Document:

<PAGE>

                                                                    EXHIBIT 10.1

                                VOTING AGREEMENT

     This VOTING AGREEMENT (this "Agreement") is dated March 19, 2004, and is
among HALSEY DRUG CO., INC., a New York corporation (the "Company"), IVAX
PHARMACEUTICALS NEW YORK LLC, a New York limited liability company (the
"Purchaser"), and each signatory listed on Exhibit A attached hereto (each such
signatory a "Holder" and, collectively, the "Holders").

     WHEREAS, the Company and the Purchaser are parties to that certain Asset
Purchase Agreement dated as of March 19, 2004 (the "Asset Purchase Agreement"),
substantially in the form attached hereto as Exhibit B and as finally entered
into by the Purchaser pursuant to which the Purchaser is purchasing certain of
the Company's assets used in connection with the Company's operations located in
Congers, New York, on such terms and conditions as determined by the Company's
Board of Directors and the Purchaser (the "Proposed Transaction"); and

     WHEREAS, to induce the Purchaser to enter into the Asset Purchase Agreement
which it would not do but for the agreement of the Holders to enter into this
Agreement; and

     WHEREAS, the closing of the Proposed Transaction is conditioned upon
security holders of the Company, who, collectively, represent no less than
two-thirds of the Company's issued and outstanding common stock or right to vote
as if they owned such common stock, entering into this Agreement.

     NOW, THEREFORE, the parties agree as follows:

     1. Representations and Warranties. Each Holder hereby represents, warrants
and covenants to the Purchaser as follows:

          (a) Title. As of the date hereof, each Holder is the sole beneficial
owner of record of the number of shares of each class of security of the Company
set forth on Exhibit A hereto (the "Shares"). The term "beneficial owner" and
all correlate expressions are used in this Agreement as defined in Rules 13d-3
and 16a-1 under the Securities Exchange Act of 1934, as amended; provided,
however, that for the avoidance of doubt, each Holder will not be deemed the
beneficial owner of any shares of capital stock of the Company that a Holder has
the right to acquire, such as shares issuable to a Holder upon the exercise of
an option or warrant, unless and until such shares are actually acquired by a
Holder at which time such shares shall be treated as Additional Shares pursuant
to Section 5 below; and further provided that notwithstanding the proviso stated
above, certain of the Holders have the right to vote their Shares.

          (b) Right to Vote. As of the date hereof, except for this Agreement or
as otherwise permitted by this Agreement, each Holder has full legal power,
authority and right to vote all of the Shares then owned of record or
beneficially by it, in favor of the approval and authorization of the Proposed
Transaction without the consent or approval of, or any other action on the part
of, any other Person. Without limiting the generality of the foregoing, each
Holder has not entered into any voting agreement (other than this Agreement)
with any Person with respect to any of the Shares, granted any Person any proxy
(revocable or irrevocable) or power of attorney with respect to any of the
Shares, deposited any of the Shares in a voting trust or

<PAGE>

entered into any arrangement or agreement with any Person limiting or affecting
such Holder's legal power, authority or right to vote the Shares on any matter,
except for the Voting Agreement dated February 6, 2004, concerning the election
of directors and the amendment to the certificate of incorporation to increase
the authorized common stock of the Company and authorize the creation of
preferred stock. From and after the date hereof, except as otherwise permitted
by this Agreement, each Holder will not commit any act that could restrict or
otherwise affect such Holder's legal power, authority and right to vote all of
the Shares then owned of record or beneficially by such Holder. Without limiting
the generality of the foregoing, except for this Agreement and as otherwise
permitted by this Agreement, from and after the date hereof, each Holder shall
not enter into any voting agreement with any Person with respect to any of the
Shares, grant any Person any proxy (revocable or irrevocable) or power of
attorney with respect to any of the Shares, deposit any of the Shares in a
voting trust or otherwise enter into any agreement or arrangement of any kind
with any Person limiting or affecting such Holder's legal power, authority or
right to vote the Shares in favor of the approval of the Proposed Transaction.

          (c) Authority. Each Holder has full legal power, authority and right
to execute and deliver and to perform its obligations under this Agreement. This
Agreement has been duly and validly executed and delivered by each Holder and
constitutes a legal, valid and binding agreement of each Holder enforceable
against it in accordance with its terms.

          (d) Conflicting Instruments. The execution and delivery of this
Agreement and the performance by each Holder of its obligations hereunder will
not result in any: (i) violation or breach of, or be in conflict with, such
Holder's respective organizational documents or material contracts, as
applicable or (ii) violation of any statutes, laws, rules, regulations, orders
or judgments applicable to such Holder, as applicable, except for any such
breach, violation, conflict or default which, individually or in the aggregate,
would not impair or adversely affect such Holder's ability to perform its
obligations under this Agreement or render inaccurate any of the representations
made by such Holder herein.

     2. Covenants. Until the termination of this Agreement in accordance with
Section 4, each Holder hereby agrees as follows:

          (a) Restrictions on Transfer. Each Holder shall not, directly or
indirectly, assign, sell, pledge, encumber, transfer (including transfers by
testamentary or intestate succession or otherwise by operation of law) or
otherwise dispose of (collectively, "Transfer"), or agree to or allow the
Transfer, any of the Shares owned of record or beneficially by such Holder or
any right, title or interest in any Additional Shares (or any right, title or
interest therein, including but not limited to any right or power to vote to
which the holder thereof may be entitled, whether such right or power is granted
by proxy or otherwise); provided, however, that notwithstanding anything to the
contrary contained in this Agreement, a Holder may Transfer Shares or any right,
title or interest in any Additional Shares to a transferee if such transferee
executes and delivers to the Company and the Purchaser a joinder to this
Agreement satisfactory in form and substance to the Company and the Purchaser,
stating that such transferee agrees to be fully bound by the terms of this
Agreement.

          (b) Agreement to Vote. Each Holder hereby agrees to vote or to cause
to be voted all of the Shares and Additional Shares owned of record or
beneficially by such Holder as

                                       2
<PAGE>

of the record date for such meeting or written consent, at the Company's
upcoming meeting of Shareholders and at any other annual or special meeting of
stockholders of the Company where any such proposal is submitted, and in
connection with any written consent of stockholders: (A) in favor of the
Proposed Transaction; and (B) against any action that may reasonably be expected
to (i) impede, interfere with, delay, postpone or attempt to discourage the
consummation of the transactions contemplated by the Asset Purchase Agreement or
(ii) result in a breach of any of the covenants, representations, warranties or
other obligations or agreements of the Company under the Asset Purchase
Agreement which would materially and adversely affect the Company or the
Purchaser or their respective abilities to consummate the transactions
contemplated by the Asset Purchase Agreement.

          (c) Granting of Proxy. In furtherance of the terms and provisions of
this Agreement, and to secure the performance of obligations hereunder, each
Holder hereby grants an irrevocable proxy, coupled with an interest, to the
Purchaser and any authorized representative or agent of the Purchaser to vote
all of the Shares beneficially owned now or during the term of the Asset
Purchase Agreement by the Holder in favor of the Proposed Transaction and in
accordance with the provisions of Section 2(b) and this Section 2(c). Each
Holder hereby ratifies and approves of each and every action taken by the
Purchaser and any authorized representative or agent of the Purchaser pursuant
to the foregoing proxy. Notwithstanding the foregoing, if requested by the
Purchaser, each Holder shall execute and deliver applicable proxy materials in
furtherance of the provisions of Section 2(b) and this Section 2(c).

          (d) Appointing New Agent. Each Holder hereby covenants that if for any
reason, Galen Partners III, L.P. is no longer acting as the agent for the
Holders, pursuant to a certain Agency Letter Agreement dated February 6, 2004,
the Holders shall appoint a replacement agent and the Holders shall cause such
replacement agent to sign an Agent's Release of Liens form in the same form
signed by Galen Partners III, L.P. on this date.

          (e) Each Holder consents to the Company's granting of a first lien and
security interest in and to the Purchaser in the Acquired Assets to secure the
repayment of the First Closing Payment and no Holder will consent to the
granting of any other lien by it or by any Third-Party on the Acquired Assets.

     3. Action in Holder Capacity Only. Each Holder makes no agreement or
understanding herein as director, officer or employee of the Company. Each
Holder signs solely in such Holder's capacity as a record holder and beneficial
owner of the Shares, and nothing herein shall limit or affect any actions taken
in its capacity as an officer, director or employee of the Company.

     4. Amendments; Termination; Modification.

          (a) Except as otherwise provided herein, this Agreement may not be
amended except by an instrument in writing signed on behalf of all parties.

                                       3
<PAGE>

          (b) This Agreement will terminate upon the earlier to occur of (i) the
date and time at which the Company's stockholder approval approving the Proposed
Transaction is obtained, and (ii) the termination of the Purchase Agreement in
accordance with its terms.

     5. Additional Shares. If, after the date hereof, a Holder acquires
beneficial or record ownership of any additional shares of capital stock of the
Company (any such shares, "Additional Shares"), including, without limitation,
upon exercise of any option, warrant or right to acquire shares of capital stock
of the Company or through any stock dividend or stock split, the provisions of
this Agreement applicable to the Shares will thereafter be applicable to such
Additional Shares as if such Additional Shares had been Shares as of the date
hereof. The provisions of the immediately preceding sentence will be effective
with respect to Additional Shares without action by any person or entity
immediately upon the acquisition by such Holder of beneficial ownership of such
Additional Shares.

     6. Certain Remedies. Without intending to limit the remedies available to
any of the parties, each party agrees that damages at law will be an
insufficient remedy in the event such party violates the terms hereof or the
powers granted hereunder. Each party agrees that each of the other parties
hereto may apply for and have injunctive or other equitable relief in any court
of competent jurisdiction to restrain the breach or threatened breach of, or
otherwise specifically to enforce, any of such party's rights or powers granted
hereunder.

     7. Binding Effect. This Agreement and the powers granted hereunder will be
binding upon, and inure to the benefit of, the parties hereto, their successors
and permitted assigns.

     8. Notices. All notices, demands or other communications given hereunder
must be in writing and transmitted by facsimile or delivered either personally
or by a nationally recognized courier service marked for next business day
delivery or sent in a sealed envelope by first class mail, postage prepaid and
either registered or certified, return receipt requested, to the address for
each party as provided on the signature pages hereto, and in the case of the
Purchaser with a copy to the General Counsel or to such other address as any
such party may designate in writing. Any such notice, demand or communication
will be deemed to have been given (a) on the date of delivery, if delivered
personally, (b) on the date of facsimile transmission, receipt confirmed, (c)
one business day after delivery to a nationally recognized overnight courier
service, if marked for next day delivery or (d) five business days after the
date of mailing, if mailed.

     9. Miscellaneous. The section headings herein are inserted for convenience
of reference only and do not affect the meaning or interpretation hereof. Any
capitalized term used in this Agreement which is not defined herein shall have
the meaning assigned to it in the Asset Purchase Agreement. This Agreement
constitutes the entire agreement of the parties pertaining to the subject matter
of this Agreement. It supersedes all prior agreements of the parties, whether
oral or written, pertaining to the subject matter of this Agreement. If any
provision of this Agreement is held unenforceable by a court of competent
jurisdiction, all other provisions of this Agreement will remain effective. If
any provision of this Agreement is held to be unenforceable only in part or
degree, it will remain effective to the extent not held unenforceable. This
Agreement may be executed in counterparts, each of which is an original and all
of which

                                       4
<PAGE>

together constitute one and the same instrument. This Agreement is governed by
the laws of the State of New York without giving effect to principles of
conflict of laws.

                  [Remainder of page left blank intentionally]

                                       5
<PAGE>

     The undersigned are executing this Agreement on the date stated in the
introductory clause.
<Table>
<S>     <C>                                                          <C>
        HALSEY DRUG CO., INC.                                        IVAX PHARMACEUTICALS NEW YORK LLC
        616 N. North Court                                           By: IVAX Corporation
        Palatine, Illinois 60067                                     4400 Biscayne Boulevard
                                                                     Miami, Florida 33137
                                                                     Attn: Rafick Henein

         /s/ Andrew D. Reddick                                        /s/ Jordan Siegel
        ----------------------------                                 ----------------------------
        By:  Andrew D. Reddick                                       By:
        Its: President and CEO                                       Its:

        GALEN PARTNERS III, L.P.                                     ORACLE STRATEGIC PARTNERS, L.P.
        By: Claudius, L.L.C., General Partner                        By: Oracle Strategic Capital L.L.C.,
        610 Fifth Avenue, 5th Fl.                                    General Partner
        New York, New York  10019                                    200 Greenwich Avenue
                                                                     3rd Floor
                                                                     Greenwich, Connecticut 06830

         /s/ Srini Conjeevaram                                       /s/ Joel Liffmann
         ----------------------------                                ----------------------------
        By: Srini Conjeevaram                                        By: Joel Liffmann
        Its: General Partner                                         Its: Authorized Agent

        GALEN PARTNERS INTERNATIONAL, III, L.P.                      CARE CAPITAL INVESTMENTS II, LP
        By: Claudius, L.L.C., General Partner                        By:  Care Capital II, LLC, as general partner
        610 Fifth Avenue, 5th Floor                                  47 Hulfish St., Suite 310
        New York, New York  10020                                    Princeton, NJ 08542

         /s/ Srini Conjeevaram
         ----------------------------
        By: Srini Conjeevaram                                        By: /s/ David R. Ramsay
                                                                         ----------------------------
        Its: General Partner                                         Name:  David R. Ramsay
                                                                     Title: Authorized Signatory

        GALEN EMPLOYEE FUND III, L.P.                                ESSEX WOODLANDS HEALTH
        By: Wesson Enterprises, Inc.                                 VENTURES V, L.P.
        610 Fifth Avenue, 5th Floor                                  190 South LaSalle Street, Suite 2800
        New York, New York 10020                                     Chicago, IL 60603

          /s/ Bruce F. Wesson                                         /s/ Immanuel Thangaraj
         ----------------------------                                ----------------------------
        By: Bruce F. Wesson                                          By: Immanuel Thangaraj
            Its: General Partner                                     Its: Managing Director
</Table>
<PAGE>
<Table>
<S>     <C>                                                         <C>

        ALAN SMITH                                                   PATRICK COYNE
        21 Bedlow Avenue                                             800 Merion Square Road
        Newport, Rhode Island  02840                                 Gladwyne, Pennsylvania 19035

         /s/ Alan Smith                                               /s/ Patrick Coyne
         ----------------------------                                ----------------------------

        MICHAEL WEISBROT                                             SUSAN WEISBROT
        1136 Rock Creek Road                                         1136 Rock Creek Road
        Gladwyne, Pennsylvania  19035                                Gladwyne, Pennsylvania  19035

         /s/ Michael Weisbrot                                         /s/ Susan Weisbrot
         ----------------------------                                 ----------------------------

        GREG WOOD                                                    DENNIS ADAMS
        1263 East Calavera Street                                    120 Kynlyn Road
        Altadena, CA 91001                                           Radnor, Pennsylvania  19312

         /s/ Greg Wood                                                /s/ Dennis Adams
        ----------------------------                                 ----------------------------

        STEFANIE HEITMEYER                                           BERNARD SELZ
        17759 Road, Route 66                                         600 Fifth Avenue, 25th Floor
        Fort Jennings, Ohio 45844                                    New York, New York 10020

         /s/ Stefanie Heitmeyer                                       /s/ Bernard Selz
        ----------------------------                                 ----------------------------

        PETER CLEMENS                                                ROGER GRIGGS
        c/o Halsey Drug Co., Inc.                                    c/o Tom Jennings
        616 N. North Court                                           7300 Turfway Road
        Palatine, Illinois 60067                                     Suite 300
                                                                     Florence, KY 41042

         /s/ Peter Clemens                                            /s/ Roger Griggs
        ----------------------------                                 ----------------------------

        VARSHA H. SHAH                                               HEMANT K. SHAH
        29 Chrissy Drive                                             29 Chrissy Drive
        Warren, New Jersey  07059                                    Warren, New Jersey  07059
</Table>
<PAGE>
<Table>
<S>    <C>                                                          <C>
        VARSHA H. SHAH AS CUSTODIAN                                  VARSHA H. SHAH AS CUSTODIAN
        FOR SACHIN H. SHAH                                           FOR SUMEET H. SHAH
        29 Chrissy Drive                                             29 Chrissy Drive
        Warren, New Jersey  07059                                    Warren, New Jersey  07059

        ----------------------------                                 ----------------------------
        By: Varshah H. Shah                                          By: Varshah H. Shah
        Its: Custodian                                               Its: Custodian

        MICHAEL RAINISCH                                             ILENE RAINISCH
        c/o Alvin Rainisch                                           c/o Alvin Rainisch
        300 Flower Lane                                              300 Flower Lane
        Morganville, New Jersey  07751                               Morganville, New Jersey  07751

         /s/ Michael Rainisch                                         /s/ Ilene Rainisch
        ----------------------------                                 ----------------------------
        KENNETH GIMBEL, IRA ACCOUNT                                  KENNETH GIMBEL
        FBO KENNETH GIMBEL                                           2455 Montgomery Avenue
        2455 Montgomery Avenue                                       Highland Park, Illinois  60035
        Highland Park, Illinois  60035

         /s/ Kenneth Gimbel                                           /s/ Kenneth Gimbel
        ----------------------------                                 ----------------------------
        By:
            ----------------------------
        Its: Trustee

        JESSICA K. CLEMENS                                           JAKE P. CLEMENS
        c/o Halsey Drug Co., Inc.                                    c/o Halsey Drug Co., Inc.
        616 N. North Court                                           616 N. North Court
        Palatine, Illinois 60067                                     Palatine, Illinois 60067

         /s/ Peter Clemens                                            /s/ Peter Clemens
        ----------------------------                                 ----------------------------

        MICHAEL REICHER TRUST                                        ANDREW D. REDDICK
        c/o Halsey Drug Co., Inc.                                    c/o Halsey Drug Co., Inc.
        616 N. North Court                                           616 N. North Court
        Palatine, Illinois 60067                                     Palatine, Illinois 60067

                                                                      /s/ Andrew D. Reddick
                                                                     ----------------------------
        ----------------------------
        By: Michael K. Reicher
        Its: Trustee

</Table>

<PAGE>
<Table>
<S>     <C>                                                          <C>
        PETER STIEGLITZ                                              GEORGE E. BOUDREAU
        RJ Palmer LLC                                                222 Elbow Lane
        156 West 56th Street, 5th Floor                              Haverford, PA  19041
        New York, New York 10019

         /s/ Peter Stieglitz                                          /s/ George E. Boudreau
        ----------------------------                                 ----------------------------

        JOHN E. HEPPE, JR.                                           JAMES F. EMIGH
        237 W. Montgomery Avenue                                     c/o Halsey Drug Co., Inc.
        Haverford, Pennsylvania 19041                                616 N. North Court
                                                                     Palatine, Illinois 60067

         /s/ John E. Heppe, Jr.                                       /s/ James F. Emigh
        ----------------------------                                 ----------------------------

        WILLIAM G. SKELLY
        c/o Central Biomedia, Inc.
        9900 Pflumm Road - Suite 63
        Lenexa, KS 66215

         /s/ William Skelly
        ----------------------------
</Table>

<PAGE>

                                   EXHIBIT A<PAGE>
                                                                    EXHIBIT 10.2

                            Use and License Agreement
                            -------------------------

     This Use and License Agreement (this "Agreement") is dated and entered into
on this the 19th day of March, 2004 (the "First Closing Date"), by and among
HALSEY DRUG CO., INC., a New York corporation with offices at 616 N. North
Court, Suite 120, Palatine, Illinois 60067 ("Halsey"), AXIOM PHARMACEUTICAL
CORPORATION, a Delaware corporation and wholly-owned direct subsidiary of Halsey
with offices at 616 N. North Court, Suite 120, Palatine, Illinois 60067 ("Axiom"
and, together with Halsey, collectively and individually, the "Seller"), and
IVAX PHARMACEUTICALS NEW YORK LLC, a New York limited liability company with
offices at 77 Brenner Drive, Congers, New York 10920 (the "Purchaser") (the
Seller and the Purchaser, collectively, the "Parties", and each individually, a
"Party").

                             PRELIMINARY STATEMENTS
                             ----------------------

     A. In connection with the assignment to the Purchaser of (i) all the
Seller's rights, title and interests in and to the Brenner Contract of Sale (as
defined in the Asset Purchase Agreement) relating to the Brenner Facility (as
hereinafter defined) and (ii) Seller's tenant interest in the Wells Avenue Lease
(as defined in the Asset Purchase Agreement) relating to the Wells Facility (as
hereinafter defined, collectively together with the Brenner Facility, the
"Facilities", and each individually, a "Facility"), each pursuant to the
transactions, documents and deliveries contemplated by the Asset Purchase
Agreement entered into by the Parties on this date (the "Asset Purchase
Agreement"), the Seller also desires to sell, and the Purchaser desires to
purchase, subject to the terms and conditions set forth therein, the Seller's
rights in the Products as well as the Halsey Equipment, Intellectual Property,
Product Registrations, Transferred Documentation and Manufacturing Information
(each, as defined in the Asset Purchase Agreement).

     B. The Parties have agreed that, pending Shareholder Approval of the
Transactions Requiring Shareholder Approval (as such terms are defined in the
Asset Purchase Agreement), the Seller shall grant to the Purchaser the exclusive
right and license to exploit the Second Closing Acquired Assets (as defined in
the Asset Purchase Agreement) for its own commercial purposes, as more
particularly set forth in this Agreement.

     C. The Purchaser and the Seller have entered into this Agreement to induce
the Purchaser to enter into the Asset Purchase Agreement which it would not do
but for the agreement of the Seller to enter into this Agreement.

     NOW, THEREFORE, in consideration of the foregoing preliminary statements
and the mutual agreements and covenants set forth herein, the Parties hereby
agree as follows:

1.       DEFINITIONS; INTERPRETATION

     1.1 Definitions. Capitalized terms not otherwise defined in this Agreement
shall have the meanings assigned to such terms in the Asset Purchase Agreement.
As used in this

<PAGE>

Agreement, the following terms shall have the respective meanings set forth in
this Section 1.1, unless otherwise specifically indicated.

          (a) "Affiliates" shall mean, with respect to any Person, any Persons
directly or indirectly controlling, controlled by, or under common control with,
such Person. For purposes hereof, the term "controlled" (including the terms
"controlling," "controlled by" and "under common control with"), as used with
respect to any Person, shall mean the direct or indirect ability or power to
direct or cause the direction of management policies of such Person or otherwise
direct the affairs of such Person, whether through ownership of voting
securities or otherwise.

          (b) "ANDA" shall mean an abbreviated new drug application requesting
permission to place a drug on the market in accordance with 21 C.F.R. Part 314
Subpart C, and all supplements filed pursuant to the requirements of the FDA,
including all documents, data and other information concerning the applicable
drug which are necessary for FDA approval to market the drug in the United
States.

          (c) "Bankruptcy Code" shall have the meaning assigned to such term in
Section 4.1.

          (d) "Brenner Facility" shall mean the land, facilities and equipment
leased by the Seller at 77 Brenner Drive, Congers, New York, being formerly
known as Lot 22.02, Block A, Section 128 and being currently known as Lot 12,
Block 2, Section 44.7 on the tax map of the Town of Clarkstown, Rockland County,
New York.

          (e) "Confidential Asset Information" shall have the meaning assigned
to such term in the Asset Purchase Agreement.

          (f) "DEA" shall mean the United States Drug Enforcement Administration
and any successor agency or entity that may be established hereafter.

          (g) "FDA" shall mean the United States Food and Drug Administration
and any successor agency or entity that may be established hereafter.

          (h) "First Closing Date" shall have the meaning assigned to such term
in the Asset Purchase Agreement.

          (i) "First Refusal Period" shall have the meaning set forth in Section
3.3.

          (j) "Licensee" shall have the meaning set forth in Section 4.2.

          (k) "Licensor" shall have the meaning set forth in Section 4.2.

          (l) "Non-Packaging Assets" shall mean any and all Second Closing
Acquired Assets other than the Packaging Equipment.

          (m) "Notice" shall have the meaning set forth in Section 3.3.

                                       2
<PAGE>

          (n) "Packaging Equipment" shall mean any and all Halsey Equipment with
 application in the packaging of pharmaceutical products.

          (o) "Person" shall mean a natural person, a corporation, a
 partnership, a trust, a joint venture, a limited liability company, any
governmental authority or any other entity or organization.

          (p) "Refundable Amount" shall have the meaning assigned to such term
in the Asset Purchase Agreement.

          (q) "Related Agreement" shall have the meaning assigned to such term
 in the Asset Purchase Agreement.

          (r) "Retained Information" shall have the meaning assigned to such
term in the Asset Purchase Agreement.

          (s) "Second Closing Date" shall have the meaning assigned to such term
in the Asset Purchase Agreement.

          (t) "Term" shall have the meaning assigned to such term in Section
 3.1.

          (u) "Third Party" shall mean any person or entity who or which is
 neither a Party nor an Affiliate of a Party.

          (v) "Wells Facility" shall mean the land and facilities leased by the
Seller at 125 Wells Avenue, Congers, New York, being formerly known as Lot 26,
Block A, Section 128 and being currently known as Lot 3, Block 3, Section 44.11
on the tax maps of the Town of Clarkstown, New York.

2.       DELIVERY; USE AND OWNERSHIP; GRANT; RESERVATION OF RIGHTS

     2.1 Delivery; Use and Ownership. On or before the First Closing Date, the
Seller shall deliver to the Purchaser possession of all of the Second Closing
Acquired Assets and all information, records and materials contained therein
(e.g. full access to use, copies of documents etc.). All such information,
records and materials provided by the Seller shall be filed in files at the
Facilities or packaged, organized and listed in a commercially reasonable
manner, at the Seller's cost. While the Purchaser shall be permitted to exploit
and use the Second Closing Acquired Assets in accordance with this Agreement,
during the Term the Seller shall retain title and ownership to the Second
Closing Acquired Assets. During the Term prior to the effectiveness of the
termination of this Agreement with respect to the Non-Packaging Assets, the
Purchaser shall have the undisturbed quiet use and enjoyment of all of the
Non-Packaging Assets and the Seller shall not interfere in any way with the
Purchaser's quiet use and enjoyment of any of the Non-Packaging Assets. During
the Term, the Purchaser shall have the undisturbed quiet use and enjoyment of
all of the Packaging Equipment and the Seller shall not interfere in any way
with the Purchaser's quiet use and enjoyment of any of the Packaging Equipment.

                                       3

<PAGE>

     2.2 Grant of License.

          (a) During the Term until the effectiveness of the termination of this
Agreement with respect to the Non-Packaging Assets, the Seller hereby grants to
the Purchaser and its Affiliates an exclusive, worldwide, royalty-free right and
license, together with the right to grant sublicenses, to (i) all of the
Seller's rights, as of the First Closing Date, to make, have made, use, offer
for sale, sell, import, develop and commercialize the Products, (ii) use and
operate for any purpose the Halsey Equipment which is not included in the
Packaging Equipment, (iii) utilize for any purpose the Manufacturing Information
relating to the Halsey Equipment which is not included in the Packaging
Equipment, (iv) utilize for any purpose the Intellectual Property relating to
the Halsey Equipment which is not included in the Packaging Equipment, (v)
utilize for any purpose the Product Registrations and the Transferred
Documentation, and (vi) to utilize the Retained Information in connection with
any of the foregoing.

          (b) In addition, during the Term, Seller hereby grants to the
Purchaser and its Affiliates an exclusive, worldwide, royalty-free right and
license, together with the right to grant sublicenses, to (i) use and operate
for any purpose the Packaging Equipment, (ii) utilize for any purpose the
Manufacturing Information relating to the Packaging Equipment, (iii) utilize for
any purpose the Intellectual Property relating to the Packaging Equipment, and
(iv) to utilize the Retained Information in connection with any of the
foregoing.

3.       TERM; TERMINATION

     3.1 Term; Termination. The term of this Agreement (the "Term") shall
commence on the First Closing Date and shall continue until the earlier of: (a)
the Second Closing Date, or (b) June 30, 2007, or (c) with respect to the
Non-Packaging Assets only, following termination of the Asset Purchase Agreement
and payment in full to the Purchaser by the Seller of the Refundable Amount as
well as any other amounts which are then due and payable by the Seller to the
Purchaser under the Asset Purchase Agreement or any Related Agreement in
accordance with Section 9.2 of the Asset Purchase Agreement, six (6) months
written notice to the Purchaser of the Seller's intention to remove the
Non-Packaging Assets from the Facilities (which notice may only be given after
payment of such amounts). Following such notice, during such six (6) month
period and thereafter until the obligations of the Seller described in Section
3.2 are fully performed, the Seller shall use its best efforts to cooperate with
the Purchaser in the unwinding of the relationship established herein with
respect to the Non-Packaging Assets in an orderly manner. The provisions of this
Section 3 shall survive any termination of this Agreement.

     3.2 Effect of Notice under Section 3.1(c). If and when the Seller gives
 notice in accordance with and as permitted under Section 3.1(c), then:

          (a) Except as otherwise agreed by the Parties, promptly, but in no
event less than 3 business days, following the end of the six (6) month period
described in Section 3.1(c), the Non-Packaging Assets shall be removed from the
Facilities by the Seller, at the Seller's cost, in a manner so as to be
minimally disruptive to the operations of the Purchaser and to the

                                       4

<PAGE>

Purchaser's use and enjoyment of the Facilities, the improvements thereon or the
other equipment located at the Facilities.

          (b) The Seller shall, at its expense, promptly restore the Facilities
to good condition and reimburse or pay the Purchaser for any and all reasonable
costs and expenses incurred or to be incurred by the Purchaser in connection
with the Seller's activities in removing the Non-Packaging Assets from the
Facilities, including (i) any damages sustained to the Facilities, the
improvements thereon or the other equipment located at the Facilities, and (ii)
repairing the Facilities and the improvements thereon such that they once again
can be used by the Purchaser for the purposes for which they were used by the
Purchaser prior to the removal of the Non-Packaging Assets.

          (c) On the first business day following the end of the six (6) month
period described in Section 3.1(c), the Seller shall post a performance bond in
the amount of One Hundred Fifty Thousand Dollars ($150,000) with a Third Party
bank or trust company, both the form of bond and institution being acceptable to
the Purchaser, to support payment and performance of the Seller's obligations
under this Section 3.2.

          (d) The Purchaser shall be permitted, but shall not be obligated, to
continue to sell, distribute and import any inventory it has of the Products
until such inventory is exhausted.

     3.3 Packaging Equipment. If a Second Closing has not occurred, promptly
upon the Purchaser's request and in no event later than the end of the Term, the
Packaging Equipment shall be removed from the Facilities by the Seller, at the
Seller's cost, in a manner so as to be minimally disruptive to the operations of
the Purchaser and to the Purchaser's use and enjoyment of the Facilities, the
improvements thereon or the other equipment located at the Facilities. In such
event:

          (a) The Seller shall, at its expense, promptly restore the Facilities
to good condition and reimburse or pay the Purchaser for any and all reasonable
costs and expenses incurred or to be incurred by the Purchaser in connection
with the Seller's activities in removing the Packaging Equipment from the
Facilities, including (i) any damages sustained to the Facilities, the
improvements thereon or the other equipment located at the Facilities, and (ii)
repairing the Facilities and the improvements thereon such that they once again
can be used by the Purchaser for the purposes for which they were used by the
Purchaser prior to the removal of the Packaging Equipment.

          (b) At least three (3) business days prior to the scheduled removal of
the Packaging Equipment, the Seller shall post a performance bond in the amount
of One Hundred Fifty Thousand Dollars ($150,000) with a Third Party bank or
trust company, both the form of bond and institution being acceptable to the
Purchaser, to support payment and performance of the Seller's obligations under
this Section 3.3.

     3.4 Losses, damage to or destruction of any of the Second Closing Acquired
Assets.

                                       5

<PAGE>

          (a) Subject to Section 2.8 of the Asset Purchase Agreement, the
Purchaser shall have no liability whatsoever to the Seller with regard to any
losses, damage to or destruction of any of the Second Closing Acquired Assets,
whenever sustained or occurred, whether during the Term or thereafter. Any
insurance held by the Purchaser covering any of the Second Closing Acquired
Assets shall be solely for the benefit of the Purchaser and the Seller shall
have no claim against such insurance for any loss, damage or destruction of any
of the Second Closing Acquired Assets. At no time, whether during the Term or
thereafter, shall the Purchaser have any duty whatsoever to care for, keep in
good repair, guard from harm or otherwise maintain or protect from any loss,
damage or destruction, any of the Second Closing Acquired Assets. The Seller
shall take possession of the Second Closing Acquired Assets from the Purchaser
"AS-IS", "WHERE-IS". THE PURCHASER MAKES NO REPRESENTATIONS OR WARRANTIES,
EXPRESS OR IMPLIED, WITH REGARD TO ANY SECOND CLOSING ACQUIRED ASSETS AND THE
SELLER HEREBY DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT
LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE.

          (b) Nothing in this Agreement shall in anyway restrict, limit or
impair the Purchaser's rights and remedies under the Security Agreement.

     3.5 Right of First Refusal. At all times after the termination of the Asset

Purchase Agreement, during the Term and until two (2) years following the end of
the Term (the "First Refusal Period"), the Purchaser shall have a right of first
refusal with respect to the Second Closing Acquired Assets, as provided in this
Section 3.5. Without limiting any other obligation of the Seller set forth in
this Agreement, the Asset Purchase Agreement or any Related Agreement, during
the First Refusal Period, the Seller shall not sell, assign, lease or otherwise
transfer any Second Closing Acquired Assets, or any rights to possess or use any
Second Closing Acquired Assets, to any Third Party or authorize or create any
obligation to do so other than pursuant to a bona fide good faith offer and
without first giving the Purchaser notice in writing of the Seller's intent to
do so together with complete copies of all final proposed (unexecuted) contracts
with any Third Party relating to same together with all completed exhibits,
schedules and descriptions (the "Notice"), and the Purchaser does not elect to
enter into any such contract. After receipt of the Notice, the Purchaser shall
have a period of up to ninety (90) days to determine whether or not it desires
enter into the contracts contained in the Notice relating to what the Seller is
proposing to do with the Second Closing Acquired Assets in place of the Third
Party counterparty). In the event that the Purchaser does not elect to enter
into such contracts within such ninety (90) day period, the Seller may enter
into such contracts with any Third Party but only in the form contained within
the Notice, and the Seller shall give the Purchaser such evidence as is required
by the Purchaser of the Seller's compliance with this Section 3.5.

4.       BANKRUPTCY.

     4.1 The Parties expressly agree that in the event the Seller becomes a
debtor under Title 11 of the United States Code, 11 U.S.C. ss. 101, et seq. (the
"Bankruptcy Code"), this Agreement shall constitute an executory contract,
subject to the provisions of 11 U.S.C. ss. 365.

                                       6

<PAGE>

The Parties further expressly agree and acknowledge that under this Agreement,
the Seller "is a licensor of a right to intellectual property" for the purposes
of 11 U.S.C. ss. 365(n), and that in the event the Seller becomes a debtor under
the Bankruptcy Code, the Purchaser, as licensee, shall be entitled to all of the
protections set forth and contained in 11 U.S.C. ss. 365(n).

     4.2 The Parties further expressly agree and acknowledge that: (i) the
Purchaser's possession and use of the subject matter of the license granted to
the Purchaser (the "Licensee") hereunder, as well as the performance by the
Seller (the "Licensor") of its obligations under this Agreement, are necessary
to effect the purpose of this Agreement, and the sale of the license granted to
the Licensee under this Agreement or the sale of the subject matter of the
license granted to the Licensee under this Agreement to any party or entity
other than the Licensee would cause irreparable harm to the Licensee; and (ii)
in the event of the Licensor's bankruptcy and the rejection of this Agreement
under 11 U.S.C. ss. 365, the Licensee may, at the Licensee's option, select a
Third Party to undertake the Licensor's obligations under this Agreement without
violating any provisions of this Agreement, including, any confidentiality or
exclusivity provisions, and the Licensee shall have no liability to the
Licensor, and the Licensor shall have no claim against the Licensee in the event
that the Licensee elects to have a Third Party undertake the Licensor's
obligations under this Agreement upon either or both of the Licensor's
bankruptcy and the rejection of this Agreement.

5.       MISCELLANEOUS PROVISIONS

     5.1 Notices. All notices and other communications required or permitted to

be given under this Agreement shall be in writing and shall be delivered
personally or sent by (a) registered or certified mail, return receipt
requested; (b) overnight via a nationally recognized courier service
guaranteeing next-day delivery, charges prepaid; or (c) facsimile (with original
promptly sent by any of the foregoing manners). Any such notices shall be
addressed to the receiving Party at such Party's address set forth below, or at
such other address as may from time to time be furnished by similar notice by
either Party:

          (a) if to the Seller, to:

                           Halsey Drug Co., Inc.
                           616 N. North Court
                           Palatine, Illinois 60067
                           Fax:  (847) 705-5399
                           Telephone:  (847) 705-7709
                           Attention: President and CEO

                           with a copy to:

                           St. John & Wayne, L.L.C.
                           Two Penn Plaza East
                           Newark, New Jersey 07105
                           Fax:  (973) 491-3555
                           Telephone:  (973) 491-3600
                           Attention:  William P. Oberdorf, Esq.

                                       7

<PAGE>

          (b) if to the Purchaser, to:

                           IVAX Pharmaceuticals New York LLC
                           4400 Biscayne Boulevard
                           Miami, Florida 33137
                           Telephone: (305) 575-4101
                           Facsimile: (305) 575-4105
                           Attention: Rafick Henein

                           with a copy to:

                           IVAX Corporation
                           4400 Biscayne Boulevard
                           Miami, Florida 33137
                           Telephone: (305) 575-6000
                           Facsimile: (305) 575-6049
                           Attention: General Counsel

                           with a copy to:

                           Reed Smith LLP
                           599 Lexington Avenue
                           New York, New York 10022-7650
                           Telephone: (212) 549-0238
                           Facsimile: (212) 521-5450
                           Attention: William R. Griffith, Esq.

All notices shall be effective upon such personal delivery or upon transmission
by facsimile, or next business day following delivery to such courier service,
or three calendar days after it is sent by such registered or certified mail, as
the case may be. Copies shall be sent in the same manner as originals.

     5.2 Descriptive Headings. The descriptive headings in this Agreement are
inserted for convenience only and are not intended to be part of or to affect
the meaning or interpretation of this Agreement.

     5.3 Counterparts. This Agreement may be executed in one or more
counterparts, both of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the Parties and delivered to the other Party.

                                       8

<PAGE>

     5.4 Entire Agreement. This Agreement, the Asset Purchase Agreement and the
Related Agreements and the Schedules and Exhibits thereto contain the entire
agreement and understanding between the Parties hereto with respect to the
subject matter hereof and supersede all prior agreements and understandings
relating to such subject matter. Neither Party shall be liable or bound to any
other Party in any manner by any representations, warranties or covenants
relating to such subject matter except as specifically set forth herein or in
the Asset Purchase Agreement or the Related Agreements.

     5.5 Fees and Expenses. Regardless of whether or not the transactions
contemplated by this Agreement are consummated, except as otherwise provided
herein each Party shall bear its own fees and expenses incurred in connection
with the transactions contemplated by this Agreement.

     5.6 Independent Contractors. Nothing contained in this Agreement shall be
deemed to constitute a partnership or joint venture between the Seller and the
Purchaser, or to constitute one as the agent of the other. The Seller and the
Purchaser shall act solely as independent contractors, and nothing in this
Agreement shall be construed to give either Party the power or authority,
express or implied, to act for, bind, or commit the other Party.

     5.7 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida, without regard to any
applicable principles of conflicts of law.

     5.8 Specific Performance. The Parties hereto agree that if any of the
provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached, irreparable damage would occur, no
adequate remedy at law would exist and damages would be difficult to determine,
and that the Parties shall be entitled to specific performance of the terms of
this Agreement, in addition to any other remedy at law or equity.

     5.9 Further Actions. Each Party shall execute, acknowledge and deliver such
further instruments, and do all such other acts, as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.

     5.10 Assignment. This Agreement may not be assigned by any Party hereto
without the prior written consent of the other Party, provided, however, that
the Purchaser may assign its rights under this Agreement to an Affiliate without
the consent of the Seller; provided, that such assignment shall not be deemed to
release the Purchaser from its obligations hereunder. Any attempted assignment
in violation of this Section 5.10 shall be void.

     5.11 Successors and Assigns. This Agreement shall be binding upon and inure
solely to the benefit of the Parties hereto, their successors and permitted
assigns, and nothing in this Agreement, express or implied, is intended to or
shall confer upon any other person or persons any rights, benefits or remedies
of any nature whatsoever under or by reason of this Agreement.

     5.12 Severability. In the event that any one or more of the provisions
contained in this Agreement, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
Parties shall negotiate in good faith with a view

                                       9

<PAGE>

to the substitution therefor of a suitable and equitable solution in order to
carry out, so far as may be valid and enforceable, the intent and purpose of
such invalid provision; provided, however, that the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained in this Agreement shall not be in any way impaired thereby,
it being intended that all of the rights and privileges of the Parties hereto
shall be enforceable to the fullest extent permitted by law.

     5.13 Consent to Jurisdiction. Each of the Purchaser and the Seller
irrevocably submits to the exclusive jurisdiction of the U.S. District Court for
the Southern District of Florida, for the purposes of any suit, action or other
proceeding arising out of this Agreement, any Related Agreement or any
transaction contemplated hereby or thereby. Each of the Purchaser and the Seller
agrees to commence any such action, suit or proceeding either in the U.S.
District Court for the Southern District of Florida or if such suit, action or
other proceeding may not be brought in such court for jurisdictional reasons, in
the Courts of the State of Florida. Each of the Purchaser and the Seller further
agrees that service of any process, summons, notice or document by U.S.
registered mail to such Party's respective address set forth above shall be
effective service of process for any action, suit or proceeding in Florida with
respect to any matters to which it has submitted to jurisdiction in this Section
5.13. Each of the Purchaser and the Seller irrevocably and unconditionally
waives any objection to the laying of venue of any action, suit or proceeding
arising out of this Agreement, any Related Agreement or the transactions
contemplated hereby and thereby in the U.S. District Court for the Southern
District of Florida, and hereby and thereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum.

     5.14 Waiver of Jury Trial.

          EACH PARTY HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT OR ANY RELATED INSTRUMENT. EACH PARTY HERETO (A) CERTIFIES THAT
NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THAT FOREGOING WAIVER; AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTY HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND
THE RELATED AGREEMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.14.

     5.15 Attorney Fees. A Party in breach of this Agreement shall, on demand,
indemnify and hold harmless the other Party for and against all reasonable
out-of-pocket expenses, including legal fees, incurred by such other Party by
reason of the enforcement and protection of its rights under this Agreement. The
payment of such expenses is in addition to any other relief to which such other
Party may be entitled.

     5.16 Interpretation.

                                       10

<PAGE>

          (a) In the event an ambiguity or a question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the Parties and no presumption or burden of proof shall arise favoring or
disfavoring any Party by virtue of the authorship of any provisions of this
Agreement.

          (b) The definitions of the terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". Unless the
context requires otherwise, (A) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein or therein); (B) any
reference to any Laws herein shall be construed as referring to such Laws as
from time to time enacted, repealed or amended; (C) any reference herein to any
Person shall be construed to include the Person's successors and assigns; (D)
the words "herein", "hereof" and "hereunder", and words of similar import, shall
be construed to refer to this Agreement in its entirety and not to any
particular provision hereof; and (E) all references herein to Sections, Exhibits
or Schedules shall be construed to refer to Sections, Exhibits and Schedules of
this Agreement.

     5.17 Joint and Several Obligations; Interpretation of "Seller".

         Halsey and Axiom shall be jointly and severally liable for the
obligations of the Seller and of each other under this Agreement and all of the
Related Agreements. Each reference to the phrase "the Seller" or "Seller" in
this Agreement or any Related Agreement to which Halsey and Axiom are both
parties shall be deemed to read as meaning "Halsey" as well as "Axiom".

                     [The next page is the signature page.]

                                       11

<PAGE>

     IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the date first written
above.

                        HALSEY DRUG CO., INC.

                        By:             /s/ Andrew D. Reddick
                                     -----------------------------------
                        Name:        Andrew D. Reddick
                        Title:       President and CEO

                        AXIOM PHARMACEUTICAL CORPORATION

                        By:             /s/ Andrew D. Reddick
                                     -----------------------------------
                        Name:        Andrew D. Reddick
                        Title:       President and CEO

                        IVAX PHARMACEUTICALS NEW YORK LLC

                        By:             /s/ Jordan Siegel
                                     ------------------------------------------
                        Name:        Jordan Siegel
                        Title:       Vice President

                                       12

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