       Tanaud Ireland Inc. of 2250 Alfred-Nobel Blvd., Suite 500, Ville
         Saint-Laurent, Quebec, H4S 2C9, Canada ("TII").

WHEREAS:

(A)      Pursuant to the Licence (as defined below) SBI, Tanaud BV and TII
         licensed certain patents, technology and know-how to Genomix.

(B)      TII wishes to be released and discharged from the Licence and the
         parties have agreed to release and discharge TII from the Licence upon
         the terms of SBI's undertaking to perform the Licence and be bound by
         its terms and conditions in place of TII.

NOW IT IS AGREED as follows.

1.       DEFINITIONS

         In this agreement:

         "COUNTERPARTIES"           means, together, Genomix and Tanaud BV;

         "EFFECTIVE DATE"           means 1 January 2005; and

         "LICENCE"                  means a patent and know-how licence between
                                    SBI, TII, Tanaud BV and Genomix, dated 23
                                    July 2004 a copy of which is annexed hereto
                                    and initialled by the parties for the
                                    purposes of identification only.

2.       SBI'S UNDERTAKING

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SBI hereby
         undertakes to observe, perform, discharge, assume liabilities under and
         be bound by the Licence as if SBI had taken the place of TII under the
         Licence. Notwithstanding this undertaking, nothing in this agreement
         shall:

         (A)      require SBI to perform any obligation created by or arising
                  under the Licence falling due for performance, or which should
                  have been performed by TII, before the Effective Date or to
                  make any payments due or as otherwise would be incurred and
                  payable by Tll prior to the Effective Date; or

         (B)      make SBI liable for any act, neglect, default, omission or
                  liability in respect of the Licence committed or incurred by
                  TII or occurring before the Effective Date.

<PAGE>

                                       2

3.       COUNTERPARTIES' UNDERTAKINGS AND RELEASE OF TII

3.1      With effect from the Effective Date and in consideration of and subject
         to the undertakings given by SBI in clause 2 and TII in clause 4, the
         Counterparties hereby:

         (A)      release and discharge TII from all liabilities under the
                  Licence and all obligations to observe, perform, discharge and
                  be bound by the Licence;

         (B)      accept SBI's undertaking to observe, perform, discharge,
                  assume liabilities under and be bound by the Licence (such
                  undertaking being set out in clause 2); and

         (C)      agree to observe, perform, discharge, assume liabilities under
                  and be bound by the Licence as if SBI had taken the place of
                  TII under the Licence.

3.2      Notwithstanding the provisions of sub-clause 3.1(A), nothing in this
         agreement shall affect or prejudice any claim or demand whatsoever
         which the Counterparties may have against TII in relation to the
         Licence and arising out of matters prior to the Effective Date.

4.       TII'S UNDERTAKING AND RELEASE OF COUNTERPARTIES

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, TII hereby
         releases and discharges the Counterparties from all liabilities under
         the Licence and all obligations to observe, perform, discharge and be
         bound by the Licence. Notwithstanding this undertaking and release,
         nothing in this agreement shall affect or prejudice any claim or demand
         whatsoever which TII may have against the Counterparties in relation to
         the Licence and arising out of matters prior to the Effective Date.

5.       COUNTERPARTS

5.1      This agreement may be executed in any number of counterparts, and by
         the parties on separate counterparts, but shall not be effective until
         each party has executed at least one counterpart.

5.2      Each counterpart shall constitute an original of this agreement, but
         all the counterparts shall together constitute but one and the same
         instrument.

<PAGE>

                                       3

6.       GOVERNING LAW

         This agreement shall be governed by and construed in accordance with
         the laws of the state of New York and subject to the jurisdiction of
         the New York courts.

IN WITNESS WHEREOF the parties have entered into this agreement on the date
first written above.

/s/ [Illegible]
-------------------------------------------------
For and on behalf of SHIRE BIOCHEM INC.

/s/ [Illegible]
-------------------------------------------------
For and on behalf of TANAUD INTERNATIONAL B.V.

/s/ M. Grey
-------------------------------------------------
For and on behalf of STRUCTURAL GENOMIX, INC.

/s/ [Illegible]
-------------------------------------------------
For and on behalf of TANAUD IRELAND INC.

<PAGE>

THIS NOVATION AGREEMENT is made the 19th day of January, 2005

BETWEEN:

1.       Shire BioChem Inc. (formerly known as BioChem Pharma Inc.) of 2250
         Alfred-Nobel Blvd., Suite 500, Ville Saint-Laurent, Quebec, H4S 2C9,
         Canada ("SBI");

2.       Tanaud International B.V. of Fred Roekestraat 123, First Floor, 1076 EE
         Amsterdam, The Netherlands ("TANAUD BV");

3.       Structural Genomix, Inc. of 10505 Roselle Street, San Diego, CA 92121,
         U.S.A. ("GENOMIX"); and

4.       Shire Intellectual Property SrI of Chancery House, High Street,
         Bridgetown, Barbados, West Indies ("SIP").

WHEREAS:

(A)      Pursuant to the Licence (as defined below) SBI, Tanaud BV and Tanaud
         Ireland Inc. ("TII") licensed certain patents, technology and know-how
         to Genomix.

(B)      By a prior novation effective as at 1 January 2005, the rights and
         obligations of TII under the Licence (the "TII INTERESTS") were novated
         to SBI, TII being released and discharged from the Licence upon the
         terms of SBI's undertaking to perform the Licence and be bound by its
         terms and conditions in place of TII.

(C)      SBI now wishes to be released and discharged from the Licence to the
         extent of its rights and obligations representing the TII Interests and
         the parties have agreed to so release and discharge SBI from the
         Licence upon the terms of SIP's undertaking to perform the Licence and
         be bound by its terms and conditions in place of SBI in respect of the
         TII Interests.

NOW IT IS AGREED as follows.

1.       DEFINITIONS

         In this agreement:

         "COUNTERPARTIES"           means, together, Genomix and Tanaud BV;

         "EFFECTIVE DATE"           means 4 January 2005; and

         "LICENCE"                  means a patent and know-how between SBI,
                                    TII, Tanaud BV and Genomix, dated 23 July
                                    2004 a copy of which is annexed hereto and
                                    initialled by the parties for the purposes
                                    of identification only.

2.       SIP'S UNDERTAKING

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SIP hereby
         undertakes to observe, perform, discharge, assume liabilities under and
         be bound by the Licence as if SIP were a party to the Licence in place
         of SBI in respect of the TII Interests only. Notwithstanding this
         undertaking, nothing in this agreement shall:

         (A)      require SIP to perform any obligation created by or arising
                  under the Licence falling due for performance, or which should
                  have been performed, before the Effective Date or to

<PAGE>
                                       2

                  make any payments due or as otherwise would be incurred and
                  payable prior to the Effective Date; or

         (B)      make SIP liable for any act, neglect, default, omission or
                  liability in respect of the Licence committed or incurred by
                  SBI or occurring before the Effective Date.

3.       COUNTERPARTIES' UNDERTAKINGS AND RELEASE OF SBI

3.1      With effect from the Effective Date and in consideration of and subject
         to the undertakings given by SIP in clause 2 and SBI in clause 4, the
         Counterparties hereby:

         (A)      release and discharge SBI, in respect of the TII Interests
                  only, from all liabilities under the Licence and all
                  obligations to observe, perform, discharge and be bound by the
                  Licence;

         (B)      accept SIP's undertaking to observe, perform, discharge,
                  assume liabilities under and be bound by the Licence (such
                  undertaking being set out in clause 2); and

         (C)      agree to observe, perform, discharge, assume liabilities under
                  and be bound by the Licence as if SIP were a party to the
                  Licence in the place of SBI in respect of the TII Interests.

3.2      Notwithstanding the provisions of sub-clause 3.1(A), nothing in this
         agreement shall affect or prejudice any claim or demand whatsoever
         which the Counterparties may have against SBI, in respect of the TII
         Interests, in relation to the Licence and arising out of matters prior
         to the Effective Date.

4.       SBI'S UNDERTAKING AND RELEASE OF COUNTERPARTIES

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SBI hereby
         releases and discharges the Counterparties from all liabilities under
         the Licence and all obligations to observe, perform, discharge and be
         bound by the Licence. Notwithstanding this undertaking and release,
         nothing in this agreement shall affect or prejudice any claim or demand
         whatsoever which SBI may have against the Counterparties in relation to
         the Licence and arising out of matters prior to the Effective Date.

5.       NOTICES

         For the purposes of all provisions in the Licence concerning the
         service of notices, the address of SIP is its principal place of
         business set out above.

6.       COUNTERPARTS

6.1      This agreement may be executed in any number of counterparts, and by
         the parties on separate counterparts, but shall not be effective until
         each party has executed at least one counterpart.

6.2      Each counterpart shall constitute an original of this agreement, but
         all the counterparts shall together constitute but one and the same
         instrument.

<PAGE>
                                       3

7.       GOVERNING LAW

         This agreement shall be governed by and construed in accordance with
         the laws of the state of New York and subject to the jurisdiction of
         the New York courts.

IN WITNESS WHEREOF the parties have entered into this agreement on the date
first written above.

/s/ [Illegible]
-----------------------------------------------------
For and on behalf of SHIRE BIOCHEM INC.

/s/ [Illegible]
-----------------------------------------------------
For and on behalf of TANAUD INTERNATIONAL B.V.

/s/ M. Grey
-----------------------------------------------------
For and on behalf of STRUCTURAL GENOMIX, INC.

/s/ [Illegible]
-----------------------------------------------------
For and on behalf of SHIRE INTELLECTUAL PROPERTY SRI

<PAGE>

THIS NOVATION AGREEMENT is made the 19th day of January, 2005

BETWEEN:

1.       Shire BioChem Inc. (formerly known as BioChem Pharma Inc.) of 2250
         Alfred-Nobel Blvd., Suite 500, Ville Saint-Laurent, Quebec, H4S 2C9,
         Canada ("SBI");

2.       Tanaud International B.V. of Fred Roekestraat 123, First Floor, 1076 EE
         Amsterdam, The Netherlands ("TANAUD BV");

3.       Structural Genomix, Inc. of 10505 Roselle Street, San Diego, CA 92121,
         U.S.A. ("GENOMIX");

4.       Shire Intellectual Property SrI of Chancery House, High Street,
         Bridgetown, Barbados, West Indies ("SIP"); and

5.       Shire Pharmaceutical Development Limited to Hampshire International
         Business Park, Chineham, Basingstoke, Hampshire, RG24 8EP, U.K.
         ("SPD").

WHEREAS:

(A)      Pursuant to the Licence (as defined below) SBI, Tanaud BV and Tanaud
         Ireland Inc. ("TII") licensed certain patents, technology and know-how
         to Genomix.

(B)      By a prior novation effective as at 1 January 2005, the rights and
         obligations of TII under the Licence (the "TII INTERESTS") were novated
         to SBI, TII being released and discharged from the Licence upon the
         terms of SBI's undertaking to perform the Licence and be bound by its
         terms and conditions in place of TII.

(C)      By a prior novation effective as at 4 January 2005, SBI was released
         and discharged from the Licence to the extent of its rights and
         obligations representing the TII Interests and the parties agreed to
         release and discharge SBI from the Licence upon the terms of SIP's
         undertaking to perform the Licence and be bound by its terms and
         conditions in place of SBI in respect of the TII Interests.

(D)      SIP now wishes to be released and discharged from the Licence to the
         extent of its rights and obligations representing the TII Interests and
         the parties have agreed to release and discharge SIP from the Licence
         upon the terms of SPD's undertaking to perform the Licence and be bound
         by its terms and conditions in place of SIP in respect of the TII
         Interests.

NOW IT IS AGREED as follows.

1.       DEFINITIONS

         In this agreement:

         "COUNTERPARTIES"           means, together, Genomix and Tanaud BV;

         "EFFECTIVE DATE"           means 4 January 2005; and

         "LICENCE"                  means a patent and know-how licence between
                                    SBI, TII, Tanaud BV and Genomix, dated 23
                                    July 2004 a copy of which is annexed hereto
                                    and initialled by the parties for the
                                    purposes of identification only.

<PAGE>

                                       2

2.       SPD'S UNDERTAKING

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SPD hereby
         undertakes to observe, perform, discharge, assume liabilities under and
         be bound by the Licence as if SPD were a party to the Licence in place
         of SIP in respect of the TII Interests only. Notwithstanding this
         undertaking, nothing in this agreement shall:

         (A)      require SPD to perform any obligation created by or arising
                  under the Licence falling due for performance, or which should
                  have been performed, before the Effective Date or to make any
                  payments due or as otherwise would be incurred and payable
                  prior to the Effective Date; or

         (B)      make SPD liable for any act, neglect, default, omission or
                  liability in respect of the Licence committed or incurred by
                  SBI or occurring before the Effective Date.

3.       COUNTERPARTIES' UNDERTAKINGS AND RELEASE OF SIP

3.1      With effect from the Effective Date and in consideration of and subject
         to the undertakings given by SPD in clause 2 and SIP in clause 4, the
         Counterparties hereby:

         (A)      release and discharge SIP from all liabilities under the
                  Licence and all obligations to observe, perform, discharge and
                  be bound by the Licence;

         (B)      accept SPD's undertaking to observe, perform, discharge,
                  assume liabilities under and be bound by the Licence (such
                  undertaking being set out in clause 2); and

         (C)      agree to observe, perform, discharge and be bound by the
                  Licence as if SPD were a party to the Licence in the place of
                  SIP in respect of the TII Interests.

3.2      Notwithstanding the provisions of sub-clause 3.1(A), nothing in this
         agreement shall affect or prejudice any claim or demand whatsoever
         which the Counterparties may have against SIP in respect of the TII
         Interests, in relation to the Licence and arising out of matters prior
         to the Effective Date.

4.       SIP'S UNDERTAKING AND RELEASE OF COUNTERPARTIES

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SIP hereby
         releases and discharges the Counterparties from all liabilities under
         the Licence and all obligations to observe, perform, discharge and be
         bound by the Licence. Notwithstanding this undertaking and release,
         nothing in this agreement shall affect or prejudice any claim or demand
         whatsoever which SIP may have against the Counterparties in relation to
         the Licence and arising out of matters prior to the Effective Date.

5.       FURTHER ASSURANCE

         The parties (including any successors in business or assignees under
         the Licence) agree, at their own cost, to enter into and execute a
         novation agreement in a form substantially similar to this agreement to
         effect the transfer of the TII Interests to SIP (or its nominee which
         shall be a subsidiary of Shire Pharmaceuticals Group plc), thereby
         discharging and releasing SPD from the effective date of such novation
         from its obligations and liabilities under the Licence and substituting
         SIP (or its nominee) as the primary obligor in respect of the TII
         Interests, such agreement to be executed on or to take effect from 1
         January 2010.

<PAGE>

                                       3

5.2      In the event the TII Interests are novated to a nominee of SIP ("SIP
         Nominee") pursuant to clause 5.1 the parties (including any successors
         in business or assignees under the Licence) further agree, when
         requested to do so by SIP and at their own cost, to enter into and
         execute a further novation agreement in a form substantially similar to
         this agreement to effect the transfer of the TII Interests to SIP,
         thereby discharging and releasing the SIP Nominee from the effective
         date of such novation from its obligations and liabilities under the
         Licence and substituting SIP as the primary obligor in respect of the
         TII interests.

6.       NOTICES

         For the purposes of all provisions in the Licence concerning the
         service of notices, the address of SPD is its principal place of
         business set out above.

7.       COUNTERPARTS

7.1      This agreement may be executed in any number of counterparts, and by
         the parties on separate counterparts, but shall not be effective until
         each party has executed at least one counterpart.

7.2      Each counterpart shall constitute an original of this agreement, but
         all the counterparts shall together constitute but one and the same
         instrument.

8.       GOVERNING LAW

         This agreement shall be governed by and construed in accordance with
         the laws of the state of New York and subject to the jurisdiction of
         the New York courts.

IN WITNESS WHEREOF the parties have entered into this agreement on the date
first written above.

 /s/ [Illegible]
---------------------------------------------------------------
For and on behalf of SHIRE BIOCHEM INC.

/s/ [Illegible]
---------------------------------------------------------------
For and on behalf of TANAUD INTERNATIONAL B.V.

/s/ M. Grey
---------------------------------------------------------------
For and on behalf of STRUCTURAL GENOMIX, INC.

/s/ [Illegible]
---------------------------------------------------------------
For and on behalf of SHIRE INTELLECTUAL PROPERTY SRI

/s/ [Illegible]
---------------------------------------------------------------
For and on behalf of SHIRE PHARMACEUTICAL DEVELOPMENT LIMITED<PAGE>

                                                                   EXHIBIT 10.17

                                           *** TEXT OMITTED AND FILED SEPARATELY
                                    PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST
                                            UNDER 17 C.F.R. SECTION 200.80(b)(4)
                                               AND RULE 406 UNDER THE SECURITIES
                                                         ACT OF 1933, AS AMENDED

                       COLLABORATION AND LICENSE AGREEMENT

      THIS RESEARCH COLLABORATION AND LICENSE AGREEMENT (the "AGREEMENT") is
made and entered into as of April 14, 2003 (the "EFFECTIVE DATE") by and between
STRUCTURAL GENOMIX, INC. a corporation organized and existing under the laws of
the State of Delaware and having its principal place of business at 10505
Roselle Street, San Diego, CA 92121 ("SGX"), and ELI LILLY AND COMPANY, a
corporation organized and existing under the laws of the State of Indiana and
having its principal place of business at Lilly Corporate Center, Indianapolis,
Indiana 46285 (together with its Affiliates, "LILLY"). SGX and Lilly may be
referred to herein individually as a "Party" and collectively as the "Parties."

                                   BACKGROUND

      WHEREAS, SGX is in the business of conducting research in the field of
high throughput protein structure determination and structure directed drug
discovery;

      WHEREAS, Lilly is in the business of discovering, developing,
manufacturing and commercializing pharmaceuticals;

      WHEREAS, SGX and Lilly wish to enter into a collaborative research program
to perform structure determination of Lilly drug targets and compounds provided
by Lilly; and

      WHEREAS, Lilly desires to obtain access and licenses to certain
technologies and processes of SGX and SGX is willing to grant such access and
licenses on the terms set forth in this Agreement.

      NOW, THEREFORE, in consideration of the foregoing and the covenants and
promises contained in this Agreement, the Parties hereby agree as follows:

1.    DEFINITIONS

      1.1 "Affiliate" means, with respect to a Party hereto, a corporation,
company or other entity that is owned or controlled by such Party by virtue of
such Party's direct or indirect ownership or control of more than fifty percent
(50%) of the outstanding shares or securities (representing the right to vote
for the election of directors or other managing authority) of such corporation,
company or other entity, but such corporation, company or other entity shall be
deemed to be an Affiliate only so long as such ownership or control exists.

      1.2 "Collaboration" means the activities conducted by the Parties in
connection with the Research Plan and the Technology Installation Plan.

                                  Page 1 of 68
<PAGE>

      1.3 "Collaboration Target(s)" means the targets identified in the attached
Exhibit A, as may be modified from time to time in accordance with Section
2.6(b).

      1.4 "Collaboration Technology" means Patent Rights and Know-How which are
conceived or reduced to practice or otherwise developed by or on behalf of Lilly
or SGX, or jointly by Lilly and SGX during and in the performance of the
Research Collaboration; provided however, Collaboration Technology does not
include SGX Background Technology, SGX Process Technology, SGX Additional
Technology or Lilly Background Technology.

      1.5 "Controls" or "Controlled" means possession of the ability to grant
the licenses or sublicenses as provided for herein, without violating the terms
of any agreement or other arrangement with a Third Party.

      1.6 "[...***...]" means a [...***...] included in the Research
Collaboration in accordance with Section [...***...] and supplied by Lilly to
SGX (including [...***...]), which is [...***...], and which SGX agrees to use
reasonably diligent efforts to [...***...].

      1.7 "Eliminated Target" means a Collaboration Target as further defined in
Section 2.9.

      1.8 "FTE" means a full time equivalent person year (consisting of a total
of [...***...] ([...***...]) hours per year) of scientific or technical work
carried out by a qualified SGX Employee on or directly related to, the Research
Plan or the Technology Installation Plan.

      1.9 "IT Infrastructure" means the hardware and software listed in Part 2
of the attached Exhibit D.

      1.10 "JSC" has the meaning ascribed such term in Section 2.7.

      1.11 "Know-How" means all ideas, inventions, instructions, designs,
processes, formulas, software, materials, methods, processes, techniques, and
data and all intellectual property rights therein.

      1.12 "Licensed Technology" means (i) SGX Process Technology; and (ii) SGX
Improvements, Other Inventions, and SGX Research Stage Technology which Lilly
elects to have installed at a Lilly Facility pursuant to Section 3.6(a).

      1.13 "Lilly Background Technology" means Patent Rights and Know-How which
are: (a) owned or Controlled by Lilly on the Effective Date or during the Term
of the Research Collaboration; (b) developed by Lilly (i) outside of the
Research Collaboration or (ii) within the Research Collaboration but are of
general application (for example, have application to other proteins in addition
to the Collaboration Targets); and (c) necessary for the conduct of the Research
Collaboration. Lilly Background Technology includes Lilly Compounds.

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<PAGE>

      1.14 "Lilly Compound" means a [...***...] that is provided by Lilly to
SGX. Lilly Compound does not include Reference Compounds.

      1.15 "Lilly Facility" means the Lilly San Diego Facility or the Lilly
Indianapolis Facility.

      1.16 "Lilly Improvements" means Patent Rights and Know How owned or
Controlled by Lilly covering improvements, enhancements or modifications to SGX
Process Technology created by or on behalf of Lilly using SGX Process
Technology, during the Technology Awareness Period, that Lilly has installed at
and are in productive use by the protein crystallography group at Lilly using
the SGX Process Technology and are necessary or useful for the operation of the
SGX Process Technology.

      1.17 "Lilly Materials" means the [...***...] embodying Collaboration
Targets, Lilly Compounds, Lilly Reference Compounds and any [...***...] used to
express Collaboration Targets, in each case, which are owned or Controlled by
Lilly.

      1.18 "Lilly New Developments" means Patent Rights and Know-How owned or
Controlled by Lilly, covering methods, systems, programs, technology and
software created by or on behalf of Lilly during the Technology Awareness
Period, that are of application in the field of [...***...], that Lilly has
installed at and are in productive use by the [...***...] group at Lilly, but
that are not Lilly Improvements.

      1.19 "Lilly San Diego Facility" means either (i) the facility known as
10575 Roselle Street, San Diego, CA 92121 or (ii) the approximately 7,000 sq ft
of available space in SGX's premises at 10581 Roselle Street, San Diego, CA
92121, as mutually agreed by the Parties as soon as practicable following the
Effective Date.

      1.20 "Lilly Indianapolis Facility" has the meaning ascribed to such term
in Section 3.2(b).

      1.21 "Other Invention" means an invention made by a Party or jointly by
the Parties in the course of executing the Technology Installation Plan.

      1.22 "Operating Team" has the meaning ascribed to such term in Section 2.8

      1.23 "Patent Rights" means patent applications filed in any country
worldwide, including provisionals, utilities, continuations (in whole or in
part), divisionals, reissues, reexaminations and foreign counterparts thereof,
any patents issued on such applications and any extensions of term,
registrations or confirmations of such patents.

      1.24 "Phase IA Acceptance Criteria" means the criteria described in Part 1
of the attached Exhibit G.

      1.25 "Phase IB Acceptance Criteria" means the Phase IB(i) and Phase IB(ii)
criteria described in Part 2 of the attached Exhibit G.

                            Page 3 of 68     ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      1.26 "Phase II Acceptance Criteria" means the criteria described in Part 3
of the attached Exhibit G.

      1.27 "Platform" means the hardware, IT Infrastructure, Third Party
Technology and operating system configuration specified in Exhibit D that is
required for Lilly to have installed at the Lilly Facilities in order to operate
the SGX Process Technology.

      1.28 "Platform Changes" has the meaning ascribed such term in Section 3.8.

      1.29 "Reference Compound" means for each Collaboration Target, any
compound which is publicly known to be an inhibitor or other modulator of such
Collaboration Target and which is approved by the JSC for inclusion in the
Research Collaboration.

      1.30 "Research Collaboration" means the program of research conducted by
the Parties under the Research Plan.

      1.31 "Research Plan" means the plan of research attached as Exhibit B to
this Agreement, as may be amended from time to time by the JSC in accordance
with Section 2.7.

      1.32 "SGX Background Technology" means all Patent Rights and Know-How
which are: (a) owned or Controlled by SGX on the Effective Date or during the
Term of the Research Collaboration; (b) developed by SGX (i) outside of the
Research Collaboration or (ii) within the Research Collaboration but are of
general application (for example, have application to other proteins in addition
to the Collaboration Targets); and (c) necessary for the conduct of the Research
Collaboration.

      1.33 "SGX Bioinformatics Technology" means integrated software tools in
source code form and all documentation reasonably necessary for the use thereof,
(i) within SGX Process Technology which are identified in the attached Exhibit F
and (ii) within SGX Improvements, which are revisions to (i) above (including
for example, error corrections, modifications, improvements and enhancements)
made by SGX during the Technology Awareness Period that SGX has installed and
are in productive use by the relevant research group at SGX using SGX Process
Technology and are necessary or useful for the operation of the SGX Process
Technology, and associated software documentation in hard copy and/or electronic
format, in each case which are owned or Controlled by SGX, and all Patent Rights
and copyrights covering such software tools and documentation.

      1.34 "SGX Employee" means an employee or other individual engaged by SGX
who has a duty to assign inventions made by such person, to SGX.

      1.35 "SGX Improvements" means Patent Rights and Know How owned or
Controlled by SGX, covering improvements, enhancements or modifications to the
SGX Process Technology created by or on behalf of SGX using SGX Process
Technology, during the Technology Awareness Period, that SGX has installed at
and are in productive use by the research group at SGX using the SGX Process
Technology and are necessary

                            Page 4 of 68
<PAGE>

or useful for the operation of the SGX Process Technology. SGX Improvements does
not include SGX Research Stage Technology.

      1.36 "SGX Materials" means (1) the [...***...] materials embodying any
Target Structure; and (2) any [...***...] used to express a Target Structure; in
each case which are owned or Controlled by SGX and are developed in the course
of the Research Collaboration.

      1.37 "SGX New Developments" means Patent Rights and Know-How owned or
Controlled by SGX, covering methods, systems, programs, technology and software
created by or on behalf of SGX during the Technology Awareness Period that are
of application in the field of high throughput structure determination, but that
are not SGX Improvements.

      1.38 "SGX Research Stage Technology" means Patent Rights and Know How
owned or Controlled by SGX, covering improvements, enhancements or modifications
to the SGX Process Technology, created by or on behalf of SGX using SGX Process
Technology during the Technology Awareness Period, that are: (i) in early stages
of development; (ii) not fully supported within SGX; (iii) not fully integrated
into the SGX Process Technology; or (iv) are not ready for supported transfer to
Third Parties, and (x) will be used by the research group at SGX using SGX
Process Technology and (y) are necessary or useful for the operation of the SGX
Process Technology.

      1.39 "SGX Process Technology" means Patent Rights and Know How owned or
Controlled by SGX as of the Effective Date, covering methods, systems, programs,
technology and software, listed in Exhibit F, and including all documentation
reasonably necessary for the use thereof. SGX Process Technology does not
include SGX Research Stage Technology, SGX Improvements, SGX New Technology or
Other Inventions.

      1.40 "Target Structure" means, on a [...***...] basis, the [...***...] of
a [...***...] determined by SGX in the course of the Research Collaboration,
either in the [...***...] and which has the following characteristics:
[...***...].

      1.41 "Technology Awareness Period" means the period commencing on the
Effective Date and terminating at the end of the Term of the Research
Collaboration.

                            Page 5 of 68     ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

      1.42 "Technology Installation Plan" means the plan agreed by the Parties
in accordance with Section 3.1.

      1.43 "Term of the Research Collaboration" means the period commencing on
the Effective Date, and terminating on the second anniversary of the Effective
Date, unless extended by mutual agreement of the Parties in accordance with
Section 2.10.

      1.44 "Term of the Technology Collaboration" means the period commencing on
the Effective Date and terminating upon the expiration of SGX's support
obligations under Section 3.4.

      1.45 "Third Party or Third Parties" means any entity other than Lilly or
SGX or their respective Affiliates.

      1.46 "Third Party Technology" means software and other technology listed
on Exhibit E, licensed to SGX by a Third Party, which Lilly is likely required
to license directly from such Third Party and which is likely required to
operate fully the SGX Process Technology.

2.    RESEARCH COLLABORATION.

      2.1 Research Collaboration. Subject to the terms and conditions of this
Agreement Lilly and SGX will use commercially reasonable efforts to conduct the
Research Collaboration in accordance with the Research Plan. It is acknowledged
that in furtherance of the Research Collaboration, SGX commenced certain
research activities prior to the Effective Date. SGX will commit a total of at
least [...***...] FTEs to the Research Collaboration during the
period between March 26, 2003 and the [...***...] anniversary of the Effective
Date, with a minimum of [...***...] FTEs being used between March
26, 2003 and the [...***...] anniversary of the Effective Date.

      2.2 Provision of Lilly Compounds. During the Term of the Research
Collaboration, Lilly will, at its sole discretion, deliver Lilly Compounds to
SGX (in quantities for each Lilly Compound prescribed in the Research Plan) for
inclusion in the Research Collaboration. SGX will not attempt directly or
indirectly to determine the structure of Lilly Compounds unless agreed by the
JSC. Lilly Compounds will be deemed Confidential Information of Lilly pursuant
to Section 7.1. The Lilly Compounds that will be used in the Research
Collaboration shall be [...***...].

      2.3 Provision of Lilly Background Technology. During the term of the
Research Collaboration, Lilly will provide SGX with reasonable quantities of
such Lilly Materials and other Lilly Background Technology as agreed to by Lilly
that are necessary for the conduct of the Research Collaboration by SGX.

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<PAGE>

      2.4 Provision of SGX Background Technology and Collaboration Technology.
During the Term of the Research Collaboration, SGX will provide Lilly with
reasonable quantities of available SGX Materials and other SGX Background
Technology and Collaboration Technology as agreed by the JSC and to the extent
reasonably necessary for Lilly to exercise its applicable rights under Article
5.

      2.5 Records; Reports. At least quarterly during the Term of the Research
Collaboration SGX will have the obligation to prepare and provide to the JSC a
detailed written report summarizing the progress of the work performed by SGX in
the course of the Research Collaboration during the preceding quarter. Promptly
upon completion of the Research Collaboration, SGX shall provide a final written
report summarizing its activities during the Research Collaboration and the
results thereof. In addition, during the Term of the Research Collaboration, SGX
will provide Lilly with quarterly reports of the time expended on the Research
Collaboration, within thirty (30) days after the close of each quarter. Such
report will include the names of SGX Employees working on the Research
Collaboration and the number of hours each such SGX Employee has allocated to
the Research Collaboration. Upon the written request of Lilly and not more than
once in each calendar year, SGX will permit Lilly, at Lilly's expense, to have
access during normal business hours to those records of SGX that may be
necessary to verify the accuracy of the FTE utilization under the Research
Collaboration and the basis for any other payments hereunder.

      2.6 Nomination of Collaboration Targets and Crystallizable Protein.

            (a) During the Term of the Research Collaboration, Lilly may
nominate to the JSC up to [...***...] ([...***...])[...***...] other than
Collaboration Targets, for which Lilly would like SGX to attempt to [...***...]
under the Research Plan. SGX will have two (2) weeks following receipt of notice
of nominated [...***...] from LillY to reject (by written notice to Lilly) the
inclusion of any such [...***...] in the Research Collaboration if any such
[...***...] is the subject of an existing research program at SGX or if SGX has
existing contractual obligationS to a Third Party with respect to such
[...***...]. Any [...***...] nominated by Lilly and not rejected by SGX in
accordance with this Section 2.6(a) will be deemed a [...***...].

            (b) During the Term of the Research Collaboration, subject to
Section 2.9, Lilly may nominate to the JSC additional [...***...] which Lilly
would like included in the Research Collaboration as Collaboration Targets. SGX
will have two (2) weeks following receipt of notice of any such nominated
[...***...] from Lilly to reject (by written notice to Lilly) the inclusion of
any such [...***...] in the Research Collaboration if such protein is the
subject of an existing research program at SGX or if SGX has existing
contractual obligations to a Third Party with respect to such [...***...]. Any
[...***...] nominated by Lilly and not rejected BY SGX in accordance with this
Section 2.6(b) will be deemed a Collaboration Target.

            (c) On or before the earlier of commencement of the Phase IA
Acceptance experiments described in Exhibit G or the start of the [...***...]
month following the Effective Date, the JSC will designate [...***...]
of the Collaboration Targets

                            Page 7 of 68     ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
 included in the Collaboration prior to such date, for inclusion in the Phase
IB(ii) validation experiments described in Exhibit G; [...***...] of which will
be Level 1, [...***...] of which will be Level 2 and [...***...] of which will
be Level 2(+) (as further described in the Research Plan), and such targets in
each Level will be of a similar level of difficulty as those targets in each
such Level in Exhibit A.

      2.7 Joint Steering Committee.

            (a) Formation. SGX and Lilly will establish a joint steering
committee ("JSC") to oversee the strategic and tactical aspects of the
Collaboration.

            (b) Membership. The JSC shall be comprised of three (3)
representatives from Lilly and three (3) representatives from SGX, designated by
the Parties promptly following the Effective Date. Each Party may replace its
JSC representatives at any time, with written notice to the other Party. The JSC
may name additional members to the JSC from time to time so long as each Party
has an equal number of members. In addition, each Party may at its discretion
invite non-voting employees, consultants or scientific advisors to attend
meetings of the JSC.

            (c) Decisions. Each Party shall have one vote on the JSC. All
decisions of the JSC shall be made by unanimous vote. Any matter which the JSC
is unable to agree upon shall be submitted to the Chief Executive Officer of SGX
and the Group Vice President, Lilly Research Laboratories of Lilly for
resolution. All decisions that cannot be agreed upon by the SGX CEO and Lilly
Group Vice President shall be made by Lilly reasonably taking into consideration
the position of SGX, excluding decisions under Sections 3.4(b), 3.4(d) and
3.6(c), which will be made by SGX reasonably taking into consideration the
position of Lilly.

            (d) Responsibilities. The JSC will review, direct and supervise the

performance of the Collaboration. The JSC will be responsible for (i)
determining the research strategy and time lines for the Research Plan and
allocating resources between Collaboration Targets (provided however, that SGX
will have the right to require that at least [...***...] FTEs are allocated to
the Phase IB validation experiments described in Exhibit G) and modifying or
amending the Research Plan as appropriate subject to the final sentence of this
Section 2.7(d); (ii) designating Collaboration Targets as Eliminated Targets in
accordance with Section 2.9; (iii) designating structures of Collaboration
Targets as Target Structures if they meet the criteria in Section 1.40; ; (iv)
determining whether to obtain licenses from Third Parties with respect to
intellectual property that may be necessary for the conduct of the Research
Collaboration; and (v) discussing patent matters relating to Research Plan
activities. Related to the Technology Installation Plan, the JSC will be
responsible for (i) reviewing and approving the Technology Installation Plan in
accordance with Section 3.1 and modifying or amending the Technology
Installation Plan as appropriate subject to the final sentence of this Section
2.7(d); (ii) determining whether any SGX Improvements, Other Inventions or SGX
Research Stage Technology will be included in the Technology Installation Plan
and supported under Section 3.4; (iii) determining which Licensed Technology
will not be supported in accordance with Section 3.4(d); (iv) agreeing on
additional support at the

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<PAGE>

Lilly Indianapolis Facility in accordance with Section 3.4(b); and (v)
determining which Platform Changes or Lilly Improvements will be supported at
Lilly in accordance with Section 3.4. Any amendments to the Research Plan or the
Technology Installation Plan which materially alter the nature or scope of the
Research Collaboration or Technology Collaboration must be agreed in writing by
the Parties.

            (e) Meetings. The JSC shall meet at least quarterly. The Parties
shall mutually agree upon times and places for such meetings (alternating
between San Diego, CA and Indianapolis, IN, or as the JSC may otherwise agree),
to discharge its responsibilities. If mutually agreed by the Parties, such
meeting may be held via videoconference or teleconference. Each Party will be
responsible for paying its own expenses in connection with participating in the
meetings of the JSC. The JSC shall prepare written minutes of each meeting and a
written record of all JSC decisions, whether made at a JSC meeting or otherwise.

      2.8 Operating Teams. The JSC may appoint one or more other working teams
("Operating Teams") to perform the day-to-day implementation of the Research
Plan and Technology Installation Plan and such other functions as the JSC may
determine.

            (a) Membership. All Operating Teams shall have at least one (1)
representative of each Party. Operating Teams shall have such decision-making
authority as may be delegated to them by the JSC. Each Party may replace its
Operating Team representatives at any time, upon written notice to the other
Party. Operating Team leaders at their discretion can name additional team
members or form sub-teams.

            (b) Decisions. Each Party shall have one vote on an Operating Team.
All decisions of the Operating Teams shall be made by unanimous vote. Any matter
that the Operating Team is unable to agree upon shall be submitted to the JSC.

            (c) Meetings. Each Operating Team shall meet as agreed by its
members or as directed by the JSC. Each Party shall bear its own costs
associated with holding and attending such meetings.

            (d) Initial Operating Teams. The JSC shall establish the following
two (2) Operating Teams, with such number of representatives of each Party and
such decision-making authority as the JSC shall determine:

                  (i) the Research Operations Team, which shall be responsible
for matters relating to the tactical aspects of the Research Plan, including:

                        (x) coordinating, monitoring and reporting research
                        progress, resource allocation and ensuring open exchange
                        between the Parties with respect to Research
                        Collaboration activities; and (y) determining which
                        Reference Compounds or Lilly Compounds to include in the
                        Research Collaboration to aid in crystallization;

                            Page 9 of 68
<PAGE>

                  (ii) the Technology Operations Team, which shall be
responsible for matters relating to the successful installation of the SGX
Process Technology and the Platform at the Lilly San Diego Facility and the
Lilly Indianapolis Facility, including:

                        (x) reviewing, directing and supervising the performance
                        of the Technology Installation Plan and revising the
                        Technology Installation Plan from time to time as
                        necessary; and (y) coordinating, monitoring and
                        reporting installation progress and ensuring open
                        exchange between the Parties with respect to Technology
                        Installation Plan activities;;

                  (iii) For avoidance of doubt, it is intended that the JSC will
delegate decision-making authority for day-to-day management of the
Collaboration to the Operating Teams described in this Section 2.8. While the
JSC retains the ability to review the decisions of the Operating Teams, it is
intended that the Operating Teams shall be given latitude to make decisions
without the need to first consult the JSC.

      2.9 Eliminated Targets. The JSC will remove a Collaboration Target from
the Research Collaboration and deem such Collaboration Target to be an
"Eliminated Target" for the purposes of Section 5.5(a), upon the occurrence of
any of the following:

            (a) either Party requests that the JSC agree to remove a
Collaboration Target from the Research Collaboration and the JSC so agrees;

            (b) Lilly determines not to pursue a Collaboration Target as a
[...***...]; notifies the JSC of such decision (which notification Lilly is
obligated to provide the JSC within thirty (30) days of such decision at Lilly)
and the JSC agrees to the removal of such Collaboration Target;

            (c) as determined by the JSC, (i) a Target Structure has not been
obtained for the Collaboration Target after reasonable effort, and (ii) it is
reasonable to conclude based on an assessment of technical feasibility, that a
Target Structure will not be obtained by SGX for such Collaboration Target
before the second anniversary of the Effective Date; or

            (d) at any time the total number of Collaboration Targets included
in the Research Collaboration for which Target Structure has not yet been
obtained exceeds [...***...] ([...***...]); in such event, the JSC will, within
thirty (30) days of a request by either Party, deem such number of Collaboration
Targets exceeding [...***...] ([...***...]) as Eliminated Targets in accordance
with this Section 2.9, as results in there being no more than [...***...]
([...***...]) Collaboration Targets included in the Research Collaboration for
which Target Structure has not been obtained. The JSC shall be responsible for
deciding which targets shall be excluded from Collaboration Targets under this
Section 2.9 (d).

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            2.10 Option to Extend Term of the Research Collaboration. On or
before the second anniversary of the Effective Date, Lilly will have the right
to extend the Term of the Research Collaboration for an additional [...***...]
period. In such event the Parties will negotiate in good faith the terms of such
extension, provided however, nothing in this Section 2.10 shall obligate the
Parties to enter into such extension.

3.    TECHNOLOGY TRANSFER

      3.1 Technology Installation Plan. Within three (3) months following the
Effective Date, SGX will prepare and the JSC will review and approve, a
Technology Installation Plan, based on the outline plan attached as Exhibit C.
The Technology Installation Plan may be updated or otherwise amended (in
accordance with Section 2.7(d)) as necessary from time to time by the JSC. Prior
to the approval by the JSC of the Technology Installation Plan, SGX may begin
ordering the equipment as described in Appendix D2. SGX shall supply any
existing validation documentation on SGX Process Technology, and will discuss
with Lilly the results of Lilly's gap analysis to be performed during the
Technology Installation Period. At Lilly's request, SGX will install the
components of the SGX Bioinformatics Technology listed in Appendix F at Lilly in
Indianapolis in advance of the installation of the SGX Process Technology at the
Lilly San Diego Facility. Upon installation, SGX will provide Lilly with a
reasonable amount of training on the use of this technology, provided however,
that any such training shall be included in the number of days allocated to
Initial Training under Section 3.4(a) below.

      3.2 Installation.

            (a) Installation at Lilly San Diego Facility. SGX will, at Lilly's
expense in accordance with Section 4.3, procure and install the Platform (other
than the IT Infrastructure) and install the SGX Process Technology on the
Platform at the Lilly San Diego Facility in accordance with the Technology
Installation Plan, provided that Lilly has purchased and installed, at its
expense, the IT Infrastructure at the Lilly San Diego Facility or at Lilly, as
agreed in the Technology Installation Plan (including in each case obtaining
from Third Parties the necessary licenses to Third Party Technology detailed in
Exhibit E). SGX will have no obligation to acquire or pay for any Third Party
Technology or any other part of the IT Infrastructure. SGX will provide the
Lilly San Diego Facility with access to certain components of SGX's IT
Infrastructure as described in the Technology Installation Plan. In the event of
any delay by Lilly in (i) approving the Technology Installation Plan, (ii)
obtaining a lease to the Lilly San Diego Facility and entering into a sublease
with SGX beyond one month after the Effective Date; (iii) approving the plans
and budget for the tenant improvements to the Lilly San Diego Facility,
including any revisions thereto, beyond one week after submission of such plans,
budgets or revisions thereto to Lilly by SGX, (iv) procuring and installing the
IT Infrastructure, or any other Platform components which the Parties agree
Lilly will procure, beyond the applicable timeline in the Technology
Installation Plan; or (v) procuring licenses to Third Party Technology required
for the Phase IA and Phase IB validation experiments as detailed in the
Technology Installation Plan, beyond the

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applicable timeline in the Technology Installation Plan, then upon request by
either Party, the timelines for installation in the Technology Installation
Plan, will be adjusted correspondingly; provided however: (i) in the event such
delay results in the Phase IA validation experiments described in Exhibit G not
commencing before the start of the [...***...] ([...***...]) month following the
Effective Date, then (A) Lilly shall immediately pay SGX [...***...]
([...***...]%) of the payment under Section 4.2(b), notwithstanding that the
Phase IA Acceptance Criteria may not yet have been achieved, and (B) commencing
at the beginning of the [...***...] ([...***...]) month following the Effective
Date and continuing through the [...***...] ([...***...]) month after the
Effective Date, one Collaboration Target will be removed from the Phase IB(ii)
validation experiment each month with the order of removal of such Collaboration
Targets being from the most difficult (within Level 2+) to the least difficult
(within Level 1); and (ii) in the event such delay results in the Phase IA and
Phase IB validation experiments not commencing before the start of the
[...***...] ([...***...]) month following the Effective Date, Lilly shall
immediately pay SGX the remaining payments due under Section 4.2(b) and 4.2(c),
notwithstanding that the Phase IA Acceptance Criteria and Phase IB Acceptance
Criteria may not yet have been achieved, and notwithstanding that such payments
are made, SGX will conduct the Phase IA and Phase IB validation experiments at
the Lilly San Diego Facility using reasonable diligence, as soon as the Lilly
San Diego Facility becomes available for such activities, provided however, in
the case of the Phase IB(ii) experiments, that the Term of the Research
Collaboration has been extended to allow such activities, in accordance with
Section 2.10. SGX will assist Lilly in the procurement of the IT Infrastructure,
including without limitation, liaising with Third Party providers of hardware
and Third Party Technology, as agreed by the JSC.

            (b) Installation at the Lilly Indianapolis Facility. At a time
determined by Lilly, but in no event later than the earlier of (i) the
expiration of Lilly's lease to the Lilly San Diego Facility and (ii) [...***...]
([...***...]) years after the commencement of Lilly's lease to the Lilly San
Diego Facility (the "Cut-Off Date"), SGX will disassemble the Platform and
uninstall the Licensed Technology, at the Lilly San Diego Facility, and
reassemble and reinstall the Platform and Licensed Technology at a facility of
Lilly in Indianapolis designated by Lilly (the "Lilly Indianapolis Facility") in
accordance with the Technology Installation Plan. Notwithstanding anything to
the contrary in this Agreement, if Lilly relocates the Platform and/or the
Licensed Technology after the Cut-Off Date, SGX will have no further obligations
under Article 3 with respect to the Platform or the Licensed Technology. Lilly
will be responsible for: (i) the costs of Third Party vendors of Platform
components for repackaging, transportation and reinstallation of the Platform,
and all other reasonable costs associated with the transportation (collectively
the "Relocation") of the Licensed Technology and the Platform under this Section
3.2(b), in accordance with Section 4.3(c); (ii) Relocation of the IT
Infrastructure to the Lilly Indianapolis Facility prior to commencement of the
reinstallation of the Licensed Technology at the Lilly Indianapolis Facility and
(iii) making fully available the Lilly Indianapolis Facility, services and Lilly
personnel necessary for installation in accordance with the Technology
Installation Plan. SGX will use reasonable diligence in performing its
obligations under this Section 3.2(b).

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<PAGE>

      3.3 Acceptance.

            (a) Phase IA. Promptly upon notification by SGX to Lilly that it has
installed the SGX Process Technology and Platform at the Lilly San Diego
Facility, Lilly, in consultation with the JSC, shall determine in good faith
whether such installation satisfies the Phase IA Acceptance Criteria.

            (b) Phase IB. Promptly upon notification by SGX to the JSC that it
has completed the Phase IB validation, Lilly, in consultation with the JSC,
shall determine in good faith whether such validation satisfies the Phase IB
Acceptance Criteria. Upon the determination by Lilly of achievement of the Phase
1B Acceptance Criteria but in no event later than the end of the Term of the
Research Collaboration, SGX will assign to Lilly its entire right, title and
interest in and to the Platform components procured by SGX on behalf of Lilly
under Section 3.2(a), installed at the Lilly San Diego Facility, including
without limitation, assignment of Third Party warranties and service contracts
where permitted.

            (c) Phase II. Promptly upon notification by SGX to Lilly that it has
installed the SGX Process Technology and Platform at the Lilly Indianapolis
Facility, Lilly, in consultation with the JSC, shall determine in good faith
whether such installation satisfies the Phase II Acceptance Criteria.

      3.4 Maintenance, Training and Technical Support. Once Lilly has determined
that the Phase IA Acceptance Criteria have been met, and payment has been made
by Lilly pursuant to Section 4.2(b), SGX will provide the following maintenance,
training and technical support services to Lilly:

            (a) Initial Training. SGX will provide, a training course at the
Lilly San Diego Facility (or at some other location as may be agreed by the JSC)
for Lilly personnel to receive detailed training on the operation of the
Licensed Technology (other than SGX Research Stage Technology) on the Platform
("Initial Training"). Such Initial Training will be conducted over a period of
no more than [...***...] ([...***...]) months and will comprise a total of at
least [...***...] ([...***...]) person months. Lilly will ensure that Lilly
personnel with appropriate technical skill are available at the Lilly San Diego
Facility to receive such training.

            (b) On-Site Training, Maintenance and Technical Support. During the
[...***...] ([...***...]) month period following completion of the Initial
Training, SGX will provide at least [...***...] ([...***...]) person days of
support for the Licensed Technology (other than SGX Research Stage Technology)
on the Platform at the Lilly San Diego Facility. If the required support results
from inherent problems with the Licensed Technology and is not due to Lilly's
action or inactions related thereto, then such support shall not count against
such [...***...] ([...***...]) person days. During the [...***...] ([...***...])
month period following payment by Lilly pursuant to Section 4.2(d), SGX will
provide at least [...***...] ([...***...]) person days of support for the
Licensed Technology (other than Research Stage Technology) on the Platform, at
the Lilly Indianapolis Facility. At Lilly's option, such support at the Lilly
Facilities may comprise: training, routine maintenance, and/or resolution of
defects or errors. Should

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additional assistance be required by Lilly beyond the [...***...] ([...***...])
days at the Lilly San Diego Facility or the [...***...] ([...***...]) days at
the Lilly Indianapolis Facility, SGX will provide such assistance as is agreed
by the JSC at a consulting rate comparable to reasonable commercial software
support service rates. Contact person(s) designated by each of the Parties shall
be the sole contacts for the coordination, delivery and receipt of the support
services under Sections 3.4(b) and (c) and shall be knowledgeable and trained in
the use of the applicable SGX Process Technology.

            (c) Support. For the [...***...] ([...***...]) month period
following the achievement of the Phase II Acceptance Criteria, SGX will provide
Lilly with a reasonable amount of electronic mail and telephone support for the
Licensed Technology (other than SGX Research Stage Technology), with email being
the primary means of support, for, among other things, problem determination,
verification and resolution, on a email-back basis, during SGX's normal business
hours of 8 am to 5 pm Pacific Standard Time, in accordance with the schedule
described in Exhibit H.

            (d) Limitations. The maintenance and technical support described
above shall be provided by SGX only for the Licensed Technology (other than SGX
Research Stage Technology) used in conjunction with the Platform. In the event
that Lilly (i) makes Platform Changes that are not agreed by the JSC, (ii) does
not accept a SGX Improvement, or Other Invention recommended by SGX, or (iii)
does not acquire additional Third Party Technology or implement other Platform
Changes recommended by SGX as necessary for the operation of the Licensed
Technology, or (iv) makes modifications to the Licensed Technology other than
those agreed by the JSC, SGX will have no obligation to provide maintenance or
technical support for the Licensed Technology modified or not modified by such
actions or inactions, respectively, of Lilly. Notwithstanding the previous
sentence, while a SGX Improvement or Other Invention is being installed at
Lilly, SGX shall continue to support the earlier release of the applicable
Licensed Technology only until the JSC determines that the SGX Improvement or
Other Invention has been successfully installed at Lilly. In addition, in the
event that any problem is the result of an action or inaction of Lilly as
described in (i) through (iv) above, SGX shall have the right to charge Lilly at
SGX's standard rates (comparable to reasonable commercial software support
rates), for the time spent resolving such problem. SGX will have no obligations
under this Section 3.4 with respect to SGX Research Stage Technology.

      3.5 Obligations. The Parties will:

            (i) ensure that the contact persons designated by each Party shall
be the sole contact for the coordination and receipt of the services provided
under Section 3.4; such person may be changed upon notice to the other Party;

            (ii) maintain during the Term of the Technology Collaboration,
adequate network connectivity as necessary to the systems of Lilly running the
SGX Process Technology, in a manner consistent with each Party's confidentiality
obligations to Third Parties, including to enable SGX to test and verify
reported problems; and

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<PAGE>

            (iii) provide reasonable supporting data to and aid each other in
the identification and correction of reported problems.

      3.6 SGX Additional Technology.

            (a) Notification and Acceptance. During the Technology Awareness
Period, SGX will provide the JSC with regular confidential updates (at least
quarterly) on the progress of development of SGX Improvements, Other Inventions
and SGX Research Stage Technology ("SGX Additional Technology") and SGX New
Developments, including without limitation, identification of (i) technology
which at the time of such update, SGX reasonably believes it could successfully
transfer to Lilly and (ii) technology which SGX recommends that Lilly have
installed at the Lilly Facilities. Lilly will have the right but not the
obligation to have any such SGX Additional Technology installed at the Lilly San
Diego Facility and/or the Lilly Indianapolis Facility, and if Lilly elects to
have such technology installed: Lilly will pay SGX for the reasonable costs of
such installation; such SGX Additional Technology will be deemed Licensed
Technology; and SGX will have the obligation to provide Lilly with support under
the terms of Sections 3.4(b) and (c) for such SGX Additional Technology (other
than SGX Research Stage Technology).

            (b) SGX New Developments. In the event that Lilly desires to obtain
a license to any SGX New Developments identified by SGX to the JSC in accordance
with Section 3.6(a), Lilly will provide written notice of such desire to SGX
within thirty (30) days of such identification by SGX and upon receipt of notice
by SGX, the Parties will negotiate in good faith the terms of a such license for
a period of up to ninety (90) days. Nothing in this Agreement will obligate SGX
to develop any SGX Additional Technology or SGX New Developments or will
obligate the Parties to enter into any license agreement under this Section
3.6(b).

            (c) Lilly Request for New Technology. In the event that Lilly
desires SGX to undertake any new development relating to the SGX Process
Technology, it shall present such request to the JSC which shall decide whether
SGX shall undertake such development. In the event that it is decided that SGX
shall undertake such developments, SGX and Lilly shall agree on the
specifications, development schedule and payments for such developments which
shall then be described in detail in the Technology Installation Plan. Any
technology developed by SGX, or jointly by SGX and Lilly under this Section
3.6(c) will be deemed SGX Improvements.

      3.7 Lilly New Developments and Improvements.

            (a) During the Technology Awareness Period, Lilly will provide the
JSC with regular confidential updates (at least quarterly) on the progress of
development of Lilly Improvements, Lilly New Developments and Other Inventions,
including without limitation, identification of technology, which at the time of
such update, Lilly reasonably believes it could successfully transfer to SGX.
SGX will have the right but not the obligation to have any such Lilly
Improvements licensed to SGX and if SGX

                            Page 15 of 68
<PAGE>

elects to license such Lilly Improvements, Lilly will provide SGX with all
necessary documentation and materials to enable SGX to exercise such rights.

            (b) In the event that SGX desires to obtain a license to any Lilly
New Developments identified by Lilly to the JSC in accordance with Section
3.7(a), SGX will provide written notice of such desire to Lilly within thirty
(30) days of such identification by Lilly and upon receipt of notice by Lilly,
the Parties will negotiate in good faith the terms of a such license for a
period of up to ninety (90) days. Nothing in this Agreement will obligate Lilly
to develop any Lilly New Developments or will obligate the Parties to enter into
any license agreement under this Section 3.7(b).

      3.8 Platform Changes. During the Term of the Technology Collaboration, (i)
Lilly will inform the JSC in advance of any upgrades, modifications,
enhancements or changes it proposes making to the Platform during the Term of
the Technology Collaboration ("Platform Changes"); and (ii) SGX will inform the
JSC of any Platform Changes it has implemented at SGX or recommends Lilly
implement at the Lilly Facility.

      3.9 Use of the Lilly San Diego Facility.

            (a) By SGX Employees. During the Term of the Technology
Collaboration, SGX employees, consultants and agents involved in the
Collaboration, may use the Lilly San Diego Facility, and the Platform and
Licensed Technology installed at the Lilly San Diego Facility: (i) for any
purpose in connection with the Technology Installation Plan; (ii) for the
conduct of Research Plan activities as agreed by the JSC; and (iii) to fulfill
its support obligations under Section 3.4.

            (b) By Lilly Employees. During the Term of the Technology
Collaboration, Lilly employees and consultants may use the Lilly San Diego
Facility, and the Platform and Licensed Technology installed at the Lilly San
Diego Facility: (i) for the conduct of Technology Installation Plan activities
as agreed by the JSC; (ii) for the conduct of Research Plan activities as agreed
by the JSC; (iii) for any purpose permitted under Lilly's licenses in Section
5.1, provided, however that Lilly activities do not interfere with SGX's ability
to fulfill the Phase IB Acceptance Criteria; and (iv) upon the end of the Term
of the Research Collaboration and prior to transfer of the Platform and Licensed
Technology to the Lilly Indianapolis Facility, for any purpose permitted under
Lilly's licenses in Section 5.1, provided in each case that Lilly has first
obtained all necessary licenses, permits and permissions to use the Lilly San
Diego Facility, reasonably acceptable to SGX.

4.    CONSIDERATION

      4.1 Research Fee.

            (a) Within thirty (30) days after the Effective Date, Lilly will pay
to SGX a non-refundable research fee of two million US dollars ($2,000,000).

                            Page 16 of 68
<PAGE>

            (b) Within forty five (45) days after the first anniversary of the
Effective Date, Lilly will pay to SGX a non-refundable research fee of
$[...***...], provided that SGX has met the FTE commitment set forth in Section
2.1 for the first year of the Research Collaboration.

            (c) Within forty five (45) days after the second anniversary of the
Effective Date, Lilly will pay to SGX a non-refundable research fee of
[...***...] US dollars ($[...***...]), provided however, that SGX has committed
a [...***...] ([...***...]) [...***...] to the Research Collaboration during the
period between March 26, 2003 and the [...***...] of the Effective Date. If SGX
has not honored such commitment, then Lilly will pay SGX a pro-rated amount
proportionate with the amount of FTEs that have actually been used as long as
the total number of FTEs committed by SGX during the period between March 26,
2003 and the [...***...] of the Effective Date exceeds [...***...]. In the event
that SGX did not receive payment under Section 4.1(b) but has committed a total
of [...***...] ([...***...])[...***...] to the Research Collaboration during the
period between March 26, 2003 and the second anniversary of the Effective Date,
Lilly will pay a further non-refundable research fee to SGX of [...***...]
dollars ($[...***...]) within forty-five (45) days after the second anniversary
of the Effective Date.

      4.2 Technology Access Fee.

            (a) Within thirty (30) days after the Effective Date, Lilly will pay
to SGX a technology access fee of four million US dollars ($4,000,000). If SGX
fails to substantially deliver and install the SGX Process Technology at the
Lilly San Diego Facility by December 31, 2006, then SGX agrees to refund
[...***...] percent ([...***...]%) of such fee.

            (b) Within forty five (45) days after determination by Lilly that
the Phase IA Acceptance Criteria have been met, Lilly will pay to SGX a
non-refundable technology access fee of [...***...] US dollars ($[...***...]),.

            (c) Within forty five (45) days after determination by Lilly of
achievement by SGX of the Phase IB(i) Acceptance Criteria, Lilly will pay to SGX
a non-refundable technology access fee of [...***...] US dollars ($[...***...]).
Within forty five (45) days after determination by Lilly of achievement by SGX
of the Phase IB(ii) Acceptance Criteria, Lilly will pay to SGX a further
non-refundable technology access fee of [...***...] US dollars ($[...***...]).

            (d) Within forty five (45) days after determination by Lilly that
the Phase II Acceptance Criteria have been met, Lilly will pay to SGX a
non-refundable technology access fee of [...***...] US dollars ($[...***...]);
provided however, if Lilly has not instructed SGX to commence [...***...] the
Platform and [...***...] the SGX Process Technology at the Lilly San Diego
Facility within [...***...] ([...***...]) months after Phase IA Acceptance
Criteria are achieved or by [...***...], whichever is later, and
SGX has achieved the Phase IB(i) Acceptance Criteria, Lilly will pay to SGX such
non-refundable technology access fee of [...***...] US dollars ($[...***...])
within four (4)

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months thereafter, notwithstanding that the Phase II Acceptance Criteria has not
been met.

      4.3 Procurement and Installation Costs.

            (a) Procurement of the Platform. SGX will be responsible, at Lilly's
expense, for the procurement of the Platform (other than the IT Infrastructure)
in accordance with the Technology Installation Plan. An estimate of the costs
for the Platform, together with the expected delivery and payment dates, is
attached as Appendix D(1). A budget for such expense shall be proposed by SGX
and approved by the JSC as part of the Technology Installation Plan, based on
the estimate in Exhibit D(1), provided however, during the three (3) months
following the Effective Date, SGX will make reasonable efforts to obtain
detailed quotations from Third Party vendors of Platform components and will
update the estimate accordingly. SGX shall not exceed the agreed upon budget
without the further approval of the JSC. SGX will update the estimate on at
least a quarterly basis during the period during which the Platform is being
procured. Within thirty (30) days after the Effective Date and on a quarterly
basis thereafter, Lilly will pay SGX the amount estimated to be due Third
Parties during the following quarter. In the event of any overpayment in any
quarter, SGX will credit such overpayment towards the next quarterly payment due
from Lilly under this Section 4.3(a). In the event that Lilly has paid more than
SGX has spent after the final quarter of payments, SGX agrees to refund such
overpayment within forty-five (45) days of the end of the quarter.

            (b) Lilly San Diego Facility. Lilly will be responsible, at Lilly's
expense for (i) obtaining the necessary lease to the Lilly San Diego Facility
and making payments thereunder and (ii) obtaining and installing the IT
Infrastructure. SGX will be responsible for supervising the tenant improvements
to the Lilly San Diego Facility and Lilly will be responsible for the costs of
such tenant improvements; which shall be paid directly by Lilly to the appointed
architect and general contractor.

            (c) Installation. Lilly will pay SGX [...***...] US dollars
($[...***...]) within thirty (30) DayS of receipt of written notification that
the Technology Installation Plan has been approved. Such payment will cover (i)
installing the Platform and Licensed Technology at the Lilly San Diego Facility,
(ii) uninstallation of the Platform and Licensed Technology at the Lilly San
Diego Facility and reinstallation of the Platform and the Licensed Technology at
the Lilly Indianapolis Facility if completed prior to the third anniversary of
the Effective Date, and (iii) project management of the procurement of the Lilly
San Diego Facility (including without limitation, designing and supervising
tenant improvements). Lilly shall pay separately the reasonable costs of
Relocation of the Platform and Licensed Technology from San Diego to
Indianapolis as further described in Section 3.2(b). In the event that Lilly
decides to install the Licensed Technology and Platform at the Lilly
Indianapolis Facility under Section 3.2(b) and such installation is completed
after the third anniversary of the Effective Date, Lilly will pay SGX
[...***...] US dollars ($[...***...]) within thirty (30) days of completion of
such installation. Such payment will cover uninstallation of the Licensed
Technology at the Lilly San Diego Facility and reinstallation of the Licensed
Technology at the Lilly

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Indianapolis Facility and support for such Licensed Technology in accordance
with Section 3.4(b).

5.    LICENSES

      5.1 Licenses to Lilly. Subject to the terms and conditions of this
Agreement, SGX hereby grants to Lilly, the following licenses:

            (a) [...***...],[...***...],[...***...],[...***...],[...***...]
license under SGX's interest in Collaboration technology relating to
Collaboration Targets, to use and modify such Collaboration Technology
[...***...]; and

            (b) [...***...],[...***...],[...***...],[...***...],[...***...]
under SGX's interest in Licensed Technology, to (i) use and duplicate the
Licensed Technology solely for Lilly's [...***...]; and (ii) to make derivative
works of the SGX Bioinformatics Technology, solely as necessary for [...***...]
the SGX Bioinformatics Technology with software of Lilly, provided however,
Lilly will not have the right to distribute such derivative works to Third
Parties and Lilly will only have the right to copy and distribute source code
within Lilly to the extent necessary to [...***...] the SGX Bioinformatics
Technology with software of Lilly.

      5.2 License Restrictions. Lilly shall not: (i) use, copy, modify or
distribute the Licensed Technology directly or indirectly, except as expressly
permitted under this Agreement; (iii) use the Licensed Technology for any
purpose for the benefit of any Third Party, provided however, this restriction
shall not prevent Lilly from doing internal research and development (on its own
behalf or on behalf of its collaborators), manufacturing or distributing any
compounds or other products developed using the Licensed Technology.

      5.3 License to SGX. Lilly hereby grants to SGX [...***...], [...***...],
[...***...], [...***...], [...***...] license under Lilly's interest in Lilly
Improvements, to (i) use and duplicate the Lilly Improvements solely for SGX's
[...***...] (on its own behalf or on behalf of its collaborators); and (ii) to
make derivative works of any software within the Lilly Improvements, solely for
the purpose of [...***...] such Lilly Improvements with SGX Process Technology,
provided however, SGX will not have the right to use any source code of such
software to prepare such derivative works. SGX will not decompile, disassemble,
or otherwise reverse engineer software within the Lilly Improvements.

      5.4 Cross Licenses. Each Party hereby grants to the other, [...***...],
[...***...],[...***...] license to use and practice Lilly Background Technology
and SGX Background Technology, solely to conduct the Research Collaboration.

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      5.5 Non-Use and Retained Rights.

            (a) Non-Use. On a Collaboration Target by Collaboration Target
basis, SGX shall not use or practice, nor shall permit its Affiliates, or
sublicensees to use or practice, Collaboration Technology relating to such
Collaboration Target for any purpose other than the conduct of the Research
Collaboration or filing or prosecuting patent applications as permitted under
Section 6.2(b), for a period of [...***...] ([...***...]) months following the
delivery of the first Target Structure for each such Collaboration Target to
Lilly; provided however the provisions of this Section 5.5(a) shall not apply to
a Collaboration Target if either (i) no Target Structure is obtained for such
Collaboration Target by the end of the Term of the Research Collaboration; or
(ii) the JSC designates a Collaboration Target as an Eliminated Target in
accordance with Section 2.9. In the event that Crystallizable Protein is
included in the Research Collaboration in accordance with Section 2.6(a) and the
gene or expression constructs for such Crystallizable Protein are not publicly
known, the provisions of this Section 5.5(a) will apply to Collaboration
Technology relating to such Crystallizable Protein and the [...***...]
([...***...]) month period described above, will commence upon delivery by Lilly
to SGX of the expression construcTS for such Crystallizable Protein.
Notwithstanding anything to the contrary in this Agreement, this Section 5.5(a)
shall not apply to the Collaboration Target: [...***...].

            (b) Retained Rights. Subject to Section 5.5(a) with regards to
Collaboration Technology, SGX retains the right to use and exploit in any way,
Collaboration Technology, SGX Background Technology, SGX Process Technology, SGX
Improvements, Other Inventions, SGX Research Stage Technology and SGX New
Developments.

      5.6 Third Party Licenses. In the event that Lilly, in consultation with
the JSC, determines that it may be necessary to acquire a license from any Third
Party specifically for the conduct of the Research Collaboration, the Parties
shall discuss which Party shall acquire such license provided however, that the
[...***...] shall be at [...***...] sole expense.

      5.7 Mutual Covenants Not to Sue. In the event that during the term of this
Agreement, either Party (the "Developing Party") develops technology such that,
without granting the other Party (the "Other Party") a license to such
technology, the use by the Other Party of Licensed Technology would infringe the
intellectual property rights of the Developing Party, the Developing Party
agrees not to assert such intellectual property rights against the Other Party
in any legal proceedings or otherwise.

6.    INTELLECTUAL PROPERTY

      6.1 Ownership of Technology.

            (a) Ownership by SGX. Title to all SGX Process Technology, SGX
Background Technology, SGX Improvements, SGX Research Stage Technology, Other

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Inventions, SGX New Developments and Collaboration Technology shall be owned by
SGX. Lilly hereby assigns to SGX and its successors and assigns all of Lilly's
rights, title, and interest in and to Collaboration Technology and Other
Inventions. Lilly will execute in a reasonably timely manner such documents as
SGX may request to document and perfect the assignment to SGX of any and all
rights in Collaboration Technology and Other Inventions. If the foregoing
assignment would be void or impermissible in a given country, then Lilly
automatically shall be deemed to have granted to SGX the perpetual, irrevocable,
fully paid-up, freely sublicensable license to use and practice such
Collaboration Technology and Other Inventions in such country for any and all
purposes consistent with this Agreement, which license shall be co-exclusive
with SGX to the maximum extent permitted in such country, and which license
shall survive any expiration or termination of this Agreement.

            (b) Ownership by Lilly. Title to all Lilly Background Technology,
Lilly Improvements and Lilly New Developments shall be owned solely by Lilly.

            (c) Law. Inventorship of inventions and, subject to the terms of
this Agreement, ownership rights with respect thereto, shall be determined in
accordance with the patent laws of the United States.

      6.2 Patent Prosecution.

            (a) Prosecution by SGX or Lilly. SGX shall be responsible, at its
sole discretion and expense, for the preparation, filing, prosecution and
maintenance of the patent applications and patents within Patent Rights within
SGX Background Technology, SGX Process Technology, SGX Improvements, SGX
Research Stage Technology and SGX New Developments, in countries selected by
SGX, and for conducting any interferences, reexaminations, reissues,
oppositions, or request for patent term extension relating thereto. Lilly shall
be responsible, at its sole discretion and expense, for the preparation, filing,
prosecution and maintenance of the patent applications and patents within Patent
Rights within Lilly Background Technology, Lilly Improvements and Lilly New
Developments, in countries selected by Lilly, and for conducting any
interferences, reexaminations, reissues, oppositions, or request for patent term
extension relating thereto.

            (b) Collaboration Technology. Lilly shall have the first right, at
its expense and sole discretion, for the preparation, filing, prosecution and
maintenance of the patent applications and patents claiming Collaboration
Technology. On a Collaboration Target by Collaboration Target basis, in the
event that Lilly elects not to file a patent application covering a Target
Structure within twelve (12) months of delivery of such Target Structure to
Lilly, SGX shall have the right to file, prosecute and maintain such patent
applications. Furthermore, in the event that Lilly elects not to pursue
prosecution or maintenance of any patent applications or patents claiming
Collaboration Technology, Lilly shall give SGX not less than sixty (60) days
notice before any relevant deadline or any permitted public disclosure, and SGX
shall have the right to pursue, at its sole discretion and expense, prosecution
and maintenance of such patent applications or patents. The Party responsible
for prosecution and maintenance

                            Page 21 of 68
<PAGE>

(the "Responsible Party), shall keep the other Party (the "Non-Responsible
Party") fully informed as to the status of such patent matters, including,
without limitation, by providing the Non-Responsible Party the opportunity, at
the Non-Responsible Party's expense, to review and comment on any documents
relating to such patent applications and patents which will be filed in any
patent office at least thirty (30) days before such filing, and promptly
providing the Non-Responsible Party with copies of any documents relating to
such patent applications and patents which the Responsible Party receives from
such patent offices, including notice of all interferences, reissues,
reexaminations, oppositions or requests for patent term extensions. At the
Responsible Party's request and expense, the Non-Responsible Party will
reasonably cooperate and assist the Responsible Party in the preparation, filing
and prosecution of patent applications claiming Collaboration Technology and in
the event of an interference, reissue, reexamination, opposition or request for
patent term extension.

      6.3 Patent Enforcement. In the event either Party becomes aware of any
interference, opposition, or request for reexamination, or similar proceedings,
involving a patent application or patent filed in accordance with Section 6.2(a)
or 6.2(b), it shall promptly notify the other Party hereto, and the Parties
shall agree on the steps which shall be taken to protect the pertinent patent.
In the event either Party becomes aware of any possible infringement of a patent
filed in accordance with Section 6.2(a) or 6.2(b) or misappropriation of an
invention within the Collaboration, it shall promptly notify the other Party
hereto, providing a written description of the potentially infringing or
misappropriation activities. SGX shall have the right, but not the obligation to
institute, prosecute and control any action or proceeding with respect to
infringement of patents within SGX Background Technology, SGX Process
Technology, SGX Improvements, SGX Research Stage Technology, SGX New
Developments, and Other Inventions. Lilly shall have the right, but not the
obligation, to institute, prosecute and control any action or proceeding with
respect to infringement of patents within Lilly Background Technology, Lilly
Improvements, Lilly New Developments and Collaboration Technology. If a Party
given the right to enforce a patent pursuant to this Section fails to bring an
action or proceeding, or take other actions (e.g., commence settlement
discussions) against a suspected infringer within a period of ninety (90) days
after having notice of such infringement, the other Party shall have the right
to bring and control an action against such infringer by counsel of its own
choice, and the non-enforcing Party shall have the right to be represented in
any such action by counsel of its own choice at its own expense. The Party
controlling an action involving any infringement of a patent under this Section
shall consider in good faith the interests of the other Party in so doing, and
shall not settle or consent to an adverse judgment in any such action which
would have a material adverse effect on the rights or interests of the other
Party without the prior express written consent of such other Party. If one
Party brings any such action or proceeding, the other Party agrees to be joined
as a Party plaintiff if necessary to prosecute the action and to give the first
Party reasonable assistance and authority to file and prosecute the suit. In
each case relating to infringement of a patent under this Section, each Party
shall bear the costs of its enforcement of such rights discussed in this section
and retain for its own account any amounts received from Third Parties.

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<PAGE>

      6.4 Notification of Potential Infringement. In the event that any Party
becomes aware of any claim that the practice of Licensed Technology infringes
the intellectual property rights of any Third Party, such Party will promptly
notify the other Party.

7.    CONFIDENTIALITY AND PUBLICITY

      7.1 Confidential Information. Except as expressly provided herein, the
Parties agree that, for the term of this Agreement and for five (5) years
thereafter, the receiving Party, or any Affiliate thereof, shall not publish or
otherwise disclose to Third Parties (other than consultants and agents of a
Party engaged in the Collaboration) and shall not use for any purpose, except as
expressly permitted herein any information or material furnished to it by the
other Party hereto pursuant to this Agreement ("Confidential Information").
Notwithstanding the foregoing, it is understood and agreed that Confidential
Information shall not include information or material that, in each case as
demonstrated by written documentation:

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

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

            (c) became generally available to the public or otherwise part of
the public domain after its disclosure and other than through any act or
omission of the receiving Party, or an Affiliate thereof, in breach of this
Agreement; or (d) was subsequently lawfully disclosed to the receiving Party, or
an Affiliate thereof, by a person other than a Party hereto or independently
developed by the receiving Party or an Affiliate thereof without reference to
any Confidential Information disclosed by the disclosing Party.

      7.2 Permitted Disclosures. Notwithstanding the provisions of Section 7.1
above, each Party hereto may disclose the other's Confidential Information to
the extent such disclosure is reasonably necessary in filing or prosecuting
patent applications, prosecuting or defending litigation, complying with
applicable governmental regulations, or submitting information to tax or other
governmental authorities, provided that if a Party is required to make any such
disclosure of another Party hereto's Confidential Information, to the extent it
may legally do so, it will give reasonable advance written notice to the other
Party of such disclosure so that the other Party may attempt to secure
confidential treatment of such Confidential Information prior to its disclosure
(whether through protective orders or otherwise).

         7.3 Publication. Any public disclosure (oral, written or graphic) by
either Party describing the scientific results of the Research Collaboration
will require prior review and written approval of the other Party at least
thirty (30) days prior to its submission for publication or other public
disclosure. If the reviewing Party so requests,

                            Page 23 of 68
<PAGE>

the proposed public disclosure will be delayed for forty-five (45) days from the
date of each request for the filing of patent application(s) related to the
proposed public disclosure.

      7.4 Publicity. The Parties agree to make a mutually agreed press release
regarding this Agreement promptly following the Effective Date. Neither Party
may make any public announcements relating to this Agreement without the other
Party's prior written consent, which consent will not be unreasonably withheld,
or delayed for a period of more than thirty (30) days after request for consent
is sought. Except as expressly provided in this Agreement, each Party agrees not
to disclose any terms of this Agreement to any Third Party without the prior
written consent of the other Party; provided however, that disclosures may be
made as required by securities or other applicable laws, or to actual or
prospective investors, or to a Party's professional advisors

      7.5 [...***...]. During the Term of the Technology Collaboration,
[...***...] with any [...***...] for purposes of [...***...] such [...***...].
[...***...] an [...***...] for the purpose of [...***...]: (i) [...***...];
or (ii) as a result of [...***...] (such as an [...***...]) not specifically
directed [...***...].

8.    INDEMNIFICATION

      8.1 Indemnification of SGX. Lilly shall indemnify, defend, and hold
harmless SGX, the directors, officers, and employees of SGX and the successors
and assigns of any of the foregoing (the "SGX Indemnitee(s)") from and against
all claims, losses, costs, and liabilities (including, without limitation,
payment of reasonable attorneys' fees and other expenses of litigation), and
shall pay any damages (including settlement amounts) finally awarded, with
respect to any claim, suit or proceeding (any of the foregoing, a "Claim")
brought by Third Party against a SGX Indemnitee, arising out of or relating to:
(a) the exercise by Lilly of the rights granted Lilly under Sections 5.1 and 5.4
of this Agreement including activities of its employees at the Lilly San Diego
Facility; (b) a material breach by Lilly of its obligations under this
Agreement; (c) a breach of Lilly's representations and warranties under Section
9; (d) any products developed, manufactured, used, sold or otherwise distributed
by or on behalf of Lilly or its Affiliates pursuant to Article 5, (including
without limitation, product liability claims); (e) the gross negligence or
willful misconduct of Lilly; (f) the use, handling, transfer or storage of the
SGX Materials received from SGX hereunder; (g) a claim that the use by SGX or by
Lilly of a Collaboration Target, DNA coding for a Collaboration Target,
Crystallizable Protein, Target Structures, Lilly Materials, Reference Compounds
or Lilly Compounds, infringes the intellectual property rights of a Third Party;
or (h) use of the Lilly Facilities by SGX employees or consultants as
contemplated under this Agreement except, in each case, to the extent caused by
the gross negligence or willful misconduct of a SGX Indemnitee.

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      8.2 Indemnification of Lilly.

            (a) SGX shall indemnify, defend and hold harmless Lilly, the
directors, officers, and employees of Lilly, and the licensors, successors and
assigns of any of the foregoing (the "Lilly Indemnitee(s)") from and against all
Claims brought by Third Party against a Lilly Indemnitee, arising out of or
relating to: (a) the performance by SGX of the Research Collaboration, except to
the extent such Claim arises out of or relates to a claim the use by SGX of a
Collaboration Target, DNA coding for a Collaboration Target, Crystallizable
Protein, Lilly Materials, Reference Compounds, or Lilly Compounds, infringes the
intellectual property rights of a Third Party; (b) the exercise by SGX of the
rights granted SGX under this Agreement, including the activities of its
employees at the Indianapolis and San Diego Facilities; (c) a material breach by
SGX of its obligations under this Agreement; (d) a breach of SGX's
representations and warranties under Section 9; (e) the handling, transfer or
storage of Lilly Materials; (f) the negligence or willful misconduct of SGX;
except, in each case, to the extent due to the gross negligence or willful
misconduct of a Lilly Indemnitee.

            (b) SGX shall indemnify, defend and hold harmless the Lilly
Indemnitees from and against all Claims brought by a Third Party against a Lilly
Indemnitee claiming that the Licensed Technology (other than SGX Research Stage
Technology) when used by Lilly as authorized in this Agreement, infringes the
intellectual property rights of a Third Party; provided that SGX shall have no
liability or obligation with respect to actual or alleged infringements to the
extent resulting from (i) the use of the Licensed Technology other than with the
Platform, (ii) modifications to the Licensed Technology or the Platform made by
Lilly or (iii) a failure by Lilly to obtain Third Party Technology licenses or
other Third Party licenses which SGX has indicated to Lilly in writing are
necessary in order to practice the Licensed Technology. THE FOREGOING STATES
SGX'S ENTIRE LIABILITY AND OBLIGATION (EXPRESS, STATUTORY, IMPLIED, OR
OTHERWISE) WITH RESPECT TO INTELLECTUAL PROPERTY INFRINGEMENT OR CLAIMS
THEREFOR.

      8.3 Indemnification Procedures. An Indemnitee that intends to claim
indemnification under this Article 8 shall promptly notify the other Party (the
"Indemnitor") in writing of any claim in respect of which the Indemnitee intends
to claim such indemnification, and the Indemnitor shall have sole control of the
defense and/or settlement thereof, provided that the indemnified Party may
participate in any such proceeding with counsel of its choice at its own
expense. The indemnity agreement in this Article 8 shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the
consent of the Indemnitor, which consent shall not be withheld unreasonably. The
failure to deliver written notice to the Indemnitor within a reasonable time
after the commencement of any such action, if prejudicial to its ability to
defend such action, shall relieve such Indemnitor of any liability to the
Indemnitee under this Article 8 but the omission so to deliver written notice to
the Indemnitor shall not relieve the Indemnitor of any liability that it may
have to any Indemnitee other than under this Article 8. The Indemnitee under
this Article 8, its employees and agents, shall cooperate fully with the
Indemnitor and its legal representatives and provide full information in the
investigation of any Claim covered by this indemnification. Neither

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<PAGE>

Party shall be liable for any costs or expenses incurred by the other Party
without its prior written authorization.

9.    REPRESENTATIONS AND WARRANTIES

      9.1 Each Party. Each Party represents and warrants to the other (i) that
it has the legal power, authority and right to enter into this Agreement and to
perform its respective obligations under this Agreement; (ii) that it is not a
Party to any agreement or arrangement with any Third Party or under any
obligation or restriction which in any way limits or conflicts with its ability
to fulfill any of its obligations under this Agreement, (including without
limitation, the licenses granted in Article 5), and shall not enter into any
such agreement or arrangement during the term of this Agreement; (iii) each
employee or person engaged in the Collaboration on behalf of Lilly or SGX has
entered into a written agreement which provides for the assignment to Lilly or
SGX, respectively, of all inventions and discoveries made by such employee or
person during the course of his or her employment or engagement with Lilly or
SGX.

      9.2 Intellectual Property. SGX represents and warrants to Lilly that as of
the Effective Date it is not aware of any claim made against it asserting the
invalidity, misuse, unenforceability or non-infringement of the SGX Process
Technology or challenging its right to use or ownership of the SGX Process
Technology.

      9.3 Disclaimer. SGX and Lilly specifically disclaim any guarantee that the
Research Collaboration or Technology Collaboration will be successful, in whole
or in part. Nothing in this Agreement shall be construed as a representation
made or warranty given by any Party that the Licensed Technology will be
operated without interruption or will be error-free. In addition, the Parties
acknowledge that notwithstanding any other provision in this Agreement, the SGX
Research Stage Technology, is licensed AS IS. EXCEPT AS OTHERWISE EXPRESSLY
PROVIDED IN THIS AGREEMENT, LILLY AND SGX MAKE NO REPRESENTATIONS AND EXTEND NO
WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THE
MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE OF THE SGX BACKGROUND
TECHNOLOGY, LILLY BACKGROUND TECHNOLOGY, LICENSED TECHNOLOGY OR COLLABORATION
TECHNOLOGY OF EACH PARTY, INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT OF THE
INTELLECTUAL PROPERTY OR OTHER RIGHTS OF ANY THIRD PARTY.

      9.4 Limitation of Liability. SGX'S AGGREGATE LIABILITY UNDER SECTION
8.2(b) SHALL BE LIMITED TO [...***...] DOLLARS ($[...***...]). IN NO EVENT SHALL
EITHER PARTY BE LIABLE FOR COSTS OF SUBSTITUTE GOODS OR SERVICES, SPECIAL,
CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES (INCLUDING WITHOUT LIMITATION
LOSS OF PROFIT) WHETHER OR NOT THE OTHER PARTY HAS BEEN

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ADVISED OF THE POSSIBILITY OF SUCH LOSS, HOWEVER CAUSED AND ON ANY THEORY OF
LIABILITY, ARISING OUT OF THIS AGREEMENT, PROVIDED HOWEVER, THE PROVISIONS OF
THIS SECTION WILL NOT APPLY TO BREACHES OF CONFIDENTIALITY OBLIGATIONS UNDER
THIS AGREEMENT. THESE LIMITATIONS SHALL APPLY NOTWITHSTANDING ANY FAILURE OF
ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.

10.   TERM AND TERMINATION

      10.1 Term of the Agreement. The term of this Agreement shall commence on
the Effective Date and unless terminated earlier, will terminate upon the later
of (i) fifteen (15) years from the Effective Date or (ii) expiration of the last
to expire patent within the Patent Rights that cover Collaboration Technology or
Licensed Technology.

      10.2 Termination for Cause. Upon any material breach of this Agreement by
either Lilly or SGX (in such capacity the "Breaching Party"), the other Party
(in such capacity the "Non-Breaching Party") may terminate this Agreement by
ninety (90) days' written notice to the Breaching Party, specifying the material
breach. The termination becomes effective at the end of such ninety (90) day
period unless (i) the Breaching Party cures such breach during such ninety (90)
day period, or (ii) if such breach is not susceptible to cure within such ninety
(90) day period, the Breaching Party is diligently pursuing a cure (unless such
breach, by its nature is incurable, in which case this Agreement may be
terminated immediately). The Parties will use reasonable efforts to work
together to cure any breach.

      10.3 Rights upon Termination for Material Breach. If the Non-Breaching
Party terminates this Agreement pursuant to Section 10.2:

            (a) in the event that the Breaching Party is SGX:

                  (i) the licenses granted Lilly under Section 5.1 will continue
with respect to Collaboration Technology developed and Licensed Technology
installed at the Lilly San Diego Facility or Lilly Indianapolis Facility, prior
to the effective Date of termination, subject to the payment by Lilly of all
amounts earned by SGX under Article 4 prior to the effective date of
termination; and

                  (ii) SGX will have no obligation to provide training, support
or maintenance under Section 3.4, for Licensed Technology installed at a Lilly
Facility prior to the date of termination;

            (b) in the event the Breaching Party is Lilly:

                  (i) the licenses granted Lilly under Section 5.1 will
terminate concurrently.

                  (ii) the licenses granted SGX under Section 5.3 will continue;
and

                            Page 27 of 68
<PAGE>

                  (iii) SGX will have no obligation to provide training, support
or maintenance under Section 3.4 for Licensed Technology installed at a Lilly
Facility prior to the date of termination.

      10.4 Termination Because of Loss of Key Personnel. Lilly may terminate the
Research Collaboration upon thirty (30) days written notice if [...***...]
leaves SGX as an employee and does not continue to constitute at least
[...***...] of an FTE devoted to the Research Program, and SGX, after reasonable
opportunity, has not been able to replace [...***...] with a replacement that
meets the reasonable satisfaction of Lilly.

      10.5 Termination Because of Change of Control. If SGX becomes subject to a
Change of Control, Lilly may terminate the Research Collaboration upon thirty
(30) days prior written notice only if the acquiring party is one of the top
[...***...] ([...***...]) pharmaceutical companies ranked in order of worldwide
sales, as published by Scrip in its then most recent ranking prior to the date
of the Change of Control, or the acquiring party does not agree to assume all
obligations of SGX under this Agreement. For purposes of this Section, "Change
of Control" means a transaction (other than an equity financing) under which the
shareholders of SGX just prior to the transaction, own less than 50% of the
voting power able to vote for directors and other matters of SGX after the
transaction.

      10.6 Effects of Termination of the Research Collaboration. In the event of
termination of the Research Collaboration under Section 10.4 or 10.5, (i) SGX
will have no further obligation to conduct the Research Collaboration, (ii)
Lilly will pay SGX a prorated amount under Sections 4.1(b) and (c) proportionate
with the amount of FTEs used by SGX prior to the effective date of termination;
(iii) SGX will have no further obligation to conduct the Phase IB(ii) Acceptance
Criteria experiments, provided however, SGX will continue to conduct the Phase
IB(i) Acceptance Criteria experiments if not already completed, and if SGX
achieves the Phase IB(i) Acceptance Criteria, Lilly will pay SGX the fee under
Section 4.2(c); (iv) the licenses granted Lilly under Section 5.1 and SGX under
Section 5.3 will continue and (v) the payment obligations of Lilly under Section
4.2 (subject to (iii) above), and 4.3 will continue.

      10.7 Effect of Termination.

            (a) Accrued Rights and Obligations. Termination of this Agreement
for any reason shall not release any Party hereto from any liability which, at
the time of such termination, has already accrued to the other Party or which is
attributable to a period prior to such termination nor preclude either Party
from pursuing all rights and remedies it may have hereunder or at law or in
equity with respect to any breach of this Agreement.

            (b) Return of Confidential Information. Upon any termination of this
Agreement, SGX and Lilly shall promptly return to the other Party or destroy all
Confidential Information received from the other Party, except to the extent
required to

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exercise any continuing rights of such Party (and in any event, except one copy
of which may be retained solely for archival purposes).

            (c) Cross License. In the event of termination of this Agreement by
either Party pursuant to this Article 10, the licenses granted to SGX and Lilly
in Section 5.2 shall terminate concurrently.

            (d) Survival. The provisions of Articles 6, 7, 8, 9 and 11 shall
survive the expiration or termination of this Agreement for any reason.

      10.8 Rights in Bankruptcy. All rights and licenses granted under or
pursuant to this Agreement by SGX and Lilly are, and will otherwise be deemed to
be, for purposes of Section 365(n) of the United States Bankruptcy Code,
licenses of rights to "intellectual property" as defined under Section 101 of
the United States Bankruptcy Code. The Parties agree that the Parties, as
licensees of such rights under this Agreement, will retain and may fully
exercise all of their rights and elections under the United States Bankruptcy
Code. The Parties further agree that, in the event of the commencement of a
bankruptcy proceeding by or against a Party under the United States Bankruptcy
Code, the Party hereto that is not a Party to such proceeding will be entitled
to a complete duplicate of (or complete access to, as appropriate) any such
intellectual property and all embodiments of such intellectual property, which,
if not already in the non-subject Party's possession, will be promptly delivered
to it (a) upon any such commencement of a bankruptcy proceeding upon the
non-subject Party's written request therefor, unless the Party subject to such
proceeding continues to perform all of its obligations under this Agreement or
(b) if not delivered under clause (a) above, following the rejection of this
Agreement by or on behalf of the Party subject to such proceeding upon written
request therefor by the non-subject Party.

11    MISCELLANEOUS

      11.1 Governing Law. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the Parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of Delaware,
without reference to rules of conflicts or choice of laws.

      11.2 Notices. Any notice required or permitted by this Agreement shall be
in writing and shall be sent by prepaid registered or certified mail, return
receipt requested, internationally recognized courier or personal delivery, or
by fax with confirming letter mailed under the conditions described above in
each case addressed to the other Party at the address shown below or at such
other address for which such Party gives notice hereunder. Such notice shall be
deemed to have been given when delivered:

      If to SGX:    Structural GenomiX, Inc.
                    10505 Roselle Street,
                    San Diego, CA  92121
                    Attn:  Chief Executive Officer
                    Copy to:  Corporate Counsel

                            Page 29 of 68
<PAGE>

      If to Lilly:  Eli Lilly and Company
                    Lilly Corporate Center
                    Indianapolis, IN 46285
                    Attention:  General Counsel
                    Fax No.: (317) 277-1917
      Copy to:      Office of Alliance Management
                    Fax No.:  (317) 433-5900

      11.3 Force Majeure. Neither Party shall lose any rights hereunder or be
liable to the other Party for damages or losses (except for payment obligations)
on account of failure of performance by the defaulting Party if the failure is
occasioned by war, strike, acts of terrorism, fire, Act of God, earthquake,
flood, lockout, embargo, governmental acts or orders or restrictions, failure of
suppliers (including, without limitation, energy suppliers), or any other reason
where failure to perform is beyond the reasonable control and not caused by the
negligence, intentional conduct or misconduct of the nonperforming Party and the
nonperforming Party has exerted all reasonable efforts to avoid or remedy such
force majeure; provided, however, that in no event shall a Party be required to
settle any labor dispute or disturbance.

      11.4 No Implied Rights. Only the rights granted pursuant to the express
terms of this Agreement shall be of any legal force or effect. No other rights
shall be created by implication, estoppel or otherwise.

      11.5 Assignment. This Agreement shall not be assignable by either Party to
any Third Party hereto without the written consent of the other Party hereto,
except either Party may assign this Agreement, without such consent, to (i) an
Affiliate or (ii) an entity that acquires all or substantially all of the
business or assets of such Party to which this Agreement pertains, whether by
merger, reorganization, acquisition, sale, or otherwise. Any permitted assignee
shall assume all obligations of its assignor under this Agreement. Any purported
assignment or transfer in violation of this Section shall be void.

      11.6 Partial Invalidity. If any provision of this Agreement is held to be
invalid by a court of competent jurisdiction, then the remaining provisions
shall remain, nevertheless, in full force and effect. The Parties agree to
renegotiate in good faith any provision held invalid and to be bound by the
mutually agreed substitute provision in order to give the most approximate
effect originally intended by the Parties

      11.7 Independent Contractors. The relationship of Lilly and SGX
established by this Agreement is that of independent contractors, and nothing
contained in this Agreement shall be construed to (i) give either Party the
power to direct or control the day-to-day activities of the other, (ii)
constitute the Parties as partners, joint venturers, co-owners or otherwise as
participants in a joint or common undertaking, or (iii) allow a

                            Page 30 of 68
<PAGE>

Party to create or assume any obligation on behalf of the other Party for any
purpose whatsoever.

      11.8 No Waiver. No waiver of any term or condition of this Agreement shall
be valid or binding on either Party unless agreed in writing by the Party to be
charged. The failure of either Party to enforce at any time any of the
provisions of the Agreement, or the failure to require at any time performance
by the other Party of any of the provisions of this Agreement, shall in no way
be construed to be a present or future waiver of such provisions, nor in any way
affect the validity of either Party to enforce each and every such provision
thereafter.

      11.9 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.

      11.10 Entire Agreement; Amendment. This Agreement, including the Exhibits
attached hereto, constitutes the entire agreement of the Parties with respect to
the subject matter hereof, and supersedes all prior or contemporaneous
understandings or agreements, whether written or oral, between Lilly and SGX
with respect to such subject matter. No amendment or modification hereof shall
be valid or binding upon the Parties unless made in writing and signed by the
duly authorized representatives of both Parties.

      IN WITNESS WHEREOF, the undersigned are duly authorized to execute this
Agreement on behalf of Lilly and SGX as applicable.

ELI LILLY AND COMPANY                    STRUCTURAL GENOMIX, INC.

By: /s/ August M. Watanabe, M.D.         By: /s/ Dr. Tim Harris
    -----------------------------            ---------------------------

Name: August M. Watanabe, M.D.           Name: Dr. Tim Harris

Title: Executive Vice President          Title: President & CEO
       Science & Technology

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                                    EXHIBIT A

                              COLLABORATION TARGETS

Group 1 [...***...]

Group 2 [...***...]

Group 3 [...***...]

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                                    EXHIBIT B

                                  RESEARCH PLAN

OVERVIEW

SGX and Lilly will carry out the Research Collaboration to [...***...] for
Collaboration Targets either in [...***...], or [...***...] with [...***...] or
[...***...], over a [...***...] period.

TARGETS

Year [...***...] Collaboration Targets are as follows:

      [...***...]
      [...***...]
      [...***...]

EXPERIMENTAL STRATEGY

[...***...]

Collaboration Targets will be assigned to [...***...] of [...***...] of
[...***...] and [...***...] based on the following criteria. Expected percentage
success rates for determining Target Structures for each level are given in
parentheses.

      [...***...], predicted to be [...***...] in [...***...] ([...***...]%) or
      [...***...] available in the [...***...] and [...***...] is clear.
      [...***...] in [...***...] and/or [...***...] to be [...***...]
      [...***...] to [...***...]
      [...***...] likely to be required ([...***...] to [...***...])

During the first [...***...] to [...***...] of the Research Collaboration,
[...***...] studies on [...***...] and [...***...] will be performed on each
Collaboration Target and, based on the outcome of these studies, Collaboration
Targets may be [...***...] to [...***...] The [...***...] will provide guidance
on the amount of effort to devote to Collaboration Targets [...***...] to
[...***...]

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As determined by the [...***...], approximately [...***...] Collaboration
Targets selected from the initial Target Structures will proceed to [...***...]
and [...***...]. At [...***...] request, [...***...] will provide [...***...]
for [...***...] undertaken at [...***...]. For the purpose of resource planning
the [...***...] will be categorized according to [...***...] of [...***...] and
[...***...]

      [...***...] or [...***...]. Many [...***...] fall into this category.

      [...***...]. Examples include most [...***...], which require [...***...]
      with [...***...] and/or [...***...] and some [...***...], which require
      [...***...]

      [...***...] Requires an initial period of effort to develop a system that
      can support consistent [...***...] efforts. An example would be
      [...***...], which would require [...***...] and [...***...] in
      [...***...] and/or [...***...]

[...***...] will provide a total of [...***...] or [...***...] per month for
each [...***...] to be [...***...] will be available in amounts of [...***...]
for [...***...] and [...***...] for [...***...]

For the purpose of the allocation of resources in the attached spreadsheet, each
[...***...] has been resourced for [...***...] following initial Target
Structure [...***...]

The [...***...] will be responsible for determining [...***...] and [...***...]
the level of [...***...] to be distributed between [...***...] and [...***...]

RESOURCES

A total of [...***...] will be devoted to the first [...***...] of the SGX-Lilly
Research Collaboration. The attached spreadsheet (Appendix B) outlines the
[...***...] of resource across the [...***...] The [...***...] have been
resourced according to the following projected levels

      [...***...]

      [...***...].

      [...***...].

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The [...***...] will be responsible for determining which Collaboration Targets
will be subject to [...***...] at [...***...], whereupon [...***...] will
deliver [...***...] to [...***...], and which Collaboration Targets progress to
[...***...] at [...***...].

EXPECTED DELIVERABLES

[...***...]

[...***...] are expected in [...***...] based on the initial assessment of level
for each Collaboration Target and [...***...] between [...***...] and
[...***...] (see accompanying spreadsheet). [...***...] deliverables are
projected as a percent of [...***...] or [...***...] entered into [...***...],
assuming the Compounds are of the [...***...] and are available in the required
amounts:

      [...***...]
      [...***...]

[...***...]

[...***...] for [...***...] at [...***...] for approximately [...***...] in
[...***...] will be provided subsequent to [...***...] the [...***...] at
[...***...]. The deliverable includes [...***...], in amounts to be determined
by the [...***...] for each Collaboration Target, and [...***...] for
[...***...] the [...***...] to [...***...] in [...***...] with Compounds.

[...***...]

[...***...] for [...***...] of a Target Structure with a [...***...] for which
[...***...] will perform the [...***...] will be provided in
[...***...]:[...***...] ([...***...]) and [...***...]. [...***...] is defined as
[...***...] and [...***...] that have been processed with
[...***...] using [...***...] and [...***...] derived from the [...***...].

[...***...] will be further processed by [...***...] to [...***...],[...***...]
of [...***...] with the [...***...], whether or not [...***...] to a [...***...]
is present. When an experimentally significant [...***...] is present the
Complex Data will be sent to [...***...] for [...***...].

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                                   APPENDIX B

                                  [...***...]

[...***...]

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                                    EXHIBIT C

                          TECHNOLOGY INSTALLATION PLAN

This Outline Technology Installation Plan will form the basis of a definitive
Technology Installation Plan to be completed within [...***...] of the
collaboration Effective Date. This Plan outlines the various modules of the
Platform and SGX [...***...], and the proposed timelines for [...***...],
[...***...], and [...***...] at both the Lilly San Diego Facility and the Lilly
Indianapolis Facility.

[...***...]

This document describes, in outline terms, the plan for [...***...] and
[...***...] of a [...***...] for Lilly by SGX. Figure 1 provides an overview of
the [...***...] to be developed by [...***...]. The Process Technology and
underlying Platform will transferred to [...***...] in [...***...]. The
[...***...] will be [...***...] and [...***...] in modules, [...***...] the
Lilly San Diego Facility, and [...***...] at the Lilly Indianapolis Facility.

While the Lilly San Diego Facility is [...***...], the [...***...] comprising
the Platform (Hardware, IT Infrastructure, and 3rd Party Technology) will be
[...***...], [...***...], and [...***...] to [...***...]. [...***...] of the
Platform and SGX [...***...] will [...***...].

A comprehensive Technology Installation Plan will be developed by [...***...]
following the Effective Date and will be [...***...] in a [...***...]. Specific
timelines for each stage of the transfer will take into account the time
required to complete the [...***...] in San Diego.

[...***...]

                                                  FIGURE 1.  The SGX
                                                  [...***...] to be [...***...]
                                                  SGX [...***...] that
                                                  integrates the Platform
                                                  components (hardware, IT
                                                  infrastructure and 3rd party
                                                  technology).  The Lilly San
                                                  Diego Facility [...***...].

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[...***...]

The Platform and SGX [...***...] will [...***...] be [...***...] in the Lilly
San Diego Facility. The facilitY will [...***...] for the installation.
[...***...] will [...***...] the [...***...] and [...***...] to [...***...]. A
separate document will outline the required [...***...].

[...***...] MODULES

For purposes of [...***...] and installation, the Platform and SGX [...***...]
have been broken down into [...***...] modules, plus the underlying [...***...]
for ease of [...***...] and [...***...]. These modules are:

      [...***...]
      [...***...] to [...***...]
      [...***...] to [...***...]
      [...***...]
      [...***...].

The Hardware and IT Infrastructure components of the Platform supporting each
module are outlined in Exhibit D. Third Party Technology is listed in
[...***...]. The processes enabled by each of these modules, as well as the
[...***...], are described in SGX [...***...], Exhibit F. Each [...***...]
module will be [...***...] and [...***...]. Once all modules are validated the
[...***...] will be [...***...] as described in Exhibit G.

[...***...] AND [...***...] STAGES

It is anticipated that transfer and [...***...] of SGX [...***...] and the
Platform will occur in [...***...] (see Figure 2).

[...***...] and [...***...] of [...***...].

[...***...] of [...***...].

[...***...] of the [...***...] and the SGX [...***...] at the [...***...].

[...***...] at the [...***...] ([...***...]).

[...***...] at the [...***...] ([...***...]).

[...***...] to [...***...].

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[...***...] at the [...***...].

[...***...] at the [...***...] ([...***...]).

Between [...***...] and [...***...] ([...***...] at the [...***...] and the
[...***...] to the [...***...]), there will a period of [...***...] in
[...***...].

[...***...]

The Lilly San Diego Facility will need to be [...***...] prior to the
[...***...] the [...***...]. It is anticipated that this [...***...] will take
[...***...]. During this period [...***...],[...***...] and [...***...] of
[...***...], will occur. As shown below, [...***...] activities will include the
[...***...] of the [...***...], the [...***...] of the [...***...], the
[...***...] of the SGX [...***...] ([...***...]) and [...***...] modules.

It is anticipated that [...***...] will [...***...] the [...***...] of the
[...***...].

It is anticipated that [...***...] will [...***...] on or about the [...***...]
of the [...***...].

[...***...]

FIGURE 2: [...***...]

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[...***...]

During the period of time in which the [...***...] is located in the Lilly San
Diego Facility, the Lilly San Diego Facility will have access to:

[...***...]of the [...***...].

[...***...] of the [...***...], as agreed by [...***...], and [...***...]
([...***...]).

OTHER SGX FACILITY USE

Lilly and SGX agree that Lilly may require access to certain SGX facilities
(i.e., [...***...]) to support work at the Lilly San Diego Facility. The details
of such access will be part of a seprate facilities use agreement, to be agreed
upon by Lilly and SGX.

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EXHIBIT D

                                    PLATFORM

    D 1: LABORATORY EQUIPMENT (costs and timelines see attached Appendix D1)

     QUANTITY                               ITEM DESCRIPTION

ROBOTICS EQUIPMENT

[...***...] TO [...***...] MODULE

        2      [...***...]
        1      [...***...]
        1      [...***...]
        1      [...***...]
        1      [...***...]
        1      [...***...]
        1      [...***...]
        3      [...***...]
        3      [...***...]
        3      [...***...]
        3      [...***...]
        2      [...***...]
        1      [...***...]
        1      [...***...]

[...***...] TO [...***...] MODULE

        1      [...***...]
        1      [...***...]
        2      [...***...]
        2      [...***...]
        1      [...***...]
        1      [...***...]

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       QUANTITY                              ITEM DESCRIPTION

ANCILLARY LAB EQUIPMENT

[...***...] AND [...***...] (SOME ITEMS TO BE SHARED)

       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       2        [...***...]
       1        [...***...]
       1        [...***...]
       4        [...***...]
       4        [...***...]
       2        [...***...]
       3        [...***...]
       2        [...***...]
       1        [...***...]
      10        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
      24        [...***...]
       1        [...***...]
       1        [...***...]
       6        [...***...]
       4        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]

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      QUANTITY                              ITEM DESCRIPTION

[...***...] AND [...***...] (CONTINUED)

      1         [...***...]
      2         [...***...]
      1         [...***...]
      2         [...***...]
      3         [...***...]
      2         [...***...]
      4         [...***...]
      3         [...***...]

[...***...]

       1        [...***...]
       1        [...***...]
       1        [...***...]
       5        [...***...]
       1        [...***...]
      15        [...***...]
       2        [...***...]
       4        [...***...]
       1        [...***...]
       5        [...***...]

[...***...] AND [...***...]

       2        [...***...]
       2        [...***...]
       5        [...***...]
      12        [...***...]
       3        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       3        [...***...]

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      QUANTITY                              ITEM DESCRIPTION

[...***...] AND [...***...] (CONTINUED)

       1        [...***...]
       1        [...***...]
       1        [...***...]
       1        [...***...]
       2        [...***...]
       1        [...***...]
       4        [...***...]
      30        [...***...]
       2        [...***...]
       2        [...***...]

GENERAL

      1         [...***...]
      3         [...***...]
      2         [...***...]

                             D 2: IT INFRASTRUCTURE

      QUANTITY                             ITEM DESCRIPTION

[...***...] & [...***...]

      2         [...***...]
      2         [...***...]
      4         [...***...]
      4         [...***...]

FACILITY INFRASTRUCTURE

      1         [...***...]
      2         [...***...]
      1         [...***...]
      1         [...***...]
      1         [...***...]

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       QUANTITY                             ITEM DESCRIPTION

TELECOM & RELATED

      1         [...***...]
      1         [...***...]

SERVERS AND RELATED ITEMS

      1         [...***...]
      4         [...***...]
      1         [...***...]
      1         [...***...]
      1         [...***...]
      1         [...***...]
      1         [...***...]
      1         [...***...]
      1         [...***...]

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                                  APPENDIX D-1

                   ESTIMATED TIMING OF LAB EQUIPMENT PURCHASES

[...***...]

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                             APPENDIX D1 (CONTINUED)

[...***...]

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                             APPENDIX D1 (CONTINUED)

[...***...]

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                                  APPENDIX D-2
                      EQUIPMENT TO BE ORDERED BY SGX PRIOR
                               TO APPROVAL OF THE
                          TECHNOLOGY INSTALLATION PLAN

<TABLE>
<CAPTION>
   ITEM                     VENDOR
   ----                     ------
<S>                       <C>
[...***...]               [...***...]
[...***...]               [...***...]
</TABLE>

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                                    EXHIBIT E

                             THIRD PARTY TECHNOLOGY

 VENDOR/INSTITUTION                                     ITEM

SGX [...***...] THIRD PARTY LICENCES

[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]

IT INFRASTRUCTURE THIRD PARTY LICENCES

[...***...]           [...***...]
[...***...]           [...***...]

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   VENDOR/INSTITUTION                                               ITEM

THIRD PARTY LICENSES TO VECTORS AND EXPRESSION SYSTEMS

[...***...]           [...***...]
[...***...]           [...***...]
[...***...]           [...***...]

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                                    EXHIBIT F
                                 SGX [...***...]

The SGX [...***...] is comprised of [...***...] modules, supported by the
[...***...]

      [...***...]
      [...***...] to [...***...]
      [...***...] to [...***...]
      [...***...]
      [...***...].

The [...***...] to [...***...] and [...***...] to [...***...] modules are
[...***...] modules, each of which have (i) [...***...] or [...***...] programs,
(ii) [...***...] for use in conjunction with [...***...] or [...***...], and
(iii) [...***...].

The [...***...] ([...***...] and [...***...]), and [...***...] modules are
[...***...] and [...***...], each of which have (i) [...***...] or [...***...],
(ii) [...***...] and/or [...***...], and (iii) [...***...] (see [...***...]
section for a description of [...***...]).

Each Module and [...***...] will be described in more detail below.

[...***...] MODULE

This module enables the user to [...***...] a [...***...] or [...***...] using
[...***...] and [...***...] a set of [...***...] for [...***...]. The
[...***...] to prepare these [...***...] using [...***...] are designed using
one of several [...***...]. The [...***...] is sent to the [...***...] along
with the [...***...] and [...***...] a record for this [...***...] and
[...***...] going forward. [...***...] can be formatted and sent to an external
vendor for synthesis using these tools.

The module includes a number of [...***...] and [...***...] and documentation
relating to use of the [...***...].

[...***...]:

      [...***...] AND [...***...]: Provides a [...***...] of all of the
      [...***...] that have been [...***...] and/or [...***...] for a
      [...***...]. Included in the [...***...] from [...***...] in the
      [...***...].

      [...***...]: ([...***...]for [...***...])[...***...] that, for a
      [...***...] or group of [...***...] provides [...***...] to [...***...],

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      [...***...], and [...***...]. The [...***...] can select [...***...] with
      which to [...***...] by simple [...***...] and [...***...] operations on
      individual [...***...].The [...***...] is automatically generated and
      [...***...] to [...***...] for [...***...].

      [...***...] of [...***...].[...***...] builds [...***...] and [...***...],
      predicts [...***...] ([...***...]), searches [...***...] for [...***...]
      to known [...***...], and uses [...***...] to classify [...***...].
      Results can be summarized on a [...***...] and [...***...] to [...***...].

      [...***...] to highlight the [...***...], and [...***...] in a [...***...]
      as defined by [...***...] and [...***...] ([...***...]). It operates as a
      [...***...] or from the [...***...] ([...***...]), and can include
      [...***...], and [...***...] in the output as an option. Output is in
      [...***...] or [...***...] ([...***...]).

      [...***...] that [...***...] the [...***...] of the [...***...] and
      [...***...] in [...***...] and [...***...] each [...***...] ([...***...]),
      and [...***...] that form the [...***...] or interact with the
      [...***...]. It also shows [...***...] and [...***...] from [...***...]
      and can include [...***...].

      [...***...] A [...***...] approach to [...***...] for [...***...] that may
      improve [...***...] and/or [...***...].[...***...] analyzes [...***...],
      [...***...], or [...***...] and suggests [...***...] based on variations
      found in [...***...]. The user can provide as much or as little
      intervention as is deemed necessary.

      [...***...] of [...***...] for [...***...] and [...***...].[...***...] and
      [...***...] that have previously been [...***...], [...***...],
      [...***...] and [...***...] with a related [...***...] ([...***...]),
      with the actual [...***...], the length of the [...***...] used to obtain
      the [...***...] and identification of all [...***...] in the [...***...].

[...***...] AND [...***...]:

        - Generating [...***...] from a [...***...].
        - Generating [...***...] from [...***...] for [...***...].
        - Generating [...***...] from a [...***...].
          Generating [...***...] from [...***...] for [...***...].

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      - Uploading of [...***...] material into the [...***...].
      - Updating the [...***...] of [...***...] already completed.
      - Generating [...***...] for a specific [...***...].
      - Use of [...***...] to generate [...***...].
      -
      - [...***...] and [...***...] in the [...***...].

[...***...]:

      [...***...]
            [...***...] and [...***...]
            [...***...]

[...***...] MODULE

This module enables the user to [...***...] for each target from the [...***...]
designed in the [...***...] MODULE. Once the [...***...] are prepared, they are
[...***...] and [...***...] into one or more of several [...***...] containing
[...***...] using [...***...]. These [...***...] are expressed in [...***...],
and for each [...***...] are chosen for [...***...]. [...***...] is achieved by
[...***...] of [...***...] for each [...***...] for [...***...] of [...***...]
to [...***...] in [...***...] and analyzing the output using [...***...].
[...***...] containing [...***...] that express [...***...] are [...***...] in
one of several [...***...] at a scale of [...***...] to [...***...]. The
resulting material is [...***...] and passed on for [...***...].

[...***...] is done via [...***...] by passing the [...***...] over [...***...]
and [...***...]. In some cases, [...***...] is also employed. The resulting
[...***...] is concentrated to on average [...***...] and passed on for
characterization of [...***...], [...***...], and [...***...] using
[...***...].[...***...] state is assessed by [...***...]. [...***...] judged to
be [...***...]%[...***...] and [...***...] is passed on for [...***...].

Other methods available within this [...***...] are [...***...] of [...***...],
[...***...] of [...***...] using [...***...] combined with [...***...], and
[...***...] of [...***...], [...***...] by [...***...]. Identification of
[...***...] for [...***...] is also available.

(i)   [...***...] PROGRAMS:

      [...***...]:[...***...] and/or [...***...] views of limited [...***...].
      Simultaneously view the effects of [...***...] as a function of
      [...***...]; also displays the [...***...], existing [...***...]
      boundaries as stored in the [...***...],[...***...], and [...***...].

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(ii)  METHODS AND PROTOCOLS:

      [...***...] AND [...***...]

         -     Calibration Procedure for [...***...]*.

         -     Setup of a [...***...] on a [...***...]*.

         -     Setup of a [...***...] on a [...***...]*.

         -     [...***...] from [...***...] on a [...***...]*.

         -     Operation of the [...***...].

         -     Operation of the [...***...].

         -     Sample [...***...] and [...***...] on a [...***...]*.

         -     [...***...] of [...***...] using [...***...] and [...***...],
               [...***...], [...***...], and/or [...***...].

         -     [...***...] using [...***...] on a [...***...]*.

         -     [...***...]:[...***...] stock creation and [...***...] on a
               [...***...].

         -     [...***...] screen preparation on a [...***...].

         -     [...***...] using [...***...] on a [...***...]*.

         -     [...***...] using [...***...] on a [...***...]*.

         -     [...***...] using [...***...] on a [...***...]*.

         -     [...***...].

         -     [...***...].

            *Or equipment of equivalent functionality.

[...***...]

         -     Growth of [...***...] in [...***...] w/[...***...].

         -     Growth of [...***...] in [...***...] w/ [...***...] and
               w/[...***...].

         -     Growth of [...***...] in [...***...] w/[...***...] +/-
              [...***...].

[...***...]

         -     [...***...] of [...***...] using [...***...] and [...***...].

         -     [...***...] and [...***...] of [...***...] or [...***...].

[...***...] AND [...***...]

         -     Protein [...***...] and [...***...] for [...***...].

         -     Protein [...***...] using [...***...] for [...***...] to
               [...***...].

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      -     Protein [...***...] using [...***...] and [...***...] for
            [...***...] samples.

      -     Protein [...***...] and [...***...] of [...***...] using
            [...***...].

      -     [...***...] and [...***...] of [...***...] proteins.

      -     Protein [...***...] using the [...***...] and [...***...].

      -     Protein [...***...] using a [...***...] and [...***...].

      -     [...***...] for protein [...***...] and [...***...]

      -     [...***...] of protein [...***...] for [...***...] and [...***...]
            using [...***...].

      -     Identification of proteins using [...***...] in [...***...] and
            analysis with [...***...].

      -     Protein [...***...] using [...***...] and [...***...].

(iii) [...***...] INTERFACES:

      MOLECULAR BIOLOGY

            [...***...]
                  Enter new [...***...].
            [...***...]
                  Enter [...***...] in [...***...] from [...***...].
            [...***...]
                  Order [...***...] and send email to [...***...] and
                  [...***...]
            [...***...]
                  [...***...] of [...***...]
            [...***...]
            [...***...].
                  Tool for entering and updating the [...***...] associated with
                  a given [...***...].
            [...***...]
                  Start [...***...] once the [...***...] are [...***...].

      [...***...]
            [...***...].

                  Enter [...***...] detail information and complete [...***...]
                  sending it to [...***...] in [...***...].
            [...***...]
                  Request [...***...].
                  Manage existing orders.
                  Query existing orders.

      PURIFICATION
            [...***...]

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                  Queries, inserts, and updates records.
            [...***...]
                  Queries, inserts, update, and delete steps.
            [...***...].

            [...***...]
                  Queries, inserts, update, and delete steps.

      [...***...] ANALYSIS
            [...***...] Records
                  Program - [...***...] information. Both [...***...] and
                  [...***...].

3.    [...***...] TO [...***...] MODULE

This module enables the user to [...***...] with the [...***...] prepared in the
[...***...]. [...***...] is tested for the [...***...] using the [...***...] and
[...***...]. Standard solutions for [...***...] are prepared and [...***...] for
use in [...***...]. [...***...] and [...***...] solutions are added to
[...***...], [...***...], and [...***...] in one of [...***...]. At pre-selected
times the [...***...] are [...***...] and the [...***...] are stored in the
database where they can be [...***...]. Solutions for [...***...] can be
selected using the [...***...] and set-up as before. Once [...***...] they are
collected, and a number of [...***...] conditions are tested for [...***...].

(i)   [...***...] PROGRAMS

      [...***...]: [...***...] interface that facilitates automated
      [...***...] of [...***...]. The method uses [...***...] based upon
      [...***...] from a set of [...***...]. The contents of the [...***...]
      are stored in the [...***...], and the [...***...] are automatically
      [...***...].

      [...***...]: [...***...] that allows [...***...] of [...***...]. The
      [...***...] is integrated into an overall [...***...] process where
      [...***...] are automatically [...***...] and [...***...]. The results
      are stored in the [...***...]. Scoring results are classified into
      [...***...] categories: [...***...], [...***...], [...***...]. All
      [...***...] and scores may be viewed interactively through a
      [...***...].

(ii)  METHODS AND PROTOCOLS:

         -     Protocols and Solutions for [...***...] and [...***...].

         -     Solution set-up for [...***...] using a [...***...].

         -     Solution set-up for [...***...] using a [...***...].

         -     [...***...] set-up via [...***...].

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      -     Entry/retrieval of [...***...] into/from [...***...].

      -     [...***...] viewing and [...***...].

      -     [...***...].

(iii) [...***...] INTERFACES:

      [...***...]
            [...***...] tool
                  Query to find [...***...] of [...***...].
            [...***...]
                  Adds [...***...] to a [...***...].
            [...***...]
                  Allows [...***...] and[...***...].
            [...***...]
                  Marks [...***...] for [...***...].
            [...***...]
                  Adds [...***...] that [...***...] a [...***...].
            [...***...]
                  [...***...] for [...***...].
            Print [...***...]
                  Prints [...***...] of a [...***...].
            Print [...***...]
                  Prints [...***...] for the [...***...].
            View [...***...]
                  Allows viewing of [...***...].
            [...***...] Summary
                  Displays a summary of [...***...] by [...***...].
            Add a [...***...]
                  Adds a new [...***...] to be used in a [...***...].
            Add a [...***...]
                  Adds a new [...***...] to be used in a [...***...].
            Add a [...***...]
                  Enters information about a [...***...].
            [...***...] /update a [...***...]
                  Reports and prioritizes [...***...] for [...***...].
            Collect Data
                  Allows for [...***...] data collection.
            [...***...] a [...***...]
                  Allows for designation of [...***...].
            [...***...] a [...***...]
                  Allows user to designate a [...***...] as [...***...].
            [...***...] Summary
                  Shows summary of [...***...] for a [...***...].
            [...***...] editor
                  Supports [...***...].

            Reports
                  Reports by project and date range.

            [...***...]
                  [...***...] to [...***...].

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            Summary page
                  Provides summaries by [...***...] and [...***...].

4.    [...***...] MODULE

This module enables the user to take [...***...] collected at a [...***...] or
other [...***...] and produce [...***...] with minimal user input. Once the
[...***...] for a [...***...] is available, a single process automates
[...***...] and [...***...]. Following [...***...] completion, the completed
[...***...] and [...***...] are directed through the [...***...]. Once a
[...***...] passes [...***...] it may be deposited in the [...***...].

(i)   [...***...] PROGRAMS:

      [...***...] consists of a [...***...] of [...***...] that perform
      [...***...] specific tasks in the [...***...], requiring minimal user
      input.

      [...***...] consists of a highly automated [...***...] that performs
      [...***...] using both [...***...] components ([...***...], [...***...])
      from the [...***...] and [...***...] for additional tests and [...***...]
      into convenient form. This system also creates [...***...] ready for
      [...***...] into the [...***...] by [...***...] staff.

      [...***...] consists of [...***...] that [...***...] of [...***...]
      present after [...***...] that are large enough to potentially represent a
      [...***...]. The optimal conformation for the [...***...] is then fit to
      this [...***...] using an [...***...] that seeks to maximize the
      [...***...] value at each [...***...].

(ii)  METHODS AND PROTOCOLS:

      -     [...***...] processing.
            An [...***...] system for processing [...***...] collected on
            the [...***...] at [...***...].

      -     [...***...] using [...***...], [...***...], or [...***...] methods.
            A [...***...] for carrying out all data set to refined [...***...]
            within a single process. These operations include [...***...],
            [...***...], and [...***...]. These tasks may also be run separately
            via [...***...].

      -     [...***...].
            A [...***...] for running a variety of [...***...],
            with support for a variety of search parameters.

      -     [...***...].
            A [...***...] for [...***...] various types of
            [...***...], including [...***...] for improving [...***...].

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            -     [...***...].
                  [...***...] for running [...***...] methods applicable at both
                  [...***...] and [...***...] resolution

            -     [...***...].
                   A [...***...] for carrying out [...***...], [...***...],
                  [...***...] and [...***...], [...***...] of [...***...], and
                  [...***...] of the [...***...] within a single process. These
                  tasks can also be run individually. In normal operating modes,
                  initial [...***...] related to [...***...] is obtained as
                  [...***...] from the [...***...] system.

            -     [...***...].
                  A [...***...] for [...***...] using metrics related to
                  [...***...] and agreement with the [...***...]. This
                  [...***...] also checks [...***...] for [...***...], checks
                  [...***...] of the [...***...] sequence with the [...***...]
                  sequence, and collects [...***...] statistics. Output from
                  this [...***...] includes, a standardized [...***...], an
                  [...***...] containing [...***...], a list of [...***...],
                  various [...***...], and [...***...] files in [...***...]
                  format.

(iii) [...***...]:

            [...***...] REPOSITORY

                  Browse
                  Expert Search Form
                  Summary Report

5.    [...***...] MODULE

This module is an optional component that functions off-line. After the
[...***...] process, a series of structure analyses are available and run at the
discretion of the project and depends on the nature of the [...***...].

[...***...] can be analyzed using [...***...], [...***...], and [...***...] to
identify likely [...***...] and to provide [...***...] for [...***...]. By
comparing [...***...], these analyses can also be used in combination with
[...***...], to [...***...] that may [...***...] or [...***...] based on
[...***...] variation and prior experimental results. For detailed comparisons
to [...***...], [...***...] provides a [...***...]. This analysis is typically
performed with [...***...] to compare the [...***...] in a [...***...] and to
compare the [...***...] of a [...***...] to [...***...] to understand
[...***...].[...***...] is an [...***...] user program that provides an
independent method to [...***...] that does not require the [...***...] to be
[...***...] and, with [...***...] is used by the [...***...] to further
understand [...***...] across [...***...]. The results of these

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analyses, as well as the observations of the [...***...], [...***...] and
[...***...], can all be tracked using the [...***...].

(i)   [...***...] PROGRAMS:

      [...***...]:[...***...] tool for [...***...] of a user-selected group of
      [...***...] in the [...***...] and [...***...] databases (updated
      [...***...]). Information is stored in the [...***...] database to greatly
      accelerate future alignments and retrieve past results. Program identifies
      [...***...] and provides [...***...] output.

      [...***...]: Determines the [...***...] of all [...***...] on the
      [...***...] of a [...***...] structure and [...***...] them [...***...].
      About [...***...]% of the time the [...***...] represents the location of
      a [...***...]. Typically used in conjunction with [...***...], which
      improves the success rate to [...***...]%.

      [...***...]: A database of descriptors of [...***...] of [...***...] (from
      [...***...] structures) that bind [...***...] and [...***...] fragments.
      Can be used in conjunction with [...***...] to identify [...***...] of a
      given [...***...] or to identify [...***...] for a [...***...].

      [...***...]: Identifies [...***...] of [...***...], [...***...] in a
      structure. Such [...***...] are usually important [...***...] and
      typically the [...***...] is the [...***...]. Often used in conjunction
      with [...***...].

      [...***...]: A structure analysis program that evaluates the [...***...]
      of the [...***...] around each [...***...] in a [...***...] or
      [...***...]. The program can be used to [...***...] onto the [...***...],
      or evaluate the reliability of [...***...] of a [...***...]. It also
      highlights [...***...] that [...***...] with [...***...] and can display
      this information for a [...***...] of structures. Also used in protein
      engineering applications.

      [...***...]: Allows association of [...***...] and [...***...] with
      [...***...]. Documentation includes [...***...] for [...***...] of
      [...***...];[...***...] of [...***...];[...***...] of [...***...]; and
      [...***...] of [...***...].

      [...***...]: A program that overlays [...***...] of [...***...] by
      optimizing the [...***...] of [...***...]. Can be used to classify
      [...***...] by [...***...] similarities and to identify [...***...].

(ii)  METHODS AND PROTOCOLS:

      Since the [...***...] module operates as an optional module, there is no
      strict protocol for all [...***...].

            Novel [...***...] are:

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            -     [...***...] to the [...***...] structure database

            -     [...***...] for the existence of [...***...]
                  ([...***...], [...***...])

            -     [...***...] using the [...***...] forum

(iii) [...***...] INTERFACES:

            STRUCTURE DEPOSITION TOOLS

                  A [...***...] for uploading [...***...] from the [...***...]
                  to the database. This tool lists [...***...] in a user
                  definable [...***...] and allows the user to [...***...] a
                  [...***...] to be uploaded. Some [...***...] are performed on
                  selection of a [...***...] and the user is informed as to
                  whether or not the [...***...] in the database. [...***...]
                  are solved on [...***...] or [...***...] systems, so the
                  [...***...] was intended to be run on these systems. It is
                  written in [...***...] with a [...***...].

6.    [...***...]

The SGX [...***...] is used to [...***...] and [...***...] and [...***...]
throughout the experimental and analytical processes. Each module has its own
workspace and interfaces as identified above. There are also general tools
available via [...***...] that are listed below.

      [...***...] TOOLS

            [...***...]
                  Calculates expected [...***...] for the [...***...] of
                  [...***...]. It implements logic to produce a [...***...],
                  calculating an [...***...] based on [...***...] when
                  necessary. The [...***...] is then analyzed for [...***...]
                  usage, [...***...], [...***...] content, [...***...],
                  [...***...] properties, and [...***...].

            [...***...]
                  [...***...] that updates the [...***...] tables

            [...***...]
                  A tool for entering and updating the [...***...] associated
                  with a [...***...].

            [...***...] Query
                  Simple web query tool available through [...***...] that only
                  allows select "m" statements. [...***...] not available
                  through this interface.

            [...***...]
                  [...***...] tool that allows users to assess the status of a
                  particular [...***...] within [...***...] using a variety of
                  [...***...].

            Change Password
                  Allows user to change [...***...] password.

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      [...***...] TOOLS
            [...***...]
                  [...***...] tool that allows users to query the database for a
                  [...***...] of [...***...] available for [...***...]. Users
                  can add [...***...] to the database as well as edit existing
                  [...***...] records.

            [...***...]
                  [...***...] tool that allows users to query the database for
                  [...***...] as well as add [...***...] to the database and/or
                  edit existing [...***...] records.

            [...***...]
                  [...***...] tool that allows users to query the database for a
                  [...***...] available. Users can also add [...***...] to the
                  database and/or edit [...***...] records.

      [...***...] TOOLS
                  [...***...]
                  [...***...]
                  [...***...]

[...***...]: [...***...] system enabling quick [...***...] of [...***...] in the
[...***...] database. Users can find [...***...] in the pipeline based on the
[...***...], [...***...], or [...***...]. Links to key [...***...] interfaces,
[...***...], and [...***...] information facilitate quick lookup of information.

      [...***...] TOOLS: [...***...] tool suite that allows [...***...] of
[...***...] for management and reporting purposes. Project managers can
[...***...] to project related information by [...***...] to scientists in the
project. [...***...] interfaces integrate [...***...] information with
[...***...] so that [...***...] is protected. Targets can be assigned to
different projects. Reports detailing project progress summarize targets based
on project affiliation.

      [...***...]: [...***...] tool suite that allows project managers to
[...***...] progress of [...***...]. Scientists and project managers can easily
[...***...] and [...***...] key [...***...], [...***...], and [...***...] using
data entry forms.

      [...***...]: [...***...] data can be filtered and displayed using an SQL
based report system. The SQL based reports are generated and saved into the
database. Reports are then published so that users can [...***...], [...***...],
[...***...], and [...***...] the results into [...***...].

      [...***...]: [...***...] searches [...***...] at [...***...] nightly for
new literature related to [...***...], [...***...], or [...***...].

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Note: Structural GenomiX, SGX, [...***...], [...***...], [...***...],
[...***...], [...***...], [...***...], [...***...], [...***...], [...***...],
[...***...], [...***...], [...***...], [...***...], [...***...], [...***...] and
[...***...] are all trademarks and/or service marks of Structural GenomiX, Inc.
Other trademarks and service marks are the property of their respective owners.

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                                   APPENDIX F
                  SGX BIOINFORMATICS TECHNOLOGY TO BE INSTALLED
                       AT LILLY IN ADVANCE OF INSTALLATION
               OF SGX [...***...] AT THE LILLY SAN DIEGO FACILITY

[...***...] versions of the following:

[...***...]:  [...***...]

[...***...]:  [...***...], [...***...], [...***...], [...***...]

            [...***...]: [...***...], [...***...], [...***...], [...***...],
                        [...***...], [...***...],[...***...]

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                                    EXHIBIT G
                               ACCEPTANCE CRITERIA

1.    [...***...]

The [...***...] of a [...***...],[...***...] target for which SGX has
[...***...] a [...***...] according to the Target Structure specifications in
Section 1.40(a) will be [...***...] using the Lilly San Diego Facility. This
experiment will comprise the following steps:

[...***...] and [...***...]
[...***...]
[...***...] and [...***...]
[...***...] and [...***...]
[...***...] at SGX-CAT at the APS
[...***...] and [...***...]

The experiment will be performed by an SGX employee or employees skilled in the
art but with [...***...] with the target in question. The target will be a
[...***...] nominated by SGX and approved by the [...***...]. Provided the
Target Structure specifications in Section 1.40(a) [...***...] for the target
the [...***...] ([...***...], [...***...] etc.) [...***...] to the structure
[...***...] to those that [...***...] the SGX structure.

2.    [...***...]

[...***...] will be comprised of [...***...] parts:

[...***...]

The [...***...] of a [...***...] Collaboration Target (or as otherwise agreed by
the JSC) for which SGX has [...***...] a [...***...] according to the Target
Structure specifications in Section 1.40 will be [...***...] using the Lilly San
Diego Facility. This experiment will comprise the following steps:

[...***...] and [...***...]
[...***...]
[...***...] and [...***...]
[...***...] and [...***...]
[...***...] at SGX-CAT at the APS
[...***...] and [...***...]

The experiment will be performed by an SGX employee or employees skilled in the
art. The target will be a [...***...] nominated by SGX and approved by the
[...***...]. Provided the Target Structure specifications in Section 1.40(a) or,
if applicable, the

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specifications of the structure which was utilized per Section 1.40(b) are
reached for the target, the [...***...] ([...***...], [...***...] etc.) that
[...***...] to the structure [...***...] to those that [...***...] the
collaboration structure.

[...***...]

Upon selection of the [...***...] ([...***...]) [...***...] Collaboration
Targets in accordance with Section 2.6(c), SGX will endeavor to determine the
[...***...] of such Collaboration Targets at the Lilly San Diego Facility for
[...***...] validation according to the Target Structure specifications in
Section 1.40. The target mix for this [...***...] validation will include the
following:

                        (i)  [...***...]
                        (ii)  [...***...]
                        (iii)  [...***...]
                        (each as further defined in the Research Plan.)

For successful completion of the [...***...] validation, SGX must demonstrate
that it has successfully determined Target Structures for at least [...***...]
([...***...]%) of such Collaboration Targets.

3.    [...***...]

The [...***...] of a Collaboration Target for which SGX [...***...] a
[...***...] according to the Target Structure specification in Section 1.40 will
be [...***...] using the Lilly Indianapolis Facility. This experiment will
comprise the following steps:

[...***...] and [...***...]
[...***...]
[...***...] and [...***...]
[...***...] and [...***...]
[...***...] at SGX-CAT at the APS
[...***...] and [...***...]

The experiment will be performed by an SGX employee or employees skilled in the
art but with [...***...] with the target in question. The target will be a
[...***...] nominated by SGX and approved by the JSC. Provided the Target
Structure specifications in Section 1.40(a) or, if applicable, the
specifications of the structure which was utilized per Section 1.40(b) are
reached for the target, the [...***...] ([...***...], [...***...] etc.) that
[...***...] to the structure [...***...] to those that [...***...] the
collaboration structure.

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                                    EXHIBIT H

                           LICENSED TECHNOLOGY SUPPORT

Requests for support under Section 3.4(c) must be submitted by Lilly employees
via email to a designated SGX group email address, which will deliver the
request to members of the SGX Bioinformatics Department and IT Department. A
first response to every email will be delivered via email to the initiating
Party, as well as the Bioinformatics Department and IT Department at SGX, during
business hours in accordance with the schedule below. Follow up emails will
continue until a resolution (final correction or work around) has been achieved.
If resolution or extent of problem cannot be determined via email then an SGX
personnel will follow up with call back to the specific Party to achieve better
clarity and final resolution of such problem. Resolution of such issues will be
finalized via email to the initiating Party, as well as the Bioinformatics
Department and IT Department at SGX.

          ERROR PRIORITY (1)       RESPONSE (2)

          Critical (A)             Within one (1) hour
          Non-Critical (B)         Within one (1) business day

      (1)   Priority:

            A. Problems that have been substantiated as resulting in substantial
impairment of functionality to users.

            B. All other problems which the user can easily avoid or detour and
for which there is no urgency for a resolution.

      (2) Response: Response consists of providing, as appropriate, one of the
following to Lilly: an existing correction; a new correction; a viable detour or
work around; a request for more information to complete analysis of the
problems, or a reasonable plan on how the problem will be corrected.

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