Document:

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[CONFIDENTIAL TREATMENT REQUESTED, CONFIDENTIAL PORTIONS OF THIS AGREEMENT HAVE
BEEN REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE COMMISSION.]

                                                                   Exhibit 10.14

                      INTERNATIONAL DISTRIBUTOR AGREEMENT

     This INTERNATIONAL DISTRIBUTOR AGREEMENT (the "Agreement") is entered into
effective April 1, 2001 (the "Effective Date") by and between TheraSense, Inc.,
a Delaware corporation with a principal place of business at 1360 South Loop
Road, Alameda, California 94502, USA ("TheraSense") and Nipro Corporation, a
corporation organized under the laws of Japan, with a principal place of
business at 3-9-3, Honjo-Nishi, Kita-ku, Osaka, Japan ("Nipro").

                                  BACKGROUND

     A.   TheraSense is the owner of the FreeStyle Products (as defined below)
useful in monitoring blood glucose levels and desires to engage a marketing and
distribution partner which can (i) assist it in obtaining regulatory and
reimbursement approvals to market the FreeStyle Products, and (ii) promote,
market and distribute the FreeStyle Products; and

     B.   Nipro desires to purchase from TheraSense, and TheraSense desires to
sell to Nipro, the FreeStyle Products for resale in the Territory (as defined
below); and

     C.   Nipro desires to distribute and sell the FreeStyle Products to
Customers (as defined below) in the Territory.

     NOW, THEREFORE, in consideration of the mutual promises contained
herein, the parties agree as follows:

1.   DEFINITIONS

     1.1  "Affiliate" shall mean any corporation or other entity which is
           ---------
directly or indirectly controlling, controlled by or under common control with
TheraSense or Nipro. For the purpose of this Agreement, "control" shall mean the
direct or indirect ownership of fifty percent (50%) or more of the

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outstanding shares or other voting rights of the subject entity to elect
directors, or if not meeting the preceding, any entity owned or controlled by or
owning or controlling at the maximum control or ownership right permitted in the
country where such entity exists.

     1.2  "Competing Product" shall mean any system used for the measurement of
           -----------------
glucose levels for purposes of diagnosis, monitoring or treatment of diabetes
melitus.

     1.3  "Confidential Information" shall mean, subject to the provisions of
           ------------------------
Article 10 hereof, (i) any proprietary or confidential information or material
in tangible form disclosed hereunder that is marked as "Confidential" at the
time it is delivered to the receiving party, or (ii) proprietary or confidential
information disclosed orally hereunder which is identified as confidential or
proprietary when disclosed and such disclosure of confidential information is
confirmed in writing within thirty (30) days by the disclosing party.

     1.4  "Customers" shall mean Nipro's customers solicited by Nipro, its
           ---------
Affiliates or its Subdistributors within the Territory.

     1.5  "Field of Use" shall mean single use, disposable, in vitro tests for
           ------------
monitoring glucose in human body fluids. It is understood that Field of Use does
not include Strips intended for use with a continuous glucose monitoring system,
such as TheraSense's Messenger product.

     1.6  "FreeStyle Products(s)" shall mean those products intended for sale in
           ---------------------
the Territory, as listed in Exhibit A attached hereto. Subject to Section 2.3,
the Freestyle Products listed in Exhibit A may be changed, discontinued or added
to by TheraSense.

     1.7  "Kissei" shall mean the Kissei Pharmaceutical Corporation, a
           ------
corporation organized under the laws of Japan, with its principal place of
business at 19-48 Yoshino, Matsumoto, Nagano 399, Japan.

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     1.8  "Subdistributor" shall mean a third party to whom Nipro has granted
           --------------
the right to distribute the FreeStyle Products under Section 2.2 hereof.

     1.9  "Territory" shall mean, as of the Effective Date, Japan.
           ---------

2.   FREESTYLE APPOINTMENT AND AUTHORITY OF NIPRO

     2.1  Appointment and Authority.
          -------------------------

          2.1.1  Exclusive Distributor. Subject to the terms and conditions
                 ---------------------
herein, TheraSense hereby appoints Nipro as TheraSense's exclusive and sole
distributor and marketing partner for the FreeStyle Products in the Territory in
the Field of Use, and Nipro hereby accepts such appointment. TheraSense agrees
not to sell the FreeStyle Products to anyone for delivery in the Territory in
the Field of Use or with knowledge that the FreeStyle Products are being
purchased for use or resale in the Territory in the Field of Use. Likewise,
Nipro agrees not to sell the Freestyle Products to anyone for delivery outside
the Territory, or inside the Territory outside the Field of Use, or with
knowledge that the FreeStyle Products are being purchased for use or resale
outside the Territory, or inside the Territory outside the Field of Use.

          2.1.2  Nipro's sole authority shall be to purchase FreeStyle Products
from TheraSense and to promote, market and resell such FreeStyle Products for
delivery to Customers in the Territory in the Field of Use in accordance with
the terms of this Agreement. Nipro shall not have the authority to make any
commitments whatsoever on behalf of TheraSense.

          2.1.3  Notwithstanding the rights granted to Nipro to distribute the
FreeStyle Products hereunder, Nipro shall have no right to advertise, solicit
sales, promote, market, sell or otherwise dispose of (i) the FreeStyle Products
outside the Territory, or (ii) any TheraSense products, other than the FreeStyle
Products in the Field of Use, in the Territory.

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     2.2  Subdistributors. Subject to the provisions of this Section 2.2, Nipro
          ---------------
may appoint one or more third parties, with a reputation for competence and
ethical behavior, within any portion of the Territory to distribute the
FreeStyle Products in the Field of Use. Within twenty (20) days after the
appointment of such Subdistributor, Nipro shall notify TheraSense of the
identity of such Subdistributor. Nipro shall not sell or otherwise transfer the
FreeStyle Products to any Subdistributor until such Subdistributor enters into a
form of written agreement ("Subdistributor Agreement") with Nipro, binding the
Subdistributor to terms and conditions substantially similar to those terms and
conditions agreed upon by Nipro in this Agreement. Further, Nipro shall only
grant Subdistributors the right to make sales of the FreeStyle Products in the
Territory in the Field of Use. Nipro agrees to terminate a Subdistributor's
right to distribute the FreeStyle Products promptly upon becoming aware that
such Subdistributor, or its authorized distributor(s) or reseller(s), is selling
or otherwise distributing the FreeStyle Products in violation of its
Subdistributor Agreement. Each Subdistributor Agreement shall contain provisions
making TheraSense a direct and intended third party beneficiary of such
Subdistributor Agreement.

     2.3  FreeStyle Product Changes.
          -------------------------

          2.3.1  Changes in the FreeStyle Products. TheraSense shall notify
                 ---------------------------------
Nipro as soon as reasonably feasible of any intended material change,
discontinuation or addition to the FreeStyle Products supplied under this
Agreement. The features, function and/or appearance of any such FreeStyle
Product may be materially technically improved by TheraSense *** so long as such
improved product meets or exceeds the Product Specification for such product, as
listed in Exhibit E. TheraSense may make non-material changes in such FreeStyle
Products, including without limitation changing components of a FreeStyle
Product, without written notice to Nipro. The Freestyle Products may be
discontinued by TheraSense only with Nipro's prior written consent, such consent
not to be unreasonably withheld.

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          2.3.2  New Versions of the FreeStyle Products. TheraSense shall notify
                 --------------------------------------
Nipro as soon as reasonably feasible of any new versions of the FreeStyle
Products that TheraSense intends to make available for commercial sale in the
Territory (each a "New Version"); provided, it is understood and agreed that New
Versions shall not include any implantable glucose sensors developed and/or
commercialized by TheraSense. Upon TheraSense's notice to Nipro of the
availability of a particular New Version, the parties shall use their best
efforts to agree on transfer prices and other terms under which Nipro may obtain
the right to market and sell such New Version in the Territory. In the event the
parties are unable to agree on such terms ***, such New Versions shall not be
added to this Agreement and TheraSense shall be free to market and promote such
New Version in the Territory; ***.

          2.3.3  Implantable Glucose Sensors. TheraSense agrees to keep Nipro
                 ----------------------------
reasonably advised of TheraSense's progress with developing an implantable
glucose sensor, and in the event TheraSense intends to make such sensor
available for commercial sale in the Territory, TheraSense will provide Nipro an
opportunity to offer its distribution services in the Territory for such sensor,
which offer TheraSense is free to accept or reject without exception.

     2.4  Reservation of Rights. Except as expressly provided in this Article
          ---------------------
2, no right, title, or interest is granted, whether express or implied, by
TheraSense to Nipro, and nothing in this Agreement shall be deemed to grant to
Nipro rights in any products or technology other than the FreeStyle Products in
the Territory, nor shall any provision of this Agreement be deemed to restrict
TheraSense's right to exploit technology, know-how, patents, or any other
intellectual property rights relating to the FreeStyle Products in products
other than the FreeStyle Products in the Territory. TheraSense reserves the
right to appoint other authorized distributors or resellers outside the
Territory provided that they are prohibited

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from selling or delivering FreeStyle Products in the Territory. TheraSense
agrees to terminate a distributor or reseller's right to distribute FreeStyle
Products promptly upon becoming aware that the distributor or reseller is
selling or distributing the FreeStyle Products, directly or indirectly, in the
Territory. TheraSense also reserves the right to appoint third parties to
distribute the FreeStyle Products and New Versions inside the Territory in
fields of use other than the Field of Use. It is further understood and agreed
that TheraSense may distribute products, other than the FreeStyle Products, in
the Territory, either directly or indirectly, for any and all uses. In addition
TheraSense reserves the right to sell Strips in the Territory, either directly
or through third parties, solely for use in calibrating a continuous glucose
monitoring system ("CGMS"), provided TheraSense will only market and sell such
Strips for use with such CGMS. ***

     2.5  Conflict of Interest. During the term of this Agreement, Nipro agrees
          --------------------
not to promote, market, or sell a Competing Product in the Field of Use in the
Territory.

     2.6  Independent Contractors. The relationship of TheraSense and Nipro
          -----------------------
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 and 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 venture or common undertaking, or (iii) allow either
party to create or assume any obligation on behalf of the other for any purpose
whatsoever. All financial and other obligations associated with either party's
business are the sole responsibility of the party.

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3.   CONSIDERATION

     3.1  Signature Payments. In partial consideration of the distribution
          -------------------
rights granted herein, upon the Effective Date of this Agreement, Nipro shall
pay to TheraSense a nonrefundable (except as provided for in Section 12.6.2),
noncreditable payment of Five Million U.S. Dollars (U.S. $5,000,000).

     3.2  TheraSense Product Prices.
          -------------------------

          3.2.1  TheraSense Products. For each FreeStyle Product purchased from
                 -------------------
TheraSense, Nipro shall pay to TheraSense an amount equal to the transfer price
set forth in Exhibit B (the "Transfer Price"). All prices are in U.S. Dollars
with terms FCA (Incoterms 2000) the Shipping Location (as defined in Section 5.5
below). The difference between the Transfer Price and Nipro's price to its
Customers shall be Nipro's sole remuneration for distribution of the FreeStyle
Products. The Transfer Prices set forth in Exhibit B shall remain in effect from
the Effective Date ***. Thereafter, TheraSense has the right to ***.

          3.2.2  Transfer Price Adjustments. By *** Nipro shall provide to
                 --------------------------
TheraSense a non-binding written estimate of its requirements of Strips (as
defined in Exhibit A) for *** the *** shall be used to establish the Transfer
Price for the Strips ***. Thereafter, upon Nipro's submission of *** to
TheraSense, if either party concludes ***

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***. Notwithstanding the foregoing, in no event shall Nipro be obligated to pay,
or TheraSense be entitled to receive, more or less than the corresponding amount
set forth on Exhibit B for the actual number of Strips purchased by Nipro in
each calendar year. *** after the end of each calendar year, Nipro or
TheraSense ***.

          3.2.3  Government Reimbursements. The parties recognize that the
                 -------------------------
market price for Strips in the Territory may change up or down as a result of
changes in the Japan government reimbursement policies. Nipro shall promptly
inform TheraSense in writing, documenting any such changes in the reimbursement
policies for hospital or clinic blood glucose testing which would affect the
price Nipro would actually receive for sales of Strips. ***.

          3.2.4  Payment for TheraSense Products. TheraSense shall submit an
                 -------------------------------
invoice to Nipro upon each shipment of FreeStyle Products ordered by Nipro and
as set forth below in Section 5.5. The invoice shall cover the Transfer Price
for the FreeStyle Products in a given shipment plus any freight, taxes or other
costs incident to the purchase or shipment initially paid by TheraSense but to
be borne by Nipro. The invoiced amounts for FreeStyle Products shipped shall be
due in full net thirty (30) days upon the later of receipt by Nipro of the
FreeStyle Products or the invoice.

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          3.2.5  Delinquency. In the event that Nipro's account becomes
                 -----------
***.

     3.3  Payment Method. Nipro shall make payments to TheraSense under this
          --------------
Agreement by wire transfer to a bank account designated by TheraSense. All
payments due hereunder shall be paid in U.S. dollars.

4.   SUPPLY OF PRODUCTS; PACKAGING AND LABELING

     4.1  Supply of FreeStyle Products. Subject to terms of this Agreement,
          ----------------------------
including without limitation Article 5, TheraSense shall sell the FreeStyle
Products (Meters, Strips (pre-packaged in vials and boxes), Lancing Devices and
Control Solution (each as defined in Exhibit A)) to Nipro in bulk.

     4.2  Supply of Lancets. Nipro shall be responsible for obtaining the
          -----------------
lancets (a disposable head placed in the Lancing Device for use in piercing the
skin of the patient to be tested, each a "Lancet") to be used in conjunction
with the FreeStyle Products. Lancets obtained by Nipro shall meet mutually
agreed upon specifications.

     4.3  Product Packaging and Labeling.
          ------------------------------

          4.3.1  Strip Packaging and Labeling. Strips shall be delivered to
                 ----------------------------
Nipro pursuant to Section 5.4 below, in a package, including without limitation
vials or boxes, (the "Strip Package") containing the Strips together with an
insert. Both the Strip Package and the insert shall be labeled as follows:
"Manufactured by TheraSense" and "Distributed by Nipro" and shall carry both the
TheraSense and Nipro logo (or at Nipro's prior reasonable notice and election,
Nipro's name and logo shall be

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replaced by "Kissei"). Unless otherwise instructed by TheraSense in writing,
Nipro shall deliver the Strips to its Customers only as part of an unopened
Strip Package.

          4.3.2  Product, Packaging and Labeling. Nipro shall be responsible for
                 -------------------------------
packaging and labeling (including without limitation any final packaging and
labeling), (i) each FreeStyle Product (other than the Strip Package) supplied to
Nipro by TheraSense hereunder, (ii) the Lancets, and (iii) all printed materials
to be inserted within or upon such packaging, in each case, subject to
TheraSense's prior review and written approval, such approval not to be
unreasonably withheld (the "Packaging Materials"). Once a particular Packaging
Material has been approved by TheraSense, it may be used by Nipro without
further approval from TheraSense. Nipro shall be also responsible for ensuring
that all FreeStyle Products and Lancets are packaged and labeled in accordance
with the requirements of all applicable regulatory authorities in Japan,
including without limitation the requirements set forth by the Japan Ministry of
Health and Welfare ("JMHW"). Except for the addition of information required by
applicable laws and regulations, Nipro shall not re-label FreeStyle Products
supplied to Nipro by TheraSense hereunder without the prior written consent of
TheraSense.

     4.4  Proprietary Notices.
          -------------------

          4.4.1  Marking. All FreeStyle Products and their Packaging Materials
                 -------
distributed by Nipro in the Territory shall be marked with any appropriate
patent number, TheraSense's name and trademarks ("Trademarks", as listed in
Exhibit D) and the name of either Nipro or Kissei; provided, the Strips
contained within the Strip Package shall only be marked with TheraSense's
Trademark(s). FreeStyle Products and their Packaging Materials shall be marked
with TheraSense Trademarks in at least equal prominence to Nipro's marks. Nipro,
its Affiliates and its Subdistributors shall not remove, alter, cover or
obfuscate any of the Trademarks or other proprietary rights notices placed or
embedded by TheraSense on any FreeStyle Product or Strip Package or any of the
items contained therein. TheraSense

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reserves the right to modify the Trademarks or substitute alternative marks for
any or all of the Trademarks at any time ***. In addition, Nipro agrees to use
those Trademarks in connection with the FreeStyle Products as may be directed in
writing by TheraSense.

             4.4.2  Use. During the term of this Agreement, Nipro may indicate
                    ---
to the public that it is an authorized distributor of the FreeStyle Products and
to advertise and promote to Customers (within the Territory) the FreeStyle
Products under the Trademarks.

             4.4.3  Approval of Representations. All representations of the
                    ---------------------------
Trademarks that Nipro intends to use shall first be submitted to TheraSense for
approval (which shall not be unreasonably withheld) of design, color, and other
details or shall be exact copies of those used by TheraSense. Nipro agrees to
fully comply with all reasonable guidelines communicated by TheraSense
concerning use of its Trademarks. Nipro may not mark the FreeStyle Products, the
Strip Package or their Packaging Materials with the Trademarks of any third
party, other than Kissei, without the prior written consent of TheraSense; which
consent shall not be unreasonably withheld. If any of TheraSense's Trademarks
are to be used in conjunction with another trademark on or in relation to the
FreeStyle Products, Strip Package or their Packaging Materials, then the
Trademarks shall be presented at least equally legibly, equally prominently, and
of equal or greater size than the other but nevertheless separated from the
other so that each appears to be a mark in its own right, distinct from the
other mark.

             4.4.4  Retained Rights. Nipro acknowledges that the requirement
                    ---------------
that the Trademarks appear on all packages and only in accordance with
TheraSense's directions are intended to ensure that all of the goodwill created
by the marketing and use of the FreeStyle Products in the Territory will accrue
for the benefit of TheraSense and that all use of the Trademarks, and any
goodwill associated therewith, shall inure to TheraSense. Nothing contained in
this Agreement shall grant to Nipro any right, title or interest in the
Trademarks, whether or not specifically recognized or perfected under applicable
laws, and

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Nipro irrevocably assigns to TheraSense all such right, title, and interest, if
any, in any Trademarks. Without limiting the foregoing, TheraSense shall retain
the worldwide right to use such Trademarks for its own co-marketing efforts and
for the distribution/sale of other products. At no time during or after the term
of this Agreement shall Nipro challenge or assist others to challenge the
Trademarks or the registration thereof or attempt to register any trademarks,
marks or trade names confusingly similar to those of TheraSense.

5.       TERMS OF PURCHASE OF FREESTYLE PRODUCTS BY NIPRO

         5.1  Solicitation and Placement of Orders from Customers. Nipro shall
              ---------------------------------------------------
be responsible for marketing and soliciting orders for FreeStyle Products from
Customers in the Territory, in the Field of Use.

         5.2  Terms and Conditions. All orders of FreeStyle Products by Nipro
              --------------------
from TheraSense during the term of this Agreement shall be subject to the terms
of this Agreement. Nothing contained in any purchase order, order
acknowledgement, or like document submitted by either party to the other shall
in any way modify or add to the terms and conditions in this Agreement.

         5.3  Forecasts. Beginning on the Effective Date and thereafter ***
              ---------
Nipro shall provide to TheraSense a good faith, non-binding written forecast of
the number of units of FreeStyle Products that Nipro expects to purchase ***
("Forecasts"). Subject to Section 5.4 below, the parties acknowledge that the
Forecasts are for TheraSense's planning purposes only and shall not be binding
upon the parties. Nipro and TheraSense shall meet, by telephone or in person, no
less frequently than *** to review Forecasts.

         5.4  Order and Acceptance. On a month-to-month and FreeStyle
              --------------------
Product-by-FreeStyle Product basis, Nipro shall submit orders for units of
FreeStyle Products so that such orders are received

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by TheraSense *** prior to its requested date of receipt of such units of
FreeStyle Products. Unless otherwise mutually agreed, Nipro shall be obligated
to purchase each month *** the amount of FreeStyle Products forecasted for such
month in its current Forecast ("Binding Forecasts"). No order shall be binding
upon TheraSense until accepted by TheraSense in writing but TheraSense agrees to
accept Nipro's purchase orders for quantities of FreeStyle Products ordered by
Nipro in a month *** the Binding Forecast for such month. Once accepted by
TheraSense, Nipro may cancel or reschedule purchase orders for FreeStyle
Products only with TheraSense's prior written approval. Nipro will use
commercially reasonable efforts to place orders for FreeStyle Products in an
even and regular fashion so as to allow for efficient scheduling of FreeStyle
Products production and warehousing. In the event TheraSense receives a purchase
order *** in advance of the requested receipt date or for a quantity that is ***
the Binding Forecast for a month, TheraSense will use commercially reasonable
best efforts to ship such FreeStyle Products to Nipro on the date and in the
quantity requested by Nipro; provided, TheraSense shall have no liability to
Nipro with respect to such orders that do not meet the requirement of this
Section 5.4 and are not accepted by TheraSense.

         5.5  Shipping. All FreeStyle Products delivered pursuant to the terms
              --------
of this Agreement shall be suitably packed in TheraSense's standard shipping
cartons, and marked for shipment at the address of Nipro, as provided in Nipro's
purchase order, for delivery within ten (10) days (excluding weekends) to Nipro,
FCA (Incoterms 2000) TheraSense's facility currently located at the address
listed for TheraSense in Article 16 of this Agreement or such other location as
TheraSense may designate (the "Shipping Location"), at which time risk of loss
shall pass to Nipro. All expenses related to shipment from the United States to
Japan, including without limitation, exportation and importation fees, customs
duties and tariffs, freight, insurance, and other shipping expenses, as well as
any special packing expense, shall

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be paid by Nipro. Nipro shall have the right to specify a carrier at the time it
places its order but, if it does not do so, TheraSense may choose the mode of
shipment and carrier.

         5.6  Acceptance of FreeStyle Products. TheraSense shall certify that
              --------------------------------
each shipment of FreeStyle Products meets the product specifications listed in
Exhibit E (the "Product Specifications"). Nipro shall have the right to inspect
all FreeStyle Products promptly upon receipt thereof for conformance with the
Product Specifications. Any FreeStyle Products not rejected by Nipro within
thirty (30) days will be deemed accepted. TheraSense will, at its election,
either repair or replace rejected defective FreeStyle Products within thirty
(30) days of receipt thereof. In the event Nipro rejects any FreeStyle Products,
Nipro shall be required to demonstrate that such product does not meet a
commercially material specification set forth in Exhibit E. The warranty for
such products shall continue independent of such acceptance or rejection.

6.       WARRANTY

         6.1  Warranty to Customer. Any warranty set forth in this Section 6.1
              --------------------
shall run directly from TheraSense to Customers. Subject to this Section 6.1,
TheraSense shall promptly replace any FreeStyle Product that does not meet one
or more of its warranties.

              6.1.1 Nipro Obligations. Nipro shall have responsibility for
                    -----------------
handling Customer returns for non-conforming FreeStyle Products under the
warranty. TheraSense shall refer all Customer warranty issues to Nipro for
resolution. Nipro shall make no warranties with respect to any of the FreeStyle
Products that exceed the warranty made by TheraSense. In the event TheraSense is
unable to replace at its expense a faulty product, TheraSense's sole and
exclusive liability and Nipro's exclusive remedy shall be to credit Nipro's
account for Nipro's original landed cost for the FreeStyle Product or, in the
case of Nipro packaged FreeStyle Product, the inventory value according to
Nipro's inventory

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accounting or, in the case of FreeStyle Products returned by a Customer, in
accordance with Section 6.1.5.

             6.1.2  TheraSense Limited Warranty. TheraSense warrants to
                    ---------------------------
Customers that upon delivery, FCA the shipping location, and during the warranty
period for the FreeStyle Products, as set forth on the product label and/or
insert (as provided by TheraSense), FreeStyle Products: (i) will meet the agreed
upon Product Specifications as set forth in Exhibit E, (ii) will be free from
defects in design, materials and workmanship, (iii) will be of merchantable
quality and fit for the purpose for which they are intended, and (iv) will
comply with all applicable laws in the place of manufacture.

             6.1.3  Warranty Limitations. The warranties in Sections 6.1.1 and
                    --------------------
6.1.2 shall not apply to FreeStyle Products that have been modified or altered
in any manner by anyone other than by or on behalf of TheraSense, or to defects
caused (i) through no fault of TheraSense during shipment to or from Nipro; (ii)
by the use or operation in an application or environment other than that
intended or recommended by TheraSense; (iii) by service by anyone other than
employees of, or persons approved in writing by, TheraSense; (iv) by accident,
negligence, misuse, other than normal electrical stress, or other causes other
than normal use; or (v) by storage, usage or handling in any manner inconsistent
with the FreeStyle Products label provided by TheraSense. Replacement FreeStyle
Products supplied under this warranty shall carry only the unexpired portion of
the original warranty. TheraSense shall not be liable for misbranding with
respect to any product labeling or package insert text provided or used by
Nipro, or any translation thereof and TheraSense shall not be liable for any
adulteration or failure to meet the Product Specifications due to handling or
packaging of the FreeStyle Products by Nipro, its Affiliates, its
Subdistributors or agents.

             6.1.4  Exclusion of Other Warranties. EXCEPT FOR THE LIMITED
                    -----------------------------
WARRANTIES PROVIDED IN SECTIONS 6.1.1, 6.1.2 AND 6.1.3 ABOVE, THERASENSE GRANTS
NO OTHER

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WARRANTIES OR CONDITIONS, EXPRESS OR IMPLIED, BY STATUTE, IN ANY COMMUNICATION
WITH NIPRO OR ITS CUSTOMERS, OR OTHERWISE, REGARDING THE FREESTYLE PRODUCTS, AND
THERASENSE SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES OF FITNESS FOR A
PARTICULAR PURPOSE, MERCHANTABILITY, AND NONINFRINGEMENT. EXCEPT AS PROVIDED
EXPRESSLY IN THIS AGREEMENT AND/OR THERASENSE'S WARRANTY, THERASENSE DOES NOT
WARRANT THAT OPERATION OF THE FREESTYLE PRODUCTS WILL BE UNINTERRUPTED OR ERROR-
FREE. THERASENSE NEITHER ASSUMES NOR AUTHORIZES ANY OTHER PERSON TO ASSUME ANY
OTHER LIABILITIES ARISING OUT OF OR IN CONNECTION WITH THE SALE OR USE OF ANY
FREESTYLE PRODUCT. ANY OTHER REPRESENTATIONS OR WARRANTIES MADE BY ANY PERSON OR
ENTITY, INCLUDING EMPLOYEES OR REPRESENTATIVES OF THERASENSE, THAT ARE
INCONSISTENT HEREWITH SHALL BE DISREGARDED AND SHALL NOT BE BINDING UPON
THERASENSE OR ITS THIRD PARTY SUPPLIERS.

             6.1.5  Limitation of Liability. THERASENSE'S LIABILITY UNDER ITS
                    -----------------------
CUSTOMER WARRANTY SHALL BE LIMITED TO A REFUND OF THE CUSTOMER'S PURCHASE PRICE
TO NIPRO, IN WHICH CASE NIPRO WILL REFUND SUCH AMOUNT TO THE CUSTOMER, AND A
REFUND OF NIPRO'S SHIPPING COSTS WITH RESPECT TO THE DEFECTIVE FREESTYLE
PRODUCT. IN NO EVENT SHALL THERASENSE BE LIABLE TO NIPRO OR ANY THIRD PARTY FOR
LOST PROFITS, THE COST OF PROCUREMENT OF SUBSTITUTE GOODS BY THE CUSTOMER, OR
FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES FOR BREACH OF
WARRANTY. THIS LIMITATION SHALL APPLY EVEN WHERE THERASENSE HAS BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGE AND NOTWITHSTANDING THE FAILURE OF THE ESSENTIAL
PURPOSE OF ANY LIMITED REMEDY STATED HEREIN.

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         6.2  Representation and Warranties by and between Nipro and TheraSense.
              -----------------------------------------------------------------

              6.2.1  Warranty to TheraSense. Nipro represents and warrants to
                     ----------------------
TheraSense that: (i) it is a corporation duly organized validly existing and in
good standing under the laws of Japan; (ii) the execution, delivery and
performance of this Agreement have been duly authorized by all necessary
corporate action on the part of Nipro.

              6.2.2  Warranty to Nipro. TheraSense represents and warrants to
                     -----------------
Nipro that: (i) it is a company duly organized validly existing and in good
standing under the laws of the State of Delaware; (ii) the execution, delivery
and performance of this Agreement have been duly authorized by all necessary
corporate action on the part of TheraSense; (iii) it has the right to grant
Nipro the exclusive distribution rights in the Territory as specified in Section
2.1.1 and, to the best of its knowledge, it has the right to grant the other
rights granted herein; and (iv) subject to Sections 6.1.3 and 6.1.4, upon
delivery, FCA the Shipping Location, the Freestyle Products will (a) meet the
agreed upon Product Specifications as set forth in Exhibit E, (b) will be free
from defects in manufacturing, materials and workmanship, (c) will be of
merchantable quality and fit for the purpose for which they are intended, and
(d) will comply with all applicable laws in the place of manufacture.

7.       ADVERTISING, MARKETING AND PROMOTION

         7.1  Advertising and Promotions. Nipro, its Affiliates and
              --------------------------
Subdistributors shall bear all expenses associated with the marketing, sales and
customer support of the FreeStyle Products in the Territory. Promptly upon
receipt of all necessary Approvals (as defined in Section 8.1), Nipro shall, at
its own expense, (i) use commercially reasonable efforts to promote the sale and
distribution of the FreeStyle Products to Customers in the Territory, and (ii)
use commercially reasonable efforts to realize the maximum sales potential for
the FreeStyle Products to Customers in the Territory. Such commercially
reasonable efforts by Nipro may include without limitation the following:

                                      -17-
<PAGE>

             (a) maintenance of an adequate and experienced sales force;

             (b) dedication of sufficient product and project management,
marketing and customer support resources to pursue the market opportunities for
the product in the Territory;

             (c) the preparation of promotional aids and materials;

             (d) the translation of clinical, technical, packaging, advertising,
and promotional materials into the primary language(s) within the Territory;
provided, however, that TheraSense shall own all rights in and to such
translations, subject to the Translation Repayment (as defined in Section 7.2.2
below);

             (e) advertising the FreeStyle Products in professional and consumer
publications within the Territory;

             (f) participating in congresses, symposia, and exhibitions within
the Territory;

             (g) systematically identifying and targeting key customers and
making sales calls on such customers within the Territory.

             (h) sponsoring technical papers and presentations.

             (i) organization of user panels to provide insight into customer
decision making.

In addition to the foregoing, Nipro shall (i) use reasonable efforts, at its own
expense, to maintain a sufficient inventory of FreeStyle Products and to fulfill
forecast demand for FreeStyle Products within

                                      -18-
<PAGE>

the Territory; and (ii) act so as to establish and maintain a favorable
reputation of the FreeStyle Products and marks in the Territory.

         7.2  Nipro Materials.
              ---------------

              7.2.1  Nipro Materials. Nipro shall provide to TheraSense for
                     ---------------
purposes of review, comment and approval by TheraSense, English language
translations of any and all promotional, advertising and educational materials
and programs, package data sheets, and other literature relating to the
FreeStyle Products at least *** prior to the commercial release of
such materials or commencement of such programs for the purpose of: (i) enabling
TheraSense to comply with regulations applicable to such materials; and (ii)
ensuring that such materials correspond with TheraSense's product policies.

              7.2.2  Effect of Termination. It is recognized that Nipro shall
                     ---------------------
experience significant expenses related to the translation of materials for
clinical, technical, packaging, advertising, and promotional reasons. Upon
expiration or any termination of this Agreement. TheraSense shall have all
rights to take over and use the translations made by Nipro, and Nipro shall
fully cooperate with TheraSense to make such translations available for the free
and full use by TheraSense or its agent, subject to the following:

                    (a) in the event this Agreement is terminated by Nipro due
to TheraSense's material breach, or in the event TheraSense elects not to extend
the term of this Agreement pursuant to Section 12.1.2, or in the event
TheraSense terminates this Agreement for Nipro's failure to meet the Annual
Minimum Purchase Obligations (as defined in Section 8.5) in any year, TheraSense
shall ***; or

                                      -19-

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<PAGE>

                   (b) in the event this Agreement is terminated by TheraSense
due to Nipro's material breach, or in the event Nipro elects not to extend the
term of this Agreement pursuant to Section 12.1.2, TheraSense shall ***.

         7.3  TheraSense Collaboration. TheraSense will collaborate with Nipro
              ------------------------
in the development of all marketing and promotional materials. TheraSense will,
at its own expense, provide Nipro with:

              7.3.1 such marketing and technical assistance and promotional
materials (in English) as TheraSense may in its reasonable discretion consider
necessary to assist with the promotion of the FreeStyle Products;

              7.3.2 training for Nipro's personnel in connection with the
marketing, sale, installation, maintenance and support of the FreeStyle Products
during the *** period following the Effective Date; provided, TheraSense's
personnel shall spend *** in providing such training unless the parties agree to
provide additional training;

              7.3.3 reasonable access to TheraSense support personnel by Nipro's
support personnel to assist Nipro in providing customer support.

8.       ADDITIONAL OBLIGATIONS OF NIPRO

         8.1  Registrations, Licenses and Permits.
              -----------------------------------

              8.1.1 If and as required from time to time under the laws of the
Territory, Nipro, at Nipro's expense, shall perform clinical trials and obtain
all registrations, licenses, permits, import approvals, reimbursement approvals,
and other legal or administrative items required to comply with the laws and
regulations of the Territory for importation, sale and distribution of the
FreeStyle Products, and gain reimbursement for such sales (collectively
"Approvals"). Nipro shall provide to TheraSense, for

                                      -20-

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<PAGE>

TheraSense's unrestricted use, complete copies of all clinical trials,
protocols, data, analyses and other information, as well as applications, and
all registrations, licenses, permits, and approval obtained therefrom relating
to the FreeStyle Products.

             8.1.2 TheraSense will provide Nipro with all information, data,
materials and product samples in its possession necessary to obtain Approvals.
In the event that disclosure of TheraSense trade secrets are required for the
Approvals, TheraSense will provide such trade secret information directly to the
Japan regulatory authorities.

             8.1.3 All Approvals will be in Nipro's name unless otherwise agreed
by the parties or required by law. Upon the expiration, cancellation, or
termination of this Agreement, Nipro shall transfer such Approvals to TheraSense
or TheraSense's agent so that TheraSense will be able to continue to sell
FreeStyle Products and be reimbursed for FreeStyle Products in the Territory,
subject to the following:

                   (a) in the event this Agreement is terminated by Nipro due to
TheraSense's material breach, or in the event TheraSense elects not to extend
the term of this Agreement pursuant to Section 12.1.2, or in the event
TheraSense terminates this Agreement for Nipro's failure to meet the Annual
Minimum Purchase Obligations in any year, TheraSense shall; or

                   (b) in the event this Agreement is terminated by TheraSense
due to Nipro's material breach, or in the event Nipro elects not to extend the
term of this Agreement pursuant to Section 12.1.2, TheraSense shall.

                                      -21-

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<PAGE>

         8.2  Health and Safety Laws and Regulations. In performing its
              --------------------------------------
obligations under this Agreement, Nipro shall comply fully with any and all
applicable health and safety laws and regulations of the Territory as they
relate to the FreeStyle Products. In addition, Nipro shall monitor the
appropriate information sources closely for changes in such laws and
regulations, and other requirements in the Territory relating to the
distribution of the FreeStyle Products in the Territory, and notify TheraSense
promptly in writing of any and all such changes.

         8.3  Sales and Inventory Records. Nipro agrees to maintain a sales and
              ---------------------------
inventory record showing, at a minimum, date sold, quantity, serial number or
lot number, shipment information, and the buyers' names and addresses of each of
the FreeStyle Products sold, as well as the quarter-end inventory position on
hand for each of the FreeStyle Products. Such records shall be kept at Nipro's
principal place of business for at least three (3) years following the end of
the calendar quarter to which they pertain. This information shall be made
available to TheraSense at TheraSense's request solely to satisfy ISO
certification, regulatory, and/or administrative requirements.

         8.4  Sales Reports. At the end of each calendar quarter, Nipro will
              -------------
provide TheraSense with a quarterly report including the following information:

              (a) monthly net sales in units of Meters to Customers in the
Territory;

              (b) monthly net sales in units of Strips to Customers in the
Territory

              (c) monthly net sales in Yen of FreeStyle Products other than
Meters and Strips to Customers in the Territory;

              (d) reporting of monthly Meter placements (units) made free of
charge to Customers;

                                      -22-
<PAGE>

Nipro shall also include in this quarterly report a description of any
developments regarding the market, competitors, government authorities, or other
material developments which Nipro judges to be of importance to the success of
FreeStyle Products, or otherwise important for TheraSense to know.

         8.5  Annual Minimum Purchase Obligations. Nipro shall purchase no less
              -----------------------------------
than the amount of Strips listed on Exhibit C for sale in the Territory in each
calendar year (the "Annual Minimum Purchase Obligations"). TheraSense shall have
the right, at its option, to terminate this Agreement for cause pursuant to
Section 12.2 hereof, in the event that ***.

         8.6  Books and Records. At TheraSense's request, Nipro, its Affiliates,
              -----------------
and its Subdistributors agree to furnish a full and detailed statement of such
party's business and operations (but only to the extent it relates to the Nipro
relationship created hereby), including, without limitation, any and all sales
and inventory records required to be kept pursuant to this Agreement, but solely
to satisfy ISO certification, regulatory, and/or administrative requirements.

         8.7  Business Review; Semi-Annual Business Plans.
              -------------------------------------------

              8.7.1 Semi-Annual Business Plans. TheraSense and Nipro shall meet,
                    --------------------------
in person, no less frequently than once every six months to review Nipro's
business plan for marketing and distributing the FreeStyle Products in the
Territory. Such business plan shall include, without limitation, promotion
strategy and tactics, and sales and other marketing plans. TheraSense shall have
the right to review and comment on such business plan.

                                      -23-

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              8.7.2 Business Review. The parties will meet at least annually to
                    ---------------
review developments in the marketplace, including pricing, competitive
developments, regulatory and administrative changes, and other factors important
to success of the FreeStyle Products in the Territory.

         8.8  Customer Support. Nipro shall maintain knowledgeable sales,
              ----------------
marketing, and support personnel to provide instructions to Customers in the
Territory in the use of the FreeStyle Products. Upon Nipro's request, TheraSense
shall provide a reasonable level of assistance with technical information and
training of Nipro and Kissei employees for the FreeStyle Products. Any expenses
related to such activities shall be borne by Nipro.

         8.9  Medical Device Reporting.
              ------------------------

              8.9.1 Reporting. Pursuant to governmental medical device reporting
                    ---------
regulations (e.g. the FDA's Medical Device Reporting (MDR) Regulations, the
European Medical Device Vigilance Guidelines, and any other applicable medical
device reporting regulations in Japan), TheraSense is required to report to the
applicable agency information that reasonably suggests that the FreeStyle
Products may have caused or contributed to a death or serious injury or has
malfunctioned and that the device would be likely to cause or contribute to a
death or serious injury if the malfunction were to recur. Each of TheraSense and
Nipro agree to supply to the other any such information promptly after becoming
aware of it so that each of TheraSense and Nipro can comply with governmental
reporting requirements.

             8.9.2  Recall Cooperation. In the event of any potential recall of
                    ------------------
FreeStyle Product in the Territory, Nipro will consult with TheraSense as to the
actions which shall be taken with respect to Customers and with respect to
government authorities in implementing such recall, including without
limitation, in locating, and retrieving if necessary, recalled FreeStyle
Products from Customers. Nipro and TheraSense shall reach agreement on such
actions prior to the product recall implementation;

                                      -24-
<PAGE>

provided, neither party shall unreasonably withhold agreement to such actions,
and the parties shall observe all legal and regulatory requirements which apply
to such recall.

             8.9.3  Recall Expenses. In the event of a recall of a FreeStyle
                    ---------------
Product, whether required or voluntary, the recall shall be at Nipro's cost and
expense in the Territory and at TheraSense's cost and expense outside the
Territory. Notwithstanding the foregoing, in the event that a recall is
primarily due to a manufacturing defect in the FreeStyle Products which requires
the replacement of FreeStyle Products, then TheraSense shall provide to Nipro
replacement FreeStyle Products free of charge.

             8.9.4  Records. Nipro shall maintain records of sales of FreeStyle
                    -------
Products by lot number and by third-party (including without limitation
distributors, wholesalers, and retailers) to whom such product was sold or
otherwise transferred. Upon TheraSense's request, Nipro shall provide TheraSense
with access to such records in the event of a FreeStyle Products recall or other
quality related issue. Nipro shall be responsible for obtaining all records of
its sales to end users in the event of a FreeStyle Products recall or other
quality related issue. Nipro shall make available to TheraSense for inspection
Nipro's process and records for adverse event and other regulatory reporting
purposes at mutually agreed upon times and further shall ensure that Nipro's
processes comply with all applicable laws and regulations in the Territory.

       8.10  Product Complaints. Nipro shall promptly investigate and monitor
             ------------------
all Customer and/or regulatory complaints and/or correspondence concerning the
use of the FreeStyle Products in the Territory. Nipro shall use commercially
reasonable efforts to advise TheraSense of all complaints alleging patient
injury promptly, if possible within twenty four (24) hours, but not more than
five (5) days business days following the date Nipro receives such complaint,
and of all other complaints relating to the FreeStyle Products as promptly as
possible but not more than five (5) business days following the date Nipro
receives such complaint. In addition, within fifteen (15) calendar days
following the date

                                      -25-
<PAGE>

Nipro receives such complaint, Nipro shall also provide TheraSense with a
materially complete written report relating thereto. Any notice to TheraSense
under this Section 8.10 shall be sent via facsimile and overnight delivery
service to the attention of TheraSense's Vice President of Regulatory Affairs or
to such other address or person as TheraSense may designate by notice.

         8.11  Notification of Unauthorized Use. Nipro shall promptly notify
               --------------------------------
TheraSense in writing upon its discovery of any unauthorized use or infringement
of the FreeStyle Products and/or TheraSense's patent, copyright, trademark or
other intellectual property rights with respect thereto. TheraSense shall have
the sole and exclusive right to bring an infringement action or proceeding
against a third party, but TheraSense shall use its commercially reasonable
judgment in determining its enforcement actions. In the event that TheraSense
brings such an action or proceeding, Nipro shall provide commercially reasonable
cooperation and provide commercially reasonable information and assistance to
TheraSense and its counsel in connection with any such action or proceeding;
provided that TheraSense shall reimburse Nipro for any direct costs (such as
reasonable attorney's fees) incurred by Nipro.

         8.12  Nipro Improvements.
               ------------------

               8.12.1 In the event that Nipro makes a commercially important
improvement to the FreeStyle Products (an "Improvement"), then TheraSense shall
have a "right of first refusal" to negotiate the rights to such improvement on
commercially reasonable terms. ***.

               8.12.2 Prior to offering an Improvement to a third party, Nipro
shall offer the Improvement to TheraSense by providing TheraSense with at least
the same level of information that

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<PAGE>

Nipro would provide to any third party. TheraSense shall *** review such
information and provide written notification to Nipro regarding its decision to
enter into negotiations for the right to such Improvement. If written notice is
given that TheraSense does not want to enter into negotiations for a license, or
written notice is not given by TheraSense within said *** period, TheraSense
will have waived its right of first refusal to license the applicable
Improvement, and Nipro will be free to license such Improvement to any third
party without further obligation to TheraSense. If TheraSense provides written
notice of its desire to enter into negotiations, the parties shall have a ***
period from the date of TheraSense's notice to Nipro to conclude a definitive
license agreement in good faith with respect to the applicable Improvement. If
the parties cannot conclude an agreement in said *** timeframe, and do not
mutually agree to extend such negotiation period, Nipro shall be free to license
such Improvement to any third party, as long as the terms of such license are
not materially better than those offered to TheraSense.

9.       ADDITIONAL OBLIGATIONS OF THERASENSE

         9.1   Supply of Products. TheraSense shall be responsible for the
               ------------------
manufacture of FreeStyle Products for sale to Nipro.

         9.2   Telephone Marketing and Technical Support. During TheraSense's
               -----------------------------------------
normal business hours, TheraSense shall provide, in English, a reasonable level
of telephone marketing and technical support to employees of Nipro who have been
trained by TheraSense to answer Nipro's questions related to FreeStyle Products.

         9.3   Intellectual Property Rights Maintenance.
               ----------------------------------------

               9.3.1     Patent and Trademark Prosecution. TheraSense will be
                         --------------------------------
responsible for maintaining all patents, Trademarks and trade names and/or
diligently prosecuting all patent applications

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<PAGE>

covering the FreeStyle Products in the Territory. TheraSense shall use its
reasonable commercial judgment in determining the level and extent of patent
protection to pursue in the Territory.

          9.3.2  Remedies for Injunction. If sale of the FreeStyle Products in
                 -----------------------
the Territory is enjoined due to any third party claim that the FreeStyle
Products or the trademark infringe the intellectual property rights of the third
party, then TheraSense may at its option and expense, (i) procure a license for
Nipro to continue selling FreeStyle Products, (ii) replace or modify the
FreeStyle Products to render them non-infringing; or (iii) if it is not
commercially reasonable to take the actions specified in items (i) and (ii),
terminate this Agreement with *** written notice to Nipro and repurchase from
Nipro the FreeStyle Products in Nipro's inventory as of the date of such
termination at Nipro's fully landed cost of such FreeStyle Products; provided,
however, that in such event, solely for purposes of Section 12.6.2, the date of
termination shall be considered to be the date the injunction is effective (as
such date may be extended by any stay or appeal of such injunction).

10.  CONFIDENTIALITY

     10.1 Except as expressly provided herein, the parties agree that for five
(5) years after the disclosure of any Confidential Information by one (1) of the
parties to the other hereto pursuant to this Agreement, the receiving party
shall keep completely confidential and shall not publish or otherwise disclose
and shall not use for any purpose except for the purposes contemplated by this
Agreement such Confidential Information, except that to the extent that it can
be established by the receiving party by competent proof that such Confidential
Information:

                 (a)  was already known to the receiving party, 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;

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

                         (d)    was independently developed by the receiving
party as demonstrated by documented evidence prepared contemporaneously with
such independent development; or

                         (e)    was subsequently lawfully disclosed to the
receiving party by a person other than a party hereto.

          10.2   Permitted Use and Disclosures. Each party hereto may use or
                 -----------------------------
disclose information disclosed to it by the other party to the extent such use
or disclosure is reasonably necessary in complying with applicable governmental
regulations or otherwise submitting information to tax or other governmental
authorities, conducting clinical trials, or otherwise exercising its rights
hereunder, provided that if a party is required to make any such disclosure of
another party's confidential information, other than pursuant to a
confidentiality agreement, it will give reasonable advance notice to the latter
party of such disclosure and, except to the extent inappropriate in the case of
patent applications, will use its best efforts to secure confidential treatment
of such information prior to its disclosure (whether through protective orders
or otherwise).

          10.3   Public Disclosure. Except as otherwise required by law, neither
                 -----------------
party shall issue a press release or make any other public disclosure of the
terms of this Agreement without the prior approval of such press release or
public disclosure. Each party shall submit any such press release or public
disclosure to the other party, and the receiving party shall have ten (10)
business days to review and approve any such press release or public disclosure,
which approval shall not be unreasonably withheld. If the receiving party does
not respond in writing within such ten (10) business day period, the press
release or public disclosure shall be deemed approved.

                                      -29-
<PAGE>

     10.4  Confidential Terms. Except as expressly provided herein, each party
           ------------------
agrees not to disclose any terms of this Agreement to any third party without
the consent of the other party; provided, disclosures may be made as required by
securities or other applicable laws, or on a strict need to know basis to actual
or prospective investors, or to a party's accountants, attorneys and other
professional advisors; provided further, however, prior to making any disclosure
regarding securities or other applicable laws, the terms of this Agreement shall
be redacted by mutual agreement of the parties.

11.  INDEMNITY; INSURANCE; LIMITATION OF LIABILITY

     11.1  Indemnification of Nipro.
           ------------------------

           11.1.1  TheraSense shall indemnify, defend, and hold harmless Nipro
and its directors, officers and employees (each an "Nipro Indemnitee") from and
against any and all liabilities, damages, losses, costs or expenses (including
attorneys' and professional fees and other expenses of litigation and/or
arbitration) (a "Liability") resulting from a claim, suit or proceeding made or
brought by a third party against a Nipro Indemnitee arising from defects in
materials, workmanship, design or packaging of the FreeStyle Products, except
for matters for which Nipro is to indemnify TheraSense pursuant to Section
11.2.1.

           11.1.2  TheraSense shall defend, or at its option settle, any claims
brought against Nipro by third parties as a result of any infringement by the
FreeStyle Products of any U.S. or foreign patent, trade name, trademark, service
mark or copyright existing under the laws of the Territory, and shall reimburse
Nipro for any judgments, damages, cost or expenses payable by Nipro to a party
bringing such action together with reasonable attorneys' fees relating thereto.
If the FreeStyle Products, or any part thereof, are, or in the opinion of
TheraSense become, the subject of any claim for infringement of such third party
patent, trademarks, or copyrights, or if it is adjudicatively determined that
the FreeStyle Products, or any part thereof, infringe any such third party
patent trademark, or copyright, then

                                      -30-
<PAGE>

TheraSense may, at its option and expense, either (i) procure for Nipro the
right under such third party patent, trademark or copyright to sell or use, as
appropriate, the FreeStyle Products (or in the case of trademark infringement,
substitute a different trademark) or (ii) replace or modify the FreeStyle
Products or parts thereof in Nipro's possession, with other suitable and
reasonably equivalent technology or parts so that the FreeStyle Products become
non-infringing or (iii) if it is not commercially reasonable to take the actions
specified in items (i) or (ii) immediately preceding, terminate this Agreement
with ninety (90) days written notice.

               11.1.3 Notwithstanding the provisions of Section 11.1.2 above,
TheraSense assumes no liability for (i) infringements relating to any assembly,
circuit, combination, method or process made by anyone other than by or on
authority of TheraSense in which any of the FreeStyle Products may be used where
the FreeStyle Products when used alone would not result in such an infringement;
(ii) infringements involving the modification or servicing of the FreeStyle
Products, or any part thereof, done by anyone other than by or on authority of
TheraSense unless such modification or servicing was done by TheraSense; (iii)
any trademark infringements involving any marking or branding of the FreeStyle
Products not applied by TheraSense or at the request of TheraSense or involving
any marking or branding applied at the request of Nipro or any marking or
branding with Nipro or Kissei's trademarks; or (iv) modification of any
FreeStyle Products other than with TheraSense's written consent.

               11.1.4 The foregoing provisions of this Section 11.1 state the
entire liability and obligations of TheraSense, and the exclusive remedy of
Nipro and its Customers, with respect to any alleged product liability claim or
other matter covered by Section 11.1.1 related to the FreeStyle Products, or any
alleged infringement of any patents, copyrights, trademarks or other
intellectual property rights by the FreeStyle Products or any part thereof.

                                      -31-
<PAGE>

          11.2   Indemnification of TheraSense.
                 -----------------------------

                 11.2.1 Nipro shall indemnify, defend and hold harmless
TheraSense and its directors, officers, employees and agents and the successors
and assigns of any of the foregoing (each a "TheraSense Indemnitee") from any
and all claims, losses, costs, liabilities or expenses (including, without
limitation, attorneys' fees and other expenses of litigation) (a "Liability")
resulting from a claim, suit or proceeding made or brought by a third party
against a TheraSense Indemnitee arising out of (a) defects in the FreeStyle
Products sold by Nipro resulting from any action of Nipro, its Affiliates and
their Subdistributors, (b) FreeStyle Products claims, whether written or oral,
made by Nipro in its advertising, promotion, sale, or distribution of any of the
FreeStyle Products beyond those made by TheraSense, (c) the labeling, packaging,
storage or other handling, distribution or sale of the FreeStyle Products by
Nipro, its Affiliates or its Subdistributors except to the extent required by
TheraSense pursuant to this Agreement, or (d) any claim alleging noncompliance
by Nipro with Japan laws and regulations in the Territory which are equivalent
to the U.S. FDC&A.

                 11.2.2 Nipro shall defend, or at its option settle, any claims
brought against TheraSense by third parties as a result of any infringement by
the FreeStyle Products of any U.S. or foreign trademark, trade name, or service
mark existing under the laws of the Territory, and shall reimburse TheraSense
for any judgments, damages, cost or expenses payable by TheraSense to a party
bringing such action together with reasonable attorneys' fees relating thereto
as a result of marking or branding the FreeStyle Products with Nipro trademarks.
If the FreeStyle Products, or any part thereof, are, or in the opinion of Nipro
become, the subject of any claim for infringement of such third party
trademarks, trade names or service marks, or if it is adjudicatively determined
that the FreeStyle Products, or any part thereof, infringe any such third party
trademarks, trade names or service marks, Nipro may substitute a new Nipro
trademark, trade name or service mark to be used to sell or use, as appropriate,
the FreeStyle Products.

                                      -32-
<PAGE>

                 11.2.3 The foregoing provisions of this Section 11.2 state the
entire liability and obligations of Nipro, and the exclusive remedy of
TheraSense, with respect to any product liability or other matter covered by
Section 11.2.1 or any alleged infringement of any trademarks, trade names or
service marks by the FreeStyle Products or any part thereof.

          11.3   Indemnification Procedure. A party that intends to claim
                 -------------------------
indemnification (the "Indemnitee") under this Article 11 shall promptly notify
the other party (the "Indemnitor") in writing of any claim, complaint, suit,
proceeding or cause of action with respect to which the Indemnitee intends to
claim such indemnification (for purposes of this Section 11.3, each a "Claim"),
and the Indemnitor shall have sole control of the defense and/or settlement
thereof; provided that the Indemnitee shall have the right to participate, at
its own expense, with counsel of its own choosing in the defense and/or
settlement of such Claim. The indemnification obligations of the parties under
this Article 11 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 or delayed unreasonably. The failure to deliver written
notice to the Indemnitor within a reasonable time after the commencement of any
such Claim shall relieve the Indemnitor of its liability to the Indemnitee under
this Article 11, only to the extent that the failure is prejudicial to its
ability to defend such action, but the omission so to deliver written notice to
the Indemnitor shall not relieve the Indemnitor of any liability to any
Indemnitee otherwise than under this Article 11. The Indemnitee under this
Article 11, and its employees, at the Indemnitor's request and expense, shall
provide full information and reasonable assistance to Indemnitor and its legal
representatives with respect to such Claims covered by this indemnification. It
is understood that only Nipro may claim indemnity under this Article 11 (on its
own behalf or on behalf of an Nipro Indemnitee), and other Nipro Indemnitees may
not directly claim indemnity hereunder. Likewise, it is understood that only
TheraSense may claim indemnity under this Article 11 (on its own behalf or on

                                      -33-
<PAGE>

behalf of a TheraSense Indemnitee), and other TheraSense Indemnitees may not
directly claim indemnity hereunder.

         11.4   Insurance. During the term of this Agreement, each party shall
                ---------
maintain liability insurance policies, including without limitation, product
liability insurance coverage, in commercially adequate amounts. TheraSense's
policy shall name Nipro as an additional insured and contain an endorsement to
provide Nipro with at least thirty (30) days prior written notice of any
cancellation or nonrenewal of such policy. Each party shall furnish to the other
party copies of such policies.

         11.5   LIMITED LIABILITY.
                -----------------

                11.5.1  EXCEPTING THE PROVISIONS OF SECTION 12.6.2, THERASENSE'S
LIABILITY ARISING OUT OF THIS AGREEMENT, THE TERMINATION THEREOF, AND/OR SALE OF
THE FREESTYLE PRODUCTS SHALL BE LIMITED TO ***.

                11.5.2  IN NO EVENT SHALL THERASENSE OR NIPRO BE LIABLE TO THE
OTHER OR ANY OTHER ENTITY FOR LOST PROFITS, OR ANY OTHER SPECIAL, CONSEQUENTIAL,
OR INCIDENTAL DAMAGES, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY ARISING OUT
OF THIS AGREEMENT, OR ANY TERMINATION THEREOF, WHETHER BASED IN CONTRACT, TORT
(INCLUDING NEGLIGENCE), OR OTHERWISE. THESE LIMITATIONS SHALL APPLY WHETHER OR
NOT THERASENSE OR NIPRO HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND
NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY PROVIDED
HEREIN OR IN THE WARRANTY FOUND IN THE FREESTYLE PRODUCTS.

                                      -34-

*** Confidential treatment requested
<PAGE>

12.  TERM AND TERMINATION

     12.1   Initial Term.
            ------------

            12.1.1 Initial Term. The initial term of this Agreement shall
                   ------------
commence on the Effective Date and shall continue in force until five (5) years
from the Effective Date, unless terminated earlier under the provisions of this
Article 12 (the "Initial Term").

            12.1.2 Extended Term. Beginning in fourth (4th) year of this
                   -------------
Agreement, and each year thereafter, the term of this Agreement may be extended
by up to an additional three (3) years (each an "Extended Term") as follows:

                   (a)   At any time during the last three (3) months of the
fourth (4th) year, either party may notify the other party that it would like to
extend the term by an additional rolling three (3) years (i.e. to add years 6,
7, and 8 to the initial five (5) years). The parties shall then meet and agree
to the Annual Minimum Purchase Obligation of Strips that shall apply for each
additional year. If the parties so agree, this Agreement shall be so extended.

                   (b)   Provided that the parties agreed to extend this
Agreement at the end of the fourth (4th) year and this Agreement is then still
in effect, during the last three (3) months of any subsequent year, the parties
may meet to extend the term by an additional rolling three (3) years (e.g., in
the last three (3) months of the fifth (5th) year, the parties may agree to add
years 7, 8 and 9, and so forth). During any Extended Term, all the terms of this
Agreement shall apply, including without limitation Section 8.5.

                   (c)   Notwithstanding anything to the contrary, neither party
is obligated to agree on a new Annual Minimum Purchase Obligation of Strips;
provided, however, that if the parties are unable to agree on such new Annual
Minimum Purchase Obligation for the extension years prior to

                                      -35-
<PAGE>

the end of the three (3) month period, TheraSense shall be free to enter into a
distribution agreement with any third party following termination of this
agreement ***.

          12.2   Termination for Cause. If either party defaults in the
                 ---------------------
performance of any provision of this Agreement, then the non-defaulting party
may give written notice to the defaulting party that if the default is not cured
*** the Agreement will be terminated. If the non-defaulting party gives such
notice and the default is not cured during the *** period, then the Agreement
shall automatically terminate at the end of that period. In addition, this
Agreement shall automatically terminate if Nipro fails to pay TheraSense in
accordance with Sections 3.1 or 3.2 and such failure shall have continued ***
after written notice thereof was provided to Nipro by TheraSense.

          12.3   Termination for Insolvency. This Agreement may be terminated by
                 --------------------------
either party effective immediately upon written notice (i) upon the institution
by or against the other party of insolvency, receivership or bankruptcy
proceedings or any other proceedings for the settlement of the other party's
debts under United States, California or Japan law, (ii) upon the other party's
making an assignment for the benefit of creditors, or (iii) upon the other
party's dissolution or ceasing to do business.

          12.4   Termination Relating to ***.
                 ---------------------------

                 12.4.1 ***. TheraSense may, at its sole discretion, terminate
                        ---
this Agreement *** if Nipro ***, without TheraSense's prior written
consent.

                                      -36-

*** Confidential treatment requested
<PAGE>

                 12.4.2  ***. Should Nipro decide to ***, it shall so notify
                         ---
TheraSense in writing ***. Nipro's obligation to provide such notice, shall
survive termination of this Agreement by TheraSense pursuant to Section 12.2 or
Section 12.4.1.

          12.5   Termination Relating to ***.
                 ---------------------------

                 12.5.1 In addition to any other rights or remedies available to
TheraSense, TheraSense shall have the right to terminate this Agreement *** if
Nipro *** unless Nipro cures such breach ***.

                 12.5.2 In the event either TheraSense or Nipro become aware
that any Nipro Affiliate ***, it shall notify the other party and Nipro shall
***.

                                      -37-

*** Confidential treatment requested
<PAGE>

          12.6   Effect of Termination.
                 ---------------------

                 12.6.1 Accrued Obligations. Expiration or 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 any rights and remedies it may have hereunder or at
law or in equity with respect to any breach of this Agreement. It is understood
and agreed that monetary damages may not be a sufficient remedy for any breach
of this Agreement and that the non-breaching party may be entitled to injunctive
relief as a remedy for any such breach. Such remedy shall not be deemed to be
the exclusive remedy for any such breach of this Agreement, but shall be in
addition to all other remedies available at law or in equity.

                 12.6.2 ***. If during the Initial Term, TheraSense terminates
                        ---
this Agreement pursuant to Section 9.3.2 or 11.1.2, or Nipro terminates this
Agreement pursuant to Section 12.2 due to TheraSense's material breach,
TheraSense shall ***.

                        ***

                        ***

                        ***

                 12.6.3 Approvals. Upon any termination or expiration of this
                        ---------
Agreement, Nipro shall (and shall ensure that its Affiliates and Subdistributors
shall): (i) assign to TheraSense all right, title and

                                      -38-

*** Confidential treatment requested

<PAGE>

interest to the Approvals (as defined in Section 8.1), and (ii) execute those
documents, as reasonably requested by TheraSense, necessary to document and/or
perfect the assignment of such registrations, approvals and government
authorizations. TheraSense shall have the exclusive right to use all such
registrations, licenses or permits upon expiration or termination of this
Agreement for any reason. In the event that the Approvals cannot be transferred
to TheraSense or its designated agent in time for the uninterrupted continuation
of sales of FreeStyle Product in the Territory, Nipro shall cooperate with
TheraSense to assure continued supply until such time as Approvals are
transferred so as to allow continued FreeStyle Product supply.

                 12.6.4 Inventory. Within twenty (20) days after the effective
                        ---------
date of termination of this Agreement, Nipro shall use its reasonable efforts to
provide TheraSense with a complete inventory of FreeStyle Products in Nipro's
possession, in transit to Nipro from TheraSense or otherwise in Nipro's control.
Upon any expiration or other termination of this Agreement, TheraSense may
inspect Nipro's FreeStyle Products inventory and audit Nipro's records.

                 12.6.5 Products. Upon termination of this Agreement, TheraSense
                        --------
shall have the option, at its sole discretion, to repurchase or have purchased
by its agent, all or part of Nipro or sub-distributor inventories of saleable
FreeStyle Product. In such case, TheraSense or its agent shall pay Nipro its
original landed cost for the Product so repurchased, or in the case of Nipro
packaged FreeStyle Product, the inventory value of such repurchased goods
according to Nipro's inventory accounting.

                 12.6.6 Return of Materials. All of TheraSense's trademarks,
                        -------------------
marks, trade names, patents, and copyrights, and all designs, drawings, formulas
or other data, photographs, samples, literature, and sales and promotional aids
of every kind related to the FreeStyle Products provided by TheraSense, shall
remain the property of TheraSense. Within thirty (30) days after the effective
date of termination of this Agreement, Nipro shall destroy all tangible items
bearing, containing, or contained in,

                                      -39-
<PAGE>

any of the foregoing, in its possession or control and provide written
certification of such destruction, or prepare such tangible items for shipment
to TheraSense, as TheraSense may direct, at TheraSense's expense. Nipro shall
not make or retain any copies of any confidential items or information which may
have been entrusted to it. Effective upon the termination of this Agreement,
Nipro shall cease to use all trademarks and trade names of TheraSense. During
the term of this Agreement and after any termination or expiration of this
Agreement, TheraSense shall have the right to continue to use and disclose for
any purpose any and all clinical trial results and other data relating to the
FreeStyle Products.

          12.6.7 Transition. Upon termination of this Agreement, Nipro shall use
                 ----------
commercially reasonable efforts to cooperate with TheraSense to effect a smooth
and orderly transition in the sale of FreeStyle Products in the Territory. After
the effective termination date, Nipro shall refer all FreeStyle Products
inquiries to TheraSense and shall provide commercially reasonable cooperation to
any newly-appointed distributors.

          12.6.8 No Renewal, Extension or Waiver. Acceptance of any order from,
                 -------------------------------
or sale of, any FreeStyle Products to Nipro after the date of termination of
this Agreement shall not be construed as a renewal or extension hereof, or as a
waiver of termination by TheraSense.

     12.7 Survival. The provisions of Sections 2.4, 2.6, 3.2.4, 3.3, 4.4.4, 5.6,
          --------
6.1, 7.2.2, 8.1.3, 8.3, 8.6, 8.9, 8.10, 8.12 (but only with respect to
Improvements reduced to practice prior to the effective date of termination),
12.4.2, 12.6, and 12.7 and Articles 10, 11 (but only to the extent such
indemnity claim arises from act or omissions that occurred prior to the
effective date of termination), 13 and 14 shall survive the expiration or
termination of this Agreement for any reason. All other rights and obligations
of the parties shall cease upon termination of this Agreement.

                                      -40-
<PAGE>

13.  DISPUTE RESOLUTION

     13.1 Chief Executive Officers. If a dispute, controversy or claim between
          ------------------------
the parties arising out of or relating to the validity, construction,
enforceability or performance of this Agreement, including disputes relating to
alleged breach or to termination of this Agreement (each, a "Dispute"), either
Nipro or TheraSense may, by written notice to the other, have such dispute
referred to the General Manager of Nipro, or his designee, and to the Vice
President of International Business Development of TheraSense, or his designee
for resolution. If, within thirty (30) days of such written notification of a
Dispute, no resolution is agreed between the parties, the dispute will be
presented to the Chief Executive Officer of Nipro, and the President of
TheraSense for resolution. If, within sixty (60) days of written notification of
a Dispute, no resolution is agreed, then either party may notify the other party
that it invokes resolution of the dispute by binding arbitration in the manner
described in Section 13.2 ("ADR").

     13.2 Arbitration.
          -----------

          13.2.1 Any Dispute that cannot be settled amicably by agreement of the
parties pursuant to Section 13.1 above shall be finally settled by binding
arbitration in the manner described in this Section 13.2. The ADR shall be
conducted pursuant to then obtaining Rules of Arbitration of the London Court of
International Arbitration, by which each party hereto agrees to be bound.
Notwithstanding those rules, the ADR shall be held in London, England by a
single arbitrator, provided that at the request of any party, the arbitration
shall be conducted by a panel of three (3) arbitrators, with one (1) arbitrator
chosen by each of TheraSense and Nipro and the third appointed by the other two
(2) arbitrators. The parties shall use their best efforts to select the
arbitrator(s) within ninety (90) days of the initiation of ADR. It is understood
and agreed that the filing by a party of an action that is subject to this
Section 13.2, whether in court or in arbitration, shall constitute an
"initiation" of ADR. Each party agrees that any such action filed in court shall
be stayed pending the outcome of the related ADR. The

                                      -41-
<PAGE>

arbitrator(s) selected in accordance with this Section 13.2 are referred to
herein as the "Panel" and shall be comprised of independent experts with
experience in the field of the dispute.

          13.2.2 All ADR proceedings, including without limitation the filing of
any documents, papers, and/or motions relating thereto, shall be made in the
English language. In the event of any dispute concerning the construction or
meaning of such documents, papers and/or motions, reference shall be made only
to such documents, papers and/or motions as written in English and not to any
translation into any other language.

          13.2.3 The decision and/or award rendered by the Panel shall be
written (specifically stating the Panel's findings of facts as well as the
reasons upon which the Panel's decision is based), final and nonappealable
(except for an alleged act of corruption or fraud on the part of the Panel) and
may be entered in any court of competent jurisdiction. The parties agree that,
any provision of applicable law notwithstanding, they will not request, and the
Panel shall have no authority to award, punitive or exemplary damages against
any party. The Panel shall have the authority to grant injunctive relief and
order specific performance. The Panel shall determine what discovery will be
permitted, consistent with the goal of limiting the cost and time which the
parties must expend for discovery; provided the Panel shall permit such
discovery as they deem necessary to permit an equitable resolution of the
dispute. Evidence need not be obtained in the presence of the Panel. At the
arbitration hearing, each party may make written and oral presentations to the
Panel, present testimony and written evidence, and examine witnesses. The costs
of any arbitration, including administrative fees and fees of the Panel, shall
be shared equally by the parties. Each party shall bear the cost of its own
attorneys' fees and expert fees. The parties and the Panel shall use their best
efforts to complete any such arbitration within one (1) year after the
appointment of the Panel, unless a party can demonstrate to the Panel that the
complexity of the issues or other reasons warrant the extension of the time
table. In such case, the Panel may extend such time table as reasonably
required. The Panel shall, in rendering its decision, apply the substantive law
of

                                      -42-
<PAGE>

the State of Delaware, without regard to its conflict of laws provisions, except
that the interpretation of and enforcement of this Section 13.2 shall be
governed by the Rules of Arbitration of the International Chamber of Commerce.
No party shall initiate arbitration hereunder unless it has attempted to resolve
the dispute in accordance with Section 13.1.

          13.2.4 Injunctive Relief. This Section 13.2 shall not be construed to
                 -----------------
prohibit either party from seeking preliminary or permanent injunctive relief,
restraining order or degree of specific performance in any court of competent
jurisdiction to the extent not prohibited by this Agreement. For avoidance of
doubt, any such equitable remedies provided under this Section 13.2 shall be
cumulative and not exclusive and are in addition to any other remedies, which
either party may have under this Agreement or applicable law.

14.  MISCELLANEOUS

     14.1 Governing Law. This Agreement, and any proceeding subject to Article
          -------------
13, shall be governed by and construed in accordance with the laws of the State
of Delaware, without reference to principles of conflicts of laws.

     14.2 Independent Contractors. The relationship of the parties hereto is
          -----------------------
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the other for any purpose as a result of this
Agreement or the transactions contemplated thereby.

     14.3 U.S. Export Control. Nipro certifies that unless prior written
          -------------------
authorization is obtained from the U.S. Bureau of Export Administration or the
U.S. Export Administration Regulations explicitly permit the re-export without
such authorization, it will not export, re-export, or transship, directly or
indirectly, the FreeStyle Products, documentation, technical assistance, or any
media in which any of the foregoing is contained, or other technology provided
hereunder or the direct product thereof, to any

                                      -43-
<PAGE>

country as to which the U.S. Government has placed an embargo against the
shipment of products, software or technology which embargo is in effect during
the term of this Agreement.

     14.4 Assignment. The parties agree that their rights and obligations under
          ----------
this Agreement shall not be delegated, transferred or assigned to a third party
without prior written consent of the other party hereto; provided either party
may assign this Agreement, without the other party's consent (a) to its
Affiliates, and (b) to an entity that acquires all or substantially all of the
business or assets of the assigning party to which this Agreement pertains,
whether by merger, reorganization, acquisition, sale or otherwise. This
Agreement shall be binding upon and inure to the benefit of the parties and
their successors and assigns.

                                      -44-
<PAGE>

     14.5 Notices. All notices required or permitted hereunder shall be given in
          -------
writing addressed to the respective parties as set forth below and shall either
be (i) personally delivered, (ii) sent by internationally-recognized private
express courier; or (iii) sent by facsimile, with a confirmation copy sent
within one (1) business day thereafter by internationally-recognized private
express courier. Notices shall be deemed to have been given on the date of
receipt if delivered personally, or two (2) days after deposit with an express
courier, or upon transmission if sent by facsimile with a confirmation copy sent
as provided herein. Either party may change its address for purposes hereof by
written notice to the other in accordance with the provisions of this Section.
The addresses for the parties are as follows:

     If to Nipro:            Nipro Corporation
                             3-9-3, Honjo-Nishi, Kita-ku
                             Osaka, Japan
                             Attention: CEO

     If to TheraSense:       TheraSense, Inc.
                             1360 South Loop Road
                             Alameda, CA 94502
                             USA
                             Attention: CEO

     14.6 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, fire, Act of God, earthquake, flood, lockout,
embargo, governmental acts or orders or restrictions, 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
such 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.

                                      -45-
<PAGE>

     14.7  Advice of Counsel. TheraSense and Nipro have each consulted counsel
           -----------------
of their choice regarding this Agreement, and each acknowledges and agrees that
this Agreement shall not be deemed to have been drafted by one party or another
and will be construed accordingly.

     14.8  Compliance with Laws. Each party shall furnish to the other party any
           --------------------
information requested or required by that party during the term of this
Agreement or any extensions hereof to enable that party to comply with the
requirements of any U.S. or foreign, state and/or government agency.

     14.9  Further Assurances. At any time or from time to time on and after the
           ------------------
date of this Agreement, Nipro shall at the request of TheraSense (i) deliver to
TheraSense such records, data or other documents consistent with the provisions
of this Agreement, (ii) execute, and deliver or cause to be delivered, all such
consents, documents or further instruments of transfer or license, and (iii)
take or cause to be taken all such actions, as TheraSense may reasonably deem
necessary or desirable in order for TheraSense to obtain the full benefits of
this Agreement and the transactions contemplated hereby.

     14.10 Severability; Waiver. In the event that any provisions of this
           --------------------
Agreement are determined to be invalid or unenforceable by a court of competent
jurisdiction, the remainder of the Agreement shall remain in full force and
effect without said provision. The parties shall in good faith negotiate a
substitute clause for any provision declared invalid or unenforceable, which
shall most nearly approximate the intent of the parties in entering this
Agreement. The failure of a party to enforce any provision of the Agreement
shall not be construed to be a waiver of the right of such party to thereafter
enforce that provision or any other provision or right.

     14.11 Entire Agreement; Modification. This Agreement sets forth the entire
           ----------------
agreement and understanding of the parties with respect to the subject matter
hereof, and supersedes all prior discussions, agreements and writings in
relating thereto. This Agreement may not be altered, amended or modified in any
way except by a writing signed by both parties.

                                      -46-
<PAGE>

     14.12 Counterparts. This Agreement may be executed in two counterparts,
           ------------
each of which shall be deemed an original and which together shall constitute
one instrument.

     IN WITNESS WHEREOF, Nipro and TheraSense have executed this Agreement by
their respective duly authorized representatives.

NIPRO CORPORATION                           THERASENSE, INC.

    /s/ Signature                                /s/ Signature
By:_______________________________          By:______________________________

Print Name:_______________________          Print Name:______________________

Title:____________________________          Title:___________________________

                                      -47-
<PAGE>

                                   EXHIBIT A

                              FREESTYLE PRODUCTS

As of the Effective Date, the FreeStyle Products include the following five (5)
products:

1.       "System Kit" shall mean one Meter and one Lancing Device for packaging
          ----------
         by Nipro into a FreeStyle starter kit.

2.       "Control Solution" shall mean a glucose solution for testing the
          ----------------
         operation of the FreeStyle Meter and Strips.

3.       "Lancing Device" shall mean a lancing device which is used to bring
          --------------
         blood to the surface of a patient's skin and which is physically
         separate from the Meter.

4.       "Meter" shall mean a meter whose sole function is to coulometrically
          -----
         measure blood glucose levels.

5.       "Strips" shall mean a package of strips which are loaded into the Meter
          ------
         *** (The Strips are currently offered in packages of 50 and 100; such
         quantities are subject to change).

*** Confidential treatment requested

<PAGE>

                                   EXHIBIT B

                                TRANSFER PRICE

                                Pricing Details

System Kit
----------

The bulk price for one Meter and one Lancing Device for packaging by Nipro into
               a FreeStyle starter kit shall be ***.

FreeStyle Test Strips Prices
----------------------------

The price of Strips (packaged in vials) is:

               Annual Sales Volume                          Price

               (number of Strips)                           Per Strip
               -----------------------------------------    -----------
               ***                                             ***
               ***                                             ***
               ***                                             ***
               ***                                             ***
               ***                                             ***
               ***                                             ***
               ***                                             ***

***

Control Solution
----------------

The price of a single vial of Control Solution is ***.

***  Confidential treatment requested
<PAGE>

                                   EXHIBIT C

                      ANNUAL MINIMUM PURCHASE OBLIGATION

           Calendar Year                       Minimum Purchase Obligation
           -----------------------------       --------------------------------
           ***                                        ***
           ***                                        ***
           ***                                        ***
           ***                                        ***
           ***                                        ***

           ***
           ***                                        ***
           ***                                        ***

***.

*** Confidential treatment requested
<PAGE>

                                   EXHIBIT D

                             THERASENSE TRADEMARKS

     THERASENSE  Japan Trademark Application No. 90261/1998   Int'l Class 10

     FREESTYLE   Japan Trademark Application No. 58692/2000   Int'l Class 10

     TheraSense agrees to provide Nipro with registration numbers as they become
available. TheraSense will use commercially reasonable efforts to register the
above marks in the Territory.

     TheraSense and Nipro agree that this list of trademarks is not exhaustive
and that trademarks may be added to this list from time to time by TheraSense.
In the event that TheraSense is precluded from using a selected trademark,
TheraSense and Nipro shall jointly select a new TheraSense trademark under which
the FreeStyle Products shall be marketed in the Territory. TheraSense shall
promptly apply to register the trademark in the Territory or secure rights as
necessary to use the trademark. Such trademark shall be added to this Exhibit D.<PAGE>

  [CONFIDENTIAL TREATMENT REQUESTED, CONFIDENTIAL PORTIONS OF THIS AGREEMENT
    HAVE BEEN REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE COMMISSION.]

                                                                   Exhibit 10.15

                      INTERNATIONAL DISTRIBUTOR AGREEMENT

     This INTERNATIONAL DISTRIBUTOR AGREEMENT (the "Agreement") is entered into
effective September 13, 2000 (the "Effective Date") by and between TheraSense,
Inc, a California corporation with a principal place of business at 1360 South
Loop Road, Alameda, California 94502, USA ("TheraSense") and Disetronic Handels
AG, a corporation organized under the laws of Switzerland, with a principal
place of business at Brunnmattstrasse 6, CH-3401 Burgdorf, Switzerland
("Disetronic").

                                  BACKGROUND
                                  ----------

     A.   TheraSense is the owner of the FreeStyle Products (as defined below)
useful in monitoring blood glucose levels and desires to engage a marketing and
distribution partner which can (i) assist it in obtaining regulatory approvals
to market the FreeStyle Product, and (ii) market and distribute the FreeStyle
Products.

     B.   Disetronic desires to purchase from TheraSense, and TheraSense desires
to sell to Disetronic, the FreeStyle Products for resale in the FreeStyle
Territory (as defined below); and

     C.   Disetronic desires to distribute and sell, through certain Affiliates
and/or Subdistributors, the FreeStyle Products to Customers (as defined below)
in the FreeStyle Territory; and

     NOW, THEREFORE, in consideration of the mutual promises contained herein,
the parties agree as follows:

1.   DEFINITIONS

     1.1  "Affiliate" shall mean any corporation or other entity which is
           ---------
directly or indirectly controlling, controlled by or under common control with
TheraSense or Disetronic. For the purpose of this Agreement, "control" shall
mean the direct or indirect ownership of fifty percent (50%) or more of the
outstanding shares or other voting rights of the subject entity to elect
directors, or if not meeting the preceding, any entity owned or controlled by or
owning or controlling at the maximum control or ownership right permitted in the
country where such entity exists.

     1.2  "Binding Forecasts" shall mean the amount of each FreeStyle Product
           -----------------
estimated in each***  appearing in each Forecast.

     1.3  "CGMS" shall mean a continuous glucose monitoring system.
           ----

     1.4  "Confidential Information" shall mean, subject to the provisions of
           ------------------------
Article 11 hereof, (i) any proprietary or confidential information or material
in tangible form disclosed hereunder that is marked as "Confidential" at the
time it is delivered to the receiving party, or (ii) proprietary or confidential
information disclosed orally hereunder which is identified as confidential or
proprietary when disclosed and such disclosure of confidential information is
confirmed in writing within thirty (30) days by the disclosing party.

     1.5  "Customers" shall mean end-user customers of Disetronic, its
           ---------
Affiliates or its Subdistributors within the European Territory, and Pump
Customers within the US Territory.

                                      -1-                 Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

     1.6  "Disetronic Trademarks" shall mean any trademarks of Disetronic and/or
           ---------------------
its Affiliates, including without limitation, any trade names and service marks
of Disetronic and/or its Affiliates.

     1.7  "Dispute" shall mean any dispute, controversy or claim between
           -------
TheraSense and Disetronic arising out of or relating to the validity,
construction, enforceability or performance of this Agreement, including
disputes relating to alleged breach or to termination of this Agreement

     1.8  "FDA" shall mean the U.S. Food and Drug Administration.
           ---

     1.9  "Field of Use" shall mean single use, disposable, in vitro glucose
           ------------
monitoring strips utilizing a sample volume ***. It is understood that Field of
Use does not include Strips intended for use with a continuous glucose
monitoring system.

     1.10 "Forecasts" shall mean a written forecast of the number of units of
           ---------
FreeStyle Products that Disetronic expects to purchase *** the number of units
of each Freestyle Product identified by its stock keeping unit ("SKU") and its
number associated with such product for inventory purposes.

     1.11 "FreeStyle Product(s)" shall mean those products listed in Exhibit A
           --------------------
attached hereto. TheraSense shall notify Disetronic as soon as reasonably
feasible of any intended material change, discontinuation or addition to the
Products listed on Exhibit A.

                    (i) The features, function and appearance of the FreeStyle
Products listed in Exhibit A may be materially technically improved by
TheraSense with *** prior written notice to Disetronic so long as the improved
products meet or exceed the Product Specifications. TheraSense may make non-
material changes in the FreeStyle products, such as changing components, without
written notice to Disetronic.

                    (ii)   The Freestyle Products listed in Exhibit A may be
discontinued by TheraSense only with Disetronic's prior written consent, such
consent not to be unreasonably withheld. If the parties agree to discontinue a
FreeStyle Product listed on Exhibit A, and TheraSense does not replace such
FreeStyle Product with a product that meets or exceeds the Product
Specifications, then TheraSense and Disetronic shall engage in good faith
discussions regarding an amendment to this Agreement, such amendment potentially
including changes to the Minimum Purchase Obligations in Exhibit C or
termination of the Agreement.

                    (iii)  Additional products may be added by TheraSense to the
FreeStyle Products listed in Exhibit A only with Disetronic's prior written
consent, such consent not to be unreasonably withheld.

     1.12 "FreeStyle Territory" shall mean, as of the Effective Date, the
           -------------------
European Territory and the U.S. Territory.

          1.12.1 "European Territory" shall mean Switzerland, Germany, Austria,
                  ------------------
The Netherlands, Denmark, Sweden, Norway, and Finland.

          1.12.2 "U.S. Territory" shall mean the United States, Canada and
                  --------------
Mexico.

                                      -2-                 Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

     1.13  "Minimum Purchase Obligations" shall mean the amount of Strips listed
            ----------------------------
on Exhibit C.

     1.14  "National Registration(s)" shall mean national registration(s) for
            ------------------------
the FreeStyle Products, on a country-by-country basis, for countries selected by
Disetronic within the European Territory.

     1.15  "Net Revenues" shall mean the net sales derived by Disetronic from
            ------------
the sale of the FreeStyle Products in the European Territory, less the following
amounts incurred in the sale of such FreeStyle Products: (i) trade, standard, or
quantity discounts given; (ii) any rebates and retroactive price reductions
given; (iii) the cost of any packaging, shipping and handling, (iv) any sales,
use, and/or other excise taxes or duties actually paid, including without
limitation VAT, (v) any amounts actually allowed or credited due to product
rejections or returns, and (vi) any write-offs or allowances for bad debt.

     1.16  "Other Distributor" shall mean a third party with whom TheraSense has
            -----------------
entered into a written agreement granting such third party the right to
distribute one or more FreeStyle Products in any country within the European
Union (such agreement to not include distribution rights in any country within
the European Territory, other than passive sales rights as required by European
Union laws and regulations).

     1.17  "Other Distribution Agreement" shall mean a written agreement between
            ----------------------------
TheraSense and an Other Distributor granting the Other Distributor the right to
distribute one or more FreeStyle Products in any country within the European
Union (such countries to not include any country within the European Territory).

     1.18  "Package" shall mean the System Kit package or the Strip package, as
            -------
applicable.

     1.19  "Payment" shall mean*** termination of this Agreement.
            -------

     1.20  "Product Specifications" shall mean the specifications set forth in
            ----------------------
Exhibit E.

     1.21  "Promotional Materials and Programs" shall mean any and all
            ----------------------------------
promotional, advertising and educational materials and programs, package data
sheets, and other literature relating to the FreeStyle Products.

     1.22  "Pump Customers" shall mean Disetronic's end user customers to whom
            --------------
Disetronic, its Affiliates or Subdistributors have sold or otherwise transferred
a Disetronic insulin pump, an infusion set, an insulin pen system, insulin pen-
needles or infusion port systems.

     1.23  "Receiving Party" shall mean the recipient of a shipment of FreeStyle
            ---------------
Product sent directly from TheraSense. The Receiving Party shall be Disetronic,
an Affiliate or a Subdistributor.

     1.24  "Sales and Inventory Records" shall mean a point-of-sale and
            ---------------------------
inventory record showing, at a minimum, date sold, quantity, price, serial
number, shipment information, and the buyers' names and addresses of each of the
FreeStyle Products sold, as well as the quarter-end inventory position on hand
for each of the FreeStyle Products.

                                      -3-                 Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

     1.25  "Shipping Location" shall mean TheraSense's facility currently
            -----------------
located at the address listed for TheraSense in Section 15.4 of this Agreement
or such other location as TheraSense may designate.

     1.26  "Subdistributor" shall mean a third party whom Disetronic has granted
            --------------
the right to distribute the FreeStyle Products under Section 2.2 hereto. Unless
expressly provided otherwise herein, such Subdistributors shall include
wholesalers and retailers.

     1.27  "Subdistributor Agreement" shall mean a written agreement between
            ------------------------
Disetronic and a Subdistributor binding the Subdistributor to terms and
conditions substantially similar to those terms and conditions agreed upon by
Disetronic in this Agreement

     1.28  "TheraSense Trademarks" shall mean the TheraSense trademarks, marks,
            ---------------------
logos and trade names listed on Exhibit D hereto, as modified by TheraSense
pursuant to Article 10.

     1.29  "Transfer Price" shall mean the transfer prices set forth in Exhibit
            --------------
B. All prices are in U.S. Dollars.

2.   FREESTYLE APPOINTMENT AND AUTHORITY OF DISETRONIC

     2.1   Appointment and Authority.

           2.1.1  Exclusive Distributor. Subject to the terms and conditions
                  ---------------------
herein, TheraSense hereby appoints Disetronic as TheraSense's exclusive
distributor for the FreeStyle Products in the European Territory in the Field of
Use, and Disetronic hereby accepts such appointment.

           2.1.2  Non-Exclusive Distributor. Subject to the terms and conditions
                  -------------------------
herein, TheraSense hereby appoints Disetronic as TheraSense's non-exclusive
distributor for the FreeStyle Products to Disetronic's Pump Customers in the
U.S. Territory in the Field of Use, and Disetronic hereby accepts such
appointment.

           2.1.3  Disetronic's sole authority shall be to purchase FreeStyle
Products from TheraSense and to promote, market and resell such FreeStyle
Products for delivery to Customers in the FreeStyle Territory in the Field of
Use in accordance with the terms of this Agreement. Disetronic may promote,
market and resell such FreeStyle products in the European Territory for delivery
to Customers in the Field of Use directly and through Subdistributors.
Disetronic may promote, market and resell such FreeStyle products in the U.S.
Territory for delivery to Customers in the Field of Use directly and through
Subdistributors, but not through wholesalers and retailers.

           2.1.4  Notwithstanding the rights granted to Disetronic to distribute
the FreeStyle Products hereunder, Disetronic shall have no right to directly:

                  (a)  solicit sales or sell the FreeStyle Products to end users
in the U.S. Territory other than to Pump Customers;

                  (b)  advertise, solicit sales, promote market or sell
TheraSense products, other than the FreeStyle Products in the Field of Use, in
the FreeStyle Territory;

                                      -4-                 Initials: ____ ____
<PAGE>

                (c)  solicit orders from persons or entities located outside the
FreeStyle Territory for Freestyle Products or other TheraSense products;

                (d)  sell in the U.S. Territory FreeStyle Products that were
purchased for the European Territory.

It is understood and agreed by Disetronic that failure to comply with the terms
of this Section 2.1.4 shall be deemed a material breach of this Agreement
subject to the provisions of Sections 13.2 and 13.5 herein.

          2.1.5  It is understood and agreed that Disetronic may appoint one
or more of its Affiliates to perform any of its obligations under this
Agreement, except as provided in Sections 3.2 and 7.4, provided such Affiliate
enters into a Subdistributor Agreement as set forth in Section 2.2. below.

     2.2  Subdistributors. Subject to the provisions of Section 2.1.3 and this
          ---------------
Section 2.2, Disetronic may appoint one or more third parties within any portion
of the FreeStyle Territory to distribute the FreeStyle Products in the Field of
Use to Customers. *** the appointment of such Subdistributor, Disetronic shall
notify TheraSense of the identity of such Subdistributor. Except for the case
where a Subdistributor is a wholesaler or retailer (provided, such exception
shall not apply where such wholesaler or retailer is a Disetronic Affiliate),
Disetronic shall not sell or otherwise transfer the FreeStyle Products to any
Subdistributor until such Subdistributor enters into a Subdistributor Agreement.
Notwithstanding the preceding ***. Disetronic shall only grant Subdistributors
the right to make sales of the FreeStyle Products to Customers in the FreeStyle
Territory in the Field of Use. Disetronic hereby guarantees the performance of
each Subdistributor with the provisions set forth in this Section 2.2. When
Disetronic receives a purchase order from a wholesaler or retailer, Disetronic
shall include in its acknowledgement of such purchase order a statement that the
FreeStyle Products are not to be repackaged, relabeled, or reshipped outside of
the European Territory . In the event Disetronic becomes aware, or has reason to
believe, that a Subdistributor (including a wholesaler or retailer) is
relabeling, repackaging or reshipping product outside of the European Territory
(except reshipping to any country within the European Union as part of a passive
sale), Disetronic shall promptly notify TheraSense and shall take corrective
action to halt such impermissible practice, including without limitation
terminating such retailer's right to sell FreeStyle Products.

     2.3  Reservation of Rights. Except as expressly provided in this Agreement,
          ---------------------
no right, title, or interest is granted, whether express or implied, by
TheraSense to Disetronic. Nothing in this Agreement shall be deemed to grant to
Disetronic rights in any products or technology other than the FreeStyle
Products, nor shall any provision of this Agreement be deemed to restrict
TheraSense's right to exploit technology, know-how, patents, or any other
intellectual property rights relating to the FreeStyle Products in products
other than the FreeStyle Products. Subject to Section 3.5, TheraSense reserves
the right to appoint other authorized distributors or resellers of the FreeStyle
Products outside the European Territory and other authorized non-exclusive
distributors or resellers of the FreeStyle Products in the U.S. Territory.
TheraSense also reserves the right to appoint third parties to distribute the
FreeStyle Products inside the FreeStyle Territory in fields of use other than
the Field of Use; for example, TheraSense reserves the right to sell Strips,
either directly or through third parties, solely for use in calibrating a CGMS,
provided TheraSense will only market and sell or otherwise transfer such Strips
for use with such CGMS and in no event shall TheraSense sell and otherwise
transfer more than five (5)

                                      -5-                 Initials: ____ ____

***  CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

Strips per CGMS sensor sold or otherwise transferred. Disetronic and TheraSense
acknowledge that this Agreement does not prohibit passive sales of FreeStyle
Products by either party to Customers within the FreeStyle Territory. It is
further understood and agreed that TheraSense may distribute products, other
than the FreeStyle Product, in the European Territory, either directly or
indirectly, for any and all uses. TheraSense agrees that it will not by itself,
or through a third party, actively promote, market or solicit the sale of
FreeStyle Products in the Field of Use in the European Territory, unless
TheraSense acknowledges Disetronic as TheraSense's exclusive distributor in
conjunction with such promotion and/or marketing.

     2.4  Conflict of Interest. Disetronic shall pursue reasonable sales
          --------------------
policies and procedures to realize the maximum sales potential for the FreeStyle
Products in the FreeStyle Territory. Disetronic agrees that if Disetronic
Trademarks should appear on any in vitro disposable glucose monitoring product
or associated meter product in the FreeStyle Territory, this would constitute a
conflict of interest with respect to Disetronic's obligations to market and
promote the FreeStyle Product, and Disetronic warrants to TheraSense that no
Disetronic Trademarks currently appear on any glucose monitoring product. During
the term of this Agreement, Disetronic and its Affiliates shall not place any
Disetronic Trademarks on any in vitro disposable glucose monitoring product or
associated meter product, other than FreeStyle Products, within the FreeStyle
Territory. Notwithstanding the foregoing, Disetronic Trademarks may appear on
***. If TheraSense does not obtain the IVD-CE mark for the FreeStyle Product by
***, the parties shall discuss in good faith amending the terms of this Article
2 provided that TheraSense's failure to obtain such IVD-CE mark is not due to
Disetronic's failure to meet its obligations.

     2.5  Independent Contractors. The relationship of TheraSense and Disetronic
          -----------------------
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 and 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 venture or common undertaking, and (iii) allow either
party to create or assume any obligation on behalf of the other for any purpose
whatsoever.

3.   CONSIDERATION

     3.1  Signature Payments. In partial consideration of the rights granted
          ------------------
herein, ten (10) days after the Effective Date, Disetronic shall pay to
TheraSense a nonrefundable pre-payment for FreeStyle Product stock to be
ordered, of One Million Five Hundred Thousand U.S. Dollars (U.S. $1,500,000)
("Prepayment"). As Disetronic orders Freestyle Product stock under this
Agreement, the payments for such stock shall be credited against the Prepayment
until the Prepayment has been exhausted.

     3.2  Equity Investment. It is understood and agreed by the parties that
          -----------------
within ten (10) days of the Effective Date of this Agreement Disetronic Holding
AG, the parent Company of Disetronic, shall pay to TheraSense Two Million Five
Hundred Thousand U.S. dollars (U.S. $2,500,000) and (i) TheraSense shall enter
into, and deliver to Disetronic Holding AG, the convertible promissory note
attached hereto as Exhibit G; and (ii) Disetronic Holding AG and TheraSense
shall sign the note purchase agreement attached hereto as Exhibit F. Disetronic
hereby guarantees that Disetronic Holding AG will perform according to the terms
of such convertible promissory note and such note purchase agreement.

                                      -6-                 Initials: ____ ____

***  CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

     3.3  FreeStyle Product Prices.
          ------------------------

          3.3.1  FreeStyle Products. For each FreeStyle Product purchased from
                 ------------------
TheraSense, Disetronic shall pay to TheraSense an amount equal to the Transfer
Price. The difference between the Transfer Price and Disetronic's price to its
Customers shall be Disetronic's sole remuneration for distribution of the
FreeStyle Products. The Transfer Prices set forth in Exhibit B shall remain in
effect from the Effective Date until the first year anniversary of the Effective
Date. Thereafter, Disetronic and TheraSense agree to renegotiate in good faith
the Transfer Prices if inflation as measured by the U.S. producer price index
increases by more than *** during any one year period, which
renegotiated Transfer Prices shall reflect the intent of the parties as set
forth herein.

          3.3.2  Transfer Price Adjustments. By October 31 of each calendar
                 --------------------------
year Disetronic shall provide to TheraSense a non-binding written estimate of
its sales of FreeStyle Products for the upcoming calendar year. These estimates
shall be used to establish the Transfer Price for the upcoming year. In the
event that Strip (as defined in Exhibit A) purchases in the first six (6) months
of any calendar year for the European Territory are less than *** the level
required to achieve the Transfer Price established for that year in the European
Territory, then (i) TheraSense may raise the Transfer Price for additional
purchases by Disetronic of Strips in such calendar year to a level consistent
with purchases equal to twice the actual Strip quantities purchased in the first
half, and (ii) Disetronic shall immediately pay TheraSense the amount
corresponding to the underpayment accrued in the first half of the calendar
year. Within 30 (thirty) days after the end of each calendar year, Disetronic or
TheraSense shall pay to the other any amounts due relating to underpayments
accrued or overpayments made in such calendar year.

          3.3.3  Payment for FreeStyle Products. TheraSense shall submit an
                 ------------------------------
invoice to Disetronic upon each shipment of FreeStyle Products ordered by
Disetronic and as set forth below in Section 4.5. The invoice shall cover the
Transfer Price for the FreeStyle Product in a given shipment plus any freight,
taxes or other costs incident to the purchase or shipment initially paid by
TheraSense but to be borne by Disetronic. The invoiced amounts for FreeStyle
Products shipped shall be due in full net thirty (30) days upon the later of
receipt by Disetronic of the FreeStyle Products or the invoice. For FreeStyle
Product repaired or replaced under Section 4.6, the invoiced amounts for such
FreeStyle Products shall be due in full net thirty (30) days upon receipt by
Disetronic of such repaired or replaced FreeStyle Products.

     3.4  Payment Method. Disetronic shall make payments to TheraSense under
          --------------
this Agreement in immediately available funds to a bank account designated by
TheraSense. All payments due hereunder shall be paid in U.S. dollars. Any
payments due hereunder which are not paid within five (5) days of the date such
payments are due shall be subject to a service charge of one per cent (1.0%) per
month, calculated on the number of days such payment is delinquent. This Section
3.4 shall in no way limit any other remedies available to TheraSense. Disetronic
shall pay all of TheraSense's costs and expenses (including reasonable
attorneys' fees) to enforce and preserve TheraSense's rights under this Section
3.4.

     3.5  Other Distributor Transfer Prices. In the event that TheraSense enters
          ---------------------------------
in to an Other Distribution Agreement with an Other Distributor, the transfer
price for such FreeStyle Products to such Other Distributor shall be as follows:

                                      -7-                 Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

               (a) in the event that the Strips to be distributed by an Other
Distributor are *** distributed by Disetronic in the European Territory, the
prices in the volume-based transfer price schedule for such Strips to such Other
Distributor shall be ***; or

               (b)  in the event that the Strips to be distributed by an Other
Distributor are *** distributed by Disetronic in the European Territory, the
transfer price for such Strips to such Other Distributor shall be ***.

     3.6  Taxes.
          -----

               (a)  Any and all amounts payable hereunder by Disetronic do not
include any government taxes (including without limitation sales, use, excise,
withholding, and value-added taxes) or duties imposed by any governmental agency
that are applicable to the export, import, or purchase of the FreeStyle Products
(other than taxes on the net income of TheraSense), and Disetronic shall bear
all such government taxes and duties (including, without limitation, sales,
withholding, value-added and similar taxes). When TheraSense has the legal
obligation to collect and/or pay such taxes, the appropriate amount shall be
added to Disetronic's invoice and paid by Disetronic, unless Disetronic provides
TheraSense with a valid tax exemption certificate authorized by the appropriate
taxing authority.

               (b)  All payments by Disetronic specified hereunder (including
those under this Article 3) are expressed as net amounts and shall be made free
and clear of, and without reduction for, any withholding taxes. Any such taxes
which are otherwise imposed on payments to TheraSense or Disetronic shall be the
sole responsibility of Disetronic.

4.   TERMS OF PURCHASE OF FREESTYLE PRODUCTS BY DISETRONIC

     4.1  Solicitation and Placement of Orders from Customers. Disetronic shall
          ---------------------------------------------------
be responsible for marketing and soliciting orders for FreeStyle Products from
Customers in the FreeStyle Territory.

     4.2  Terms and Conditions. All orders of FreeStyle Products by Disetronic
          --------------------
from TheraSense during the term of this Agreement shall be subject to the terms
of this Agreement. Nothing contained in any purchase order or the like document
submitted by Disetronic to TheraSense shall in any way modify or add to the
terms and conditions in this Agreement.

     4.3  Forecasts. Beginning on the Effective Date and thereafter ***,
          ---------
Disetronic shall provide to TheraSense a Forecast.

     4.4  Order and Acceptance.
          --------------------

          4.4.1  Disetronic shall submit orders for units of FreeStyle Products
so that such orders are received by TheraSense at least *** prior to the
requested shipment date of such units of FreeStyle Products. Disetronic shall be
obligated to purchase *** the Binding Forecasts. TheraSense is obligated to
accept Disetronic's purchase orders within five (5) working days after receipt
thereof provided that the quantities of FreeStyle Products ordered by Disetronic
in a calendar quarter are *** the full amount requested

                                      -8-                 Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

by Disetronic in the Binding Forecasts for such calendar quarter ("Accepted
Quantity") and such order is received by TheraSense at least *** prior to the
requested shipment date. Subject to the foregoing, no order for quantities
greater than a given Accepted Quantity shall be binding upon TheraSense unless
and until accepted by TheraSense in writing, and TheraSense shall have no
liability to Disetronic with respect to purchase orders that are not accepted.

     For example: if Disetronic delivers a Forecast on April 1, 2001, requesting
1000 units of Freestyle Product with SKU Number XYZ for the calendar quarter
beginning July 1, 2001, then Disetronic shall be obligated to purchase *** such
FreeStyle Product with SKU Number XYZ in the calendar quarter beginning July 1,
2001; and, TheraSense shall accept Disetronic's purchase order in such calendar
quarter, provided that TheraSense received the purchase order *** in advance of
the requested shipment date, and further provided that the quantity of such
FreeStyle Products with SKU Number XYZ ordered by Disetronic for the calendar
quarter beginning July 1, 2001 is not greater than ***.

          4.4.2 Once accepted by TheraSense, Disetronic may cancel or reschedule
purchase orders for FreeStyle Products only with TheraSense's prior written
approval. Disetronic will use commercially reasonable efforts to place orders
for FreeStyle Products in an even and regular fashion so as to allow for
efficient scheduling of FreeStyle Product production and warehousing. In the
event TheraSense receives a purchase order less than *** in advance of the
requested shipment date or for a quantity that is *** above the Binding
Forecasts, TheraSense will use commercially reasonable efforts to ship such
FreeStyle Products to Disetronic on the date and in the quantity requested by
Disetronic.

          4.4.3 TheraSense shall promptly inform Disetronic when it expects a
shipment of an Accepted Quantity to Disetronic to be delayed. In the event that
TheraSense fails to have available for shipment to Disetronic substantially all
quantities of FreeStyle Products specified in an Accepted Quantity *** after the
requested shipment date specified in such Accepted Quantity, TheraSense agrees
to credit to Disetronic *** of the ordered but undelivered FreeStyle Products in
such Accepted Quantity.

     4.5  Shipping. For all shipments of FreeStyle Products to Disetronic,
          --------
TheraSense may choose the mode of shipment and carrier unless Disetronic
specifies a carrier in the purchase order. All FreeStyle Products delivered
pursuant to the terms of this Agreement shall be suitably packed in TheraSense's
standard shipping cartons, and marked for shipment at the address of Disetronic,
its Affiliate, or its Subdistributor, as applicable, as provided in Disetronic's
purchase order, for delivery within ten (10) days (excluding weekends) to
Disetronic, its Affiliate, or its Subdistributor, as applicable, EXW (Incoterms
2000) the Shipping Location, at which time risk of loss shall pass to
Disetronic. TheraSense shall promptly notify Disetronic of any changes to the
Shipping Location. All customs, freight, insurance, and other shipping expenses,
as well as any special packing expense, shall be paid by Disetronic.

     4.6  Acceptance of FreeStyle Products. FreeStyle Product shipped by
          --------------------------------
TheraSense to Disetronic shall conform with the Product Specifications. Upon
receipt of a FreeStyle Product shipment, the Receiving Party shall have the
right to inspect such FreeStyle Products promptly upon receipt thereof for
conformance with the Product Performance Criteria and the Lot Acceptance
Criteria in set forth in Exhibit E. Any FreeStyle Products not rejected within
thirty (30) days will be deemed accepted. TheraSense will, at its election,
either repair or replace defective FreeStyle Products within thirty (30)

                                      -9-                 Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

days of receipt thereof. In the event Disetronic, its Affiliate or
Subdistributor rejects any FreeStyle Products, Disetronic shall be required to
demonstrate that such FreeStyle Product does not meet a specification set forth
in the Product Performance Criteria or the Lot Acceptance Criteria set forth in
Exhibit E.

     4.7  Product Packaging and Labeling.
          ------------------------------

          4.7.1 Product, Packaging and Labeling. TheraSense shall deliver each
                -------------------------------
FreeStyle Product to Disetronic, its Affiliate, or its Subdistributor, as
instructed by Disetronic in each in purchase order. Each FreeStyle Product shall
be delivered in a Package containing the FreeStyle Product together with a Strip
package insert and/or a System Kit owners booklet.

                (a) For FreeStyle Product sold to Disetronic for the European
Territory, the Package, System Kit owners booklet, Strip packages and Strip
package insert shall be labeled to indicate that the product is manufactured by
TheraSense and distributed by Disetronic, and shall carry both the TheraSense
and Disetronic Trademarks. With respect to the FreeStyle Product Meter, the
front will contain the TheraSense Trademarks and the trademark "Disetronic",
with TheraSense's Trademarks (combined, if more than one) in equal prominence to
"Disetronic". The back of the FreeStyle Product Meter shall be labeled to
indicate that the product is manufactured by TheraSense and distributed by
Disetronic, and shall indicate Disetronic's customer service telephone number.

                (b) For FreeStyle Product sold to Disetronic for the U.S.
Territory, the Package and the System Kit owners booklet shall carry both the
TheraSense and Disetronic Trademarks. With respect to the FreeStyle Product
Meter, the front will contain the TheraSense Trademarks and the name
"Disetronic", with T heraSense's Trademarks (combined, if more than one) in
equal prominence to the trademark "Disetronic". The back of the FreeStyle
Product Meter shall be labeled with TheraSense's name and shall indicate
TheraSense's customer service telephone number.

                (c) For the FreeStyle Territory, unless otherwise instructed by
TheraSense, Disetronic shall deliver all FreeStyle Products to its Customers
only as part of an unopened Package. Disetronic shall not repackage FreeStyle
Products supplied to Disetronic by TheraSense hereunder without the prior
written consent of TheraSense. In addition, except for the addition of
information required by applicable laws and regulations, Disetronic shall not
re-label FreeStyle Products supplied to Disetronic by TheraSense hereunder
without the prior written consent of TheraSense. Subject to Section 7.4,
TheraSense shall be responsible for ensuring that all FreeStyle Products are
packaged and labeled in accordance with the requirements set forth by the FDA or
comparable regulatory authorities for each country within the European
Territory.

                (d) Restriction of Rights. TheraSense agrees that TheraSense's
                    ---------------------
use of the Disetronic trademarks shall be in conformance with Disetronic
guidelines for its trademarks; provided, Disetronic has provided such guidelines
to TheraSense within a reasonable time prior to TheraSense marking the FreeStyle
Products with such Disetronic trademarks. In addition, TheraSense acknowledges
that except as expressly provided in this Agreement, Disetronic grants no other
rights, title, or interest with respect to Disetronic's trademarks.

          4.7.2 Proprietary Notices. Disetronic, its Affiliates and its
                -------------------
Subdistributors shall not remove, alter, cover or obfuscate any logo, trademark
notice or other proprietary rights notices placed or embedded by TheraSense on
or in any Package or any of the items contained therein.

                                 -10-                        Initials: ____ ____
<PAGE>

     4.7.3 Authorized Representative. To the extent permitted by law, labeling
           -------------------------
concerning the Authorized Representative shall be placed at the end of product
documentation, such as the owners booklet and Strip package insert, rather than
on the Meter or packaging.

5.   WARRANTY

     5.1   Warranty to Customer. Any warranty set forth in this Section 5.1
           --------------------
shall run directly from TheraSense to the Customer.

           5.1.1 Disetronic Obligations. Disetronic shall have responsibility
                 ----------------------
for handling Customer returns for allegedly non-conforming FreeStyle Products.
Disetronic shall make no warranties with respect to any of the FreeStyle
Products that exceed the warranty made by TheraSense to its customers. The
warranty made by TheraSense to its customers may be changed by TheraSense at its
sole discretion; as of the Effective Date, TheraSense warrants the Meters for
five years. *** Disetronic will forecast and order warranty Meters and Strips at
no charge. In the event TheraSense is unable to replace an allegedly faulty
product, TheraSense's sole and exclusive liability and Disetronic's exclusive
remedy shall be to credit Disetronic's account for the net amount actually paid
for any such FreeStyle Product. Disetronic shall dispose of returned FreeStyle
Product as instructed by TheraSense. In the event the parties should not agree
as to whether a certain Freestyle Product is faulty, then the parties shall
select an independent laboratory which shall test such Product for conformance
to the applicable Product Specification. The party whose position does not
prevail upon such laboratory testing shall pay the costs associated with such
testing.

           5.1.2 Limited Warranty by TheraSense. TheraSense warrants that upon
                 ------------------------------
delivery, EXW the Shipping Location, and during the warranty period for the
FreeStyle Products, as set forth on the product label and/or insert for such
FreeStyle Products, the FreeStyle Products (i) will meet the agreed upon Product
Specifications as set forth in Exhibit E, (ii) will be free from defects in
manufacturing, materials and workmanship, (iii) will be of merchantable quality
and fit for the purpose for which they are intended, and (iv) will comply with
all applicable laws for the U.S. and for each country within the European
Territory.

           5.1.3 Warranty Limitations. The warranties in Section 5.1.1 and 5.1.2
                 --------------------
shall not apply to FreeStyle Products that have been modified or altered in any
manner by anyone other than TheraSense, or to defects caused (i) through no
fault of TheraSense during shipment to or from Disetronic; (ii) by the use or
operation in an application or environment other than that intended or
recommended by TheraSense in the owners booklet provided by TheraSense to
Disetronic for translation; (iii) by service by anyone other than employees of,
or persons approved in writing by, TheraSense; (iv) by accident, negligence,
misuse, other than normal electrical stress, or other causes other than normal
use as described in the owners booklet provided by TheraSense to Disetronic for
translation; or (v) by storage, usage or handling in any manner inconsistent
with the FreeStyle Product label. Replacement FreeStyle Products supplied under
this warranty shall carry only the unexpired portion of the original warranty.
TheraSense shall not be liable for misbranding with respect to any product
labeling or package insert text provided or used by Disetronic, or any
translation thereof and TheraSense shall not be liable for any adulteration or
failure to meet the FreeStyle Product Specifications due to handling or
packaging of the FreeStyle Products by Disetronic, its Affiliates, its
Subdistributors or agents.

                                 -11-                        Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

          5.1.4 Exclusion of Other Customer Warranties. EXCEPT FOR THE LIMITED
                --------------------------------------
WARRANTY PROVIDED IN SECTION 5.1 ABOVE, THERASENSE GRANTS NO OTHER WARRANTIES OR
CONDITIONS, EXPRESS OR IMPLIED, BY STATUTE, IN ANY COMMUNICATION WITH DISETRONIC
OR ITS CUSTOMERS, OR OTHERWISE, REGARDING THE FREESTYLE PRODUCTS, AND THERASENSE
SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR
PURPOSE, MERCHANTABILITY, AND NONINFRINGEMENT. THERASENSE DOES NOT WARRANT THAT
OPERATION OF THE FREESTYLE PRODUCTS WILL BE UNINTERRUPTED OR ERROR-FREE.
THERASENSE NEITHER ASSUMES NOR AUTHORIZES ANY OTHER PERSON TO ASSUME ANY OTHER
LIABILITIES ARISING OUT OF OR IN CONNECTION WITH THE SALE OR USE OF ANY
FREESTYLE PRODUCT. ANY OTHER REPRESENTATIONS OR WARRANTIES MADE BY ANY PERSON OR
ENTITY, INCLUDING EMPLOYEES OR REPRESENTATIVES OF THERASENSE, THAT ARE
INCONSISTENT HEREWITH SHALL BE DISREGARDED AND SHALL NOT BE BINDING UPON
THERASENSE OR ITS THIRD PARTY SUPPLIERS.

          5.1.5 Limitation of Liability. THERASENSE'S LIABILITY UNDER THE
                -----------------------
WARRANTY SHALL BE LIMITED TO A REFUND OF THE CUSTOMER'S PURCHASE PRICE. IN NO
EVENT SHALL THERASENSE BE LIABLE TO DISET RONIC OR ANY THIRD PARTY FOR LOST
PROFITS, THE COST OF PROCUREMENT OF SUBSTITUTE GOODS BY THE CUSTOMER, OR FOR ANY
SPECIAL, CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES FOR BREACH OF WARRANTY.
THIS LIMITATION SHALL APPLY EVEN WHERE THERASENSE HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGE AND NOTWITHSTANDING THE FAILURE OF THE ESSENTIAL
PURPOSE OF ANY LIMITED REMEDY STATED HEREIN.

     5.2  Representations and Warranties by and between Disetronic and
          TheraSense.

          5.2.1 Warranty to TheraSense. Disetronic represents and warrants to
                ----------------------
TheraSense that: (i) it is a corporation duly organized validly existing and in
good standing under the laws of Switzerland; (ii) the execution, delivery and
performance of this Agreement have been duly authorized by all necessary
corporate action on the part of Disetronic.

          5.2.2 Warranty to Disetronic. TheraSense represents and warrants to
                ----------------------
Disetronic that: (i) it is a company duly organized validly existing and in good
standing under the laws of the State of California; (ii) the execution, delivery
and performance of this Agreement have been duly authorized by all necessary
corporate action on the part of TheraSense; (iii) to the best of its knowledge
it has the right to grant the rights and licenses granted herein; (iv) it has
obtained consent from Asulab for TheraSense and Disetronic to cobrand the
FreeStyle Products as set forth in this Agreement; (v) it will obtain and
maintain all facility licenses necessary to manufacture the FreeStyle Products;
and (vi) subject to Section 5.1.3 and 5.1.4, upon delivery, EXW the Shipping
Location, the Freestyle Products will (a) meet the agreed upon Product
Specifications as set forth in Exhibit E, (b) will be free from defects in
manufacturing, materials and workmanship, (c) will be of merchantable quality
and fit for the purpose for which they are intended, and (d) will comply with
all applicable laws for the U.S. and for each country within the European
Territory.

6.       ADVERTISING, MARKETING AND PROMOTION

                                 -12-                        Initials: ____ ____
<PAGE>

     6.1  Advertising and Promotions. Disetronic shall, at its own expense, (i)
          --------------------------
use commercially reasonable efforts to promote the sale and distribution of the
FreeStyle Products to Customers in the FreeStyle Territory, and (ii) use
commercially reasonable efforts to realize the maximum sales potential for the
FreeStyle Products to Customers in the FreeStyle Territory. Such commercially
reasonable efforts by Disetronic shall include without limitation the following:

          6.1.1 maintenance of an adequate and experienced sales force for such
purposes, such as Disetronic's existing insulin pump sales force, in the
respective countries in the Freestyle Territory;

          6.1.2 dedication of sufficient product and project management,
marketing and financial resources to pursue the market opportunities for the
product in the FreeStyle Territory;

          6.1.3 provide adequate contact with existing and potential Customers
within the European Territory and with Pump Customers within the U.S. Territory
on a regular basis, consistent with good business practice;

          6.1.4 assessment of Customers' requirements for Freestyle Products,
including modifications and improvements thereto, in terms of quality, design,
functional capability, and other features;

          6.1.5 the preparation of promotional materials in the primary
languages within the European Territory;

          6.1.6 the translation of all user and technical manuals into the
primary languages within the European Territory;

          6.1.7 advertising the FreeStyle Products in trade and other relevant
publications;

          6.1.8 participating in appropriate trade shows at which FreeStyle
Products are displayed by Disetronic; provided that if such trade shows are
outside of the FreeStyle Territory, Disetronic shall obtain prior written
approval from TheraSense, such approval not to be unreasonably withheld; and

          6.1.9 making sales calls on physicians within the FreeStyle
Territory.

     In addition to the foregoing, Disetronic shall (i) *** in the European
Territory, offer a System Kit (as defined in Exhibit A hereto) *** to Customers
in the European Territory (but in no event *** per System Kit); (ii) *** in the
U.S. Territory, offer a System Kit (as defined in Exhibit A hereto) *** (but in
no event ***) to Pump Customers in the U.S. Territory using offer materials
agreed to by TheraSense in writing; and (iii) use reasonable efforts, at its own
expense, to maintain a sufficient inventory of FreeStyle Products and to fulfill
forecast demand for FreeStyle Products within the FreeStyle Territory.

     6.2  Disetronic Materials. Disetronic shall provide to TheraSense for
          --------------------
purposes of review, comment and approval by TheraSense any and all Promotional
Materials and Programs at least *** prior to the commercial release of such
Promotional Materials and Programs; provided that

                                 -13-                        Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

once a particular Promotional Material and Program has been approved in writing
by TheraSense, no further approval from TheraSense shall be required for such
Promotional Material and Program, and Disetronic may make as many publications
of such particular approved Promotional Material and Program as Disetronic
elects. The parties agree and acknowledge that such review by TheraSense shall
be targeted at ensuring (i) TheraSense's ability to comply with any regulations
applicable to Promotional Materials, and (ii) that the Promotional Materials and
Programs correspond with TheraSense's marketing activities. Within *** after
receipt of any such proposed Promotional Materials and Programs from Disetronic,
TheraSense shall provide comment and/or notice of approval or non-approval to
Disetronic.

     6.3  TheraSense Collaboration. TheraSense will collaborate with Disetronic
          ------------------------
in the development of all Disetronic's marketing and promotional materials for
FreeStyle Product. TheraSense shall acknowledge Disetronic's exclusive
distributorship in all marketing and promotional materials prepared by
TheraSense for use in the European Territory in the Field of Use. All such
materials shall be submitted to Disetronic for its approval. In addition,
TheraSense will, at its own expense, provide Disetronic with:

          6.3.1 such marketing and technical assistance and promotional
materials (in English) as TheraSense may in its reasonable discretion consider
necessary to assist with the promotion of the FreeStyle Product;

          6.3.2 training in the U.S. for Disetronic's personnel in connection
with the marketing, sale, installation, maintenance and support of the FreeStyle
product; provided, however, that during the six (6) month period following the
Effective Date TheraSense's personnel spend *** providing such training;

          6.3.3 reasonable access to TheraSense maintenance and support
personnel to assist Disetronic's support personnel in providing maintenance and
support centers.

7.   ADDITIONAL OBLIGATIONS OF DISETRONIC

     7.1  Standard Sales Report. Disetronic and TheraSense shall mutually agree
          ---------------------
on a standard sales report to be provided to TheraSense on a monthly basis
during the term of the Agreement; provided that such standard sales report shall
consist only of aggregate data identifying by distributor, country and product,
the quantities of particular FreeStyle Products sold in such prior month. In no
event shall such standard sales report be required to disclose any information
which would cause or allow any particular individual to be personally
identifiable.

     7.2  Sales and Inventory Records. Disetronic agrees to maintain Sales and
          ---------------------------
Inventory Records. Such Sales and Inventory Records shall be kept at
Disetronic's principal place of business for at least three (3) years following
the end of the calendar quarter to which they pertain.

     7.3  Minimum Purchase Obligations
          ----------------------------

          7.3.1 Disetronic shall purchase no less than the Minimum Purchase
Obligations for sale in the European Territory in each calendar year; provided,
Disetronic's obligation to purchase such amounts shall not commence until the
earlier of (a) Disetronic obtaining National Registrations in ***. In the event
Disetronic does not obtain such

                                 -14-                        Initials: ____ ____

***  CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

National Registrations until *** Disetronic's Minimum Purchase Obligations for
year 2001 *** the Minimum Purchase Obligations shall be purchased in the first
six months of the calendar year.

          7.3.2 ***

          7.3.3 Disetronic and TheraSense agree that in the event that IVD-CE
mark for FreeStyle Products is not obtained by *** the time period for achieving
the Minimum Purchase Obligations set forth in Exhibit C for 2001 will be
extended by the number of days between June 30, 2001 and the date on which
TheraSense obtains the IVD-CE mark for FreeStyle Products, and that the dates
for meeting the Minimum Purchase Obligations set forth in Exhibit C for years
2002 - 2005 shall be extended accordingly. For example, in the event that
TheraSense obtains the IVD-CE mark ***.

          7.3.4 Without limiting the foregoing, within *** from the end of a
calendar year, TheraSense shall give Disetronic notice of any failure by
Disetronic to meet Minimum Purchase Obligations in such prior calendar year.
Subject to the foregoing, if Disetronic fails to meet the Minimum Purchase
Obligations ***, TheraSense shall have the right, at its option, to terminate
this Agreement for cause pursuant to Section 13.2 hereof.

     7.4  Registrations, Licenses and Permits.
          -----------------------------------

          7.4.1 National Registrations and IVD Registration. The parties agree
                -------------------------------------------
and understand that (i) in December 2003, the IVD (98/79/EC) will become
mandatory; (ii) until December 2003, National Registrations can be obtained and
used; and (iii) Products already in the distribution chain in December 2003 can
continue to be sold until December 2005.

                (a) Before CE-Marking according to IVD (98/79/EC).
                    ---------------------------------------------

                    (i)   Disetronic, shall use its best efforts to obtain
National Registrations in TheraSense's name (unless national regulations require
the Registration to be in Disetronic's name) by ***.  It is understood and
agreed by the parties that Disetronic's Affiliate, Disetronic Medical Systems
AG, and/or Disetronic shall be the exclusive entity or entities responsible for
obtaining such National Registrations; provided that if a National Registration
must by

                                 -15-                        Initials: ____ ____

***  CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

law be obtained by an entity other than Disetronic or Disetronic Medical Systems
AG, then (i) Disetronic shall guarantee and hereby guarantees the performance of
such other entity, and (ii) such other entity shall enter into a written
agreement, binding such other party to terms and conditions substantially
similar to the terms and conditions of this Agreement. If required by a
regulatory agency to accomplish National Registration in a particular country in
the European Territory, for each such country, TheraSense shall send to
Disetronic within fourteen (14) days after Disetronic's request, those FreeStyle
Products and copies of documents including but not limited to development files,
production files, study protocols and results that are necessary to obtain such
National Registration. It is understood and agreed by the parties that any such
FreeStyle Products, documents, files, protocols and/or results are Confidential
Information of TheraSense and subject to the terms of Article 11 herein. If and
as required from time to time under the laws of any country or other
jurisdiction within the European Territory, Disetronic, *** shall perform
clinical trials and obtain all additional registrations, licenses and permits
required to comply with the laws and regulations of each country in the European
Territory for importation, sale and distribution of the FreeStyle Product;
provided, however, that no activities in connection with obtaining such
registrations, licenses or permits shall be initiated by Disetronic without
TheraSense's prior written approval. Disetronic shall provide to TheraSense
complete copies of all clinical trial protocols, data, analyses and other
information, as well as applications, and all registrations, licenses and
permits obtained therefrom relating to the FreeStyle Products. To the extent
permitted by law, all registrations, approvals, and government authorizations
obtained by Disetronic in the European Territory with respect to the FreeStyle
Products shall be in the name of TheraSense.

                       (ii)  Upon (i) Disetronic obtaining a registration,
approval, license, permit or authorization in the European Territory, and/or
(ii) upon the expiration, cancellation, or termination of this Agreement, all
registrations, approvals, and government authorizations shall be transferred and
delivered to, and shall inure to the benefit of TheraSense or its designee, to
the extent that this is permissible under applicable law, at no cost to
TheraSense other than lawfully imposed transfer fees. Where any National
Registration, registration, license, permit, approval and/or government
authorization must by law be obtained in Disetronic, its Affiliate's, or
Subdistributor's name, Disetronic shall (and shall ensure that its Affiliates
and Subdistributors shall): (i) assign to TheraSense all right, title and
interest to such National Registration, registration, license, permit, approval
and/or government authorizations, and/or (ii) execute those documents, as
requested by TheraSense, necessary to document and/or perfect the assignment of
such National Registration, registration, license, approval and/or government
authorization. TheraSense shall have the exclusive right to use all such
National Registrations, registrations, licenses, permits, and/or governmental
authorizations if this Agreement is terminated for any reason other than
TheraSense's material breach of this Agreement.

                       (iii) TheraSense warrants that the FreeStyle Meters are,
at the time they are delivered to Disetronic, in Conformity with the provisions
of the EMC Directive (89/336/EEC) and shall establish a corresponding Conformity
declaration with the first shipment of such Meters.

                       (iv)  TheraSense shall sell and deliver to Disetronic
*** or as soon thereafter as reasonably possible approximately 100 FreeStyle
Meters calibrated to a whole blood reference, for use by Disetronic in obtaining
national registrations for the FreeStyle Products. Such Meters are not required
to carry the Disetronic trademark specified in Section 4.7.

                   (b) After CE-Marking according to IVD (98/79/EC).
                       --------------------------------------------

                                     -16-                   Initials _____ _____

*** CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                       (i)    TheraSense shall appoint an Authorized
Representative for FreeStyle Products.

                       (ii)   TheraSense shall be responsible for obtaining the
IVD-CE Mark for the applicable FreeStyle Products. TheraSense shall use
commercially reasonable efforts to obtain such CE mark by ***. At TheraSense's
request, Disetronic shall provide reasonable assistance to TheraSense in
obtaining the CE mark. Disetronic will be considered as TheraSense's exclusive
distributor of the FreeStyle Products in the Field of Use in the European
Territory.

                   (c) TNO Guidelines. TheraSense will use its commercially
                       --------------
reasonable efforts to meet TNO Guidelines as required and necessary, by ***
based on tests conducted by TheraSense or by a third party authorized in writing
by TheraSense to conduct the tests. If TheraSense is unable to meet the required
and necessary TNO Guidelines and is unable to obtain the IVD-CE mark by *** then
TheraSense and Disetronic shall engage in good faith discussions regarding an
amendment to the Minimum Purchase Obligations in Exhibit C.

                   (d) Registrations, Licenses and Permits in the US Territory.
                       -------------------------------------------------------
Disetronic will be considered as TheraSense's non-exclusive distributor of the
FreeStyle Products in the Field of Use in the U.S. Territory.

             7.4.2 EMC Conformity. The parties agree and understand that
                   --------------
FreeStyle Products must be in compliance with the EMC Directive (89/336/EEC) as
of the date FreeStyle Products are first shipped from TheraSense to Disetronic
for purposes of commercial sale under this Agreement.

         7.5 Health and Safety Laws and Regulations. Disetronic shall comply
             --------------------------------------
fully with any and all laws and regulations of the FreeStyle Territory
applicable to distributors, as such laws relate to the FreeStyle Products.
Notwithstanding the foregoing, for any country in which a national European
registration for Freestyle Products is in Disetronic's name, Disetronic shall
comply fully with any and all laws and regulations applicable to such registrant
in such country. In addition, until such time as TheraSense obtains a CE Mark
for FreeStyle Products, Disetronic shall monitor the appropriate information
sources closely for changes in such laws and regulations, and other requirements
in the European Territory relating to the distribution of the FreeStyle Products
in the European Territory, and shall use its best efforts to notify TheraSense
promptly in writing of any and all such changes.

         7.6 Feedback. Disetronic, its Affiliates and its Subdistributors shall
             --------
timely provide in writing to TheraSense feedback it receives from Customers in
the FreeStyle Territory relating to how the FreeStyle Products could be improved
to meet the needs of various market segments. TheraSense may, at its option, use
such feedback to implement changes in the Freestyle Products. If TheraSense
elects not to implement changes based on such feedback, TheraSense and
Disetronic agree to discuss in good faith the terms under which Disetronic may
be permitted to implement such changes to the FreeStyle Products. In the event
Disetronic conceives of or reduces to practice an invention relating to
FreeStyle Products and any Confidential Information disclosed by TheraSense to
Disetronic under this Agreement during the Term, inventorship and ownership of
such invention shall be determined ***. Where Disetronic is the sole owner of
such invention, ***. Subject to the foregoing, TheraSense shall own all right,
title and interest to

                                     -17-                    Initials: ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

***.

     7.7  Semi-Annual Business Plans. TheraSense and Disetronic shall meet, in
          --------------------------
person, no less frequently than once every six months to review Disetronic's
business plan for marketing and distributing the FreeStyle Products in the
FreeStyle Territory. Such business plan shall include, without limitation,
promotion strategy and tactics, and sales and other marketing plans. TheraSense
shall have the right to review and comment on such business plan.

     7.8  Quarterly Meetings. TheraSense and Disetronic shall meet, in
          ------------------
person, or by telephone, no less frequently than once every calendar quarter to
review and discuss, as necessary: (i) FreeStyle Products (including any changes,
discontinuations, and additions thereto); (ii) Forecasts of the FreeStyle
Products; (iii) Product Specifications (including any changes thereto); (iv)
FreeStyle Product warranties (including any changes thereof); (v) patent and
intellectual property rights relating to the feedback provided under Section 7.5
(vi) each party's trademarks, trade names and service marks relating to
FreeStyle Products, (vii) each party's promotional, marketing and advertising
materials relating to the FreeStyle Products in the FreeStyle Territory, and
(viii) changes in reimbursement policies and requirements in the European
Territory relating to the distribution of the FreeStyle Products that have come
to the attention of Disetronic.

     7.9  Customer Support. Disetronic shall maintain knowledgeable
          ----------------
sales, marketing, and support personnel to provide instructions to Customers in
the European Territory in the use of the FreeStyle Products. Upon Disetronic's
request, at agreed times, TheraSense shall provide a reasonable level of
assistance with technical information and training of Disetronic employees for
the FreeStyle Products. Any expenses related to such activities shall be borne
by Disetronic. Upon TheraSense's request and with Disetronic's consent,
TheraSense may provide direct support to Disetronic's Customers and Disetronic
will provide TheraSense with such Customers' names and information as TheraSense
may reasonably request in order for TheraSense to provide such support to such
Customers.

     7.10 Medical Device Reporting. Pursuant to governmental medical device
          ------------------------
reporting regulations (e.g. the FDA's Medical Device Reporting (MDR)
Regulations, the European Medical Device Vigilance Guidelines, and any other
applicable medical device reporting regulations), TheraSense is required to
report to the applicable agency information that reasonably suggests that a
FreeStyle Product may have caused or contributed to the death or serious injury
or has malfunctioned and that the device would be likely to cause or contribute
to a death or serious injury if the malfunction were to recur. Each of
TheraSense and Disetronic agree to supply to the other any such information
promptly after becoming aware of it so that each of TheraSense and Disetronic
can comply with governmental reporting requirements. It is understood and agreed
that reporting to TheraSense shall be within twenty-four (24) hours to enable
TheraSense to comply with FDA reporting requirements. Disetronic agrees to use
its best efforts to promptly retrieve and return to TheraSense any individual
FreeStyle Product which Disetronic has reported to TheraSense or a governmental
agency. In the event that TheraSense is required by any regulatory agency to
recall a FreeStyle Product, or if TheraSense or a regulatory authority initiates
a FreeStyle Product recall, Disetronic shall cooperate with and assist
TheraSense and its Authorized Representative in locating, and retrieving if
necessary, recalled FreeStyle Products from Customers. Recalls shall be at
Disetronic's cost and expense in the European Territory and at TheraSense's cost
and expense in the U.S. Territory. Notwithstanding the foregoing, in the event
that a recall is primarily due to a FreeStyle Product manufacturing defect then
TheraSense shall provide to Disetronic replacement FreeStyle Product at no
charge. Disetronic shall maintain records of sales of

                                     -18-                     Initials ____ ____

*** CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

FreeStyle Products by lot number and by end user to whom such product was sold
or otherwise transferred. Upon TheraSense's request, Disetronic shall provide
TheraSense with access to such records in the event of a FreeStyle Product
recall or other quality related issue. Disetronic shall be responsible for
obtaining all records of its sales to end users in the event of a FreeStyle
Product recall or other quality related issue. Disetronic shall make available
to TheraSense for inspection Disetronic's process and records for adverse event
and other regulatory reporting purposes at mutually agreed upon times and
further shall ensure that Disetronic's processes comply with all applicable laws
and regulations in the FreeStyle Territory.

     7.11  Product Complaints. Disetronic shall promptly investigate and monitor
           ------------------
all Customer and/or regulatory complaints and/or correspondence concerning the
use of the FreeStyle Products in the FreeStyle Territory. Disetronic shall
advise TheraSense of all complaints alleging patient injury within twenty four
(24) hours, and of all other complaints relating to the FreeStyle Products as
promptly as possible but not more than five (5) business day following the date
Disetronic receives such complaint. In addition, within fifteen (15) calendar
days following the date Disetronic receives such complaint, Disetronic shall
also provide TheraSense with a materially complete written report relating
thereto. Any notice to TheraSense under this Section 7.11 shall be sent via
facsimile and email to the attention of TheraSense's Vice President of
Regulatory Affairs or to such other address or person as TheraSense may
designate by notice. Receipt of both (i) a legible facsimile and (ii) an email
shall constitute legal notice under this Section 7.11, and such notice shall be
deemed given upon the latter of (i) or (ii) if not simultaneously dated. Without
limiting the effectiveness of legal notice by facsimile and email as set forth
above, if requested by the notified party, the notifying party shall also send
such notice via overnight delivery. If Disetronic fails to submit timely any
report pursuant to this Section 7.11, TheraSense may require that Disetronic pay
in full prior to shipment of any orders by TheraSense until such report is
submitted.

     7.12  Notification of Unauthorized Use. Disetronic shall promptly notify
           --------------------------------
TheraSense in writing upon its discovery of any unauthorized use or infringement
of the FreeStyle Products and/or TheraSense's patent, copyright, trademark or
other intellectual property rights with respect thereto. TheraSense shall have
the sole and exclusive right to bring an infringement action or proceeding
against a third party, and, in the event that TheraSense brings such an action
or proceeding, Disetronic shall cooperate and provide full information and
assistance to TheraSense and its counsel in connection with any such action or
proceeding; provided that TheraSense shall reimburse Disetronic for any expenses
(including but not limited to reasonable attorney's fees) incurred by
Disetronic.

     7.13  Audits. TheraSense shall have the right to audit Disetronic solely
           ------
for the purpose of enabling TheraSense to comply with legal or regulatory
requirements, including ISO requirements.

8.   ADDITIONAL OBLIGATIONS OF THERASENSE

     8.1   Supply of Products. TheraSense shall be responsible for the
           ------------------
manufacture of FreeStyle Products for sale to Disetronic.

     8.2   New Versions of FreeStyle Products. TheraSense shall provide
           ----------------------------------
Disetronic with new versions of FreeStyle Products. Disetronic and TheraSense
shall use their best efforts to agree on transfer prices for such new versions
of FreeStyle Products. If the parties cannot agree on transfer prices then such
new versions shall not be included on Exhibit A. For purposes of clarity, the
parties understand that new versions of FreeStyle Products do not include any
TheraSense products falling

                                     -19-                    Initials: ____ ____
<PAGE>

outside of the scope of the FreeStyle Products as defined in Exhibit A,
including without limitation implantable glucose sensors and glucose sensors
coupled to insulin delivery devices.

     8.3  Telephone Marketing and Technical Support. During TheraSense's normal
          -----------------------------------------
business hours, and in order to answer Disetronic's questions related to
FreeStyle Products, TheraSense shall provide a reasonable level of telephone
marketing and technical support to employees of Disetronic who have been trained
by TheraSense or by Disetronic, provided that where the training was provided by
Disetronic, such training received prior approval from TheraSense.

     8.4  Intellectual Property Rights Maintenance-Patent and Trademark
          -------------------------------------------------------------
Prosecution. TheraSense will be responsible for maintaining all patents,
-----------
TheraSense Trademarks and trade names and/or diligently prosecuting all patent
applications covering the FreeStyle Products in the FreeStyle Territory.
TheraSense shall use its reasonable commercial judgment in determining the level
and extent of patent protection to pursue in the FreeStyle Territory. In the
event TheraSense elects to abandon a particular issued patent or trademark
registration covering a Freestyle Product in a particular country in the
European Territory, TheraSense will notify Disetronic of such election.
Disetronic shall have the right, within thirty (30) days of such notice, to
elect to pay the on-going fees and costs associated with maintaining such patent
or trademark registration. Notwithstanding the foregoing, any such patent or
trademark registration shall be maintained in TheraSense's name.

     8.5  Quality Systems Regulations. TheraSense will manufacture, design and
          ---------------------------
label FreeStyle Products for the U.S. Territory in accordance with the then
governing U.S. FDA Quality Systems Regulations, and for the European Territory
in accordance with the then governing European Union Quality Systems
Regulations.

     8.6  Audits. Disetronic shall have the right to audit TheraSense solely for
          ------
the purpose of enabling Disetronic to comply with legal or regulatory
requirements, including ISO requirements.

9.   LIMITED LIABILITY TO DISETRONIC AND OTHERS. EXCEPT AS PROVIDED IN SECTION
13.7.7, THERASENSE'S LIABILITY ARISING OUT OF THIS AGREEMENT, THE TERMINATION
THEREOF, AND/OR SALE OF THE FREESTYLE PRODUCTS SHALL BE LIMITED TO ***. IN NO
EVENT SHALL THERASENSE BE LIABLE TO DISETRONIC, ITS AFFILIATES, ITS DISTRIBUTORS
AND/OR ANY OTHER ENTITY FOR COSTS OF PROCUREMENT OF SUBSTITUTE GOODS, LOST
PROFITS, OR ANY OTHER SPECIAL, CONSEQUENTIAL, OR INCIDENTAL DAMAGES ("INDIRECT
DAMAGES"), INCLUDING ANY "INDIRECT DAMAGES" THAT DISETRONIC HAS AGREED TO
INDEMNIFY, DEFEND AND/OR HOLD HARMLESS OF ITS AFFILIATES, SUBDISTRIBUTORS AND/OR
ANY OTHER ENTITY, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY ARISING OUT OF
THIS AGREEMENT WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE), OR
OTHERWISE. THESE LIMITATIONS SHALL APPLY WHETHER OR NOT THERASENSE HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND NOTWITHSTANDING ANY FAILURE OF
ESSENTIAL PURPOSE OF ANY LIMITED REMEDY PROVIDED HEREIN OR IN THE WARRANTY FOUND
IN THE FREESTYLE PRODUCTS.

10.  TRADEMARKS

                                     -20-                     Initials:____ ____

*** CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

     10.1   License. In conjunction with the distribution and sale of each
            -------
FreeStyle Product, TheraSense hereby grants Disetronic a non-exclusive license
in the U.S. Territory and an exclusive license in the European Territory to use
the relevant TheraSense Trademarks, identified on Exhibit D as modified by
TheraSense pursuant to this Article 10, in the FreeStyle Territory during the
Term. Notwithstanding the foregoing, TheraSense reserves the right to use such
TheraSense Trademarks (a) outside the European Territory, (b) inside the
European Territory with respect to passive sales and CGMS products pursuant to
Section 2.3 (including any promoting, marketing, and/or selling such CGMS
product), and (c) to promote, market, and/or sell any products, other than
FreeStyle Products in the European Territory. Such license(s) shall terminate at
the earlier of (i) the end of the term of this Agreement, or (ii) the
termination of Disetronic's right to distribute the FreeStyle Products.
TheraSense reserves the right to modify TheraSense Trademarks or substitute
alternative marks for any or all of the TheraSense Trademarks at any time upon
ninety (90) days prior written notice where such notice is commercially
reasonable, and in no event upon less than thirty (30) days prior written
notice. In addition, Disetronic agrees to use those TheraSense Trademarks in
connection with FreeStyle Products as may be designated in writing by
TheraSense. TheraSense shall retain the worldwide right to use such TheraSense
Trademarks for its own co-marketing efforts and for the distribution/sale of
other products. Disetronic acknowledges that except as expressly provided
herein, TheraSense grants Disetronic no other rights, title, or interest under
or relating to TheraSense's trademarks, trade names or service marks.

     10.2   Use. During the term of this Agreement, Disetronic shall have the
            ---
right to indicate to the public that it is an authorized distributor of the
FreeStyle Products and to advertise and promote to Customers (within the
FreeStyle Territory) the FreeStyle Products under the TheraSense Trademarks.
Disetronic shall not alter or remove any Trademark applied to the FreeStyle
Products. Except as set forth in this Article 10, nothing contained in this
Agreement shall grant to Disetronic any right, title or interest in the
TheraSense Trademarks, whether or not specifically recognized or perfected under
applicable laws, and Disetronic irrevocably assigns to TheraSense all such
right, title, and interest, if any, in any TheraSense Trademarks. At no time
during or after the term of this Agreement shall Disetronic challenge or assist
others to challenge the TheraSense Trademarks or the registration thereof or
attempt to register any trademarks, marks or trade names confusingly similar to
those of TheraSense.

     10.3   Approval of Representations. All representations of the TheraSense
            ---------------------------
Trademarks that Disetronic intends to use (1) shall first be submitted to
TheraSense for approval (which shall not be unreasonably withheld) of design,
color, and other details, or (2) shall be exact copies of those used by
TheraSense. Disetronic agrees to fully comply with all reasonable guidelines, if
any, communicated by TheraSense concerning use of the TheraSense Trademarks.
Disetronic may not mark the FreeStyle Products packaging materials with the
trademarks of any third party without the prior written consent of TheraSense;
which consent may be withheld at TheraSense's sole discretion. If any of
TheraSense's Trademarks are to be used in conjunction with another trademark on
or in relation to the FreeStyle Products, then the TheraSense Trademarks shall
be presented at least equally legibly, equally prominently, and of equal or
greater size than the other but nevertheless separated from the other so that
each appears to be a mark in its own right, distinct from the other mark.

     10.4   TheraSense use of Trademarks. During the term of this Agreement,
            ----------------------------
TheraSense shall not use a TheraSense Trademark on any in vitro glucose
monitoring product distributed for sale in the European Territory, other than a
FreeStyle Product, except as provided in Section 2.3. TheraSense reserves the
right to use all other TheraSense marks, trademarks, trade names and service
marks on any and all TheraSense product.

                                     -21-                     Initials:____ ____
<PAGE>

11.      CONFIDENTIALITY

         11.1 Except as expressly provided herein, the parties agree that for
five (5) years after the disclosure of any Confidential Information by one (1)
of the parties to the other hereto pursuant to this Agreement, the receiving
party shall keep completely confidential and shall not publish or otherwise
disclose and shall not use for any purpose except for the purposes contemplated
by this Agreement such Confidential Information, except that to the extent that
it can be established by the receiving party by competent proof that such
Confidential Information:

             (a) was already known to the receiving party, 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 in breach of this Agreement;

             (d) was independently developed by the receiving party as
demonstrated by documented evidence prepared contemporaneously with such
independent development; or

             (e) was subsequently lawfully disclosed to the receiving party by a
person other than a party hereto.

         11.2 Permitted Use and Disclosures. Each party hereto may use or
              -----------------------------
disclose information disclosed to it by the other party to the extent such use
or disclosure is reasonably necessary in complying with applicable governmental
regulations or otherwise submitting information to tax or other governmental
authorities, conducting clinical trials, or otherwise exercising its rights
hereunder, provided that if a party is required to make any such disclosure of
another party's confidential information, other than pursuant to a
confidentiality agreement, it will give reasonable advance notice to the latter
party of such disclosure and, save to the extent inappropriate in the case of
patent applications, will use its best efforts to secure confidential treatment
of such information prior to its disclosure (whether through protective orders
or otherwise).

         11.3 Public Disclosure. Except as otherwise required by law, neither
              -----------------
party shall issue a press release or make any other public disclosure of the
terms of this Agreement without the prior approval of such press release or
public disclosure. Each party shall submit any such press release or public
disclosure to the other party, and the receiving party shall have ten (10)
business days to review and approve any such press release or public disclosure,
which approval shall not be unreasonably withheld. If the receiving party does
not respond in writing within such ten (10) business day period, the press
release or public disclosure shall be retransmitted by the issuing party to the
attention of the President of the receiving party. If the receiving party does
not respond to such retransmission within five (5) business days the press
release or public disclosure shall be deemed approved.

         11.4 Confidential Terms. Except as expressly provided herein, each
              ------------------
party agrees not to disclose any terms of this Agreement to any third party
without the consent of the other party; provided, disclosures may be made as
required by securities or other applicable laws, or on a strict need to know

                                     -22-                     Initials:____ ____
<PAGE>

basis to actual or prospective investors, or to a party's accountants, attorneys
and other professional advisors; provided further, however, prior to making any
disclosure regarding securities or other applicable laws, the terms of this
Agreement shall be redacted by mutual agreement of the parties.

12.     INDEMNITY

        12.1 Indemnification of Disetronic.
             -----------------------------

              12.1.1 TheraSense shall indemnify, defend, and hold harmless
Disetronic, its Affiliates and Subdistributors, and their directors, officers
and employees (each an "Disetronic Indemnitee") from and against any and all
liabilities, damages, losses, costs or expenses (including attorneys' fees and
other expenses of litigation and/or arbitration) (a "Liability") resulting from
a claim, suit or proceeding made or brought by a third party against a
Disetronic Indemnitee arising from (i) defects in materials, workmanship,
manufacturing, labeling or packaging of the FreeStyle Products by TheraSense if
such defects can be attributed to TheraSense's responsibility and could not be
detected by Disetronic through use of due diligence in the tests or inspection
of the FreeStyle Products before its delivery to Customers or end users, and/or
(ii) any claim of noncompliance by TheraSense with the U.S. or foreign laws and
regulations in the FreeStyle Territory, except to the extent caused by a
Disetronic Indemnitee.

              12.1.2 TheraSense shall defend, or at its option settle, any
claims brought against Disetronic by third parties as a result of any
infringement by the FreeStyle Products of any U.S. or foreign patent, trademark,
trade name, service mark, or copyright existing under the laws of the FreeStyle
Territory, and shall reimburse Disetronic for any judgments, damages, cost or
expenses payable by Disetronic to a party bringing such action together with
reasonable attorneys' fees relating thereto. Disetronic agrees that TheraSense
shall be relieved of its obligations under this Section 12.1.2 unless Disetronic
notifies TheraSense promptly in writing of and gives TheraSense proper and full
information and assistance to settle or defend any such claims. If the FreeStyle
Products, or any part thereof, are, or in the opinion of TheraSense become, the
subject of any claim for infringement of such third party patent, trademark,
trade name, service mark, or copyrights, or if it is adjudicatively determined
that the FreeStyle Products, or any part thereof, infringe any such third party
patent, or copyright, then TheraSense may, at its option and expense, either (i)
procure for Disetronic the right under such third party patent, trademark, trade
name, service mark or copyright to sell or use, as appropriate, the FreeStyle
Products (or in the case of trademark infringement, substitute a different
trademark, trade name or service mark), or (ii) replace or modify the FreeStyle
Products or parts thereof in Disetronic's possession, with other suitable and
reasonably equivalent technology or parts so that the FreeStyle Products become
non-infringing or (iii) if it is not commercially reasonable to take the actions
specified in items (i) or (ii) immediately preceding, terminate this Agreement
with ninety (90) days written notice.

              12.1.3 Notwithstanding the provisions of Section 12.1.2 above,
TheraSense assumes no liability for (i) infringements relating to any assembly,
circuit, combination, method or process in which any of the FreeStyle Products
may be used where the FreeStyle Products when used alone would not result in
such an infringement; (ii) infringements involving the modification or servicing
of the FreeStyle Products, or any part thereof, unless such modification or
servicing was done by TheraSense; (iii) any trademark infringements involving
any marking or branding of the FreeStyle Products not applied by TheraSense or
involving any marking or branding applied at the request of Disetronic or any
marking or branding with the Disetronic trademarks; or (iv) the modification of
any FreeStyle Products other than with TheraSense's written consent.

                                     -23-                     Initials:____ ____
<PAGE>

              12.1.4 The foregoing provisions of this Section 12.1 state the
entire liability and obligations of TheraSense, and the exclusive remedy of
Disetronic and its Customers, with respect to any alleged product liability
claim related to the FreeStyle Products, or any alleged infringement of any
patents, copyrights, trademarks or other intellectual property rights by the
FreeStyle Products or any part thereof.

         12.2 Indemnification of TheraSense.
              -----------------------------

              12.2.1 Disetronic shall indemnify, defend and hold harmless
TheraSense and its directors, officers, employees and agents and the successors
and assigns of any of the foregoing (each a "TheraSense Indemnitee") from any
and all damages, losses, costs, liabilities or expenses (including, without
limitation, attorneys' fees and other expenses of litigation and/or arbitration)
(a "Liability") resulting from a claim, suit or proceeding made or brought by a
third party against a TheraSense Indemnitee arising out of (a) defects in the
FreeStyle Products sold by Disetronic except those defects which can be
attributed to TheraSense, (b) FreeStyle Product claims, whether written or oral,
made by Disetronic in its advertising, promotion, sale, or distribution of any
of the FreeStyle Products, (c) the labeling, packaging, storage or other
handling of the FreeStyle Products by Disetronic, or (d) any claim of
noncompliance by Disetronic with the U.S. or foreign laws and regulations in the
FreeStyle Territory, except to the extent caused by a TheraSense Indemnitee.

              12.2.2 Disetronic shall defend, or at its option settle, any
claims brought against TheraSense by third parties as a result of any
infringement by the FreeStyle Products of any U.S. or foreign trademark, trade
name, or service mark existing under the laws of the FreeStyle Territory, and
shall reimburse TheraSense for any judgments, damages, cost or expenses payable
by TheraSense to a party bringing such action together with reasonable
attorneys' fees relating thereto as a result of marking or branding the
FreeStyle Products with Disetronic trademarks. TheraSense agrees that Disetronic
shall be relieved of its obligations under this Section 12.2.2 unless TheraSense
notifies Disetronic promptly in writing of and gives Disetronic proper and full
information and assistance to settle or defend any such claims. If the FreeStyle
Products, or any part thereof, are, or in the opinion of Disetronic become, the
subject of any claim for infringement of such third party trademarks, trade
names or service marks, or if it is adjudicatively determined that the FreeStyle
Products, or any part thereof, infringe any such third party trademarks, trade
names or service marks, Disetronic may substitute a new Disetronic trademark,
trade name or service mark to be used to sell or use, as appropriate, the
FreeStyle Products.

              12.2.3 The foregoing provisions of this Section 12.2 state the
entire liability and obligations of Disetronic, and the exclusive remedy of
TheraSense and its Customers, with respect to any alleged infringement of any
trademarks, trade names or service marks by the FreeStyle Products or any part
thereof.

13.      TERM AND TERMINATION

         13.1 Initial Term. The initial term of this Agreement shall commence on
              ------------
the Effective Date and shall continue in force until five (5) years from the
Effective Date, unless terminated earlier under the provisions of this Article
13 (the "Initial Term"). At the end of the Initial Term, this Agreement shall
automatically renew for subsequent three-year terms unless written notice of
termination is given by either party to the other party at least one (1) year
prior to the Agreement's then-current expiration date.

                                     -24-                     Initials:____ ____
<PAGE>

         13.2 Termination for Cause. If either party defaults in the performance
              ---------------------
of any provision of this Agreement, then the non-defaulting party may give
written notice to the defaulting party that if the default is not cured *** the
Agreement will be terminated. If the non-defaulting party gives such notice and
the default is not cured during *** then the Agreement shall automatically
terminate at the end of that period. In addition, this Agreement shall
automatically terminate if Disetronic fails to pay TheraSense in accordance with
Sections 3.1, 3.2 and/or 3.3 and such failure shall have continued for ***.

         13.3 Termination for Disetronic and TheraSense Insolvency. This
              ----------------------------------------------------
Agreement may be terminated by TheraSense or Disetronic effective immediately
upon written notice to the other party (i) upon the institution by or against
the other party of insolvency, receivership or bankruptcy proceedings or any
other proceedings for the settlement of the other party's debts under United
States, California or Swiss law, unless such other party timely contests such
proceedings, (ii) upon the other party's making an assignment for the benefit of
creditors, or (iii) upon the other party's dissolution or ceasing to do
business.

         13.4 Termination Relating to ***. TheraSense may, at its sole
              ---------------------------
discretion, terminate this Agreement ***.

         13.5 Termination Relating to ***. In addition to any other rights or
              ---------------------------
remedies available to TheraSense, TheraSense shall have the right to terminate
this Agreement *** if TheraSense has reasonable belief ***, Disetronic shall
have the opportunity to dispute such claim and the parties agree to discuss in
good faith the resolution thereof.

         13.6 Termination Relating to ***.
              ---------------------------
              ***

         13.7 Effect of Termination.
              ---------------------

                                     -25-                     Initials:____ ____

*** CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

              13.7.1 Accrued Obligations. Expiration or 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 any rights and remedies it may have hereunder or at
law or in equity with respect to any breach of this Agreement. It is understood
and agreed that monetary damages may not be a sufficient remedy for any breach
of this Agreement and that the non-breaching party may be entitled to injunctive
relief as a remedy for any such breach. Such remedy shall not be deemed to be
the exclusive remedy for any such breach of this Agreement, but shall be in
addition to all other remedies available at law or in equity.

              13.7.2 Inventory. Within thirty (30) days after the effective date
                     ---------
of termination of this Agreement, Disetronic shall use its reasonable efforts to
provide TheraSense with a complete inventory of FreeStyle Products in
Disetronic's possession, in transit to Disetronic from TheraSense or otherwise
in Disetronic's control. Upon any expiration or other termination of this
Agreement, TheraSense may inspect Disetronic's FreeStyle Product inventory and
audit Disetronic's records.

              13.7.3 Return of Materials. All trademarks, marks, trade names,
                     -------------------
patents, copyrights, designs, drawings, formulas or other data, photographs,
samples, literature, and sales and promotional aids of every kind related to the
FreeStyle Products or provided by TheraSense shall remain the property of
TheraSense. Within thirty (30) days after the effective date of termination of
this Agreement, Disetronic shall destroy all tangible items bearing, containing,
or contained in, any of the foregoing, in its possession or control and provide
written certification of such destruction, or prepare such tangible items for
shipment to TheraSense, as TheraSense may direct, at TheraSense's expense.
Disetronic shall not make or retain any copies of any confidential items or
information which may have been entrusted to it. Notwithstanding the foregoing,
Disetronic may retain only those samples and documents required for Disetronic
to comply with legal, regulatory and product liability requirements then in
effect. Disetronic shall provide to TheraSense a list of all such materials
required to be kept in Disetronic's possession. Effective upon the termination
of this Agreement, Disetronic shall cease to use all trademarks and trade names
of TheraSense. During the term of this Agreement and after any termination or
expiration of this Agreement, TheraSense shall have the right to continue to use
and disclose for any purpose any and all clinical trial results and other data
relating to the FreeStyle Products.

              13.7.4 Products. In the event of breach by Disetronic of this
                     --------
Agreement, Disetronic shall cease selling any FreeStyle Products and shall
destroy all remaining inventory at the time of such breach. Subject to the
foregoing, upon expiration of this Agreement, or termination wholly unrelated to
any breach of this Agreement by Disetronic, Disetronic may continue selling in
the FreeStyle Territory any FreeStyle Products which were in Disetronic's
inventory at the time of such expiration or termination of the Agreement.

              13.7.5 Limitation on Liability. Subject to Section 13.7.7, in the
                     -----------------------
event of termination by either party in accordance with any of the provisions of
this Agreement, neither party shall be liable to the other because of such
termination, for compensation, reimbursement or damages on account of the loss
of prospective profits or anticipated sales or on account of expenditures,
investments, leases, inventory or commitments in connection with the business or
goodwill of TheraSense or Disetronic.

              13.7.6 Transition. Upon termination of this Agreement, Disetronic
                     ----------
shall (i) diligently cooperate with TheraSense to effect a smooth and orderly
transition in the sale of FreeStyle Products in

                                     -26-                     Initials:____ ____
<PAGE>

the FreeStyle Territory, and (ii) refer all FreeStyle Product Customer support
inquiries to TheraSense, or to TheraSense's then-authorized customer support
provider.

              13.7.7 Payment Upon Termination. Within thirty (30) days of the
                     ------------------------
effective date of termination of this Agreement, TheraSense shall pay to
Disetronic the Payment. It is understood and agreed that such Payment shall only
be due in the event this Agreement is permissively terminated by TheraSense (by
providing written notice to Disetronic) pursuant to Section 13.1, or terminated
by Disetronic pursuant to Section 13.2 due to TheraSense's breach or pursuant to
Section 13.3 due to TheraSense's insolvency. In addition, within thirty (30)
days of termination or expiration of this Agreement, Disetronic shall deliver to
TheraSense all Sales and Inventory Records (as described in Section 7.1) and a
report which shall identify all outstanding leads for sales of Products and a
description of the status of any other sales activities regarding the FreeStyle
Products. Disetronic and TheraSense agree to observe the applicable privacy laws
relating to the data provided. TheraSense agrees that it shall not provide such
data to any company producing and distributing insulin pumps and/or infusion
sets. In the event TheraSense elects to develop and/or commercialize an insulin
pump and/or infusion set, TheraSense also agrees that is shall not use such data
in conjunction with such development and/or commercialization.

              13.7.8 No Renewal, Extension or Waiver. Acceptance of any order
                     -------------------------------
from, or sale of, any FreeStyle Products to Disetronic after the date of
termination of this Agreement shall not be construed as a renewal or extension
hereof, or as a waiver of termination by TheraSense.

         13.8 Survival. The provisions of Sections 2.5, 3.2, 3.3.3, 3.4, 4.6,
              --------
4.7.2, 7.2, 7.4.1(a)(ii), 7.10, 7.11, 10.2, 13.7 and 13.8, Articles 5, 9, 11, 12
(to the extent such claims arise from acts or omissions that occurred out of
Products supplied to Disetronic prior to expiration or termination of this
Agreement), 14 and 15, and Exhibits F and G shall survive the expiration or
termination of this Agreement for any reason. All other rights and obligations
of the parties shall cease upon termination of this Agreement.

14.      DISPUTE RESOLUTION

         14.1 Mediation. If a dispute arises out of or relates to this contract,
              ---------
or the breach thereof, including a dispute noticed under Sections 13.2 through
13.5, the parties agree that before filing any claim in arbitration as set forth
below, the parties shall first to try in good faith to settle the dispute by
engaging in a meeting in Minneapolis, Minnesota, for a minimum of forty-eight
(48) hours, where including without limitation, the CEO's (or the equivalent
thereof) of both parties shall be present. Such meeting shall take place within
twenty (20) days of any notice of dispute under this Agreement.

         14.2 Arbitration. Subject to Section 14.1, if the parties are unable to
              -----------
resolve a Dispute, the Dispute shall be settled by binding arbitration conducted
in Minneapolis, Minnesota pursuant to the Commercial Arbitration Rules of the
American Arbitration Association then in effect by one (1) arbitrator appointed
in accordance with such rules. The decision and/or award rendered by the
arbitrator shall be written (specifically stating the arbitrator's findings of
facts as well as the reasons upon which the arbitrator's decision is based),
final and nonappealable (except for an alleged act of corruption or fraud on the
part of the arbitrator) and may be entered in any court of competent
jurisdiction. The parties agree that, any provision of applicable law
notwithstanding, they will not request, and the arbitrator shall have no
authority to award, punitive or exemplary damages against any party. The
arbitrator shall have the authority to grant injunctive relief and order
specific performance. The arbitrator shall determine what discovery will be
permitted, consistent with the goal of limiting the cost and time which the
parties

                                     -27-                     Initials:____ ____
<PAGE>

must expend for discovery; provided the arbitrator shall permit such discovery
as they deem necessary to permit an equitable resolution of the dispute.
Evidence need not be obtained in the presence of the arbitrator. At the
arbitration hearing, each party may make written and oral presentations to the
arbitrator, present testimony and written evidence, and examine witnesses. The
costs of any arbitration, including administrative fees and fees of the
arbitrator, shall be shared equally by the parties. Each party shall bear the
cost of its own attorneys' fees and expert fees. The parties and the arbitrator
shall use their best efforts to complete any such arbitration within one (1)
year after the appointment of the Panel, unless a party can demonstrate to the
arbitrator that the complexity of the issues or other reasons warrant the
extension of the time table. In such case, the Panel may extend such time table
as reasonably required. The arbitrator shall, in rendering its decision, apply
the substantive law of the State of California, without regard to its conflict
of laws provisions, except that the interpretation of and enforcement of this
Section 14.2 shall be governed by the U.S. Federal Arbitration Act. Pending the
establishment of the arbitral tribunal or pending the arbitral tribunal's
determination of the merits of the controversy, either party may seek from a
court of competent jurisdiction any interim or provisional relief that may be
necessary to protect the rights or property of that party.

15.      MISCELLANEOUS

         15.1 Governing Law. This Agreement, any dispute arising therefrom, and
              -------------
any proceeding subject to Article 14, shall be governed by and construed in
accordance with the laws of the State of California, without reference to
principles of conflicts of laws.

         15.2 Independent Contractors. The relationship of the parties hereto is
              -----------------------
that of independent contractors. The parties hereto are not deemed to be agents,
partners or joint venturers of the other for any purpose as a result of this
Agreement or the transactions contemplated thereby.

         15.3 Assignment. ***, the parties agree that their rights and
              ----------
obligations under this Agreement shall not be delegated, transferred or assigned
to a third party without prior written consent of the other party hereto;
provided TheraSense may assign this Agreement, without Disetronic's consent (a)
to its Affiliates, and (b) to an entity that acquires all or substantially all
of the business of assets of TheraSense to which this Agreement pertains,
whether by merger, reorganization, acquisition, sale or otherwise. This
Agreement shall be binding upon and inure to the benefit of the parties and
their successors and assigns.

         15.4 Notices. Any required notices hereunder shall be given in writing
              -------
by email and by facsimile at the address of each party below, or to such other
address as either party may substitute by written notice. Notice shall be deemed
served when delivered or, if delivery is not accomplished by reason or some
fault of the addressee, when tendered.

         If to Disetronic:      Disetronic Handels AG
                                Brunnmattstrasse 6
                                CH-3401 Burgdorf
                                Switzerland
                                Attention: Senior Corporate Attorney
                                Swiss Telephone Number: (+41) 34 427-1111
                                Website: www.disetronic.com

         If to TheraSense:      TheraSense, Inc.

                                     -28-                     Initials:____ ____

*** CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                1360 South Loop Road
                                Alameda, CA 94502
                                USA
                                Attention:  Vice President, Business Development
                                U.S. Telephone Number: (510) 749-5400
                                Website: www.therasense.com

         15.5  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, fire, Act of God, earthquake, flood,
lockout, embargo, governmental acts or orders or restrictions, 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 such 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.

         15.6  Insurance. Each party shall, at all times during the term of this
               ---------
Agreement, maintain a product liability insurance policy with commercially
reasonable amounts of insurance in annual amounts of no less than Five Million
U.S. Dollars (U.S. $5,000,000) per occurrence, and each party shall list the
other and its Affiliates as named insureds.

         15.7  Advice of Counsel. TheraSense and Disetronic have each consulted
               -----------------
counsel of their choice regarding this Agreement, and each acknowledges and
agrees that this Agreement shall not be deemed to have been drafted by one party
or another and will be construed accordingly.

         15.8  Compliance with Laws. Each party shall furnish to the other party
               --------------------
any information requested or required by that party during the term of this
Agreement or any extensions hereof to enable that party to comply with the
requirements of any U.S. or foreign, state and/or government agency.

         15.9  Further Assurances. At any time or from time to time on and after
               ------------------
the date of this Agreement, Disetronic shall at the request of TheraSense (i)
deliver to TheraSense such records, data or other documents consistent with the
provisions of this Agreement, (ii) execute, and deliver or cause to be
delivered, all such consents, documents or further instruments of transfer or
license, and (iii) take or cause to be taken all such actions, as TheraSense may
reasonably deem necessary or desirable in order for TheraSense to obtain the
full benefits of this Agreement and the transactions contemplated hereby.

         15.10 Severability; Waiver. In the event that any provisions of this
               --------------------
Agreement are determined to be invalid or unenforceable by a court of competent
jurisdiction, the remainder of the Agreement shall remain in full force and
effect without said provision. The parties shall in good faith negotiate a
substitute clause for any provision declared invalid or unenforceable, which
shall most nearly approximate the intent of the parties in entering this
Agreement. The failure of a party to enforce any provision of the Agreement
shall not be construed to be a waiver of the right of such party to thereafter
enforce that provision or any other provision or right.

         15.11 Entire Agreement; Modification. This Agreement sets forth the
               ------------------------------
entire agreement and understanding of the parties with respect to the subject
matter hereof, and supersedes all prior discussions, agreements and writings in
relating thereto. This Agreement may not be altered, amended or modified in any
way except by a writing signed by both parties.

                                     -29-                     Initials:____ ____
<PAGE>

         15.12 Counterparts. This Agreement may be executed in two counterparts,
               ------------
each of which shall be deemed an original and which together shall constitute
one instrument.

         15.13 Future Cooperation. The parties agree to discuss development of a
               ------------------
broader relationship between them, potentially including other products not
covered by this Agreement, such as implantable glucose sensors and glucose
monitoring devices coupled with insulin delivery devices. The terms of such
broader relationship, if any, shall be subject to the negotiation of a separate
agreement.

IN WITNESS WHEREOF, Disetronic and TheraSense have executed this Agreement by
their respective duly authorized representatives.

DISETRONIC HANDELS AG                     THERASENSE, INC.

    /s/ Signature                              /s/ Signature
By:____________________________           By: __________________________

Print Name:____________________           Print Name:___________________

Title:_________________________           Title: _______________________

                                     -30-                     Initials:____ ____
<PAGE>

CONFIDENTIAL                                                   13 September 2000

                                   EXHIBIT A

                              FREESTYLE PRODUCTS

     As of the Effective Date, The FreeStyle Products include the following six
(6) products:

     1. "System Kit" shall mean a product that consists of 1 Meter, 10 Strips, 1
         ----------
Lancing Device, 1 Finger Cap, 10 Lancets, 1 Carrying Case, 1 Log Book, 1 Quick
Reference Card, 1 Owners Booklet; where "Finger Cap" shall mean cap for the
                                         ----------
Lancing Device designed for lancing the finger rather than the arm.

     2. "Lancer" shall mean a disposable head placed in a lancing device for use
         ------
in piercing the patient's skin.

     3. "Control Solution" shall mean a glucose solution for testing the
         ----------------
operation of the FreeStyle Meter and Strips.

     4. "Lancing Device" shall mean a lancing device which is used to bring
         --------------
blood to the surface of a patient's skin and which is physically separate from
the Meter.

     5. "Meter" shall mean a meter whose sole function is to coulometrically
         -----
measure blood glucose levels.

     6. "Strips" shall mean a package of strips which are located into the
meter ***. (The Strips are currently offered in packages of 50 and 100; such
quantities are subject to change).

***Confidential treatment requested
<PAGE>

CONFIDENTIAL                                                   13 September 2000

                                   EXHIBIT B

                                TRANSFER PRICE

                                Pricing Details

System Kit
----------

      The price of a System Kit for sale in the FreeStyle Territory is ***
(includes 1 Meter, 10 Strips, 1 Lancing Device, 1 Finger Cap, 10 Lancets, 1
Carrying Case, 1 Log Book, 1 Quick reference Card, 1 Owners Booklet).

Strips
------

     The price of Strips ordered for the US Territory is ***.

     The price of Strips ordered for the European Territory is:

                     Annual Sales Volume             Price
                     (number of Strips)            Per Strip
                     -------------------           ---------
                            ***                       ***
                            ***                       ***
                            ***                       ***
                            ***                       ***
                            ***                       ***
                            ***                       ***

Lancing Devices, Lancets and Control Solution
---------------------------------------------

     The following prices are valid for the following products for sale in the
FreeStyle Territory when not purchased as part of a System Kit:

     Lancing Devices         *** per lancing device

     Lancets                 *** per box if 100 lancets

     Control Solution        *** per bottle of control solution

***  Confidential treatment requested

                                                               Initials:
                                                                        --------
<PAGE>

CONFIDENTIAL                                                   13 September 2000

                                   EXHIBIT C

         ANNUAL MINIMUM PURCHASE OBLIGATION FOR THE EUROPEAN TERRITORY

                                                Minimum
                     Calendar Year        Purchase Obligation
                     -------------        -------------------

                                    ***

*** Confidential treatment requested.
<PAGE>

CONFIDENTIAL                                                  13 September 2000

                                   EXHIBIT D

                             THERASENSE TRADEMARKS

     TheraSense
     .  EU Registration #00960120 filed October 19, 1998
     .  US serial number 75/542,727 filed August 25, 1998
     .  Canada serial number 894,025 filed October 22, 1998

     FreeStyle (registrations pending)
     .  US serial number 75/697,764 filed May 4, 1999

     The Technology of Caring  (registration pending)
     .  U.S. serial number 75/793,921 filed September 7, 1999

     ***

     TheraSense agrees to provide Disetronic with the registration numbers and
the countries and the countries to which they correspond as such information
becomes available. TheraSense will use commercially reasonable efforts to
register the above trademarks in the European territory.

     TheraSense and Disetronic shall agree by *** on the TheraSense brand name
under which the FreeStyle Products will be marketed in the European Territory.
TheraSense shall promptly apply to register the TheraSense brand name or secure
the necessary rights to use the TheraSense brand name. Disetronic agrees to
assign all of its right, title and interest, if any, in such TheraSense brand
name to TheraSense. Such brand name shall be added to Exhibit D.

     ***

***  Confidential treatment requested

                                      -4-          Initials:
                                                            ----- -----
<PAGE>

CONFIDENTIAL                                                   13 September 2000

                                   EXHIBIT E

                            PRODUCT SPECIFICATIONS

    Product Performance Criteria

    The FreeStyle Products shall meet the following specification when tested
using the test procedures in the attached TheraSense document #DOC00482
"FreeStyle Strip Verification report", as this document may be updated by
TheraSense.

Hematocrit range                            ***
Operating temperature range                 ***
Acetaminophen error                         ***
Ascorbate error                             ***
User error                                  ***
Glucose range                               ***
Accuracy                                    ***

    Lot Acceptance Criteria

    The Strips shall meet the following specifications when tested by the
Receiving Party using the test procedures in the attached TheraSense document
$DOC00345 "FreeStyle Strip Calibration Procedure", as this document may be
updated by TheraSense.

RMS standard deviation at low glucose level                     ***
RMS coefficient of variation at medium glucose level            ***
RMS coefficient of variation at high glucose level              ***

    TNO Precision Guidelines

    Until such time as TheraSense obtains the IVD-CE mark for the FreeStyle
Products, all Strips shipped by TheraSense to Disetronic for sale in the
European Territory shall conform (in TheraSense's release testing) with the
guideline on permissible coefficient of variation specified in paragraph 5.2.2
(b) of the TNO Centre for Medical Technology's publication entitled "Quality
Guideline, Non-Implantable Portable Blood Glucose Monitors for Self Monitoring"
dated February 1991. After TheraSense obtains the IVD-CE mark for the FreeStyle
products, TheraSense will comply with the relevant, applicable IVD-CE mark
criteria as required.

*** Confidential treatment requested

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