Document:

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                                                                   EXHIBIT 10.14

                       SUPPLY AND MANUFACTURING AGREEMENT

                                    Between

               TEIKOKU SEIYAKU CO., LTD./TEIKOKU PHARMA USA, INC.

                                      And

                           ENDO PHARMACEUTICALS INC.

The confidential portions of this exhibit have been filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request
in accordance with Rule 406 of the Securities Act of 1933.

            REDACTED PORTIONS OF THIS EXHIBIT ARE MARKED BY AN ***.

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TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 2

This Supply and Manufacturing Agreement, is effective as of the 23rd day of
November 1998, between Teikoku Seiyaku Co., Ltd., a Japanese corporation
(TEIKOKU JAPAN) and its U.S. subsidiary, Teikoku Pharma USA, Inc. (TEIKOKU USA)
having their respective principal office at 567 Sanbonmatsu, Ochio-cho,
Ohkawagun, KAGAWA 769-26, Japan and Suite 101, 3707 Williams Road, San Jose, CA
95117-2017 (collectively hereinafter referred to as "TEIKOKU"), and Endo
Pharmaceuticals Inc., a Delaware corporation, having its principal office at 223
Wilmington West Chester Pike, Chadds Ford, PA 19317 ("ENDO").

WHEREAS, ENDO has entered into an Sole and Exclusive License Agreement of even
date with Hind Health Care, Inc. (HIND), pursuant to which ENDO has obtained a
sole and exclusive license to all of HIND's Intellectual Property with regards
to a topical formulation of lidocaine for the treatment of post-herpetic
neuralgia, other forms of neuralgia and other neuropathy (Product);

WHEREAS, HIND and TEIKOKU have represented to ENDO that under a separate
agreement between them, TEIKOKU USA will become the owner of the NDA for the
Product upon the issuance of such NDA by the FDA and is listed in the NDA as the
sole manufacturer of the Product;

WHEREAS, TEIKOKU JAPAN has represented to ENDO that it has and will make
available suitable facilities, equipment, and sufficiently trained and qualified
employees at its facilities to manufacture and supply ENDO with the Product; and

WHEREAS, ENDO upon reliance on these various representations by HIND and TEIKOKU
desires to avail itself of the services of TEIKOKU and TEIKOKU is willing to
provide its services to manufacture and supply the Product to ENDO under the
terms and conditions set forth below;

NOW, THEREFORE, in consideration of the covenants and obligations hereinafter
set forth and intending to be legally bound, the parties hereby agree as
follows:

1.  DEFINITIONS
    -----------

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TEIKOKU-ENDO
SUPPLY & MANUFATURING AGREEMENT
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1.1  "Adverse Reaction" means all data concerning any serious or unexpected
     adverse effects, side-effects, and contraindications of the Product which
     may come to the attention of either of the parties, and which, in the
     reasonable judgment of such party is of such a nature and magnitude that it
     is required under the laws of the United States or Japan to be collected,
     maintained, and reported to a Competent Regulatory Authority.

1.2  "Affiliate" means any entity controlling, controlled by or under common
     control of either ENDO or TEIKOKU JAPAN.  For purposes hereof, "control"
     shall mean ownership, directly or indirectly, of more than fifty percent
     (50%) of the securities having the right to vote for the election of
     directors, in the case of a corporation, and more than fifty percent (50%)
     of the beneficial interest in the capital, in the case of a business entity
     other than a corporation.

1.3  "Best Efforts" means those efforts which would be made by a reasonably
     prudent business person acting in good faith, in the exercise of reasonable
     commercial judgment and in a manner consistent with those efforts a party
     devotes to a pharmaceutical product resulting from its own research efforts
     and having similar market potential.

1.4 "Commercial Package" means a sealed carton which contains six (6) Envelopes
     and shall constitute the final finished package configuration ready for
     importation to the United States for commercial sale by ENDO in the United
     States as modified from time to time by mutual consent of the parties.

1.5  "Competent Regulatory Authority" means the FDA in the United States, the
     MOHW in Japan, or any other government agency responsible for the issuance
     of any authorizations, registrations, licenses, or approvals for
     pharmaceutical products to be manufactured in and exported from Japan and
     imported into the United States for commercial sale in the United States.

1.6  "Envelope" means a hermetically sealed, resealable, four (4) colors (white,
     being considered a color) pre-printed envelop which contains five (5)
     Products.

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

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1.8 "Good Manufacturing Practices" means those practices in the manufacture of
     pharmaceutical products which are recognized as good manufacturing
     practices by the FDA in accordance with FDA guidelines, other
     administrative interpretations, and rulings in connection therewith,
     including but not limited to those regulations cited in 21 CFR parts 210
     and 211.

1.9  "Intellectual Property Rights" means the Patents and Know-How listed in
     Exhibit A which are necessary or useful for the manufacture, export, and
     import of the Product.

1.10 "Know-how" means all information and data, regardless of form, which is
     necessary or useful for the manufacture, export, and import of the Product
     including, but not limited to, the chemical composition, manufacturing
     processes, procedures, methods, analytical tests, and quality control
     information for the Product.

1.11 "Label" means any written, printed, or graphic matter upon the Product, the
     Envelope, the Commercial Package, or the Sample.

1.12 "Manufacture" means the making, finishing, packaging, and/or labeling of
     the Product and the Commercial Package.

1.13 "NDA" means the new drug application covering the Product on file with the
     FDA, as amended from time to time.

1.14 "Patent" means the United States patents and patent applications listed in
     Exhibit A owned in whole or in part or licensed or assigned to TEIKOKU and
     all reissues, extensions, substitutions, confirmations, registrations,
     revalidations, additions, continuations, continuations-in-part, and
     divisions thereof.

1.15 "MOHW" means the Japanese Ministry of Health and Welfare.

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1.16 "Product" means the transdermal (Patch) delivery system, which consists of
     a topical formulation of Lidocaine, designated as formula number KN48.

1.17 "Product Launch" means the first commercial sale of the Product by ENDO for
     resale or use to an unaffiliated third party in the Territory.

1.18 "Related Agreement" means the Sole and Exclusive License Agreement entered
     into by Hind Health Care, Inc. and ENDO of even date herewith and attached
     hereto as Exhibit B and made a part hereof.

1.19 "Sample" means two (2) Products in an Envelop which is not intended to be
     sold for commercial value by ENDO in the Territory.

1.20 "Submission Package" means all pre-clinical, laboratory, clinical,
     biocompatibility and other testing data, labeling, processing, material and
     packaging specifications, and supplements or amendments to the foregoing;
     and all other information in the possession of and used by TEIKOKU and HIND
     for submitting, obtaining, and maintaining approval of a NDA in accordance
     with the requirements of the Food Drug & Cosmetic Act, as amended, from
     time to time.

1.21 "Territory" means the United States, its territories, commonwealths, and
     possessions.

1.22 "Yen" means the legal currency and tender of Japan.

Except as otherwise defined above, all capitalized terms used in this Agreement
shall have the respective meanings attached to them as set forth in the Related
Agreement.

2.   OBLIGATIONS OF THE PARTIES
     --------------------------

2.1  MANUFACTURING
     -------------

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SUPPLY & MANUFATURING AGREEMENT
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     (1)  TEIKOKU-During the term of this Agreement, TEIKOKU JAPAN shall be
          -------
     responsible for the following activities in connection with the manufacture
     of the Product:

          (1)  TEIKOKU JAPAN shall use its Best Efforts to Manufacture the
               Product in compliance with current Good Manufacturing Practices
               ("GMP") as applied to final finished pharmaceutical products as
               regulated by the FDA, in accordance with all TEIKOKU JAPAN'S
               standard operating procedures, and in accordance with ENDO's
               quality control requirements.  A list of TEIKOKU JAPAN's standard
               operating procedures for the manufacture of the Product and
               ENDO's quality control requirements are attached hereto as
               Exhibits C and D, respectively.

          (2)  TEIKOKU JAPAN shall validate its pharmaceutical manufacturing
               processes, tests, and methods as well as associated facilities,
               equipment and systems, keep such processes, tests, methods,
               facilities, equipment, and systems current, and make results of
               validation and annual reviews of such processes, tests, methods,
               facilities, equipment, and systems available to ENDO within sixty
               (60) calendar days of Endo's reasonable request for such
               information;

          (3)  TEIKOKU shall retain such samples of the Product as are required
               and specified to comply with the general retention requirements
               as set forth in GMPs, perform stability testing as described and
               required to conform with the Product stability protocol and
               report any confirmed out-of-specification test results to ENDO
               within ten (10) business days, and make Product stability reports
               and findings available for inspection by ENDO within ten (10)
               business days of ENDO's reasonable request for such information;

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          (4)  The parties agree that any changes in TEIKOKU JAPAN's testing or
               packaging procedures for the Product outside the approved
               documented process will require prior written mutual consent of
               the parties.  Should ENDO request a change (or changes) in
               specifications, manufacturing process, materials, analytical
               testing methods mandated by the FDA or any other Competent
               Regulatory Authority, or request a change not mandated by the
               FDA, TEIKOKU JAPAN, in conformity with regulations governing such
               change, shall make every reason able effort to accommodate such a
               change (or changes), but all reasonable cost incidental to such a
               change that was not man dated by the FDA or any other Competent
               Regulatory Authority shall be borne by ENDO;

          (5)  TEIKOKU JAPAN shall maintain its manufacturing facility in
               compliance with FDA regulations and update all required
               documentation in cooperation with ENDO in the event of any
               amendments that may be made to the NDA.
          (6)  TEIKOKU JAPAN shall investigate all abnormalities in processing
               of the Product and share all investigation reports with ENDO

          (7) TEIKOKU shall participate and cooperate with ENDO representatives
               who may audit TEIKOKU's facilities and records related to the
               manufacture of the Product and implement the recommendations, if
               any, made by ENDO as a result of such audit, as may be required
               to comply with this Agreement. TEIKOKU will provide ENDO with a
               written action planned for the implementation of such
               recommendations or the actions already taken by TEIKOKU with
               regard to such recommendations;

          (8)  Assure that penicillin, cephalosporin or penicillin and
               cephalosporin-containing products will not be received, stored,

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               handled, dispensed, Manufactured or packaged in the same
               facility(ies) or in facilities that share common Heating,
               Ventilation and Air Conditioning systems or utilize the same
               equipment in the manufacture or handling of the components, raw
               materials or packaging of the Product;

          (9)  retain all records of the processing and manufacture of the
               Product in accordance with the applicable regulatory
               requirements.

     (2)  During the term of this Agreement, ENDO shall be responsible for the
     following activities in connection with the manufacture of the Product:

          (1)  ENDO shall periodically audit, at reasonable intervals, TEIKOKU
               JAPAN's facilities and the Product and Commercial Package-
               related regulatory records upon the provision of advance notice
               to TEIKOKU JAPAN. ENDO shall promptly provide TEIKOKU a copy of
               ENDO's audit report and/or any observations ENDO may have as a
               result of its audit.

2.2  SUPPLY OF THE PRODUCT
     ---------------------

     (1)  TEIKOKU USA hereby grants to ENDO a Sole and Exclusive license under
     the NDA to use, market and sell Product purchased by ENDO from TEIKOKU USA.

     (2)  Quantities.
          ----------

          (1)  ENDO Product Requirements.  TEIKOKU USA shall supply and sell to
               -------------------------
               ENDO and ENDO agrees to purchase, one hundred percent (100%) of
               ENDO's requirements for Commercial quantities and Samples of the
               Product for the Territory in accordance with this Agreement and
               the terms, if any, set forth in ENDO's purchase orders.  If a
               conflict between ENDO's

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               purchase order and the terms of this Agreement exists or
               develops, the terms of this Agreement shall prevail.

          (2)  Annual Minimum Orders.  ENDO shall purchase from TEIKOKU USA and
               ---------------------
               TEIKOKU USA shall supply annual minimum orders in the amount set
               forth in Exhibit E attached hereto and made a part hereof, as
               amended from time to time through mutual consent of the parties.

          (3)  Product Estimates.  Within thirty (30) days of execution of this
               -----------------
               Agreement, ENDO shall provide TEIKOKU USA an estimate of its
               requirements for the Product by month for the calendar year 1999.
               Thereafter, ninety (90) days prior to the beginning of each
               calendar quarter, ENDO shall provide to TEIKOKU USA an estimate
               of its requirements for the Product by month for the upcoming
               four (4) calendar quarters.  These estimates for the Product
               shall be estimates only and shall not constitute binding
               commitments for the Product.

          (4)  Product Firm Orders.  At least one hundred fifty (150) days prior
               -------------------
               to the beginning of a calendar quarter, ENDO will provide
               TEIKOKU with a firm order for the Product for said calendar
               quarter ("Firm Order").  Firm Orders for the Product for the
               applicable calendar quarter may not be less than 75% nor greater
               than 135% of the estimates for such calendar quarter provided in
               Paragraph 2.2(b) above.  TEIKOKU shall be required to supply to
               ENDO such Firm Orders of Product for the applicable calendar
               quarter.

          (5)  Material Change in Product and/or Label.  Notwithstanding
               ---------------------------------------
               Paragraph 2.2(iii) above, in the event that ENDO requires TEIKOKU
               to materially change the Commercial Package Label, at least one
               hundred and fifty (150) days prior to the beginning of a calendar
               quarter, ENDO will provide TEIKOKU with a Firm Order for the
               Product with the revised

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               Label for said calendar quarter. Firm Orders for the Product with
               the revised Label for the applicable calendar quarter may not be
               less than 75% nor greater than 135% of the estimates for such
               calendar quarter provided in Paragraph 2.2(ii) above. TEIKOKU
               shall use its best commercial efforts to supply to ENDO such Firm
               Orders of Product for the applicable calendar quarter.

               The parties shall work together in good faith to ensure the
               fastest implementation of the manufacture and delivery of any
               material change required to the Product.

          (6)  Minimum Shelf Life.  TEIKOKU hereby warrants that at the time of
               ------------------
               delivery of Product to ENDO under this Agreement, such Product
               shall have a minimum of eighty percent (80%) of its shelf life
               still available.

2.3  REGULATORY MATTERS
     ------------------

     (1) FDA Communications. Upon being contacted by the FDA for any regulatory
         ------------------
          purpose related to the Product or the NDA for the Product, TEIKOKU
          shall immediately notify ENDO. ENDO shall be responsible for providing
          all responses directly to the FDA regarding inquiries related to the
          marketing, promotion, and/or sale of the Product, including any
          amendments or supplements to the NDA for the Product relating to its
          marketing, promotion and/or sale within the Territory and ENDO shall
          copy TEIKOKU USA with all such responses. TEIKOKU shall be responsible
          for providing all responses directly to the FDA regarding inquiries
          related to the manufacture, export, or import of the Product and
          TEIKOKU USA shall copy ENDO with all such responses.

     (2)  Regulatory Approvals.
          --------------------

          (1)  Submission Package.  TEIKOKU USA shall submit all applications,
               ------------------
               including any Submission Packages, to obtain the

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               necessary authorizations, licenses, registrations, or approvals
               to manufacture, export, and import the Product for sale in the
               Territory.

          (2)  Expenses.  TEIKOKU shall bear all its own costs and expenses to
               --------
               obtain any necessary authorizations, licenses, registrations, or
               approvals to manufacture, export, and import the Product for sale
               in the Territory.

     (3)  Adverse Drug Reactions/Product Complaints
          -----------------------------------------

          (1)  Adverse Reaction or Product Complaint:  Each party hereto hereby
               -------------------------------------
               agrees to notify the other parties by facsimile with a follow up
               hard copy, within twenty-four hours (24) of receipt of any
               adverse reaction or complaint reported to it or its agent
               resulting from the use of the Product.

          (2)  FDA Reporting.
               -------------

               (1)  Adverse Reactions and Field Alerts:  TEIKOKU USA will be
                    ----------------------------------
                    responsible for completion and submission to the FDA of any
                    Form FDA 3500a with respect to an adverse reaction involving
                    the Product or any complaint that would require a field
                    alert, as and when appropriate, unless such request is made
                    directly to ENDO or ENDO is under any statutory or
                    regulatory obligation to make such or similar report or
                    filing. Each party will forward to the other a copy of each
                    completed Form FDA 3500a or similar report or filing with
                    respect to the Product at least forty-eight (48) hours prior
                    to filing such a report with the FDA.

               (2)  Periodic Adverse Experiences Reports and Annual Reports:
                    -------------------------------------------------------
                    TEIKOKU USA will be responsible for completion of the
                    periodic ADE (Adverse Drug Experiences)

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                    reports and annual reports required by the FDA with
                    respect to the Product. TEIKOKU USA will forward to ENDO a
                    copy of each such report dealing with the Product at least
                    forty-eight (48) hours before filing such with the FDA.

               (3)  Recalls.  TEIKOKU shall inform ENDO of any withdrawal,
                    -------
                    recall actions or FDA audit of its manufacturing facilities
                    and the Product process and provide copies to ENDO of all
                    inspection observations reports (483s) and any other FDA or
                    other Competent Regulatory Authority communications and
                    TEIKOKU's responses to such communications which may affect
                    the manufacture, export, or import of the Product or
                    TEIKOKU's facility's compliance with GMPs;

2.4  PAYMENTS
     --------

     (1)  ENDO agrees to pay to TEIKOKU USA the prices set forth in Exhibit E
     attached hereto and made a part hereof with regards to Products supplied to
     ENDO by TEIKOKU under this Agreement.

     (2)  Payments due from ENDO hereunder to TEIKOKU USA shall be made via a
     Letter of Credit, issued from a reputable bank on terms that are
     reasonably acceptable to TEIKOKU USA and shall be paid thirty (30) days
     after receipt by the issuing bank of all documents necessary for payment
     under the Letter of Credit, provided that ENDO shall promptly deliver to
     TEIKOKU USA all documents required to be delivered by ENDO under the Letter
     of Credit.

2.5  PRODUCT SHIPMENTS
     -----------------

TEIKOKU JAPAN shall properly prepare and package the Product and the Commercial
Package so that it may be lawfully and safely shipped to points designated by
ENDO in the Territory.  Further, to the extent requested by ENDO or as required
by

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applicable law or custom, for each shipment of Product, TEIKOKU shall prepare
and execute all necessary or applicable shipping documents; including a
Certificate of Analysis for each lot and include such documents with each
shipment.  Terms of shipment will be FOB delivered to ENDO's Atlanta, Georgia
Distribution Center site, duty paid, or such other site as may be mutually
agreed upon by the parties hereto.  ENDO shall inspect all such shipments upon
their receipt and shall report any readily discernible defects to TEIKOKU USA
within sixty (60) days of receipt of the shipment of Product.  ENDO will report
any defects not readily discernible to TEIKOKU USA within thirty (30) days of
ENDO's discovery of same.  ENDO shall not be deemed to have finally accepted the
Product shipment until completion of ENDO's review of all relevant documentation
related to the shipment of the Product and/or retesting of the Product.

3.   OPTION TO QUALIFY AN ADDITIONAL MANUFACTURING SITE
     --------------------------------------------------

During the term of this Agreement, in the event ENDO's purchase of Product from
TEIKOKU equals *** or greater Envelopes in *** consecutive calendar years
commencing from the Launch of the Product by ENDO, TEIKOKU shall use its best
commercial efforts, at ENDO's request, to qualify in the shortest possible time,
a second fully operational, FDA-approved, manufacturing facility at a different
factory site in Japan to manufacture one hundred (100%) percent of ENDO's annual
requirements for the Product in the Territory. Such facility shall comply with
GMP requirements and all other applicable FDA regulations governing the
manufacture and importation of the Product into the Territory, provided that
ENDO shall pay fifty percent of TEIKOKU's reasonable cost to create and/or
qualify such second manufacturing facility and such payment by ENDO shall, in no
event, exceed ***.

4.   ADDITIONAL TERRITORIES
     ----------------------

4.1  In the event ENDO exercises its option for a license to market, promote,
     and sell the Product in *** and *** under the Related Agreement, TEIKOKU
     hereby agrees to supply and ENDO hereby agrees to purchase, one hundred
     (100%) of ENDO's annual requirements for the Product for commercial sale of
     the Product in *** and *** on commercial terms

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     substantially similar to the terms contained in this Agreement, which terms
     shall be mutually agreed to by the parties.

4.2  In the event ENDO exercises its option for a license to market, promote,
     and sell the Product in *** and *** under the Related Agreement, TEIKOKU
     shall provide reasonable assistance to ENDO, at ENDO's expense, to obtain
     all necessary authorizations, licenses, registrations, or approvals for
     ENDO to market, promote, sell, and distribute the Product in *** and ***.

5.   WARRANTIES AND REPRESENTATIONS
     ------------------------------

5.1  Legal Authority.  Each party represents and warrants to the other that it
     ---------------
     has the legal power, authority and right to enter into this Agreement and
     to perform its respective obligations set forth herein.

5.2  No Conflicts.  Each party represents and warrants that as of the date of
     ------------
     this Agreement it is not a party to any agreement or arrangement with any
     third party or under any obligation or restrictions, which in any way
     limits or conflicts with its ability to fulfill any of its obligations
     under this Agreement.

5.3  Third Party Claims.  TEIKOKU warrants to ENDO that there are no third party
     ------------------
     claims that would challenge or impair the license of the rights granted to
     ENDO herein, including without limitation, any claims based upon patents,
     copyrights, trademarks, or trade secret laws of the Territory.

5.4  Submission Package.  TEIKOKU hereby warrants and represents to ENDO that
     ------------------
     the TEIKOKU's section of the Submission Package (CMC Section) for the
     Product and all information contained therein, as of the effective date of
     this Agreement, are true and correct and that TEIKOKU is unaware of any
     fact that would render such information inaccurate or untrue.

5.5  Survival.  The foregoing representations and warranties shall survive the
     --------
     execution, delivery, and performance of this Agreement, notwithstanding any
     due diligence investigation by or on behalf of either party.

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6.   TERM
     ----

This Agreement shall begin on the day written above and shall expire upon
expiration of the Related Agreement.

7.   TERMINATION
     -----------

This Agreement may be terminated by either TEIKOKU or ENDO for the following
reasons:

     (a)  Material Breach.  Either party may terminate this Agreement in the
          ---------------
     case of a material breach by one of the other parties which is not cured
     within forty five (45) days after written notice of the breach by the
     terminating party

     (b)  Bankruptcy.  Either party may terminate this Agreement immediately in
          ----------
     its entirety if the other party is declared insolvent by a court of
     competent jurisdiction, files a petition of bankruptcy, is adjudged
     bankrupt, takes advantage of any insolvency act, is in receivership, or
     executes a bill of sale, deed of trust, or assignment for the benefit of
     creditors.

     (c)  ENDO may terminate this Agreement immediately upon termination of the
     Related Agreement.

8.   EFFECT OF TERMINATION
     ---------------------

Upon termination of this Agreement by ENDO in accordance with Paragraph 7(a)
above, ENDO shall have the right to make or have made the Product for commercial
sale in the Territory.  TEIKOKU shall be required to negotiate in good faith, a
reasonable royalty-bearing sublicensable license to TEIKOKU's Intellectual
Property Rights to make and have made the Product solely in the Territory.

9.   EFFECT OF TERMINATION ON OTHER OBLIGATIONS
     ------------------------------------------

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Termination of this Agreement shall have no effect on, or relieve any party from
the obligation to make any payment or perform any actions arising prior to the
effective date of termination.  Further, any rights and obligations of the
parties, which by their intent are meant to survive the termination or
expiration of this Agreement, shall survive the expiration or termination of
this Agreement.

10.  INDEMNIFICATION
     ---------------

10.1 TEIKOKU shall indemnify, defend, and hold harmless ENDO, its officers,
     agents, Affiliates, subsidiaries, parent companies, and employees, from and
     against any and all loss, damage, claim, injury, cost or expenses,
     including reasonable attorneys' fees and expenses of litigation, in
     connection with any illness or personal injury, including death, or
     property damage, that arises out of or is attributable to: (1) any
     negligent act or willful misconduct of TEIKOKU with respect to the
     manufacture, supply, export, or import of the Product in the Territory; (2)
     latent defects in the Product or any component of the Product; or (3)
     TEIKOKU's breach of the terms of this Agreement, provided, however, TEIKOKU
                                                      --------  -------
     shall not be obligated to indemnify ENDO to the extent that any loss,
     damage, claim, injury, cost or expense arises out of ENDO's negligence,
     willful misconduct or breach of this Agreement.

10.2 TEIKOKU USA shall defend, indemnify and hold harmless ENDO and its
     officers, agents, affiliates, subsidiaries, parent companies, and
     employees, from and against any and all loss, claim, injury, damage, cost
     or expense, including reasonable attorneys' fees and expenses of
     litigation, in connection with any claimed infringement of any third party
     patent rights under the patent laws of Japan and the United States with
     respect to the manufacture, supply, export, and import of the Product
     hereunder.

10.3 ENDO shall indemnify, defend, and hold harmless TEIKOKU, its officers,
     agents, Affiliates, subsidiaries, parent companies, and employees, from and
     against any and all loss, damage, claim, injury, cost or expense, including
     reasonable attorneys' fees and expenses of litigation, in connection with
     any illness or personal injury, including death, or property damage, that
     arises out of: (1) any use, marketing, promotion, sale, or distribution of
     the Product in

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     the Territory; (2) the negligence or willful misconduct of ENDO; or (3)
     breach of the terms of this Agreement by ENDO, provided, however, ENDO
                                                    --------  -------
     shall not be obligated to indemnify TEIKOKU to the extent that any loss,
     damage, claim, injury, cost or expense arises out of TEIKOKU 's negligence,
     willful misconduct, latent Product defects, or breach of this Agreement.

11.  CONFIDENTIALITY
     ---------------

11.1 All information disclosed by one party to the other under this Agreement
     shall be deemed to be confidential information ("Confidential
     Information"). The parties hereby agree to hold in strictest confidence any
     and all Confidential Information disclosed by one party to the other under
     this Agreement or obtained by either party as a result of performing its
     obligations under this Agreement.  The parties hereby agree that the
     following shall not be considered Confidential Information subject to this
     Agreement:

     (1)  information which at the time of disclosure by one party to the other
     is in the public domain;

     (2)  information which, after disclosure by one party to the other becomes
     part of the public domain by publication or otherwise, provided that such
     publication is not in violation of this Agreement or any other
     confidentiality agreement;

     (3)  information, which the receiving party can establish in writing, was
     already known to it or was in its possession at the time of disclosure by
     the other party and was not acquired, directly or indirectly, from the
     disclosing party.

     (4)  information, which the receiving party lawfully receives from a third
     party, provided, however, that such third party was not obligated to hold
     such information in confidence.

     (5)  information which the receiving party is compelled to disclose by a
     court or other tribunal of competent jurisdiction, or the FDA, provided

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TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 18

     however, that in such case the receiving party shall immediately give
     notice to the disclosing party to enable the disclosing party to exercise
     its legal rights to prevent and/or limit such disclosure.  In any event,
     the receiving party shall disclose only that portion of the Confidential
     Information that, in the opinion of the disclosing party's legal counsel,
     is legally required to be disclosed and will exercise reasonable efforts to
     ensure that any such information so disclosed will be accorded confidential
     treatment by said court or tribunal.

11.2 The receiving party shall not use Confidential Information for any purpose
     other than for the purposes set forth in this Agreement.

11.3 The receiving party will not disclose Confidential Information to any
     person other than to its employees, officers, agents, and consultants that
     have a need to know such information to effectuate the purpose of this
     Agreement and that such employees, officers, agents, and consultants shall
     be informed of this Confidentiality Agreement and shall, in writing, be
     bound by its terms. All Confidential Information will contain a statement
     indicating that the information is confidential and should not be disclosed
     to unauthorized individuals.

11.4 Upon written request from the disclosing party or termination of this
     Agreement, whichever comes sooner, the receiving party shall either
     promptly return to the disclosing party all Confidential Information
     provided to the receiving party pursuant to this Agreement including any
     copies thereof and notes or extracts based thereon or certify to the
     disclosing party that all such Confidential Information have been duly
     destroyed; except the receiving party may keep one (1) copy for archival
     purposes and until this Agreement is terminated or becomes inoperative,
     shall keep confidential and not use in any way detrimental to the
     disclosing party any analyses, compilation, studies or other documents
     which reflect any of the Confidential Information.

12.  APPLICABLE LAW
     --------------

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TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 19

The laws of the Commonwealth of Pennsylvania, U.S.A., shall govern the
construction of this Agreement, not taking into consideration its conflicts of
laws provisions.

13.  FORCE MAJEURE
     -------------

No party shall be liable for a delay in performance or failure to perform an
obligation under this Agreement if such delay or failure is due to an act of God
or any other occurrence beyond the control of the party, including but not
limited to fire, explosion, disease, war, invasion, government acts, weather or
civic unrest, or strikes, provided, however, that the party who is unable to
perform its obligations under this Agreement due to such occurrence resumes its
performance as soon as possible following the end of the occurrence causing
delay or failure.  If for any reason, including Force Majeure, TEIKOKU's
capability to manufacture and deliver the Product under this Agreement is
impaired, TEIKOKU will give ENDO first preference in allocation of available
supply of Product. In the event that a party claims non performance of its
obligations under this Agreement as a result of this Paragraph, the other party
shall have the right to terminate this Agreement if the force majeure that is
claimed results in non performance by the claiming party that last more than
ninety (90) days.

14.  RECORDS AND INSPECTION
     ----------------------

TEIKOKU shall permit the duly authorized representatives of ENDO to visit and
inspect the Manufacturing (including waste handling and disposal), processing
testing, packing, and shipping facilities for the Product during normal business
hours provided, however, that ENDO shall first provide TEIKOKU with reasonable
notice of any such intended visit.  Further, ENDO shall, after providing the
same amount of prior notice to TEIKOKU, be provided with access to audit any and
all documents and records related directly with (1) TEIKOKU's manufacture and
supply of the Product, and (2) TEIKOKU's performance under this Agreement with
respect to the manufacture and supply of the Product.  Further, TEIKOKU shall
permit representatives of the FDA or their agents to visit and inspect any and
all facilities used in the manufacturing, testing, processing, packaging, or
shipping of the Product.  This permission for both the FDA and ENDO shall
include access to audit any and all documents and records relating to TEIKOKU's
performance under this Agreement.

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TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 20

15.  RETENTION OF RECORDS
     --------------------

Whenever applicable, all documentation, records, raw data, and specimens
pertaining to this Agreement will be held for the length of time specified by
the FDA GMP regulations.

16.  ARBITRATION
     -----------

16.1 All disputes over the meaning and interpretation of this Agreement shall be
     resolved by conciliation and non-binding mediation and if such mediation is
     unsuccessful then such disputes shall be finally settled by a single
     Arbitrator selected by TEIKOKU and ENDO. If TEIKOKU and ENDO cannot agree
     on a single Arbitrator, then disputes shall be resolved by an Arbitration
     Panel comprising one arbitrator appointed by TEIKOKU and one arbitrator
     appointed by ENDO, and a Chairman of the Arbitration Panel appointed by the
     first two arbitrators. Any such arbitration proceeding shall be conducted
     in accordance with AAA rules; shall be held in the Commonwealth of
     Pennsylvania, unless otherwise agreed by the parties; and judgment upon the
     arbitration award may be entered in any court having jurisdiction.

16.2 In order to initiate procedures for dispute resolution by conciliation,
     mediation and arbitration either party may give written notice to the
     other of intention to resolve a dispute, and absent satisfactory
     resolution, then to arbitrate.  Such notice shall contain a statement
     setting forth the nature of the dispute and the resolution sought.  If,
     within thirty (30) days of such notice a resolution by conciliation between
     the parties themselves or by mediation has not been achieved to the
     satisfaction of both parties, and if within sixty (60) days from said
     written notice an Arbitrator or Arbitration Panel has not been appointed
     with an arbitration schedule satisfactory to both parties, then either
     party may proceed with judicial remedies.

16.3 Notwithstanding the above, TEIKOKU reserves the right and power to proceed
     with direct judicial remedies against ENDO without conciliation, mediation
     or arbitration for material breach of the payments due on Products

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TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 21

     supplied to ENDO by TEIKOKU under this Agreement after giving written
     notice of such breach to ENDO followed by an opportunity period of forty
     five (45) days in which to cure such breach. In collecting overdue payments
     TEIKOKU may use all judicial remedies available.

17.  NOTICES
     -------

All notices required under this Agreement shall be in writing and shall be
effective if delivered to the party entitled to receive the same by hand or when
received by the addressee if such notice is deposited in the United States or
Japanese Mail addressed to such party at the address set forth below.

                    If to TEIKOKU:
                    --------------

                    Masahisa Kitagawa
                    President & CEO
                    Teikoku Pharma USA, Inc.
                    3707 Williams Road, Suite 101,
                    San Jose, CA 95117-2017
                    Tel: 408-615-4143
                    Fax: 408-615-4147

                    With a copy to:

                    Akemi Chaen
                    Manager, International Division,
                    Teikoku Seiyaku Co., Ltd.
                    567 Sanbonmatsu, Ochi-cho,
                    Ohkawa-gun, Kagawa 769-26,
                    Japan
                    Tel: 011-81-879-24-1601
                    Fax: 011-81-879-25-3599

                    and if to ENDO:

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TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 22

                    Carol A. Ammon
                    President & CEO
                    Endo Pharmaceuticals Inc.
                    223 Wilmington West Chester Pike
                    Chadds Ford, PA 19317
                    Tel: (610) 558-9800
                    Fax: (610) 558-9683

                    With a copy to:

                    Osagie 0. Imasogie
                    Senior Vice President, Business Development
                    Endo Pharmaceuticals Inc.
                    223 Wilmington West Chester Pike
                    Chadds Ford, PA 19317
                    Tel: (610) 558-9800
                    Fax: (610) 558-9684

18.  ASSIGNMENT
     ----------

This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns, provided that neither party
shall assign this Agreement or any rights herein without the other party's
consent, except that ENDO may assign this Agreement to its successor in business
and/or parent entity.

19.  HEADINGS
     --------

All headings of the clauses of this Agreement are inserted for convenience only
and shall not affect any construction or interpretations of this Agreement.

20.  PRESERVATION OF RIGHTS
     ----------------------

The waiver of a default of any clause of this Agreement shall not be construed
as a waiver of either subsequent or continuing default.

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PAGE 23

21.  SEVERABILITY
     ------------

In the event that any clause of this Agreement shall be found to be void or
unenforceable, such findings shall not be construed to render any other clause
of this Agreement either void or unenforceable, and other clauses shall remain
in full force and effect unless the clause(s) which is/are invalid or
unenforceable shall substantially affect the rights or obligations granted to or
undertaken by either party.

22.  AUTHORITY
     ---------

The parties hereby represent that they have full power and authority to enter
into and perform the Agreement and the parties do not know of any contract,
agreements, promises or undertakings which would prevent a full execution and
performance of this Agreement.

23.  ENTIRETY
     --------

This Agreement, together with its attached Exhibits, constitute the entire
agreement between TEIKOKU and ENDO with respect to the subject matter hereof and
supersedes all prior and/or contemporaneous agreements and understandings,
whether oral, written or in any other medium, that might exist between the
parties with relation to the subject matter hereof.  No modification to any
provision of this Agreement shall be binding unless in writing and signed by
both TEIKOKU and ENDO.  No waiver of any rights under this Agreement, will be
effective unless in writing signed by the party to be charged.  All of the terms
and provisions of this Agreement shall be binding upon and inure to the benefit
of and be enforceable by the respective successors and permitted assigns of the
parties hereto.

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TEIKOKU-ENDO
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PAGE 24

IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
executed in duplicate as of the day and year first above written by their duly
authorized officers as set forth below.

TEIKOKU SEIKAYU CO., LTD.           ENDO PHARMACEUTICALS INC.

By:  /s/ MASAHISA KITAGAWA          By: /s/ CAROL A. AMMON
     -----------------------            -----------------------
Name:  Masahisa Kitagawa                  Carol A. Ammon
                                          President & CEO
Title:  President & CEO
       _____________________

TEIKOKU PHARMA USA, INC.

By:  /s/ MASAHISA KITAGAWA
     -----------------------
Name:   Masahisa Kitagawa
Title:  President & CEO

<PAGE>

TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 25

EXHIBIT A

                        LIST OF TEIKOKU PATENTS, PATENT
                        -------------------------------
                           APPLICATIONS AND KNOW-HOW
                           -------------------------

USPTO APPLICATION NO.               TITLE
--------------------                -----

08/258378      COMPOSITION OF MATTER, SPECIFIC TO PATCH FORMULATION FOR PRODUCT
               AND ANY RELATED FORMULATIONS.

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TEIKOKU-ENDO
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PAGE 26

EXHIBIT B

                COPY OF THE SOLE AND EXCLUSIVE LICENSE AGREEMENT
                ------------------------------------------------
                         BETWEEN HIND HEALTH CARE, INC.
                         ------------------------------
                         AND ENDO PHARMACEUTICALS INC.
                         ----------------------------

<PAGE>

TEIKOKU-ENDO
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PAGE 27

EXHIBIT C

                  ENDO'S STANDARD QUALITY CONTROL REQUIREMENTS
                  --------------------------------------------
                     FOR THIRD PARTY CONTRACTORS/SUPPLIERS
                     -------------------------------------

PURPOSE:  This document serves as the basis for Contractor-specific Quality
-------
requirements which form the basis of the contractor management process.

1.0  GUIDING PRINCIPLES

Regarding the working relationship between quality control departments of
Contractor and Endo for Endo marketed products:

1.1  Unless otherwise specified, Endo refers to the Endo quality control
     department or its designee ("Endo Quality") and the Contractor's quality
     control department ("Contractor Quality").

1.2  Endo has the responsibility to provide sufficient information to Contractor
     so that Contractor can ensure that the Product meets Endo quality control
     specifications.

1.3  Contractor is responsible for ensuring that the Product meets Endo quality
     control specifications for the duration of the Product shelf life.

2.0  MAINTENANCE OF COMPLIANCE BETWEEN THE PRODUCT REGISTRATION AND PRODUCT
MANUFACTURING PROCESS

2.1  Technical Changes
     -----------------

     (2.1)  Contractor will supply to Endo a copy of the following:

          .  current manufacturing formula
          .  in-process test specifications and methods

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          .  stability test specifications and methods
          .  release test specifications and methods
          .  sources of all ingredients, specifications

          Any revisions to such specifications and methods shall be provided to
          Endo at the time such revisions are made.

     (2.1.2)  Where Endo holds the Product registration: All Contractor-proposed
     product process changes will be communicated to Endo for initial review and
     approval of the plan for change.  This will enable Endo to assess if any
     changes to the Product registration need to be made.  In addition,
     notification of the proposed Contractor process changes will allow Endo to
     maintain adequate control over the quality components of the product
     marketing authorization filed by Endo with the applicable regulatory
     agencies.

     (2.1.3)  Endo will notify the Contractor of any process changes it wishes
     to make to the Product Registration to enable the Contractor to keep the
     process in line with such registration.

     (2.1.4)  Where required, following validation of a process change by
     Contractor, Contractor will supply a copy of the related validation
     protocol and report to Endo and associated stability data, as it becomes
     available.

     (2.1.5)  Contractor is responsible for maintaining a system to implement
     any compendial changes.

2.2  Labeling/Packaging Material Changes
     -----------------------------------

     (2.2.1)  Endo may initiate changes in the product labeling or packaging
     material. Endo will also review and approve any Contractor-proposed
     changes.  This includes a change in the supplier of any labeling or
     packaging material.

     (2.2.2)  The Contractor shall provide Endo with a sample and new Bill of
     Materials prior to implementation of any change in labeling or packaging
     materials.

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2.3  Other Changes
     -------------

The Contractor will communicate any proposed changes in storage or shipping of
Product to Endo for review and approval prior to implementation of such changes.
The Contractor will also inform Endo of any planned changes in facilities or
equipment.

3.0  BATCH RELEASE

3.1  Batch review and release will be the responsibility of a Contractor
     Qualified Person, who will act in accordance with Contractor's policies,
     which must be in compliance with Product registration.

3.2  For each batch released by the Contractor for sale by Endo, the Contractor
     will send to Endo a "Certificate of Conformance."  The "Certificate of
     Conformance" will include a statement that the batch has been manufactured
     according to cGMPs and the specifications as approved by the applicable
     regulatory authorities, and is released for sale or supply.  In addition,
     it will include the following:

..    Name, lot number and expiry date of the Finished Product.
..    Where applicable, date of manufacture of the Bulk Dosage form and lot
     number if different.
..    Total amount of packages released.

Further, the agreed upon batch documentation will be sent according to timelines
to be agreed upon by Endo and the Contractor.  At a minimum, the Certificate of
Analysis will be attached.

Final Product acceptance by Endo may be dependent upon this review and/or
retesting.

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PAGE 30

3.3  The Contractor must have a formal retest policy and procedure in place that
     is in accordance with applicable regulations.

3.4  The Contractor will notify Endo immediately in the event of any deviations
     during manufacture and when any test reveals contamination, or degradation
     in any batch of Product and file any reports required by regulations.

4.0  BATCH DOCUMENTATION

4.1  Originals of all batch documents will be retained by the Contractor
     according to Regulatory and Company requirements.

4.2  In the case of a request from Endo, the Contractor agrees to provide a copy
     of any of the following batch documents for supplied Products to Endo by
     facsimile or courier within 24 hours:

..    Analytical and Microbiological Test Results (finished Product and
     In-Process)
..    Deviation Reports
..    Inspection Records
..    Investigation Reports
..    Label Room Samples
..    Labeling Component Destruction Record
..    Line Clearances
..    Packaging Samples
..    Reconciliation Sheets
..    Coded Material
..    Packaging
..    Yield
..    Rejects Record
..    Temperature and Humidity Charts
..    Weighing Records of Active Drug Substances and Excipients

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PAGE 31

5.0  RETENTION SAMPLES

5.1  Unless Endo agrees to maintain retention samples, the Contractor shall
     retain under proper storage conditions such samples of Products as required
     to comply with retention sample requirements and/or registration
     commitments but in no case less than that amount needed to perform two
     complete sets of finished Product testing. Testing of retention samples may
     be initiated by Endo.  Retention samples cannot be tested by Contractor
     without the express consent of Endo.

6.0  STABILITY

6.1  The Contractor must have systems in place to insure that Product released
     will meet all criteria throughout its shelf life.

6.2  For each Product for which the Contractor is responsible for performing
     stability, Endo requires that a minimum of one Production lot per year per
     Product put up, have representative samples withheld for stability testing
     unless a reduced stability program is agreed to by both parties.  Samples
     shall be stored and tested at appropriate intervals, as described in an
     approved stability protocol.  Endo will approve stability protocols for
     Products for which Endo holds the registration and technology.  Any changes
     in approved protocols must be reviewed and approved by Endo.

6.3  If a confirmed result indicates the Product has failed to remain within
     specifications, the Contractor is required to notify Endo immediately.
     Notification will include discussion of problems, data available, and path
     forward.  In addition, a copy of the investigation report or information on
     corrective action(s) should be sent to Endo as soon as they become
     available.

6.4  As part of the annual Product review, the Contractor will provide to Endo a
     summary stability report on each Product.  The report should contain
     cumulative tabular result information on all active studies. The Contractor
     is expected to analyze the data and provide a written summary attesting to
     the ongoing acceptability of the Product.

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PAGE 32

6.5  Alert limits will be established.  The Contractor is required to notify
     Endo of any confirmed out of alert results within three (3) business days
     and provide the data to Endo.

6.6  In all cases, the Contractor must investigate any confirmed out of limit
     result and forward a copy of the completed investigation report to Endo
     within thirty (30) business days.

6.7  The Contractor must have a formal stability retest policy and procedure in
     place that is in accordance with applicable regulations.

6.8  In the event that the Agreement between Contractor and Endo is terminated,
     the Contractor will continue to provide Endo with stability data supporting
     the acceptability of the Product until all Product distributed by Endo has
     reached the end of its shelf life.

7.0  COMPLAINTS

7.1  Product complaint reports received by Endo from its customers will be
     summarized and sent by facsimile to the Contractor.  Product complaint
     reports received by the Contractor will be summarized and sent within one
     (1) business day by facsimile to Endo.  Product complaint reports which may
     require reporting to appropriate government agencies will be promptly
     communicated and the agreed upon party will notify authorities of such
     reports within three (3) working days following receipt.

7.2  The Contractor will investigate all Product complaints associated with
     Contractor-provided services and provide Endo with a written report within
     thirty (30) days after receipt of the complaint.  If Endo deems it
     necessary, Endo may further investigate, with the cooperation of
     Contractor, such complaints.  Endo will provide a written response to the
     complainant, with a copy to the Contractor, when applicable.

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PAGE 33

8.0  RECALL

8.1  In the event that either party has reason to believe that any one or more
     lots of Product or any Product component should be recalled or withdrawn
     from distribution, such party shall immediately inform the other in writing
     prior to taking any such action.

8.2  Endo and the Contractor will consult to determine whether or not a recall
     of a Product is required and the process to be followed to execute such
     recall.

8.3  Both parties must forward to the other party a copy of any regulatory field
     alerts prior to sending an alert to the appropriate regulatory authorities.

9.0  ANNUAL PRODUCT REVIEW

9.1  Each year the Contractor will provide for each Product supplied to Endo an
     Annual Product Review, or if otherwise agreed by Endo and Contractor,
     sufficient information to support Endo's Annual Product Review.

9.2  When the Contractor agrees to provide an Annual Product Review, the Annual
     Product Review will contain:

For all batches manufactured:

..    Total number of batches manufactured
..    Total number of batches packaged
..    Number of batches reworked
..    Number of batches rejected
..    Number of batches recalled
..    A review and summary of customer complaints
..    A listing and discussion of recalls
..    A listing and review of changes
..    A listing and review of stability data
..    Results of visual inspection of retained samples

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TEIKOKU-ENDO
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PAGE 34

For batches supplied to Endo:

..    A listing of Product batches supplied by batch number and date delivered
     to Endo
..    A review and summary of analytical results for those batches including any
     retest results and investigations
..    A listing and review of process deviations/investigations
..    Discussion, evaluation and conclusions

9.3  Endo will review and approve the Annual Product Review for Products for
     which Endo holds the registration and owns the technology.

10.0 AUDITS

10.1 Endo will schedule periodic audits of the Contractor's facilities.  If
     requested, the Contractor shall grant access for additional Product
     specific audits by Endo.

10.2 Endo shall have the right to visit the Contractor's plant where Products
     are manufactured on any business day upon reasonable prior notice to the
     Contractor.  During any such visit, Endo shall have the right to audit the
     Contractor's manufacturing and quality control procedures, records, and
     facilities as well as registrations, supplements, and regulatory
     correspondence to ensure that the Contractor complies with the Product
     registration and with current Good Manufacturing Practice regulations or
     other procedures required by Endo.  The Contractor shall take a course of
     action and resolution acceptable to Endo in the event that Endo finds any
     contractual or regulatory deficiencies during such audit.

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PAGE 35

11.0 INSPECTIONS/LEGAL ACTIONS

11.1 Upon receipt, the Contractor shall provide Endo with copies of inspection
     reports, and/or legal actions (and access to copies of all notices,
     correspondence, and telephone contact reports) with or by governmental
     agencies relating to its manufacturing facilities or any Product
     manufactured or tested by the Contractor on behalf of Endo unless otherwise
     agreed to by the parties.

12.0 SUPPLIER QUALIFICATION

When the Contractor agrees to provide materials supplied by other vendors, the
Contractor must maintain a formal supplier qualification and management program.
Selection, qualification, and management of sub-Contractors are the
responsibility of the Contractor in these instances, unless otherwise agreed
upon.

13.0 TRAINING

Each person engaged in the manufacturing, processing, packing, testing or
holding of a drug Product shall have education, training, and experience, or any
combination thereof, to enable that person to perform the assigned functions.
Training shall be in the particular operations that the employee performs and in
current applicable manufacturing regulations as they relate to the employee's
functions.  Training in applicable manufacturing regulations shall be conducted
by qualified individuals on a continuing basis and with sufficient frequency to
assure that employees remain familiar with requirements applicable to them.
This training must be documented in a training record for each employee.

Where applicable, Endo will provide the Contractor with Product specific
training as part of any technology transfer process.

<PAGE>

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PAGE 36

14.0 VALIDATION

14.1 The Contractor must maintain a formal validation program for:

..    Validation planning
..    Facilities
..    Equipment
..    Methods
..    Cleaning
..    Process
..    Processes controlled by Contractors Computer system

Validation may be prospective, concurrent or retrospective but in all cases,
critical parameters and acceptance criteria must be documented.

Product related validation protocols must be reviewed and approved by Endo prior
to execution.

Where applicable, Endo may require process or test method qualification as part
of any technology transfer process.

<PAGE>

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PAGE 37

EXHIBIT D

TEIKOKU STANDARD OPERATING PROCEDURES WITH REGARDS TO THE PRODUCT

<PAGE>

TEIKOKU-ENDO
SUPPLY & MANUFACTURING AGREEMENT
PAGE 38

EXHIBIT E

                   PRICE AND TERMS FOR COMMERCIAL QUANTITIES
                   -----------------------------------------
                         OF PRODUCT AND PRODUCT SAMPLES
                         ------------------------------

<TABLE>
<CAPTION>
1.   Price for the Product
    Annual Quantity of Envelopes      Unit Cost per Commercial Package Envelope,
    ----------------------------      CIF,ENDO's Distribution Center, USA.
                                    -------------------------------------------
<S>                                 <C>
   ***                                 ***

</TABLE>

a) All Sample Packages shall be sold to ENDO for *** per Envelope for up to
*** units of Samples.

b) The above Unit Costs per Envelope shall be guaranteed up to and including the
third anniversary date of the product Launch in the United States. "Product
Launch" shall mean the first commercial sale of the Product by ENDO for resale
or use to an unaffiliated third party in the Territory.

c) Commencing on the fourth anniversary date of the Product Launch in the
United States and thereafter, the Unit Cost per Envelope shall be adjusted
annually in an amount equal to the percentage change in the rate of inflation
from the previous calendar year to the next calendar year, as measured by the
Japanese Consumer Price Index, such adjustments may result in an increase or
decrease in the Unit Cost per Envelope in accordance with such annual inflation
rate, provide, however, that in no event during the term of this Agreement,
shall this Paragraph result in ENDO paying

<PAGE>

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SUPPLY & MANUFACTURING AGREEMENT
PAGE 39

more than a cumulative total of *** (***%) for an Envelope over the Envelope
prices set forth above. In the event that the cumulative inflation rate in Japan
during the term of this Agreement, exceeds ***%, the parties will meet to
reasonably discuss the price for the Product.

The parties hereby agree that for purposes of this Agreement, the Yen shall be
valued to the US Dollar in a range of ***-***-Yen to $1.00 USD (the Yen Range).
Commencing from January 1, 2000, in the event that the value of the Yen falls
outside the Yen Range, the parties shall share equally the benefit and liability
of such Yen fluctuation.  The parties shall reconcile their exchange
transactions at the end of each calendar quarter.

d)  Annual Minimum Orders.  ENDO shall purchase the following minimum orders of
Product, on an annual basis, commencing with the first twelve (12) months after
the Product Launch:

  Year 1  -    *** envelopes
  Year 2  -    *** envelopes
  Year 3  -    *** envelopes

2.  Package Size
    ------------

  a)  Commercial Package.  Each Envelope shall contain five (5) patches (10 X 14
      ------------------
  cm). Each Commercial Package shall contain six (6) Envelopes.  Any changes to
  the package size and the allocation, if any, of any associated expenses shall
  be agreed to by the parties prior to such package size change.

  b)  Samples.   Each Sample Package shall contain two (2) Patches in an
  Envelopes.

3.  Shipping Units
    --------------

The Product shall be shipped to ENDO's designated Distribution Center in a 40
foot reefer container which will include 90,000 Envelopes + 10%.
                                                          -<PAGE>

                                                                   EXHIBIT 10.15

                               SUPPLY AGREEMENT

This Agreement is entered into effective as of the first day of July 1, 1998,
between Endo Pharmaceuticals Inc., 223 Wilmington West Chester Pike, Chadds
Ford, Pennsylvania ("Endo") and Mallinckrodt Chemical, Inc., with offices at 675
McDonnell Boulevard, St. Louis, Missouri ("Mallinckrodt").

1.   Term
     ----

The term of this Agreement shall be from April 1, 1998, through December 31,
2002. After such initial term, this Agreement shall be automatically renewed for
additional terms of one year each, unless terminated by either party by giving
the other written notice of termination at least ninety (90) days before the
start of any such renewal term.

2.   Product
     -------

a)        During the term hereof, Mallinckrodt agrees to sell to Endo and Endo
agrees to purchase from Mallinckrodt, *** (PRODUCT) meeting specifications set
forth on Exhibit "A" attached hereto and made a part hereof

b)        During the term of this agreement, Mallinckrodt shall supply PRODUCT
exclusively to Endo and shall not manufacture and/or use PRODUCT for itself or
for any third party other than Endo. Endo hereby represents and warrants to
Mallinckrodt that it is the sole and lawful assignee of all of the right and
obligations of E.I. duPont de Nemours and Company ("duPont") under and pursuant
to that certain letter agreement between duPont and Mallinckrodt, effective as
of September 1, 1988, a copy of which is attached hereto as Exhibit B.

c)        Pursuant to the terms of this Agreement, Endo shall purchase from
Mallinckrodt Endo's requirements for the PRODUCT in accordance with the
following schedule:

--------------------------------------------------------------------------------
    Year of Contract         Minimum % of Endo's Product Requirement for Oral
                             Dosage Product to be Purchased from Mallinckrodt
--------------------------------------------------------------------------------
           1-2                                    * * *
--------------------------------------------------------------------------------
            3                                     * * *
--------------------------------------------------------------------------------
            4+                                    * * *
--------------------------------------------------------------------------------

For purposes of the table set forth immediately above, the first "Year of
Contract" shall be deemed to commence on the effective date hereof and to end on
June 30, 1999.

3.     Manufacturing Standards
       -----------------------

a)        Mallinckrodt will manufacture PRODUCT according to: (i) its "Standard
          Operating Procedures" and, (ii) FDA Guidelines and current Good
          Manufacturing Practices (cGMP) as applied to bulk pharmaceutical
          chemicals, as regulated and as defined by the U.S. Food and Drug
          Administration.

The confidential portions of this exhibit have been filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment request
in accordance with Rule 406 of the Securities Act of 1933.

            REDACTED PORTIONS OF THIS EXHIBIT ARE MARKED BY AN ***.

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b)        Mallinckrodt will manufacture PRODUCT in material compliance with its
field DW for said PRODUCT and the specifications stated therein, as well as any
other specifications mutually agreed to by both parties in writing. Mallinckrodt
will notify Endo of any and all material changes in its production, testing or
packaging procedures in the DMF documented process as required by FDA
"Guidelines for Drug Master Files" Section VIIA.

4.   Price
     -----

a)        The price for the PRODUCT will be ***. The price may be adjusted by
Mallinckrodt via a pass-through of PRODUCT cost increases experienced by
Mallinckrodt, effective July 1, 1999, and each July I thereafter, during the
term of this Agreement, provided Mallinckrodt furnishes Endo back-up
documentation for such cost pass-through price increases.

b)        Mallinckrodt shall invoice Endo upon shipment for PRODUCT delivered
hereunder. Endo shall make payment one hundred and twenty (120) days from Endo's
receipt of Mallinckrodt's correct invoice for the initial shipment of three (3)
lots and net thirty (30) days for all subsequent shipments.

5.   Shipment
     --------

Mallinckrodt shall ship PRODUCT in accordance with Endo's firm orders FOB
destination. Once each calendar quarter Endo will provide to Mallinckrodt a
forecast of its anticipated requirements of PRODUCT for the next succeeding four
(4) calendar quarters. The forecast for the first three (3) months is considered
to contain firm orders by Endo for PRODUCT for the next calendar quarter
("binding forecast"). A firm order means Endo will receive and pay for the
PRODUCT. The forecast for the next three quarters is non-binding and will be
used by Mallinckrodt for production planning. Endo shall provide to Mallinckrodt
its initial forecast covering the period through September 30, 1998, within 30
days of the date of this Agreement. Mallinckrodt agrees to supply to Endo
PRODUCT up to one hundred and ten percent (110%) of the firm order quantities
ordered by Endo in accordance with Endo's written purchase orders pursuant to
the binding forecast. Mallinckrodt shall use all reasonable commercial efforts
to satisfy any orders in excess of one hundred and ten percent (110%) of Endo's
binding forecast.

6.   Warranties
     ----------

a)        Endo and Mallinckrodt each accept responsibility for and warrant that
they will comply with all federal, state, and local statutes, regulations, and
governmental orders applicable to or related to their respective use,
possession, handling, transportation, sale or disposal of PRODUCT.

b)        Mallinckrodt warrants and represents to Endo that all PRODUCT sold and
delivered to Endo under this Agreement shall meet the specifications set forth
on Exhibit A attached hereto and shall be shipped to Endo within the time frames
stipulated in the firm orders.

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c)        [THE WARRANTIES OF MALLiNcKRoDT SET FORTH SPECIFICALLY IN THIS
AGREEMENT ARE EXCLUSIVE AND ARE IN LIEU OF ANY AND ALL OTHER WARRANTIES AND/OR
REPRESENTATIONS, WHETHER EXPRESS OR IMPLIED, ARISING BY OPERATION OF LAW OR
OTHERWISE. MALLINCKRODT EXPRESSLY DISCLAIMS ANY AND ALL EXPRESS OR IMPLIED
WARRANTIES OF MERCHANTABILITY AND/OR FITNESS FOR A PARTICULAR PURPOSE OR USE
OTHER THAN USE IN PHARMACEUTICAL PREPARATIONS. IN NO EVENT SHALL MALLINCKRODT BE
LIABLE FOR ANY SPECIAL, INDIRECT, OR CONSEQUENTIAL DAMAGES OF ENDO WHATSOEVER,
INCLUDING WITHOUT LIMITATION, ANY LOSS OF PROFITS OR BUSINESS INTERRUPTION OF
ENDO'S, EVEN IF ADVISED OF THE POSSIBILITY OF SAID DAMAGES.] Endo shall notify
Mallinckrodt as soon as reasonably practical of any claim arising hereunder,
whether for breach of warranty or otherwise.

7.   Force Majeure
     -------------

Either party shall be excused from non-performance or delay in performance, and
the time of any performance will be extended to the extent reasonably necessary
under the circumstances, to the extent that such nonperformance or delay in
performance is caused by circumstances beyond the reasonable control of the
party affected ("Force Majeure"). Without limitation, the term "force MaJeure"
shall include severe raw materials shortages or promulgation of governmental
regulations under the U.S. Federal Food, Drug, and Cosmetic Act or the U.S. Drug
Enforcement Administration or actions by those agencies which make it
impractical for Endo to use any PRODUCT or which make it impossible for
Mallinckrodt to make or sell PRODUCT. The affected party shall promptly notify
the other of the Force Majeure circumstances and their probable duration. If, in
the sole reasonable opinion of Mallinckrodt, any new statute, regulation, or
court order, or any change in any existing statute, regulation or court order
shall result in an increase in the cost of supplying PRODUCT hereunder so as to
make performance of this Agreement commercially impractical, then Mallinckrodt
shall have the right to terminate this Agreement on sixty (60) days written
notice without any liability therefor, provided that Mallinckrodt will be
required to satisfy Endo's then current, firm orders for PRODUCT.

8.   Termination
     -----------

Either party shall have the right to terminate this Agreement effective upon
sixty (60) days written notice to the other party in the event of a material
breach hereof by the non-terminating party which has not been cured or is not
curable within such sixty (60) day period, without the requirement that the
terminating party provide additional notices. In addition, either party shall
have the right immediately to terminate this Agreement if any law, regulation or
court order is deemed to prohibit the performance by either party of any
material obligation hereunder or in the event the other party files a petition
for bankruptcy, reorganization, or protection under the Federal Bankruptcy Laws
or any substantially similar legislation, has filed against it a petition under
the Federal Bankruptcy Laws or any substantially similar legislation which
petition is not dismissed within sixty (60) days after filing, appoints or has
appointed a trustee or receiver with respect to its business or assets, makes
any arrangement for the benefit of some or all of its creditors, violates the
provisions of any obligation of confidentiality set forth herein or otherwise
takes any action, which, in the reasonable judgment of the terminating party,
amounts to an intent not to perform or to repudiate the terms hereof

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9.   Entire Agreement, Amendment and Waiver
     --------------------------------------

The terms hereof represent the entire Agreement of the parties including, but
not limited to, the subject matter hereof and supersedes all prior and/or
contemporaneous agreements, conditions, usage of trade, or course of dealing
between the parties with regard to the subject matter hereof. Any form of
communication by either party purporting to modify, vary, explain, or supplement
the terms of this Agreement, except as expressly provided for in this Agreement,
shall be of no effect, unless in writing and signed by an authorized
representative of each party. No waiver by either party with respect to any
breach, default, or right shall be deemed to constitute a waiver of any other
breach, default, or right, unless such waiver is in writing and signed by an
authorized representative of the waiving party.

10.  Governing Law and Severability
     ------------------------------

This Agreement is deemed by the parties to be a Delaware contract and,
accordingly, this Agreement shall be construed and enforced in accordance with
Delaware law, without reference to its conflicts of laws and principles. If any
provision of this Agreement, for any reason, shall be determined by a court of
competent jurisdiction to be invalid, illegal, or unenforceable in any respect,
that determination shall not be deemed to cause any other provision of this
Agreement to be invalid, illegal, or unenforceable. Thereafter, this Agreement
shall be construed, enforced, and performed as if the provision or provisions so
determined to be invalid, illegal, or unenforceable had not been contained
herein.

11.  Adverse Information
     -------------------

Each party agrees to notify the other immediately by telephone (with written
follow-up) of any inquiry, contact, or communication received from any
governmental agency which relates to or impacts upon any of the PRODUCT or their
components. In addition, each party will promptly notify the other in writing of
any information it may obtain or learn of concerning any adverse experiences
with any of the PRODUCT or their components.

12.  Confidentiality
     ---------------

Each party agrees to maintain in confidence all the express provisions of this
Agreement, not to disclose it to any third party without the express written
consent of the disclosing party, to be given or withheld in the absolute
discretion of the disclosing party.

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In Witness Whereof, the parties hereto have caused their duly authorized
officers to execute this Agreement as of the date first written above.

Endo and Mallinckrodt have entered into this Agreement this 1st day of July
1999.

ENDO PHARMACUETICALS

By: /s/ Pat Cunningham

Name: Pat Cunningham

Title: General Manager, Bulk Narcotics

Date:

6/17/98
Endo Supply Agreement Final

MALLINCKRODT CHEMICAL, INC.
By:
Name: Pat Cunningham
General Manner, Bulk Narcotics
Pharmaceutical Chemicals Division

Date: Legal Approval:

                                       5

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                                  EXHIBIT "A"
                            Product Specifications

                                    *  *  *

                                       6

<PAGE>

                      FIRST AMENDMENT TO SUPPLY AGREEMENT
                     BETWEEN ENDO PHARMACEUTICALS INC. AND
                          MALLINCKRODT CHEMICAL, INC.

This first amendment ("the Amendment") to the Supply Agreement (the
"Agreement"), is effective as of the 16th day of December 1999 between Endo
Pharmaceuticals Inc. ("Endo"), with its offices at 223 Wilmington West Chester
Pike, Chadds Ford, Pennsylvania 19317 and Mallinckrodt Chemical, Inc.
("Mallinckrodt") with its offices at 675 McDonnell Boulevard, St. Louis,
Missouri, 63134.

WHEREAS, Endo and Mallinckrodt entered into that certain Supply Agreement dated
July 1, 1998 (the "Agreement"), whereby Mallinckrodt has been and continues to
supply *** ("Product") to Endo as set forth therein; and

WHEREAS, Endo and Mallinckrodt desire to amend the Agreement as follows:

NOW, THEREFORE, the parties hereto agree as follows:

1.   Unless set forth herein, the capitalized terms contained in this Amendment
     shall have the meanings set forth in the Agreement.

2.   Paragraph 1. Term, of the Agreement is hereby amended by deleting the words
                  ----
     "through December 31, 2002" and substituting the words "through June 30,
     2004" in the first sentence.

3.   All other terms and conditions of the Agreement remain unchanged and in
     effect.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
by their duly authorized representatives.

ACCEPTED BY:

MALLINCKRODT CHEMICAL, INC.                       ENDO PHARMACEUTICALS, INC.

By: /s/ Pat Cunningham                               By: /s/ Osagie O. Imasogie
   -------------------------                         --------------------------
   Pat Cunningham                                    Osagie O. Imasogie
   General Manager                                   Senior Vice President
   Bulk Narcotics                                    Business Development

                                                     By: /s/ Carol A. Ammon
                                                     --------------------------
                                                     Carol A. Ammon

                                                     Date: May 8, 2000

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