Document:

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                                                                  EXHIBIT 10. 19

Portions of this Exhibit have been omitted pursuant to a request for
Confidential Treatment. The omitted portions, marked by [****], have been
separately filed with the Commission.

                               LICENSE AGREEMENT

                 THIS LICENSE AGREEMENT ("Agreement") is made and entered into
as of August 2, 1995 (the "Effective Date") between VIRUS RESEARCH INSTITUTE,
INC., a Delaware corporation having its principal place of business at 61
Moulton Street, Cambridge, Mass 02138 (hereinafter referred to as "VRI"), and
PASTEUR MERIEUX SERUMS ET VACCINS, a French corporation having its registered
head office at 58 Avenue Leclerc, Lyon, France (hereinafter referred to as
"PMC").

                                    RECITALS

                 A. VRI has certain proprietary rights relating to the use of
polyphosphazene for the mucosal delivery of vaccines against human diseases.

                 B. PMC desires to obtain a license to such rights and to
research, develop, manufacture, market, sell and distribute certain vaccines
which incorporate polyphosphazene, all under the terms and conditions set forth
below.

                 NOW THEREFORE, for and in consideration of the covenants,
conditions, and undertakings hereinafter sat forth, it is agreed by and between
the parties as follows:

                                   ARTICLE 1

                                  DEFINITIONS

                 1.1 "Affiliate" shall mean, with respect to any Person, (i) any
other Person of which securities or other ownership interests representing 50%
or more of the voting interests (or such lesser percentage which is the maximum
allowed to be owned by a foreign corporation in a particular jurisdiction) are,
at the time such determination is being made, owned, controlled or held directly
or indirectly, by such Person, or (ii) any other Person which, at the time such
determination is being made, is Controlling, Controlled by or under common
Control with, such Person.

                 For the purpose of this section 1.1, "Control," whether used as
a noun or verb, refers to the possession directly or indirectly, of the power to
direct, or cause the direction of, the management or policies of a Person,
whether through the ownership of voting securities, by contract or otherwise,
and "Person" means any natural person, corporation, firm, business trust, joint
venture, association, organization, company, partnership or other business
entity, or

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The information below marked by [****] has been omitted
pursuant to a request for Confidential Treatment. The omitted portion has been
separately filed with the Commission.

any government, or any agency or political subdivision thereof.  The Joint
Venture companies known as Pasteur Merieux MSD Snc and MCM Vaccine Co. are
Affiliates of PMC.

                 1.2 "Co-Exclusive Vaccine" shall mean a mucosally administered
vaccine (other than a DNA vaccine) against one or more of the following
diseases: Respiratory Syncytial Virus ("RSV"), Para Influenza, Cytomegalovirus
("CMV"), Pneumococcal Pneumonia ("Pneumo") (including S. pneumoniae,
Branhamalla, non-typable Haemophilus Influenza and Otitis Media), Rabies, each
alone or in combination with each other, and specifically excluding a
combination of (a) one or more of the vaccines specifically enumerated as a
Co-Exclusive Vaccine or Exclusive Vaccine with (b) a vaccine which is not
specifically enumerated as an Exclusive Vaccine or Co-Exclusive Vaccine.

                 1.3 "Exclusive Vaccine" shall mean a mucosally administered
vaccine(s) (other than a DNA vaccine) against one or more of Lyme Disease,
Meningococcus and Influenza, each alone or in combination with each other or in
combination with a Co-Exclusive Vaccine and shall also include [****]
specifically excluding a combination of (a) one or more of the vaccines
specifically enumerated as a Co-Exclusive Vaccine or Exclusive Vaccine with (b)
a vaccine which is not specifically enumerated as an Exclusive Vaccine or
Co-Exclusive Vaccine.

                 1.4 "Field" shall mean the prevention of a disease in humans.

                 1.5 "Licensed Know-How" shall mean any biological materials,
and any research and development information, inventions, know-how,
pre-clinical, clinical and other technical data, in each case that are owned by
VRI, or possessed by VRI with the right to provide the same to others, from and
after the Effective Date and which is necessary or useful for the improving,
making, using or selling of Licensed Products as provided in this Agreement.

                 1.7 "Licensed Product(s)" shall mean, individually and
collectively, the Exclusive Vaccines and the Co-Exclusive Vaccines provided that
polyphosphazene is used for the mucosal administration of the product containing
such vaccine.

                 1.8 "Net Sales" shall mean the gross invoice price of Licensed
Products sold or distributed by PMC or its Affiliates or any of their
sublicensees, less: (i) normal and customary rebates, trade discounts, and
credits for returns and allowances, all to the extent actually allowed, (ii) to
the extent separately reported on the invoice, sales or other excise taxes or
duties imposed upon and paid by PMC, its Affiliates or sublicensees with respect
to such sales, and (iii) transportation charges and insurance for transportation
to the extent separately invoiced or separately reported on the invoice and paid
by the seller.

                                      -2-

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                 In the event that Licensed Product is sold in other than an
arms length transaction, then Net Sales shall be the gross invoice price which
would be received in an arms length transaction, taking account of any
deductions for items referred to in clauses (i), (ii) and (iii) of the preceding
paragraph.

                 In the event that consideration in addition to or in lieu of
money is received for Licensed Product such consideration shall be added to Net
Sales.

                 Notwithstanding the provisions of this Section, Net Sales shall
not include sales to an Affiliate for resale by such Affiliate.

                 1.9 "Patent Rights" shall mean the following patents and patent
applications, and all subject matter claimed therein:

                          (a)     All patents and applications listed in
Exhibit A; any continuations, continuations-in-part, divisions and substitutions
thereof, or of which such an application or patent is a successor; patents which
may issue upon any of the foregoing; and all renewals, reissues and extensions
thereof; and

                          (b)     Any foreign patents and/or applications that
are counterparts of a patent or application described in paragraph (a) above,
including any patent or application that claims subject matter claimed in, or
that takes priority from, a patent or application described in paragraph (a)
above; and

                          (c)     Any patent or application owned by VRI during
the term of this Agreement which claims polyphosphazene and/or the use thereof
in as part of a vehicle for the mucosal administration of vaccine.

                 1.10 "PMC Mucosal Delivery Technology" shall mean any and all
materials, information, data, improvements, patents and patent applications
directed to polyphosphazene and/or its use as part of a mucosal delivery system
including, but not limited to, data related to polymer safety (other than Drug
Master Files or clinical data, and excluding that which is unique to the
formulation of polyphosphazene with a specific PMC antigen) which are owned by
PMC or in the possession of PMC with the right to provide same to others during
the term of the Agreement.

                 1.11 "Significant Competition" with respect to each Licensed
Product in each country for each calendar year shall mean that a third party
sells a mucosally delivered vaccine which competes with a Licensed Product as to
a given indication, whether in single antigen or multivalent form and such third
party vaccine has a commercially recognized advantage in safety, immunogenicity
and/or therapeutic value over the competing Licensed

                                      -3-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

Product and that such third party vaccine has [****] vaccines for the indication
concerned. The sale of a Co-Exclusive Vaccine by a licensee of VRI or the sale
of a polyphosphazene adjuvanted parenteral vaccine shall not be a third party
vaccine for the purpose of this definition.

                 1.12 "Territory" shall mean (i) all countries included in the
continents of North and South America, including Central America and the islands
of the Caribbean, Europe, and Africa, including the dependencies and territories
of such countries; (ii) Thailand, and (iii) all countries previously part of the
U.S.S.R. [****]

                 1.13 "Valid Claim" shall mean a claim of an issued and
unexpired patent or pending patent application included within the Patent
Rights, which has not been held unenforceable, unpatentable or invalid by a
court or other governmental agency of competent jurisdiction from which no
appeal can be or is taken, and which has not been admitted to be invalid or
unenforceable through reissue, disclaimer or otherwise.

                                   ARTICLE 2

                                GRANT OF RIGHTS

                 2.1 License to PMC. (a) Subject to the terms and conditions of
this Agreement, VRI hereby grants to PMC (i) a license under the Patent Rights
and Licensed Know-How to make, have made, and use the Licensed Products which
are Exclusive Vaccines outside of the Territory but only for sale in the Field
in the Territory and to make, have made, use, sell and distribute the Licensed
Products which are Exclusive Vaccines in the Field in the Territory, which
license under this Section 2.l(a)(i) shall be exclusive with respect to sale of
Exclusive Vaccines in the Field in the Territory and in all other respects the
license granted under this Section 2.1(a)(i) is non-exclusive, and (ii) a
license under the Patent Rights and Licensed Know-How to make, have made, and
use the Licensed Products which are Co-Exclusive Vaccines outside of the
Territory but only for sale in the Field in the Territory and to make, have
made, use and sell a Licensed Product which is a Co-Exclusive Vaccine in the
Field in the Territory which license under this Paragraph 2.1(a) shall be
exclusive to PMC for use, sale and distribution of Co-Exclusive Vaccine in the
Field in each country of the Territory but for one other entity which may, at
VRI's option, be VRI or an entity licensed by VRI, and in all other respects the
license granted under this Section 2.l(a)(ii) is non-exclusive. It is expressly
understood that only one entity other than PMC will be or be permitted to be
licensed by VRI, to use or sell any Co-Exclusive Vaccine in the Field in any
country of the Territory.

                                      -4-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                          (b)     Subject to the terms and conditions of this
Agreement, VRI hereby grants to PMC a non-exclusive license under the Patent
Rights and Licensed Know-How (i) to use, sell and distribute the Licensed
Products set forth in Exhibit B in the countries set forth in Exhibit B, but
only to the extent that all of the antigens contained therein are covered by
patent rights of PMC and/or its Affiliates which give PMC an exclusive position
with respect to those antigens in those countries, and (ii) to make and have
made and use Licensed Products set forth in Exhibit B in any country of the
world but only for use, sale and distribution in the countries set forth in
Exhibit B, and only to the extent that all of the antigens contained therein are
covered by patent rights of PMC and/or its Affiliates, which give PMC an
exclusive position with respect to all of the antigens contained in the Licensed
Product of Exhibit B in those countries of Exhibit B. Exhibit B is intended to
set forth the countries in which PMC holds exclusive rights in respect of a
given antigen and the antigens as to which such exclusive rights are held in
that country. Such Exhibit B shall be amended from time to time to take account
of any additional countries and/or additional Licensed Products which contain
only antigens as to which PMC obtains exclusive rights during the term of this
Agreement but only to the extent that VRI is able to grant such a license and
only to the extent VRI has not previously granted to a third party rights which
would prevent VRI from granting such rights to PMC.

                          (c)     Upon written notice to VRI, PMC shall have
the right to be granted a non-exclusive license to use, sell and distribute each
Co-Exclusive Vaccine and each Exclusive Vaccine, in each country (other than
Japan) where PMC and/or its Affiliates have patent rights (as an owner or
exclusive licensee) which cover the antigen of such Exclusive Vaccine or
Co-Exclusive Vaccine provided that VRI has not granted rights to a third party
in such country which would prevent VRI from granting such license to PMC, which
non-exclusive license extension shall be limited to a Co-Exclusive Vaccine or
Exclusive Vaccine, as the case may be, which contains such antigen. The
non-exclusive license shall include the right to make and have made each such
Co-Exclusive Vaccine and Exclusive Vaccine but only for use and sale in the
countries specified in this Paragraph 2.1(c).

                          (d)     [****]

                          (e)     In order to assure PMC of the exclusive
rights granted in Section 2.1(a)(i), VRI shall not grant to a third party or
itself exercise any rights or licenses under Patent Rights and Licensed Know-How
to use, sell or distribute a mucosally administered vaccine [****] against Lyme
Disease, Meningococcus or Influenza in the Field in the Territory. In addition,
except as permitted in Section 2.1 (a (ii), VRI shall not grant to a third party
or itself exercise any rights or licenses under Patent Rights and Licensed
Know-How to use, sell or distribute a mucosally administered vaccine [****]
against RSV, Para Influenza, CMV Pneumo (including S. Pneumoniae, Branhamalla,
non-typable Haemophilus Influenza and Otitis Media) and Rabies in the Field in
the Territory.

                                      -5-

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                 2.2 Licenses to VRI. Subject to the rights granted to and
maintained by PMC and to any existing rights of third-parties, PMC hereby grants
to VRI a worldwide, royalty free, license to use PMC Mucosal Delivery Technology
to make, have made, use and sell vaccine products, including the right to
sublicense such license to Affiliates. Such license of PMC Mucosal Delivery
Technology may also be sublicensed to third parties with the prior written
consent of PMC, which consent shall not be unreasonably withheld.

                 2.3 Sublicenses. With respect to the rights granted under
Section 2.1(a)(i) PMC shall have the right to grant sublicenses under this
Agreement with the prior approval of VRI as to the sublicensee, which approval
shall not be unreasonably denied. With respect to the rights granted under
Section 2.1(a)(ii), PMC shall have the right (without the approval of VRI) to
grant a sublicense to one other party in any country where PMC is not selling or
does not intend to sell Licensed Product. PMC shall advise VRI of the name of
such sublicensee when such sublicensee is selected. The rights granted under
Section 2.1(b) and (c) are not sublicensable, except to Affiliates of PMC.

                 2.4 (a) In case of any sublicense by PMC or VRI of the rights
and licenses granted in this Agreement, the sublicensee shall agree to be bound
by the terms, obligations and conditions identical to those of Articles 7 and 10
and Sections 2.5 and 12.5 of this Agreement (substituting the name of the
Sublicensee for that of the sublicensing party), with the other party being
expressly made a third party beneficiary thereof, and the sublicensing party
shall be responsible for the performance by the appointed sublicensee of such
terms, obligations and conditions.

                     (b) Each sublicense agreement concluded by PMC will
include a requirement that the sublicensee maintain records and permit
inspection on terms essentially identical to Article 10.4 of this Agreement.
At VRI's request, PMC shall arrange for an independent certified accountant
selected by VRI to inspect the records of its sublicensee(s) for the purpose
of verifying royalties due to VRI and shall cause such accountant to report
the results thereof to VRI.

                     (c) All sublicenses granted for a Licensed Product or
for the PMC Mucosal Delivery Technology in a country shall terminate upon
termination of the licenses granted hereunder with respect to such Licensed
Product or to PMC Mucosal Delivery Technology as the case may be, provided
that upon expiration of the full term of this Agreement pursuant to Paragraph
5.1, all parties shall have fully paid-up, non-cancelable licenses.

                 2.5 To the extent Patent Rights licensed to PMC under this
Agreement have been licensed by VRI from another party under an agreement with
another party ("Another Party Agreement(s)"), PMC understands and agrees as
follows:

                                      -6-

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                          (i) The rights licensed to PMC by VRI are subject to
                 the terms, limitations, restrictions and obligations of the
                 Another Party Agreement(s).

                          (ii) PMC will comply with the terms, obligations,
                 limitations and restrictions of the Another Party Agreement(s)
                 to the extent PMC has been permitted to review such terms,
                 obligations, limitations and restrictions. VRI will give PMC,
                 upon request, a reasonable opportunity to review the same
                 except to the extent that confidentiality or other obligations
                 towards Another Party may prevent VRI from doing so. In any
                 event VRI shall act reasonably in advising PMC of the scope of
                 PMC's obligation pursuant to such Another Party Agreement. It
                 is expressly understood that PMC may refuse to accept a license
                 under one or more Another Party Agreements, in which case PMC
                 will not be bound thereby.

                 2.6 Disclosure of Technology. Upon the execution of this
Agreement, and periodically thereafter upon request by PMC, VRI shall provide to
PMC copies of all available information in tangible form within the Licensed
Know-How or related to the Patent Rights.

                 2.7 Subject to the terms and conditions of the Supply Agreement
to be negotiated under this Section 2.7, PMC is hereby granted a non-exclusive
right and license under the Patent Rights and Licensed Know-How to make and have
made polyphosphazene for use by PMC, its Affiliates and its sublicensees as part
of a mucosal delivery system in the manufacture of Licensed Product in
accordance with and to the extent that PMC retains its license to Licensed
Product under this Agreement.

                 PMC shall have the right at any time during the term of this
Agreement, but not the obligation, to exercise its right under the herein
granted manufacturing license. In the event that PMC decides to exercise such
rights, it shall so inform VRI in writing, and VRI shall promptly disclose to
PMC all applicable manufacturing technology in the possession of VRI at the time
of such disclosure. Subject to applicable confidentiality obligations, VRI and
PMC shall share and exchange any technology and know-how they shall generate
while establishing manufacturing processes and facilities.

                 When either PMC or VRI achieves manufacture of polyphosphazene
on a commercial basis, it shall have an obligation to use reasonable efforts in
good faith to assist the other to satisfy its reasonable requirements of
polyphosphazene for use as part of a vehicle for a mucosal delivery system for
vaccines on reasonable commercial terms, taking into account the respective
investments made and risks incurred by the parties in connection with such
manufacture.

                 PMC and VRI shall consult in good faith and in their mutual
interest as to an arrangement for the manufacture and supply of polyphosphazene
for clinical lots as well as in

                                      -7-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

commercial quantities for use as a part of a mucosal delivery system by PMC and
its Affiliates and authorized sublicensees in the Licensed Products as licensed
hereunder and for use by VRI, its Affiliates and licensees (other than PMC).

                 VRI shall use commercially reasonable efforts to establish a
process capable of yielding under GMP conditions consistent and validated
supplies of polyphosphazene in accordance with agreed upon specifications,
[****]

                 VRI shall use commercially reasonable efforts to obtain a
manufacturer of polyphosphazene. Thereafter, under the terms and conditions of a
supply agreement to be negotiated in good faith between the parties (the "Supply
Agreement"), VRI shall be

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

responsible for scaling-up the process in an efficient, cost-effective GMP
manufacturing facility for production of polyphosphazene according to
agreed-upon specifications at industrial scale, which Supply Agreement [****]

                 PMC shall render all reasonable assistance to VRI in
identifying and selecting a third-party manufacturer. In the event that VRI
retains such manufacturer, VRI shall then, subject to appropriate
confidentiality provisions, transfer to it all of VRI's technology for
manufacture of polyphosphazene.

                                   ARTICLE 3

                            MILESTONES AND ROYALTIES

                 3.1 Milestone Fees. PMC shall pay to VRI the non-refundable and
non-creditable amounts specified below within thirty (30) days following the
accomplishment by PMC, its Affiliates or sublicensees of the corresponding event
set forth below, or (ii) within thirty (30) days following receipt by PMC of
written notice of accomplishment by VRI or a VRI's Affiliate of such other
corresponding event set forth below:

                          (a)     [****]

                          (b)     [****]

                 3.2 Royalties.  [****]

                                      -8-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                          (a)     [****]

                          (b)     [****]

                          (c)     [****]

                          (d)     In the case of the earned royalties set forth
in paragraphs (a) and (b) above, the royalties would be adjusted in each country
for each calendar year for each Licensed Product in the event PMC was required
to pay royalties to a third party for use of polyphosphazene as part of a
mucosal delivery system in such Licensed Product in such a country for such year
utilizing the following method, but in no event shall [****]

         (1) First determine the relationship between Net Sales in the
applicable country for the year and the total worldwide Net Sales in that same
category of sales for the year for the Licensed Product, i.e., divide Net Sales
in a country for the applicable Licensed Product, where, [****] by worldwide Net
Sales in all countries for such Licensed Product [****].

                                  (2)      Apply this percentage to total
royalties paid in all such countries for the Licensed Product for the year to
determine the VRI royalties in a country against which a credit for third party
royalties paid in such country may be taken.

                                  (3)      Subtract the amount of third party
royalties paid in the country in question from [****].

                          (e)     Royalties shall be calculated and paid on a
country-by-country and product-by-product basis [****] provided, however, that
if at any time after the expiration [****], the making, using or selling of the
product is covered by Patent Rights, the royalties shall be paid until the
expiration if the last to expire of any such patent(s).

                          (f)     [****]

                 3.3 Single Royalty: Non-Royalty Sales. It is understood that in
no event shall more than one royalty be payable under Section 3.2 with respect
to a particular unit of Licensed Product. No royalty be payable under Section 3
with respect to sales of Licensed Products among PMC, its Affiliates and/or
sublicensees, but royalty shall be due upon the subsequent sale of the Licensed
Product to an entity who is not an Affiliate or sublicensee provided, however,
that if there is no or is to be no subsequent sale of the Licensed Product to an
entity who is not an Affiliate or a sublicensee, then the royalty shall be due
and shall be based upon the higher of (i) the gross invoice price to such
Affiliate or sublicensee or (ii) the average gross invoice price with PMC
charges to its customers (other than Affiliates and

                                      -9-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

sublicensees) for the Licensed Product for the relevant reporting period of
Section 9.1 in the relevant country.

                 No royalty shall be payable for (i) Licensed Product used in
clinical trials, or (ii) Licensed Product used by PMC or its sublicensee for
research, or (iii) customary quantities of Licensed Product distributed by PMC
or its sublicensee as free samples.

                 3.4 Combination Products. In the event Licensed Products
contain vaccines licensed hereunder in combination, the royalty rate applicable
to said combination products shall be the rate [****]

                                   ARTICLE 4

                                RESEARCH PROGRAM

                 4.1 Object. Pursuant to the mutually agreed upon research
program attached hereto as Exhibit D (the "Research Program"), VRI agrees to
conduct the research described therein and PMC agrees to support and fund such
Research Program in accordance with the terms and conditions set forth below.

                 4.2 Oversight of the Research Program

                          (a)     Oversight.  The Research Program will be
overseen and monitored by the Research Steering Committee as described herein
(the "Committee").

                          (b)     Membership. [****] Such representatives will
be qualified, by reason of background and experience, to assess the scientific
progress of the Research Program. Each party will have the right to change its
representation on the Committee upon written notice sent to the other.

                          (c)     Chair. [****]

                          (d)     Responsibilities.  The Committee will have

authority to:

                                  (i) review and approve the draft
                          Research Program prepared by VRI and establish
                          the definitive Research Program;

                                      -10-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                                  (ii) make recommendations regarding the
                          performance of the Research Program and the conduct of
                          the research pursuant thereto, and monitor performance
                          thereunder;

                                  (iii) modify the Research Program as it
                          determines, for each twelve (12) month period during
                          the term thereof;

                                  (iv) review any and all proposed
                          publication[s] or communication[s] relating to the
                          Research Program and the results therefrom, in
                          accordance with the procedure set forth in this
                          Article 4;

                                  (v) review any and all proposed filing of
                          patent application[s] in connection with the Research
                          Program.

                 4.3 Meetings. [****] Meetings in person will normally take
place at VRI's premises or such other pace as may be mutually agreed upon.
Meetings may be held by telephone. At such meetings, the Committee will discuss
the Research Program and the status of performance by VRI under the program,
evaluate the results thereof and set priorities therefor. [****] The Committee
will prepare written minutes of each meeting and a written record of all
decisions whether made at a formal meeting or not. Such minutes will incorporate
semi-annual research reports prepared for the parties by VRI. A quorum for a
meeting shall require [****]

                 4.4 Committee Deadlock.  If there are issues on which the
Committee cannot reach agreement because of a Deadlock (as hereinafter
defined)[****]

                 4.5 The Principal Investigator.

                          (a)     Principal Investigator.  [****]

                          (b)     Duties.  The Principal Investigator will
direct the Research Program and coordinate the efforts of other researchers
involved in the performance of such Program. The Principal Investigator will sit
with the Committee as provided in Section 4.2 hereof, will perform the duties
set forth hereunder and will be afforded the opportunity to actively participate
in all Committee deliberations. The Principal Investigator will provide
reasonably detailed status reports of the Research Program to the Committee at
six-month intervals, as well as at the earliest practicable time whenever, in
the Principal Investigator's judgment, an invention is created or reduced to
practice. The Principal Investigator will devote such time and efforts as may be
required to fulfill his duties hereunder and to ensure the successful
administration and coordination of the Research Program.

                                      -11-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                          (c)     Replacement.  The Principal Investigator may
be replaced in the event the then existing Principal Investigator is no longer
able or is unwilling to so serve or fails to perform the duties assigned. In
such circumstances VRI, with the consent of PMC shall appoint a substitute
Principal Investigator. PMC will not unreasonably withhold its consent to a
substitute Principal Investigator proposed by VRI. [****]

                 4.6 (a) Conduct of Research Program. The Research Program will
be conducted by VRI at VRI's laboratories. VRI will use all reasonable efforts
to complete research in accordance with the said Research Program [****]. Any
research work performed by VRI pursuant hereto will be in compliance with Good
Laboratory Practices as applicable in the United States of America. [****]

                          (b)     Visitation.  For the purpose of facilitating
PMC's understanding of the research activities conducted by VRI hereunder, VRI
will permit duly authorized employees or representatives of PMC to visit its
facilities where the research is conducted, at reasonable times and with
reasonable notice.

                 4.7 Financial Conditions.

                          (a)     Support Commitment.  PMC will provide funding
for and during the term of the Research Program up to a maximum of two million
five hundred thousand United States dollars (2,500,000 US$) (the "Maximum
Commitment"). The Maximum Commitment will be inclusive of all costs incurred by
VRI implementing the Research Program.

                          (b)     Payment Schedule.  Support payments will be
made by PMC to VRI in four (4) equal half-year payments of six hundred
twenty-five thousand United States dollars (625,000 US$) in advance with the
first payment to be made within eight (8) days of the Effective Date hereof.

                 4.8 VRI will provide an annual budget for the research program
and semi-annual financial reports of actual and budgeted expenditure.

[****]

                 [****] the records on which these reports are based shall be
open, no more than once each year, for inspection by an independent certified
accountant selected by PMC and acceptable to VRI, upon reasonable notice during
normal business hours and at PMC's expense, for the sole purpose of verifying
the accuracy of the reports.

                 [****]

                                      -12-

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The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                 4.9 No Conflict With Research Program. VRI agrees that the
Research Program funds provided by PMC will be applied to the Research Program
and may not, without PMC prior written approval, be used in support of any other
research at VRI.

                 4.10 Title to Equipment. VRI will retain title to any equipment
purchased with funds provided by PMC under this Agreement, if such purchase is
mutually agreed upon as part of the Research Program budget.

                 4.11 Term and termination.

                          (a)     The term of the Research Program will be two
(2) years as from the Effective Date hereof.

                          (b)     In addition to any other remedy which it may
have, PMC will be entitled to terminate the Research Program and cease funding
thereof in the event of a material breach by VRI of any of VRI's obligations and
covenants hereunder following written notice or such breach to VRI. If such
breach is not cured within thirty (30) days after written notice is given by PMC
to VRI specifying the breach, PMC may terminate the Research Program and cease
funding hereunder forthwith upon written notice to VRI after expiration of such
thirty (30) day period, and [****]

                          (c)     In the event that the Research Program is
terminated pursuant to this Section 4.11, VRI's right to receive any unpaid
balance otherwise committed by PMC as support commitment pursuant to Section 4.7
hereof will become forfeited and no further payments with respect to the
Research Program will be due to VRI by PMC except to the extent that such funds
are needed to pay actual and non-cancelable obligations of VRI accrued to that
date.

                 4.12 Confidentiality. In order to facilitate the operation of
the Research Program, either party may disclose confidential or proprietary
information owned or controlled by it to the other. It is hereby understood and
agreed that such information shall be deemed "Proprietary Information" and
treated as such in accordance with Article 7.

                 4.13 Results of the Research Program

                          (a)     [****]

                          (b)     [****]

                          (c)     [****]

                          (d)     [****]

                                      -13-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                          (e)     [****]

                          (f)     [****]

                          (g)     [****]

                          (h)     [****]

                 4.14         [****]

                                   ARTICLE 5

                              TERM AND TERMINATION

                 5.1 Term. This Agreement shall become effective as of the
Effective Date and, unless earlier terminated pursuant to the other provisions
of this Article 5, shall continue in full force and effect as long as PMC is
obligated to pay royalties under this Agreement. PMC's license under Section 2.1
with respect to the Licensed Know-How shall survive the expiration, but not an
earlier termination, of this Agreement.

                 5.2 Termination for Breach. In the event of a material breach
of this Agreement the nonbreaching party in addition to any other remedy which
it may have shall be entitled to terminate this Agreement following written
notice of such breach to the breaching party. If such breach is not cured within
sixty (60) days after written notice is given by the non-breaching party to the
breaching party specifying the breach, the non-breaching party may terminate the
Agreement forthwith upon written notice to the breaching party after expiration
of such sixty (60) day period.

                 5.3 Termination by PMC. (a) Any provision herein
notwithstanding, after completing PMC's funding obligation under Article 4, PMC
may terminate this Agreement at any time by giving VRI at least one hundred and
eighty (180) days prior written notice.

                          (b)     PMC may terminate its license with respect to
any Licensed Product by one hundred and eighty (180) days prior written notice
to VRI, and thereafter such Licensed Product(s) shall no longer be licensed
under this agreement.

                          (c)     In the event of a termination under Section
5.3 (a) all rights granted herein to PMC shall forthwith revert to VRI [****].

                                      -14-

<PAGE>

                 5.4 Survival.

                          5.4.1   Termination of this Agreement for any reason
shall not release either party hereto from any liability which at the time of
such termination has already accrued to the other party.

                          5.4.2   In the event this Agreement is terminated for
any reason, PMC and its Affiliates and sublicensees shall have the right to sell
or otherwise dispose of the stock of any Licensed Product then on hand, all
subject to the payment to VRI of fees and royalties pursuant to Article 3
hereof.

                          5.4.3   Articles 7, 11 and 12, and Sections 2.5, 5.,
5.5, 8.4, 10.3 and 10.4, shall survive the expiration and any termination of
this Agreement. Except as otherwise provided in Section 5.1 and Section 5.4.3,
all rights and obligations of the parties under this Agreement shall terminate
upon the expiration or termination of this Agreement.

                 5.5 In the event that PMC's rights and licenses under this
Agreement are terminated, PMC agrees not to make, use or sell Licensed Products
except as permitted by Article 5.4.2.

                 5.6 Either party may terminate this Agreement on notice if the
other party makes a general assignment for the benefit of creditors, is the
subject of proceedings in voluntary or involuntary bankruptcy or has a receiver
or trustee appointed for substantially all of its property; provided that in the
case of an involuntary bankruptcy proceeding such right to terminate shall only
become effective if the other party consents thereto or such proceeding is not
dismissed within ninety (90) days after the filing thereof. If, in connection
with bankruptcy proceedings involving a party, an election is made by or on
behalf of such party to reject the obligations of this Agreement and the other
party elects to retain its rights to intellectual property hereunder pursuant to
Section 365 n.1 of the Bankruptcy Code (USA), such other party shall be entitled
to enforce any rights exclusively granted to it in respect of intellectual
property hereunder by commencement of any action it deems necessary to that
effect against third-party infringers and may do so in the name and stead of the
bankrupt party.

                                   ARTICLE 6

                           PATENTS AND INFRINGEMENTS

                 6.1 Prosecution by VRI. VRI shall have the right, at PMC's
expense, to control the filing for, prosecution and maintenance of the Patent
Rights in the Territory. In the event that VRI grants any license in a country
of the Territory with respect to any Patent Right, then thereafter PMC's
obligation to pay patent costs for Patent Rights in such country shall be an
amount equal to the total cost therefor multiplied by a fraction having as a

                                      -15-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

numerator one and as a denominator the total number of licenses granted by VRI
in respect of such Patent Rights in such country. VRI hall keep PMC reasonably
informed as to the status of the Patent Rights in the Territory, and shall
provide PMC with copies of all proposed filings and correspondence of a
substantive nature with respect to patents or applications within the Patent
Rights to be made with or sent to the United Sates Patent and Trademark Office
or its counterpart in any country of the Territory (each, a "Patent Authority").
VRI shall also provide to PMC copies of all correspondence that it receives from
a Patent Authority with respect to the Patent Rights and shall consider any
comments of PMC with respect thereto.

                 6.2 Infringement Claims. If the production, sale or use of a
Licensed Product results in any claim for infringement of a patent or other
proprietary right of a third party against PMC, its Affiliates or sublicensees,
PMC shall promptly notify VRI thereof in writing. As between the parties to this
Agreement, PMC shall have the right at its own expense to defend and control the
defense of any such claim against PMC, by counsel of PMC's own choice.

                 6.3 Enforcement of Patent Rights. (a) In the event that any
Patent Rights are infringed by a third party with respect to an Exclusive
Vaccine or Co-Exclusive Vaccine in the Field in the Territory, with the consent
and approval of VRI (which shall not be unreasonably denied and shall be deemed
to have been granted if VRI shall be in voluntary or involuntary bankruptcy
proceedings, other than a proceeding such as Chapter 11 where the debtor
continues to operate the business), PMC and/or its Affiliates or sublicensees
shall have the right (except as provided below), but not the obligation, to
institute, and prosecute any action or proceeding under the Patent Rights with
respect to such infringement, by counsel of its choice, including any
declaratory judgment action arising from such infringement. Any amounts
recovered from third parties with respect to the Patent Rights in such action
shall be applied first to reimburse the expenses of the action; then to the
extent the award [****]. PMC shall not have the right to settle, compromise or
take any action in such litigation which diminish, limit or inhibit the scope,
validity or enforceability of the Patent Rights without the express written
permission of VRI. PMC shall keep VRI advised of the progress of such
proceedings.

                 6.4 In the event that a third party is infringing the Patent
Rights with respect to an Exclusive Vaccine or Co-Exclusive Vaccine in the
Territory in the Field and PMC does not elect to institute an action, VRI shall
have the right, but not the obligation, to commence an infringement suit under
the Patent Rights against such infringer and retain any recovery; provided that
it so notifies PMC. If VRI commences a suit in accordance with this Section 6.4,
PMC shall have the [****] expenses thereof. If PMC elects to so
participate,[****]. VRI shall have the right to control such action with counsel
of its choice.

                                      -16-

<PAGE>

                 6.5 VRI Participation. In VRI's sole discretion, VRI shall be
entitled to participate at its expense through counsel of its choosing in and
control any legal action by or against PMC affecting the validity or
enforceability of the patents on which Patent Rights are based, and PMC may
elect to participate in any such action to the extent necessary to defend its
own interests.

                 6.6 Each party agrees to cooperate with each other with respect
to any litigation under Sections 6.2, 6.3 or 6.4.

                                   ARTICLE 7

                                CONFIDENTIALITY

                 7.1 Nondisclosure. Except as otherwise provided in this
Agreement, a party receiving (the "Receiving Party") any business or technical
information ("Proprietary Information") that is disclosed to it by the other
party the ("Disclosing Party") shall for a period beginning on the Effective
Date and ending ten (10) years after the termination of this Agreement hold in
confidence and not disclose to any third party the "Proprietary Information". In
addition, the Receiving Party shall not use Proprietary Information that it
receives from the Disclosing Party, except as is reasonably necessary to
exercise the rights granted to the Receiving Party under Article 2 or Article 6
of this Agreement. Notwithstanding the foregoing, with the prior written
permission of the Disclosing Party (which shall not be unreasonably withheld),
the Receiving Party may disclose information concerning the Patent Rights and/or
the Licensed Know-How to actual or prospective sublicensees or to other third
parties with whom the Receiving Party is considering or has entered into a
business relationship, all of whom are similarly bound in writing under a
reasonable confidentiality agreement. Proprietary Information of a party shall
not include:

                          7.1.1   Information which is or was published or has
become generally available to the public through no fault of the Receiving
Party;

                          7.1.2   Information which the Receiving Party can
document is or was in its possession at the time of disclosure or was
independently developed by the Receiving Party; or

                          7.1.3   Information which is rightfully acquired by
the Receiving Party from a third party who is not under an obligation of
confidentiality to the disclosing party, and to the best of the Receiving
Party's knowledge and belief is entitled to rightfully make such disclosure, but
only to the extent the Receiving Party complies with any restrictions imposed by
the third party.

                 7.2 Exceptions. The Receiving Party may disclose Proprietary
Information of the other, in connection with the order of a court of law or
administrative or governmental authority provided that the Receiving Party
exerts reasonable efforts to preserve the

                                      -17-

<PAGE>

confidentiality thereof and the disclosing party is given an opportunity to
protect the confidentiality thereof, or as is reasonably necessary in connection
with the labeling of its products that are otherwise sold in compliance with
this Agreement or as required for obtaining regulatory approval of Licensed
Product, provided that the Receiving Party protects the confidentiality thereof
to the fullest extent possible.

                 7.3 Notwithstanding anything else to the contrary, PMC agrees
that Licensed Know-How, or Proprietary Information received from VRI shall be
used by PMC only in and for Licensed Products and their development for sale in
the Territory in the Field, all in accordance with this Agreement, and can only
be used by PMC for so long as and to the extent that PMC maintains a license
under this Agreement.

                 7.4 Notwithstanding anything else to the contrary and subject
to Section 5.1, in the event that PMC's rights and licenses under this Agreement
are terminated, PMC agrees a) not to use Licensed Know-How, or any Proprietary
Information provided to PMC by VRI or any information developed by PMC which is
derived from or is based on Licensed Know-How for the research, development,
making, or using or selling of any product or process, including, but not
limited to Licensed Products and (b) not to do any of the foregoing while this
Agreement is in force for any product except as licensed under this Agreement.

                 7.5 Notwithstanding anything else to the contrary, VRI agrees
that PMC Mucosal Delivery Technology licensed to it by PMC hereunder may be used
only in a manner consistent with the provisions of this Agreement. VRI's
licenses herein shall survive the expiration of the term hereof but not an
earlier termination of this Agreement except as provided in Section 5.3(c).

                                   ARTICLE 8

                         REPRESENTATIONS AND WARRANTIES

                          8.1.1 VRI and PMC each represents and warrants to
the other that each has the full right and authority to enter into this
Agreement and grant the rights and licenses granted herein;

                          8.1.2   VRI represents and warrants to PMC that it
has not previously granted and, prior to termination of this Agreement, will not
grant any rights in the Patent Rights or the Licensed Know-How that are
inconsistent with the rights and licenses granted to PMC herein;

                          8.1.3   To the best of VRI's knowledge, there is no
pending or threatened claim or litigation to which VRI is a party contesting the
validity or right to use any of the Patent Rights, and VRI has not received any
notice of infringement with respect to Patent Rights.

                                      -18-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                 8.2 Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN
SECTION 8.1 ABOVE, NEITHER PARTY MAKES ANY REPRESENTATION OR EXTENDS ANY
WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NONINFRINGEMENT, OR VALIDITY OF ANY PATENT RIGHTS ISSUED OR PENDING.

                 8.3 Effect of Representations and Warranties. Subject to
Section 8.4, it is understood that if the representations and warranties under
this Article 8 are not true and accurate and PMC incurs liabilities, costs or
other expenses as a result of such falsity, VRI shall indemnify and hold PMC
harmless from and against any such liabilities, costs or expenses incurred,
provided that VRI receives prompt notice of any claim against PMC resulting from
or related to such falsity and the sole right to control the defense or
settlement thereof.

                 8.4 Limitation of Liability. Notwithstanding anything else to
the contrary, VRI's liability for any breach of this Agreement (including but
not limited to any liability which results from any breach of any representation
or warranty) is limited to the payments received or to be received from PMC
under this Agreement. This Limitation on Liability shall not be applicable to
intentional misconduct on the part of VRI or where PMC, as a result of such
breach, is liable to a third party in excess of such Limitation on Liability.

                                   ARTICLE 9

                                 DUE DILIGENCE

                 9.1 General. PMC shall use commercially reasonable efforts to
research, develop, register, market and sell and to continue to market and sell
each Licensed Product in each country of the Territory; [****]. Upon a failure
by PMC to meet its obligations under this Section 9.1 with respect to any
Licensed Product in any country (directly or through a sublicensee), VRI shall,
among other remedies available to it, [****]

                 9.2 PMC shall promptly notify VRI, in writing, if at any time
PMC does not intend to continue to research, develop and/or obtain regulatory
approval for and/or market and sell any Licensed Product in any country of the
Territory.

                 9.3 In the event that PMC provides VRI with notice pursuant to
Section 9.2 with respect to any Licensed Product or with respect to any
country(ies) the rights herein

                                      -19-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

granted by VRI to PMC to such Licensed Product in such country(ies), upon
written notice from VRI to PMC shall revert to VRI.

                 9.4 In the event that PMC does not meet any of the milestones
set forth in Exhibit C (as the same may be extended as indicated herein) for any
of the Licensed Products set forth in Exhibit C, VRI shall have the right to
[****]. PMC shall have the right to a [****] and the Parties shall agree on a
reasonable period for such extension. Exhibit C shall be appropriately revised
to reflect such extension. In addition, PMC shall have the right to extend each
of the milestones of Exhibit C, if not achieved, [****]. The parties agree to
set similar milestones for [****]

                 9.5 PMC shall provide written reports to VRI on June 30th and
December 31st of each year concerning the efforts being made in accordance with
Section 9.1 with respect to the Licensed Product. PMC shall provide VRI with any
additional information reasonably requested by VRI in this respect. Such reports
shall be considered to be Proprietary Information of PMC.

                                   ARTICLE 10

                             ACCOUNTING AND RECORDS

                 10.1 Reports. PMC agrees to make quarterly written reports to
VRI within sixty (60) days after the end of each calendar quarter in which
royalties are due under this Agreement, stating in each such report the number,
description, and aggregate Net Sales of Licensed Products sold during the
calendar quarter and upon which a fee or royalty is payable under Article 3
above. The report shall also include the calculation of Net Sales all on a
country by country and Licensed Product by Licensed Product basis. The report
shall be due with respect to sales of Licensed Product sold by PMC sixty (60)
days after the end of the calendar quarter and with respect to sales of Licensed
Product by sublicensees, ninety (90) days after the end of a calendar quarter.
If no such sales have been made, by PMC, its Affiliates and sublicensees, the
report shall so state.

                 10.2 Payment. Concurrently with the making of each such report
of Section 10.1, PMC shall pay to VRI the royalties at the rate specified in
Article 3 above. All payments by PMC to VRI hereunder shall be made in U.S.
Dollars. If any currency conversion shall be required in connection with the
calculation of royalties hereunder, such conversion shall be made by using the
rate of exchange published in the Wall Street Journal for the last business day
of the applicable calendar quarter.

                                      -20-

<PAGE>

                 10.3 Withholding Taxes. Any withholding or other tax that PMC
or any of its Affiliates are required by statute to withhold and pay on behalf
of VRI with respect to the royalties payable to VRI under this Agreement shall
be deducted from said royalties and paid contemporaneously with the remittance
to VRI; provided, however, that in regard to any tax so deducted PMC shall
furnish VRI with proper evidence of the taxes paid on its behalf. VRI will
furnish PMC with appropriate documents to secure application of the favorable
rate of withholding tax under applicable tax treaties.

                 10.4 Records; Inspection.

                          10.4.1    PMC shall keep complete, true and accurate
books of account and records for the purpose of determining the amounts payable
to VRI under this Agreement. Such books and records shall be kept at PMC's
principal place of business for at least three (3) years following the end of
the calendar quarter to which they pertain, and will be open for inspection
during such three (3) year period by a representative of VRI for the purpose of
verifying PMC's royalty statements. Such inspections may be made no more than
once each calendar year, during normal business hours and upon thirty (30) days
prior notice. Any such information shall be considered to be Proprietary
Information of PMC.

                          10.4.2    Inspections conducted under this Section
10.4 shall be at the expense of VRI, unless an underpayment exceeding five
percent (5%) of the amount paid for the period covered by the inspection is
established in the course of any such inspection, whereupon all costs relating
thereto will be paid by PMC, as well as any unpaid royalties within the thirty
(30) days after requested by VRI.

                                   ARTICLE 11

                         INDEMNIFICATION AND INSURANCE

                 11.1 PMC shall defend, indemnify and hold harmless VRI,
Affiliates or VRI and its licensors, and its respective directors, officers,
shareholders, agents, consultants and employees (collectively, the
"Indemnitees") from and against any and all liability, loss, damages and
expenses (including reasonable attorneys' fees) as the result of claims,
demands, costs or judgments which may be made or instituted against any of the
Indemnitees arising out of the manufacture, design, possession, distribution,
use, testing, sale or other disposition by or through PMC and/or Affiliates of
PMC and/or licensees of either PMC or Affiliates of PMC of any Licensed Product
and/or any product or process in connection with or arising out of the Patent
Rights or Licensed Know-How and/or any material provided by PMC or Affiliates of
PMC under this Agreement (in each case, other than any claims, demands, costs or
judgments arising out of, based upon or resulting from infringement of the
intellectual property rights of a third party based upon the use of
polyphosphazene as a part of a mucosally delivered vaccine PMC's obligation to
defend, indemnify and hold harmless shall include any and all such claims,
demands, costs or judgments, including but not limited to

                                      -21-

<PAGE>

money damages arising from alleged personal injury (including death) to any
person or alleged property damage. PMC shall have the right to control the
defense of any action which is to be indemnified in whole by PMC hereunder,
including the right to select counsel (which shall be reasonably acceptable to
VRI) to defend the Indemnitees and to settle any claim as to which the
Indemnitees are fully indemnified by PMC. Notwithstanding the foregoing, PMC
shall have no obligation to indemnify or hold any Indemnitee harmless with
respect to any claim, demand, cost or judgment that results or is alleged to
result from the willful misconduct or negligence of an Indemnitee nor to the
extent that VRI has the obligation to indemnify under a Supply Agreement entered
into between the parties pursuant to Section 2.7. If PMC does not provide
counsel to defend the Indemnitees, VRI shall have the right to select counsel
and PMC shall pay the reasonable costs and expenses of said counsel. The
provisions of this paragraph shall survive and remain in full force and effect
after any termination, expiration or cancellation of this Agreement and PMC's
obligation hereunder shall apply whether or not such claims are rightfully
brought.

                                   ARTICLE 12

                                 MISCELLANEOUS

                 12.1 Publicity. VRI and PMC shall cooperate in the preparation
of a mutually agreeable press release and other publicity disclosing the
existence of this Agreement and their business relationship. Except for
information disclosed in such a mutually agreed press release or publicity,
neither PMC nor VRI shall disclose the existence or any terms of this Agreement
without the prior written consent of the other party, except for such limited
disclosure as may be reasonably necessary to either party's bankers, investors,
attorneys or other professional advisors, or in connection with a merger or
acquisition, or as may be required by law in the offering of securities or in
securities regulatory filings or otherwise.

                 12.2 Waiver. It is agreed that no waiver by either party hereto
of any breach or default of any of the covenants or agreements herein set forth
shall be deemed a Waiver as to any subsequent and/or similar breach or default.

                 12.3 Independent Contractors. The relationship of the parties
hereto is that of independent contractors. Neither party hereto is an agent,
partner or joint venturer of the other for any purpose.

                 12.4 Compliance with Laws. In exercising its rights under this
license, PMC shall fully comply with the requirements of any and all applicable
laws, regulations, rules and orders of any governmental body having jurisdiction
over the exercise of rights under this license.

                 12.5 Notices. Any notice required or permitted to be given to
the parties hereto shall be deemed to have been properly given if delivered in
person or when received if

                                      -22-

<PAGE>

mailed by first-class certified mail or sent by facsimile to the other party at
the appropriate address as set forth below or to such other addresses as may be
designated in writing by the parties from time to time during the term of this
Agreement.

                     VRI:                  VIRUS RESEARCH INSTITUTE, INC.

                                           61 Moulton Street
                                           Cambridge, Mass. 02138
                                           Attention:  Chief Executive Officer

                     PMC:                  PASTEUR MERIEUX SERUMS El VACCINS
                                           58 Avenue Leclerc
                                           Lyon, France
                                           Attention:  V.P. Product Development

                     With Copy to:         V.P.  Secretary & General Counsel

                 12.6 Complete Agreement. It is understood and agreed between
VRI and PMC that this Agreement constitutes the entire agreement with respect to
the subject matter of this Agreement, both written and oral, between the
parties, and that all prior agreements respecting the subject matter hereof,
either written or oral, expressed or implied, shall be abrogated, cancelled, and
are null and void and of no effect. No amendment or change hereof or addition
hereto shall be effective or binding on either of the parties hereto unless
reduced to writing and executed by the respective duly authorized
representatives of each of the parties hereto.

                 12.7 Severability. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provision and the parties shall exert best efforts to amend
this Agreement to include a provision which is valid, legal and enforceable and
which carries out the original intent of the parties. In the event that such a
provision cannot be included in the Agreement and the absence thereof materially
changes a party's obligations or rights under this Agreement, such party shall
have the right to terminate this Agreement.

                 12.8 Counterparts and Headings. This Agreement may be executed
in counterparts, each of which shall be deemed to be an original and both
together shall be deemed to be one and the same agreement. All headings and any
cover page or table of contents are inserted for convenience of reference only
and shall not affect its meaning or interpretation.

                 12.9 Governing Law. All matters affecting the interpretation,
validity and performance under this Agreement shall be governed by the internal
laws of the Commonwealth of Massachusetts without regard for its conflict of
laws principles.

                                      -23-

<PAGE>

                 12.10 Force Majeure. If and to the extent that either party
hereto is prevented, by circumstances not now reasonably foreseeable and not
within its reasonable ability to control, from performing any of its obligations
under this Agreement (other than payment obligations) and promptly so notifies
the other party giving full particulars of the circumstances in question, then
the party affected shall be relieved of liability to the other for failure to
perform such obligations, but shall nevertheless use its best efforts to resume
full performance thereof without avoidable delay, and pending such resumption
shall consult with the other party and shall permit and shall use its best
efforts to facilitate any efforts the other party may make to effect the
performance of such obligations by other means. If such failure to perform
continues for a period of more than one (1) year, the other party may terminate
this Agreement by written notice to the non-performing party with respect to the
rights and licenses with respect to those Licensed Products and with respect to
the failure to obtain regulatory approval for a Licensed Product shall not be
considered to be circumstances within this Section 12.10.

                                   ARTICLE 13

                             ASSIGNMENT; SUCCESSORS

                 13.1 This Agreement shall not be assignable by either of the
parties without the prior written consent of the other party (which consent
shall not be unreasonably withheld), except that either party may assign this
Agreement to an Affiliate or to a successor in interest or transferee of all or
substantially all of the portion of the business to which this Agreement
relates.

                 13.2 Subject to the limitations on assignment herein, this
Agreement shall be binding upon and inure to the benefit of said successors in
interest and assigns of VRI and PMC. In order for such assignment to be
effective any such successor or assignee of a party's interest shall expressly
assume in writing the performance of all the terms and conditions of this
Agreement to be performed by said party and such Assignment shall not relieve
the Assignor of any of its obligations under this Agreement.

                 IN WITNESS WHEREOF, both VRI and PMC have executed this
Agreement, in duplicate originals, by their respective officers hereunto duly
authorized, the day and year first above written.

VIRUS RESEARCH INSTITUTE, INC.       PASTEUR MERIEUX SERUMS ET VACCINS

By:  /s/ J. Barrie Ward              By:  /s/ Herve Tainturier
     ---------------------------          --------------------------------------

Print Name:  J. Barrie Ward          Print Name:  Herve Tainturier
             -------------------                  ------------------------------

                                             Corporate Vice President, Secretary
Title:  Chairman & CEO               Title:  and General Counsel
        ------------------------             -----------------------------------

                                      -24-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                                   EXHIBIT A
                                 PATENT RIGHTS

1.      [****]

2.      [****]

3.      U.S. PATENT NO. 5,053,451 licensed from The Pennsylvania Research
        Corporation

4.      U.S. APPLICATION SERIAL NO. [****]

I.      M.I.T. Case No. 5400

        U.S.  Patent 5,149,543
        "Ionically Cross-Linked Polymeric Mirocapsules"
        By Samdar Cohen, Carmen Bano, Karyn B. Visscher, Marie Chow, Harry B.
        Allcock and Robert S. Langer

        U.S. Patent 5,308,701
        "Ionically Cross-Linked Polymeric Microcapsules"
        By Samdar Cohen, Carmen Bano, Karyn B. Visscher, Marie Chow, Harry B.
        Allcock and Robert S. Langer

        Foreign Patent Applications pending:
        [****]

II.     M.I.T. Case 5743

        U.S. Patent 4,880,662
        "Water-Soluble Phosphazene Polymers Having Pharmacological Applications"
        By Harry R. Allcock, Paul E. Austin and Sukky Kwon

        U.S.S.N.:  434,145 - ABANDONED
        "Water-Soluble Phosphazene Polymers Having Pharmacological Applications"
        By Harry K. Allcock, Paul E. Austin and Sukky Kwon
        Jointly owned with Pennsylvania Research Corporation.

II.     M.I.T. Case No. 3985
        U.S. Patent No. 4,900,556
        "Systems For Delayed And Pulsed Release of Biologically Active
        Substances"

                                      -25-

<PAGE>

         By Herman N. Eisen, Robert S. Langer, Jr. and Margaret A. Wheatley

         U.S. Patent No. 4,921,757
         "System and Apparatus For Delayed And Pulsed Release of Biologically
         Active Substances"
         By Herman N. Eisen, Robert S. Langer, Jr. and Margaret A. Wheatley

IV.      M.I.T. Case No. 3986
         U.S. Patent No. 4,933,185
         "System For Controlled Release of Biologically Active Compounds"
         By Herman N. Eisen, Robert S. Langer, Jr. and Margaret A. Wheatley

Explanatory Notes

         M.I.T. Case No. 4433 -- All patent rights abandoned.
         "Polyphosphazene Matrix System for Drug Delivery Applications"
         By Cato T. Laurencin, Robert S. Langer, Harry R. Allcock and Thomas X.
         Neenan U.S.S.N. 737,921

                                      -26-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                                   EXHIBIT B

                             PMC PROPRIETARY RIGHTS

                                     [****]

                                      -27-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                                   EXHIBIT C

                          MILESTONES TO BE MET BY PMC

                                    [****]

                                      -28-

<PAGE>

The information below marked by [****] has been omitted pursuant to a request
for Confidential Treatment. The omitted portion has been separately filed with
the Commission.

                                   EXHIBIT D

                                RESEARCH PROGRAM

                                     [****]

                                      -29-<PAGE>

                                                                   EXHIBIT 10.20

                               LICENSE AGREEMENT

         This License Agreement ("Agreement") is made effective as of this first
day of December 1997, between VIRUS RESEARCH INSTITUTE, Inc., having a place of
business at 61 Moulton Street, Cambridge, MA 02138, USA (herein referred to as
"LICENSOR") and SmithKline Beecham P.L.C., having a place of business at New
Horizons Court, Brentford, Middlesex TW8 9EP, United Kingdom (herein referred to
as "LICENSEE"),

                               WITNESSETH THAT:

         WHEREAS, LICENSOR is the owner of and/or controls all right, title and
interest in certain patents, identified in Appendix A hereto, and know-how in
the field of Rotavirus; and

         WHEREAS, LICENSEE desires to obtain certain worldwide licenses from
LICENSOR under the aforesaid patents and know-how, and LICENSOR is willing to
grant to LICENSEE such licenses;

         NOW, THEREFORE, in consideration of the covenants and obligations
expressed herein and intending to be legally bound, and otherwise to be bound by
proper and reasonable conduct, the parties agree as follows:

1.       DEFINITIONS

         1.01     "AFFILIATE(S)" shall mean any corporation, firm, partnership
                  or other entity, whether de jure or de facto, which directly
                  or indirectly owns, is owned by or is under common ownership
                  with a party to this Agreement to the extent of at least fifty
                  percent (50%) of the equity (or such lesser percentage which
                  is the maximum allowed to be owned by a foreign corporation in
                  a particular jurisdiction) having the power to vote on or
                  direct the affairs of the entity and any person, firm,
                  partnership, corporation or other entity actually controlled
                  by, controlling or under common control with a party to this
                  Agreement.

         1.02     "BLOCKING PATENTS" shall mean patents owned and/or controlled
                  by THIRD PARTIES which are needed by LICENSEE for the making,
                  having made, using, having used, importing, offering for sale,
                  selling or having sold VACCINES

<PAGE>
                                                                              2.

                  and/or technology owned and/or controlled by THIRD PARTIES
                  which is necessary for LICENSEE in order to practice the
                  license(s) granted by LICENSOR hereunder. For the avoidance of
                  doubt any patents and/or patent applications and/or technology
                  owned and/or controlled by DynCorp to which LICENSEE may
                  acquire a licence will be considered for the purpose of this
                  Agreement as BLOCKING PATENTS.

         1.03     "COMBINATION" shall mean VACCINE wherein (a) Rotavirus
                  antigen(s) is (are) formulated in combination with one or more
                  additional therapeutically and/or prophylactically active
                  antigens.

         1.04     "FDA" shall mean the United States Food and Drug
                  Administration.

         1.05     "KNOW-HOW" shall mean all present and future technical
                  information, materials and know-how which relate to (a)
                  Rotavirus antigen(s) for use in a live attenuated vaccine
                  against rotavirus which are now and/or at anytime during the
                  term of this Agreement developed, owned, proprietary to and/or
                  controlled by LICENSOR and/or to which LICENSOR has otherwise
                  the right to grant license, which are both secret and
                  substantial. KNOW-HOW shall include the Rotavirus 89.12 strain
                  and any other live attenuated Rotavirus strain(s) useful or
                  necessary for VACCINE, owned and/or controlled by LICENSOR
                  and/or to which LICENSOR has otherwise the right to grant
                  license and, without limitation, all chemical,
                  pharmacological, toxicological, clinical, assay, control and
                  manufacturing data and any other information relating thereto.
                  KNOW-HOW shall not include any information, materials and/or
                  know-how which are generally ascertainable from publicly
                  available information or which subsequently become publicly
                  available. KNOW-HOW existing as of the Effective Date is
                  listed in Appendix B attached hereto which shall, as
                  appropriate, be updated from time to time. LICENSOR shall
                  identify KNOW-HOW in writing at the time of disclosure to
                  LICENSEE.

         1.06     "LICENSEE" shall mean SmithKline Beecham P.L.C.

         1.07     "LICENSOR" shall mean Virus Research Institute, Inc.

         1.08     "MAJOR MARKETS" shall mean the United States of America,
                  United Kingdom, France, Germany and Italy.

<PAGE>

                                                                              3.

         1.09     "NET SALES" shall mean the gross receipts from sales of
                  VACCINE in the TERRITORY by LICENSEE, its AFFILIATES and/or
                  sublicensees to THIRD PARTIES under this Agreement after
                  deducting:

                  (i)    reasonable transportation charges, including insurance;
                         and

                  (ii)   LICENSEE's costs for syringes and other administration
                         devices combined with, or contained in, commercial
                         packaging; and

                  (iii)  sales and excise taxes and duties paid by a selling
                         party and any other governmental charges imposed upon
                         the production, importation, use or sale of VACCINE
                         including, without limitation, contributions and
                         payments collected by any governmental authorities as
                         liability provisions and/or made pursuant to
                         governmental injury compensation schemes; and

                  (iv)   trade, quantity and cash discounts (other than cash
                         discounts for early payments), commissions and other
                         customary rebates; and

                  (v)    allowances or credits to customers or charges back from
                         customers on account of rejection or return of VACCINE
                         subject to royalty under this Agreement or on account
                         of retroactive price reductions affecting such VACCINE;
                         and

                  (vi)   the difference between fifty percent (50%) of the
                         royalties paid to THIRD PARTIES as referred to in
                         Paragraph 4.02 and the amount of royalties actually
                         deducted under Paragraph 4.02; and

                  (vii)  the royalties payable by LICENSEE to THIRD PARTIES on
                         the manufacture, use and/or sale of VACCINE for
                         adjuvants and/or other technology contained in VACCINE
                         to the extent they are not otherwise deducted pursuant
                         to the provisions of Section 4 hereof or under
                         Paragraph 1.09 (vi) above.

                  Sales between or among LICENSEE and its AFFILIATES or
                  sublicensees shall be excluded from the computation of NET
                  SALES except where such AFFILIATES or sublicensees are end
                  users, but NET SALES shall include the subsequent final sales
                  to THIRD PARTIES by such AFFILIATES or sublicensees.

<PAGE>

                                                                              4.

                  If VACCINE is sold as a COMBINATION, NET SALES for purposes of
                  determining royalties on COMBINATION shall be calculated by
                  multiplying NET SALES by the fraction A/B, where A is the
                  invoice price of a monovalent form of VACCINE sold separately
                  and B is the invoice price of COMBINATION.

                  If the invoice price of a monovalent form of VACCINE is not
                  available and the parties are unable to agree on an
                  alternative arrangement, then royalty on COMBINATION shall be
                  determined by multiplying NET SALES by a fraction X/Y wherein
                  X is one (1) and Y is the total number of active antigens
                  included in COMBINATION with all the Rotavirus antigens being
                  counted as only one (1) antigen.

         1.10     "PATENTS" shall mean all patents and patent applications which
                  are or become owned and/or controlled, in whole or in part, by
                  LICENSOR or to which LICENSOR otherwise has, now or in the
                  future, the right to grant licenses, which generically or
                  specifically claim VACCINE, a process for manufacturing
                  VACCINE and intermediates used in such process, or a use of
                  VACCINE. Included within the definition of PATENTS are any
                  continuations, continuations-in-part, divisions, patents of
                  addition, reissues, renewals or extensions (other than SPC)
                  thereof. Also included within the definition of PATENTS are
                  any patents and patent applications which generically or
                  specifically claim any improvements of VACCINE or
                  intermediates or manufacturing processes required or useful
                  for production of VACCINE which are developed by LICENSOR
                  and/or under which LICENSOR otherwise has the right to grant
                  licenses or sublicenses, now or in the future, during the term
                  of this Agreement. For the avoidance of doubt PATENTS do not
                  include patents or patent applications which claim adjuvants,
                  delivery systems, or other delivery vehicles or vaccines which
                  include solely antigens other than Rotavirus antigens. The
                  current list of patent applications and patents encompassed
                  within PATENTS is set forth in Appendix A attached hereto.

         1.11     "SPC" shall mean all Supplementary Protection Certificates for
                  medicinal products and their equivalents provided under the
                  Council Regulation (EEC) No. 1768/92 of June 18, 1992 which
                  are directed to a VACCINE.

         1.12     "VACCINE" shall mean any and all live attenuated Rotavirus
                  vaccines or components thereof licensed hereunder which
                  contain the Rotavirus 89.12 strain and/or a strain derived
                  from the Rotavirus 89.12 strain, developed and/or owned by
                  LICENSOR and/or to which LICENSOR has otherwise, now or in the

<PAGE>

                                                                              5.

                  future, the right to grant license and/or any and all live
                  attenuated Rotavirus vaccines or components thereof licensed
                  hereunder which are developed and/or owned by LICENSOR and/or
                  to which LICENSOR has otherwise, now or in the future, the
                  right to grant license.

         1.13     "VALID CLAIM" shall mean a claim of a granted PATENT which has
                  not lapsed or been abandoned and which has not been declared
                  invalid or unenforceable by a court of competent jurisdiction
                  or administrative agency from which no appeal is or can be
                  taken.

         1.13     "TERRITORY" shall mean all the countries and territories of
                  the world.

         1.14     "THIRD PARTY(IES)" shall mean any person or party other than a
                  party to this Agreement or an AFFILIATE.

         "Interpretative Rules". For purposes of this Agreement, except as
         otherwise expressly provided herein or unless the context otherwise
         requires: (a) defined terms include the plural as well as the singular
         and the use of any gender shall be deemed to include the other gender;
         (b) references to "Articles", "Sections", "Paragraphs" and other
         subdivisions and to "Appendices", "Schedules" and "Exhibits" without
         reference to a document, are to designated Articles, Sections,
         Paragraphs and other subdivisions of, and to Appendices, Schedules and
         Exhibits to, this Agreement; (c) the use of the term "including" means
         "including but not limited to"; and (d) the words "herein", "hereof",
         "hereunder" and other words of similar import refer to this Agreement
         as a whole and not to any particular provision.

2.       GRANT

         2.01     LICENSOR hereby grants to LICENSEE and its AFFILIATES an
                  exclusive license, with the right subject to Paragraph 2.02 to
                  grant sublicenses, under PATENTS, KNOW-HOW and any SPC to
                  make, have made, use, have used, sell, offer for sale, have
                  sold, keep, import and export VACCINE and COMBINATION, in the
                  TERRITORY, in any formulation, configuration, combination
                  and/or delivery system, subject to the terms and conditions of
                  this Agreement.

         2.02     LICENSEE agrees to notify LICENSOR of any sublicense under
                  PATENTS and/or KNOW-HOW it shall grant to any THIRD PARTY(IES)
                  and, at

<PAGE>

                                                          CONFIDENTIAL TREATMENT

                                                                              6.

                  LICENSOR's request, agrees to provide LICENSOR with suitably
                  redacted versions of the sublicense agreements LICENSEE may
                  enter into with said THIRD PARTY(IES).

         2.03     Notwithstanding anything else to the contrary herein, LICENSEE
                  agrees that PATENTS and KNOW-HOW shall be used by LICENSEE
                  only in and for VACCINES and in accordance with this Agreement
                  and can only be used by LICENSEE for so long as and to the
                  extent this Agreement and the licences and rights granted
                  hereunder are not terminated pursuant to Paragraph 10.02,
                  10.03, 10.04 or 10.06.

         2.04     To the extent that any rights and licenses granted to LICENSEE
                  under this Agreement are rights and licenses obtained by
                  LICENSOR under an agreement with a THIRD PARTY ("Third Party
                  Agreement"), then any such rights and licenses granted to
                  LICENSEE will be subject to the terms, conditions and
                  obligations of such Third Party Agreement. LICENSEE
                  specifically acknowledges that the obligations contained in
                  Sections 2.4 (c), 8 and 10 (attached hereto as Appendix E) of
                  a certain License and Clinical Trials Agreement between
                  LICENSOR and the James N. Gamble Institute of Medical Research
                  ("the Gamble Agreement") will be binding on LICENSEE.

3.       PAYMENTS AND ROYALTIES

         3.01     LICENSEE shall make the following license fee payment to
                  LICENSOR, which payment shall be non-refundable to LICENSEE
                  for any reason: [*]

         3.02     As consideration for the license under PATENTS granted to
                  LICENSEE under this Agreement, LICENSEE shall pay to LICENSOR
                  the following royalties ("Patent Royalty(ies)"):

                         (a) [*]

                         (b) [*]

                         (c) [*] ; and

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>

                                                         CONFIDENTIAL TREATMENT

                                                                              7.

                         (d) [*]

                  provided that the VACCINE sold is covered by a VALID CLAIM in
                  the particular country where sales are made.

         3.03     As consideration for the license to KNOW-HOW granted to
                  LICENSEE under this Agreement, LICENSEE shall pay to LICENSOR
                  royalties on NET SALES in those countries wherein there is no
                  granted PATENT or wherein a patent application is pending or
                  wherein there is no VALID CLAIM ("Know-How Royalty(ies)"),
                  provided that the making, using or selling of VACCINE actually
                  use KNOW-HOW which LICENSOR has identified in writing as being
                  secret and substantial at the time of disclosure to LICENSEE.
                  The rate of the Know-How Royalties payable under this
                  Paragraph 3.03 shall, on a country-by-country basis, be [*]
                  that would be payable under paragraph 3.02 hereto considering
                  the applicable portion of annual NET SALES. In the event
                  LICENSEE, in a specific country, faces competition with a
                  vaccine which represents [*] of NET SALES in such country, the
                  sale of which vaccine would infringe PATENTS if sold in
                  patented countries (a "Competitive Vaccine"), the rate of the
                  Know-How Royalties payable by LICENSEE to LICENSOR on NET
                  SALES in such country shall only be [*] that, considering the
                  applicable portion of annual NET SALES, would be payable under
                  Paragraph 3.02 hereof. LICENSEE acknowledges that the supply
                  of the Rotavirus 89.12 strain by LICENSOR to LICENSEE shall
                  constitute supply of KNOW-HOW which is secret, substantial and
                  identified as being secret and substantial and that Know-How
                  Royalties due under this Paragraph 3.03, subject to Paragraph
                  3.05, shall be payable on NET SALES of VACCINE which contains
                  such strain(s) or any strain derived therefrom.

         3.04     LICENSEE's royalty obligations under Paragraph 3.02 shall
                  become effective in each country in the TERRITORY, on a
                  country-by-country basis, at such time as there is a VALID
                  CLAIM in such country covering the VACCINE sold and shall be
                  applicable until expiry of the last remaining PATENT in such
                  country. In the event that any THIRD PARTY initiates any legal
                  or administrative proceedings challenging the validity, scope
                  or enforceability of a PATENT in any country in the TERRITORY
                  and a THIRD PARTY sells a Competitive Vaccine in such

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>

                                                         CONFIDENTIAL TREATMENT

                                                                              8.

                  country, then the Patent Royalties on NET SALES pursuant to
                  Paragraph 3.02 in such country shall be suspended during
                  pendency of the proceedings while such Competitive Vaccine is
                  sold in such country and a Know-How Royalty calculated
                  pursuant to Paragraph 3.03 shall be due instead for the period
                  specified in Paragraph 3.05 with the Know-How Royalty being
                  [*]. If the validity, scope and enforceability of claims
                  in the PATENT which cover VACCINE are upheld by a court or
                  other legal or administrative tribunal from which no appeal is
                  or can be taken, then the amount of Patent Royalties which
                  would have been due during the period of suspension, less any
                  amount of paid Know-How Royalties, shall be promptly paid with
                  interests, the interest rate being the Interbank Bank of
                  America base rate. If the claims in the PATENT which cover
                  VACCINE are held to be invalid or otherwise unenforceable by a
                  court or other legal or administrative tribunal from which no
                  appeal is or can be taken then LICENSOR shall retain the
                  Know-How Royalties paid under this Paragraph 3.04 and no
                  further royalties under Paragraph 3.02 shall be owed in such
                  country provided that in the event LICENSEE has paid to
                  LICENSOR a Know-How royalty pursuant to this Paragraph 3.04
                  after the expiration of the period specified in Paragraph
                  3.05, the amount of such Know-How Royalties paid by LICENSEE
                  shall be promptly reimbursed by LICENSOR to LICENSEE with
                  interests.

         3.05     LICENSEE's Know-How Royalty obligations under Paragraph 3.03
                  shall be effective, on a country-by-country basis, for a
                  period of ten (10) years from LICENSEE's first commercial sale
                  of VACCINE as part of a nationwide introduction of VACCINE in
                  such country of the TERRITORY.

         3.06     In the event the only remaining patent protection afforded to
                  a PRODUCT in any country of the TERRITORY where it is sold is
                  a SPC, LICENSEE shall pay to LICENSOR a royalty on NET SALES
                  in that country at the applicable Patent Royalty rate pursuant
                  to Paragraph 3.02 if LICENSEE does not face competition from a
                  Competitive Vaccine with respect to VACCINE in that country
                  and at the applicable Know-How royalty rate pursuant to
                  Paragraph 3.03 if LICENSEE does face competition from a
                  Competitive Vaccine with respect to VACCINE in that country.

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>
                                                         CONFIDENTIAL TREATMENT

                                                                              9.

         3.07     In the event that LICENSOR secures rights to any live
                  attenuated Rotavirus strain(s) other than the Rotavirus 89.12
                  strain which LICENSEE considers is(are) useful or necessary
                  for VACCINE, LICENSOR shall, at LICENSEE's sole option,
                  transfer such other live attenuated Rotavirus strain(s) to
                  LICENSEE with unrestricted rights to use such strain(s)
                  whereupon LICENSEE shall contribute to [*] of the procurement
                  costs of LICENSOR.

                  In the event that LICENSOR is offered a license to
                  improvements on Inventions (as defined in the Gamble
                  Agreement) under paragraph 2.5 of the Gamble Agreement,
                  LICENSOR shall notify LICENSEE forthwith and provide all
                  information with respect thereto received by LICENSOR. If
                  requested in writing by LICENSEE, LICENSOR shall exercise the
                  option provided that LICENSEE pays the costs and expenses
                  thereof. Any licensing rights obtained by LICENSOR as a result
                  of the exercise of the option upon LICENSEE's request shall
                  automatically be included in the license granted to LICENSEE
                  hereunder. Any costs and expenses paid by LICENSEE in relation
                  to the exercise of the option for licensing rights to
                  improvements on Inventions shall be fully creditable against
                  any royalties paid hereunder.

4.       COMPULSORY LICENSES, BLOCKING PATENTS AND OTHER ROTAVIRUS ANTIGENS

         4.01     In the event that a governmental agency in any country or
                  territory grants or compels LICENSOR or LICENSEE to grant a
                  license under PATENTS and/or KNOW-HOW to any THIRD PARTY for
                  any vaccine(s) that compete(s) with VACCINE sold by LICENSEE,
                  LICENSEE shall have the benefit in such country or territory
                  of the terms granted to such THIRD PARTY to the extent that
                  such terms as a whole are more favourable to the THIRD PARTY
                  than those granted to LICENSEE under this Agreement.

         4.02     The parties recognize that BLOCKING PATENTS may exist. If at
                  any time during the term of this Agreement LICENSEE, in its
                  sole discretion, deems it necessary to seek a license under
                  any BLOCKING PATENT(S) from any THIRD PARTY in order to
                  practice the rights and licenses granted by LICENSOR to
                  LICENSEE hereunder in any particular country(ies), [*]

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>
                                                         CONFIDENTIAL TREATMENT

                                                                             10.

         4.03     In the event that Rotavirus antigens (other than Rotavirus
                  antigens produced from strain 89.12 or derivatives thereof)
                  are required to provide and/or to increase protection against
                  any specific Rotavirus serotype, the royalties payable to
                  LICENSOR pursuant to Paragraph 3.02 or pursuant to Paragraph
                  3.03, as appropriate, shall be reduced by [*].

         4.04     In no event shall the combined royalty reductions and
                  deductions pursuant to Paragraphs 4.02 and 4.03 cause the
                  level of royalties otherwise due to LICENSOR pursuant to
                  Paragraph 3.02 or pursuant to Paragraph 3.03, as appropriate,
                  to be reduced by [*] with respect to any VACCINE in any
                  country for any calendar quarter.

5.       DEVELOPMENT AND MILESTONES

         5.01     Subject to the provisions of Paragraph 5.02 below, LICENSEE
                  will, in accordance with LICENSEE's reasonable business and
                  scientific judgement, exercise its reasonable efforts and
                  diligence in developing VACCINE and in undertaking
                  investigations and actions required to obtain appropriate
                  governmental approvals to market VACCINE in at least the MAJOR
                  MARKETS and in commercialising VACCINE in such MAJOR MARKETS.
                  All such activity shall be undertaken at LICENSEE's expense.
                  At LICENSEE's request and expense, LICENSOR shall supply
                  LICENSEE with reasonable technical assistance in undertaking
                  such investigations and actions.

         5.02     The parties shall institute a development program with the
                  objective of advancing VACCINE to commercial launch. The
                  responsibilities of the parties shall be as follows:

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>
                                                         CONFIDENTIAL TREATMENT

                                                                             11.

                         (a) FIRST PHASE

                             LICENSOR has initiated a Phase II clinical trial to
                             demonstrate proof of concept of VACCINE and shall
                             complete such trial at LICENSOR's cost and expense.
                             The parties shall agree on acceptable end points
                             concerning immunogenicity, safety and efficacy for
                             proof of concept which end points shall be attached
                             hereto as Appendix C and the meeting of such end
                             points shall establish proof of concept.

                             In parallel with said Phase II trial, LICENSEE
                             shall at its expense perform feasibility studies to
                             produce VACCINE with a commercial cell line. The
                             feasibility studies will have the purpose of (i)
                             demonstrating that a commercially viable yield is
                             obtainable from the chosen cell line(s), (as
                             defined in Appendix D attached hereto) and (ii)
                             subject to prior successful completion of (i),
                             optimizing the manufacturing process, and, if
                             necessary and feasible, producing GMP commercial
                             products for use in a Phase III clinical study and
                             in Phase II/III bridging studies.

                         (b) MILESTONE - PHASE II/MANUFACTURING

                             Contingent upon (i) LICENSOR establishing proof of
                             concept under Paragraph 5.02 (a) and (ii) LICENSEE
                             demonstrating that VACCINE can be produced in
                             commercially viable yields under Paragraph 5.02 (a)
                             LICENSEE shall pay LICENSOR a development milestone
                             fee of [*] unless LICENSEE notifies LICENSOR in
                             writing that LICENSEE has decided not to pursue the
                             development of VACCINE within sixty (60) days after
                             successful completion of first phase by both
                             parties.

                             If however LICENSOR is not able to demonstrate
                             satisfactory proof of concept at the end of Phase
                             II trial and/or LICENSEE cannot demonstrate in
                             accordance with Paragraph 5.02 (a) within six (6)
                             months after proof of concept in the Phase II trial
                             that a commercially viable yield can be obtained,
                             then the parties shall negotiate in good faith to
                             determine whether further joint development is
                             warranted and, if no agreement can be reached, this
                             Agreement may be terminated at the option of
                             LICENSEE if LICENSOR has

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>
                                                         CONFIDENTIAL TREATMENT

                                                                             12.

                             been unable to demonstrate satisfactory proof of
                             concept at the end of Phase II trial and at the
                             option of LICENSOR if LICENSEE has been unable to
                             demonstrate that a commercially viable yield can be
                             obtained.

                             (c) MILESTONE - PHASE III/TRIAL INITIATION

                             Contingent upon satisfactory completion of the
                             Phase II clinical and manufacturing milestone in
                             accordance with Paragraph 5.02 (b), LICENSEE shall
                             prepare a clinical development plan and discuss the
                             suitability of such plan with the FDA and shall
                             exert reasonable efforts to obtain FDA's approval
                             of such plan under an IND within a reasonable
                             timeframe to be agreed upon in good faith between
                             the parties.

                             If LICENSEE, after discussion with the FDA, is
                             satisfied with the economics of such plan and
                             decides to advance to pivotal Phase III, it shall
                             at its expense conduct a pivotal Phase III clinical
                             trial. LICENSOR shall be consulted in the design of
                             such trial and shall participate in the running of
                             the trial but LICENSEE shall exercise the ultimate
                             control and management of the trial.

                             Upon initiation of the Phase III clinical study
                             under an IND the design of which has been discussed
                             with and approved by the FDA, LICENSEE shall pay
                             LICENSOR a second milestone fee of [*].

                             If LICENSEE, after discussion with the FDA, is not
                             satisfied with the economics of such plan and
                             decides to discontinue the VACCINE development, the
                             second milestone fee shall not be due.

                             However, should LICENSEE decide to conduct the
                             Phase III clinical study with, and pursue the
                             development of, VACCINE in a MAJOR MARKET of Europe
                             rather than in the USA, the second milestone fee
                             shall be reduced to [*].

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>
                                                         CONFIDENTIAL TREATMENT

                                                                             13.

                             (d) MILESTONE - PHASE III/COMPLETION

                             Provided that the pivotal Phase III study on
                             completion provides satisfactory results that in
                             LICENSEE's opinion can be used for submission of a
                             registration file in a MAJOR MARKET, then LICENSEE
                             shall pay LICENSOR a third milestone fee of [*]. In
                             the event that the results of the Phase III study
                             are not acceptable for registration purpose, such
                             third milestone fee shall be payable only when a
                             regulatory submission is first made in a MAJOR
                             MARKET.[*]

                             (e) REGISTRATION MILESTONE

                             LICENSEE shall pay a milestone fee of [*]

         5.03     LICENSEE shall report to LICENSOR on the status and progress
                  of LICENSEE's efforts to develop and commercialise VACCINE at
                  such times and in such manner as LICENSOR may reasonably
                  request.

         5.04     LICENSOR shall provide to LICENSEE, at LICENSEE's request and
                  expense, technical assistance within its area of expertise
                  concerning development, production and commercialisation of
                  VACCINE. Provision of such technical assistance shall include,
                  but not be limited to, visits by LICENSOR personnel to
                  LICENSEE and visits by LICENSEE personnel to LICENSOR at times
                  and for periods of time upon which the parties will agree.

         5.05     In the event that LICENSEE's development of VACCINE is
                  terminated at any time under the provisions of this Section 5
                  other than for failure by LICENSOR to establish satisfactory
                  proof of concept, LICENSEE shall, to the extent that it is
                  allowed and free to do so, grant LICENSOR a license under its
                  manufacturing

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>

                                                                             14.

                  technology specific for VACCINES in exchange for a reasonable
                  compensation to be discussed and agreed upon in good faith by
                  the parties.

                  In the event LICENSEE, at its sole option, elects not to
                  market VACCINE itself or through its AFFILIATES in any MAJOR
                  MARKET(S), LICENSEE shall give LICENSOR a first option for the
                  grant of marketing sub-licensing rights in any such MAJOR
                  MARKET upon terms and conditions to be negotiated and agreed
                  upon in good faith by the parties.

                  In the event LICENSEE, at its sole option, elects not to
                  market VACCINE itself or through its AFFILIATES and/or
                  sublicensees in any MAJOR MARKET(S), the rights and licenses
                  granted to LICENSEE under this Agreement shall be terminated
                  with respect to any such MAJOR MARKET(S).

6.       EXCHANGE OF INFORMATION AND CONFIDENTIALITY

         6.01     During the term of this Agreement, LICENSOR shall promptly
                  disclose to LICENSEE and/or supply LICENSEE with all
                  KNOW-HOW. LICENSOR shall not be authorized to make any
                  publication with respect to the KNOW-HOW nor disclose it to
                  any THIRD PARTY provided that, LICENSOR shall, upon LICENSEE's
                  prior consent in writing which consent shall not be
                  unreasonably withheld, be authorized to publish the data from
                  the Phase II clinical trial referred to in Paragraph 5.02
                  hereof and prior studies and, without consent, be authorized
                  to disclose KNOW-HOW to its licensor as per the Gamble
                  Agreement.

         6.02     During the term of this Agreement, the parties shall promptly
                  inform each other of any information that a party obtains or
                  develops regarding the utility and safety of VACCINE and shall
                  promptly report to the other party any confirmed information
                  of serious or unexpected reactions or side effects related to
                  the utilisation or medical administration of VACCINE.

         6.03     During the term of this Agreement and for seven (7) years
                  thereafter, irrespective of any termination earlier than the
                  expiration of the term of this Agreement, LICENSOR and
                  LICENSEE shall not reveal or disclose to THIRD PARTIES any
                  confidential information received from the other party without
                  first obtaining the written consent of the disclosing party,
                  except as may be required for purposes of investigating,
                  developing, manufacturing or marketing VACCINE

<PAGE>
                                                                             15.

                  or for securing essential or desirable authorisations,
                  privileges or rights from governmental agencies, or is
                  required to be disclosed to a governmental agency, or is
                  necessary to file or prosecute patent applications concerning
                  VACCINE or to carry out any litigation concerning VACCINE
                  provided that in each case the disclosing party exerts best
                  efforts to maintain the confidentiality thereof under such
                  circumstances and notifies the owner of the confidential
                  information prior to any such disclosure. This confidentiality
                  obligation shall not apply to such information which is or
                  becomes a matter of public knowledge, or is already in the
                  possession of the receiving party, or is disclosed to the
                  receiving party by a THIRD PARTY having the right to do so, or
                  is subsequently and independently developed by employees of
                  the receiving party or AFFILIATES thereof who had no knowledge
                  of the confidential information disclosed. The parties shall
                  take reasonable measures to assure that no unauthorised use or
                  disclosure is made by others to whom access to such
                  information is granted.

         6.04     Nothing herein shall be construed as preventing a party hereto
                  from disclosing any information received from the other party
                  to an AFFILIATE, sublicensee, distributor or to a THIRD PARTY
                  as may be required for purposes of investigating, developing,
                  manufacturing or marketing VACCINE, provided such AFFILIATE,
                  sublicensee, distributor or THIRD PARTY has undertaken a
                  similar obligation of confidentiality with respect to the
                  disclosed confidential information.

         6.05     All confidential information disclosed by one party to the
                  other shall remain the intellectual property of the disclosing
                  party. In the event that a court or other legal or
                  administrative tribunal, directly or through an appointed
                  master, trustee or receiver, assumes partial or complete
                  control over the assets of a party to this Agreement based on
                  the insolvency or bankruptcy of such party, the bankrupt or
                  insolvent party shall promptly notify the court or other
                  tribunal (i) that confidential information received from the
                  other party under this Agreement remains the property of the
                  other party and (ii) of the confidentiality obligations under
                  this Agreement. In addition, the bankrupt or insolvent party
                  shall, to the extent permitted by law, take all steps
                  necessary or desirable to maintain the confidentiality of the
                  other party's confidential information and to insure that the
                  court, other tribunal or appointee maintains such information
                  in confidence in accordance with the terms of this Agreement.

         6.06     No public announcement or other disclosure to THIRD PARTIES
                  concerning the existence of or the terms of or the subject
                  matter covered by this Agreement

<PAGE>
                                                                             16.

                  shall be made, either directly or indirectly, by any party to
                  this Agreement, without first obtaining the approval of the
                  other party and agreement upon the nature and text of such
                  announcement or disclosure. The party desiring to make any
                  such public announcement or other disclosure shall inform the
                  other party of the proposed announcement or disclosure in
                  reasonable sufficient time prior to public release, and shall
                  provide the other party with a written copy thereof, in order
                  to allow such other party to comment upon such announcement or
                  disclosure. If such public announcement or other disclosure is
                  required under securities laws or rules or pursuant to a
                  public or private financing the concerned party needs not
                  obtain the consent of the other party but shall provide the
                  other party with a five (5) working days notice allowing the
                  other party to review and comment upon such proposed
                  disclosure and/or announcement and such other party shall
                  cooperate fully with the concerned party with respect to all
                  disclosures regarding this Agreement to the United States
                  Securities Exchange Commission and any other governmental or
                  regulatory agencies, including requests for confidential
                  treatment of proprietary information of either party included
                  in any such disclosure.

         6.07     Neither LICENSEE nor LICENSOR shall submit for written or oral
                  publication any manuscript, abstract or the like which
                  includes data or other information generated and provided by
                  the other party without first obtaining the prior written
                  consent of the other party, which consent shall not be
                  unreasonably withheld. The contribution of each party shall be
                  noted in all publications or presentations by acknowledgement
                  or coauthorship, whichever is appropriate.

7.       PATENT PROSECUTION AND LITIGATION

         7.01     LICENSOR, or any entity having granted or granting rights to
                  LICENSOR, shall be responsible for the filing, prosecution and
                  maintenance of PATENTS which, subject to Paragraph 7.02, shall
                  be at the cost and expense of LICENSOR (or the entity having
                  granted or granting rights to LICENSOR). LICENSOR shall
                  disclose to LICENSEE the complete texts of all patent
                  applications within PATENTS as well as all information
                  received concerning the institution or possible institution of
                  any interference, opposition, re-examination, reissue,
                  revocation, nullification or any official proceedings
                  involving a PATENT anywhere in the TERRITORY. LICENSEE shall
                  have the right to review all such pending applications and
                  other proceedings and to make comments and/or recommendations
                  to LICENSOR concerning them and their conduct and

<PAGE>
                                                                             17.

                  LICENSOR shall consider, in good faith, all such LICENSEE's
                  comments and/or recommendations. LICENSOR agrees to keep
                  LICENSEE promptly and fully informed of the course of patent
                  prosecution or other proceedings including by providing
                  LICENSEE with copies of substantive communications, search
                  reports and THIRD PARTY observations submitted to or received
                  from patent offices throughout the TERRITORY. LICENSOR shall
                  provide such patent consultation to LICENSEE at no cost to
                  LICENSEE. LICENSEE shall hold all information disclosed to it
                  under this section as confidential subject to the provisions
                  of Paragraphs 6.03 and 6.04.

         7.02     LICENSOR shall notify LICENSEE in sufficiently reasonable time
                  in advance of any PATENT or subject matter or claim contained
                  in PATENT which LICENSOR intends to abandon or otherwise cause
                  or allow to be forfeited and LICENSEE shall have the right to
                  assume responsibility for filing, prosecution and maintenance
                  of any such PATENT or subject matter or claim contained in
                  PATENT at LICENSEE's expense provided LICENSOR has the right
                  to permit LICENSEE to assume such responsibility.

         7.03     In the event of the institution of any suit by a THIRD PARTY
                  against LICENSOR, LICENSEE or its AFFILIATES or sublicensees
                  for patent infringement involving the manufacture, use, sale,
                  distribution or marketing of VACCINE anywhere in the
                  TERRITORY, the party sued shall promptly notify the other
                  party in writing. Subject to Section 21 below, LICENSEE shall
                  have the right but not the obligation to defend such suit at
                  its own expense. LICENSOR and LICENSEE shall reasonably assist
                  one another and cooperate in any such litigation at the
                  other's request without expense to the requesting party.

         7.04     In the event that LICENSOR or LICENSEE becomes aware of actual
                  or threatened infringement of a PATENT anywhere in the
                  TERRITORY, that party shall promptly notify the other party in
                  writing. LICENSEE shall have the first right but not the
                  obligation to bring, at its own expense, an infringement
                  action against any THIRD PARTY and to use LICENSOR's name in
                  connection therewith. If LICENSEE does not commence a
                  particular infringement action within ninety (90) days,
                  LICENSOR, after notifying LICENSEE in writing, shall be
                  entitled, but not obligated, to bring such infringement action
                  at its own expense. The party conducting such action shall
                  have full control over its conduct, including settlement
                  thereof provided that LICENSEE shall not take any steps,
                  including settlement, which would have an adverse effect on
                  PATENTS unless LICENSOR's consent is obtained. In any event,
                  LICENSOR and LICENSEE

<PAGE>
                                                                             18.

                  shall reasonably assist one another and cooperate in any such
                  litigation at the other's request without expense to the
                  requesting party.

         7.05     LICENSOR and LICENSEE shall recover their respective actual
                  out-of-pocket expenses, or equitable proportions thereof,
                  associated with any litigation or settlement thereof, from any
                  recovery made by any party. Any excess amount shall before the
                  party which has conducted the litigation or settlement
                  thereof.

         7.06     The parties shall keep one another informed of the status of
                  and of their respective activities regarding any litigation or
                  settlement thereof concerning VACCINE.

         7.07     LICENSOR shall authorise LICENSEE to act as LICENSOR's agent
                  for the purpose of making any application for any extensions
                  of the term of PATENTS, including SPC, and shall provide
                  reasonable assistance therefor to LICENSEE, at LICENSEE's
                  expense. (In the United States of America as permitted under
                  Title 35 of the United States Code).

         7.08     LICENSOR, on behalf of itself, its officers, agents and
                  successors hereby waives any and all actions and causes of
                  action, claims and demands whatsoever in law or equity of any
                  kind against LICENSEE'S and its AFFILIATES' exercize of
                  LICENSEE's rights under Paragraphs 7.02 and 7.07, and, subject
                  to LICENSEE's obligations under Paragraph 7.04, against
                  LICENSEE's and its AFFILIATES' exercize of LICENSEE's rights
                  under Paragraph 7.04.

8.       TRADEMARKS

         8.01     LICENSEE, at its expense, shall be responsible for the
                  selection, registration and maintenance of all trademarks
                  which it employs in connection with VACCINE and COMBINATION
                  and shall own and/or control such trademarks. Nothing in this
                  Agreement shall be construed as a grant of rights, by license
                  or otherwise, to LICENSOR to use such trademarks for any
                  purpose.

<PAGE>

                                                                             19.

9.       STATEMENTS AND REMITTANCES

         9.01     LICENSEE shall keep and require its AFFILIATES and
                  sublicensees to keep complete and accurate records of all
                  sales of VACCINE and COMBINATION under the licenses granted
                  herein. LICENSOR shall have the right, at LICENSOR's expense,
                  through a certified public accountant or like person
                  reasonably acceptable to LICENSEE, to examine such records
                  during regular business hours during the life of this
                  Agreement and for six (6) months after its termination;
                  provided, however, that such examination shall not take place
                  more often than once a year and shall not cover such records
                  for more than the preceding two (2) years and provided further
                  that such accountant shall report to LICENSOR only as to the
                  accuracy of the royalty statements and payments. In the event
                  that such inspection shall indicate in any calendar year that
                  the royalties which should have been paid by LICENSEE are at
                  least five percent (5%) greater than those which were
                  actually paid by LICENSEE, then LICENSEE shall pay the cost of
                  such inspection in addition to the underpaid royalties.

         9.02     Within sixty (60) days after the close of each calendar
                  quarter, LICENSEE shall deliver to LICENSOR a true accounting
                  of all VACCINES and COMBINATION sold by LICENSEE, its
                  AFFILIATES and its sublicensees during such quarter, and shall
                  at the same time pay all royalties due. Such accounting shall
                  show sales, NET SALES and deductions against royalties on NET
                  SALES on a country-by-country and product-by-product basis.

         9.03     Any tax paid or required to be withheld by LICENSEE on behalf
                  of LICENSOR on account of royalties payable to LICENSOR under
                  this Agreement shall be deducted from the amount of royalties
                  otherwise due. LICENSEE shall secure and send to LICENSOR
                  proof of any such taxes withheld and paid by LICENSEE or its
                  sublicensees for the benefit of LICENSOR.

         9.04     All royalties due under this Agreement shall be payable in
                  United States Dollars. Monetary conversions from the currency
                  of a foreign country in which VACCINE is sold into US currency
                  shall be made at the exchange rate in force on the last
                  business day of the period for which the royalties are being
                  paid as published by Banque Generale de Belgique, Brussels,
                  Belgium, or on another basis mutually agreed to by both
                  parties in writing.

<PAGE>
                                                                             20.

10.      TERM AND TERMINATION

         10.01    Unless otherwise terminated, this Agreement shall expire upon
                  the expiration, lapse or invalidation of the last remaining
                  PATENT in the TERRITORY. Expiration of this Agreement under
                  this provision shall not preclude LICENSEE from continuing to
                  market VACCINE and to use KNOW-HOW without any further royalty
                  or other payments to LICENSOR.

         10.02    If either party fails or neglects to perform covenants or
                  provisions of this Agreement and if the party in default has
                  not corrected such default within sixty (60) days (the period
                  shall be thirty (30) days for a payment default) after
                  receiving written notice from the other party with respect to
                  such default, such other party shall have the right to
                  terminate this Agreement by giving written notice to the party
                  in default provided the notice of termination is given within
                  six (6) months of the default and prior to correction of the
                  default. If the default other than a payment default is not
                  curable in sixty (60) days and the defaulting party in good
                  faith notifies the other party in writing prior to the sixty
                  (60) days that it is initiating cure of the default and
                  initiates cure of such default within the sixty (60) days and
                  in good faith continues to attempt to cure the default, and in
                  fact cures the default within one hundred and twenty (120)
                  days, then this Agreement shall not be terminable hereunder.

         10.03    LICENSEE may terminate this Agreement in its entirety or with
                  respect to any country by giving LICENSOR at least three (3)
                  months prior written notice thereof.

         10.04    Either party may terminate this Agreement if, at any time, the
                  other party shall file in any court or agency pursuant to any
                  statute or regulation of (the United States or of) any
                  (individual) state or (foreign) country, a petition in
                  bankruptcy or insolvency or for reorganisation or for an
                  arrangement or for the appointment of a receiver or trustee of
                  the party or of its assets, or if the other party proposes a
                  written agreement of composition or extension of its debts, or
                  if the other party shall be served with an involuntary
                  petition against it, filed in any insolvency proceeding, and
                  such petition shall not be dismissed with sixty (60) days
                  after the filing thereof, or if the other party shall propose
                  or be a party to any dissolution or liquidation, or if the
                  other party shall make an assignment for the benefit of
                  creditors.

<PAGE>
                                                                             21.

         10.05    Notwithstanding the bankruptcy of LICENSOR, or the impairment
                  of performance by LICENSOR of its obligations under this
                  Agreement as a result of bankruptcy or insolvency of LICENSOR,
                  LICENSEE, if it has not then been notified for breach by
                  LICENSOR, shall be entitled to retain the licenses granted
                  herein, subject to LICENSOR's right to terminate this
                  Agreement for reasons other than bankruptcy or insolvency as
                  expressly provided in this Agreement.

         10.06    LICENSEE shall be entitled to terminate this Agreement by
                  written notice to LICENSOR in the event of change of control
                  of LICENSOR, provided such notice is given within thirty (30)
                  days after LICENSOR has notified LICENSEE of such change of
                  control or after the date which LICENSOR can demonstrate is
                  the date on which LICENSEE has been otherwise informed of such
                  change of control.

11.      RIGHTS AND DUTIES UPON TERMINATION

         11.01    Upon termination of this Agreement, LICENSOR shall have the
                  right to retain any sums already paid by LICENSEE hereunder,
                  and LICENSEE shall pay all sums accrued hereunder which are
                  then due.

         11.02    Upon termination of this Agreement in its entirety or with
                  respect to any country under Paragraph 10.02, 10.03 or 10.04,
                  LICENSEE shall notify LICENSOR of the amount of VACCINE
                  LICENSEE and its AFFILIATES, sublicensees and distributors
                  then have on hand, the sale of which would, but for the
                  termination, be subject to royalty, and LICENSEE and its
                  AFFILIATES, sublicensees and distributors shall thereupon be
                  permitted to sell that amount of VACCINE provided that
                  LICENSEE shall pay the royalty thereon at the time herein
                  provided for.

         11.03    Termination of this Agreement shall terminate all outstanding
                  obligations and liabilities between the parties arising from
                  this Agreement except those described in Paragraphs 2.03,
                  6.03, 6.04, 6.05, 6.06, 6.07, 7.03, 7.06, 7.08, 8.01, 9.01,
                  9.02, 9.03, 9.04, 9.05, 11.01, 11.02, 11.03, 14.01, 15.01,
                  18.01, 20.01 and 21.01.

         11.04    Upon termination of this Agreement by LICENSOR pursuant to
                  Paragraph 10.02 for breach of LICENSEE, LICENSEE agrees not to
                  use KNOW-HOW and/or

<PAGE>

                                                                             22.

                  PATENTS for the research, development, making, using or
                  selling of any product or process, including, but not limited
                  to, VACCINES.

12.      WARRANTIES AND REPRESENTATIONS

         12.01    LICENSOR warrants that it has the right to grant the rights
                  and licences under PATENTS and KNOW-HOW as provided throughout
                  this Agreement including, but not limited to, the Rotavirus
                  89.12 strain and that it has the right to enter into this
                  Agreement.

         12.02    Nothing in this Agreement shall be construed as a warranty
                  that PATENTS are valid or enforceable or that their exercise
                  does not infringe any patent rights of THIRD PARTIES. Without
                  having made an investigation or search, LICENSOR hereby
                  warrants and represents that it has no present knowledge from
                  which it can be inferred that PATENTS are invalid or that
                  their exercise would infringe patent rights of THIRD PARTIES
                  or that the Rotavirus 89.12 strain or the use thereof in
                  VACCINE infringes any patent rights of THIRD PARTIES. Subject
                  to other provisions contained herein, a holding of invalidity
                  or unenforceability of any PATENT, from which no further
                  appeal is or can be taken, shall not affect any obligation
                  already accrued hereunder, but shall only eliminate royalties
                  otherwise due under such PATENT from the date such holding
                  becomes final.

         12.03    LICENSOR acknowledges that, in entering into this Agreement,
                  LICENSEE has relied upon technical and clinical information
                  and KNOW-HOW disclosed and/or supplied by or on behalf of
                  LICENSOR and that LICENSEE has relied upon LICENSOR's
                  obligation to disclose and/or supply further information
                  pursuant to Paragraph(s) 6.01 and/or 6.02 hereof. LICENSOR
                  warrants and represents that LICENSOR has no knowledge that
                  the technical and/or clinical information and/or KNOW-HOW
                  disclosed and/or supplied to LICENSEE prior to the date of
                  this Agreement is inaccurate in any material respect. LICENSOR
                  warrants and represents that it will use its reasonable
                  efforts to review the technical and/or clinical information
                  and/or KNOW-HOW to be disclosed and/or supplied to LICENSEE
                  under Paragraph(s) 6.01 and/or 6.02 hereof after the date of
                  this Agreement for any inaccuracies therein and that, to the
                  extent LICENSOR has any knowledge of any material inaccuracies
                  in such technical and/or clinical information and/or KNOW-HOW,
                  it shall inform LICENSEE of such inaccuracies. LICENSOR and
                  LICENSEE warrant and represent to each other that they have
                  not, up to the date of this Agreement, omitted to disclose
                  and/or supply to each

<PAGE>
                                                                             23.

                  other any information known to them concerning VACCINE or the
                  transactions contemplated by this Agreement which would, to
                  the best of their knowledge, be material to the other's
                  decision to enter into this Agreement and to undertake the
                  commitments and obligations set forth herein.

         12.04    LICENSOR warrants and represents that it has no present
                  knowledge of the existence of any pre-clinical or clinical
                  data or information concerning VACCINE which suggests that
                  there may exist toxicity, safety and/or efficacy concerns
                  which may materially impair the utility and/or safety of
                  VACCINE.

13.      FORCE MAJEURE

         13.01    If the performance of any part of this Agreement by either
                  party, or of any obligation under this Agreement other than a
                  payment provision, is prevented, restricted, interfered with
                  or delayed by reason of any cause beyond the reasonable
                  control of the party liable to perform, unless conclusive
                  evidence to the contrary is provided, the party so affected
                  shall, upon giving written notice to the other party, be
                  excused from such performance to the extent of such
                  prevention, restriction, interference or delay, provided that
                  the affected party shall use its reasonable best efforts to
                  avoid or remove such causes of non-performance and shall
                  continue performance with the utmost dispatch whenever such
                  causes are removed. When such circumstances arise, the parties
                  shall discuss what, if any, modification of the terms of this
                  Agreement may be required in order to arrive at an equitable
                  solution. In the event agreement is not reached or the force
                  majeure event cannot be cured within six (6) months, the other
                  party shall have the right to terminate this Agreement by
                  serving a written notice to the party affected by the force
                  majeure event.

14.      GOVERNING LAW

         14.01    This Agreement shall be deemed to have been made in the United
                  States of America and its form, execution, validity,
                  construction and effect shall be determined in accordance with
                  the laws of the Commonwealth of Massachusetts, USA, without
                  regard to its choice of law principles.

<PAGE>

                                                                             24.

15.      RESOLUTION OF DISPUTES

         15.01    Prior to initiating legal action, the parties agree to attempt
                  to settle any dispute by discussions between the parties,
                  provided, however that this Paragraph 15.01 shall not prevent
                  either party from seeking injunctive relief where necessary.
                  If the parties have not resolved the dispute amicably, legal
                  action may be introduced.

16.      SEPARABILITY

         16.01    In the event any portion of this Agreement shall be held
                  illegal, void or ineffective, the remaining portions hereof
                  shall remain in full force and effect.

         16.02    If any of the terms or provisions of this Agreement are in
                  conflict with any applicable statute or rule of law, then such
                  terms or provisions shall be deemed inoperative to the extent
                  that they may conflict therewith and shall be deemed to be
                  modified to conform with such statute or rule of law.

         16.03    In the event that the terms and conditions of this Agreement
                  are materially altered as a result of Paragraphs 16.01 or
                  16.02, the parties will renegotiate the terms and conditions
                  of this Agreement to resolve any inequities.

17.      ENTIRE AGREEMENT

         17.01    This Agreement, entered into as of the date first written
                  above, constitutes the entire agreement between the parties
                  relating to the subject matter hereof and supersedes all
                  previous writings and understandings. No terms or provisions
                  of this Agreement shall be varied or modified by any prior or
                  subsequent statement, conduct or act of either of the parties,
                  except that the parties may amend this Agreement by written
                  instruments specifically referring to and executed in the same
                  manner as this Agreement.

<PAGE>

                                                                             25.

18.      NO WAIVER

         18.01    The failure of either party at any time to exercise any of
                  their respective rights under this Agreement shall not be
                  deemed a waiver thereof, nor shall such failure in any way
                  prevent either party, as the case may be, from subsequently
                  asserting or exercising such rights.

19.      NOTICES

         19.01    Any notice required or permitted under this Agreement shall be
                  sent by certified mail, return receipt requested, postage
                  pre-paid to the following addresses of the parties:

                                    if to LICENSOR:
                                    Virus Research Institute, Inc.,
                                    61 Moulton Street
                                    Cambridge, MA 02138,
                                    USA
                                    Attention: President

                                    cc: Elliot M. Olstein, Esq.
                                    Carella, Byrne, Bain, Gilfillan, Cecchi,
                                      Stewart & Olstein
                                    6 Becker Farm Road
                                    Roseland, New Jersey 07068
                                    USA

                                    if to LICENSEE:

                                    SmithKline Beecham P.L.C.
                                    New Horizons Court
                                    Brentford
                                    Middlesex TW8 9EP
                                    United Kingdom

                                    with a copy to :
                                    SmithKline Beecham Biologicals Manufacturing
                                      S.A.
                                    rue de l'Institut 89

<PAGE>

                                                                             26.

                                    1330 Rixensart, Belgium
                                    Attention : Senior Vice President,
                                      General Manager

         19.02    Any notice required or permitted to be given concerning this
                  Agreement shall be effective upon receipt by the party to whom
                  it is addressed.

20.      ASSIGNMENT

         20.01    Without prejudice to Paragraph 10.06, this Agreement and the
                  licenses herein granted shall be binding upon and inure to the
                  benefit of the successors in interest of the respective
                  parties. Neither this Agreement nor any interest hereunder
                  shall be assignable by either party without the written
                  consent of the other provided, however, that LICENSEE may,
                  without the consent of LICENSOR, assign this Agreement to any
                  AFFILIATE or to any corporation with which it may merge or
                  consolidate or to which it may sell all or substantially all
                  of its assets, and that LICENSOR may without obtaining the
                  consent of LICENSEE assign this Agreement to any corporation
                  with which it may merge or consolidate or to which it may sell
                  all or substantially all of its assets.

         20.02    In the event of a permitted assignment hereunder the assignee
                  must accept in writing the obligations of this
                  Agreement, whereupon the assignor shall be relieved of its
                  obligations under this Agreement.

21.      INDEMNIFICATION

         21.01(a) LICENSEE agrees to defend, indemnify and hold harmless
                  LICENSOR, its AFFILIATES and any of their licensors that have
                  granted a license under which LICENSEE has received a license
                  under this Agreement as well as each of their respective
                  directors, officers, employees, shareholders, and agents
                  (hereinafter individually and collectively referred to as
                  "Indemnitee") against any and all actions, claims
                  (specifically including, but not limited to, any damages based
                  on product liability claims), suits, losses, demands,
                  judgments, and other liabilities (including attorneys' fees
                  until LICENSEE assumes the defense as described below)
                  asserted by THIRD PARTIES, government and non-government,
                  resulting from or arising out of the manufacture, use or sale
                  of VACCINES by LICENSEE, its AFFILIATES or sublicensees
                  provided however that LICENSEE's indemnification to an

<PAGE>

                                                                             27.

                  Indemnitee hereunder shall not apply to any liability, damage,
                  loss or expense to the extent that it is directly or
                  indirectly attributable to the gross negligence or intentional
                  misconduct of such Indemnitee. If any such claims or actions
                  are made, Indemnitee shall be defended at LICENSEE's sole
                  expense by counsel selected by LICENSEE and reasonably
                  acceptable to LICENSOR; provided that LICENSOR may, at its own
                  non-refundable expense, also be represented by counsel of its
                  own choosing.

         (b)      Any such Indemnitee shall notify LICENSEE promptly of any
                  claim or threatened claim under this Section 21, shall fully
                  cooperate with all reasonable requests of LICENSEE with
                  respect thereto, and shall give LICENSEE the right to control
                  the defence and settlement of any such claim provided such
                  Indemnitee shall be fully indemnified under this Section 21.

         (c)      The provision of this Section 21 shall apply whether or not an
                  act or claim is rightly brought or asserted.

IN WITNESS WHEREOF, the parties, through their authorised officers, have
executed this Agreement as of the date first written above.

VIRUS RESEARCH INSTITUTE Inc.

             /s/ William A. Packer
             -----------------------------
BY:          WILLIAM A. PACKER
TITLE:       PRESIDENT

SMITHKLINE BEECHAM P.L.C.

             /s/ Jean Stephenne
             -----------------------------
BY:          JEAN STEPHENNE
TITLE:       Senior Vice President, General Manager

<PAGE>

                                                         CONFIDENTIAL TREATMENT

                                   APPENDIX A

                               PATENT INFORMATION

[*]

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>

                                                         CONFIDENTIAL TREATMENT

                                   APPENDIX B

                    VRI PROPRIETARY INFORMATION AND KNOW-HOW,
                             89-12 ROTAVIRUS VACCINE
                                 8 October 1997

[*]

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>
                                                          CONFIDENTIAL TREATMENT

                                   APPENDIX C

                          PHASE II CLINICAL ENDPOINTS

[*]

/*/ Confidential material omitted and filed separately with the Securities and
    Exchange Commission.

<PAGE>

                                   APPENDIX D

                             MANUFACTURING ENDPOINT

- -    Yield a minimum of 1 dose/ml

- -    This yield should be achieved in a cell line acceptable for commercial
     production and acceptable to regulatory authorities.

<PAGE>

                                   APPENDIX E

                EXCERPTS OF LICENSE AND CLINICAL TRIALS AGREEMENT
   DATED FEBRUARY 27, 1995 BETWEEN VIRUS RESEARCH INSTITUTE, INC AND JAMES N.
                      GAMBLE INSTITUTE OF MEDICAL RESEARCH

     2.4  (a)

          (b)

          (c)  VRI agrees to forward to GAMBLE a copy of any and all fully
executed sublicense agreements within thirty (30) days of execution thereof, and
further agrees to forward to Gamble annually a copy of such reports received by
VRI from its Sublicensee during the preceding twelve (12) month period under the
sublicenses as shall be pertinent to a royalty accounting under said sublicense
agreements. VRI may delete from copies of sublicense agreements provided to
GAMBLE hereunder commercial, research and development, manufacturing, financial
and other provisions unrelated to VRI's or the Sublicensee's obligations to
Gamble.

8.   INDEMNIFICATION AND INSURANCE.

     8.1  VRI shall defend, indemnify and hold harmless GAMBLE and its trustees,
officers, medical and professional staff, employees, and agents and their
respective successors, heirs and assigns against all losses, damages, expenses,
including attorney's fees and against any claims, suits, actions, demands or
judgments brought against any one or more of them, arising out of any theory of
product liability (including, but not limited to, action in the form of tort,
warranty, or strict liability) or negligence concerning any product, process or
service made, used or sold pursuant to any right or license granted under this
AGREEMENT. VRI shall have the right to control the defense settlement and/or
compromise of any such claims or actions.

     8.2  VRl's obligations under Section 8.1 above shall not apply to any
liability, damage, loss or expense to the extent that it is directly
attributable to the negligence or intentional misconduct of GAMBLE or any of its
trustees, officers, medical and professional staff, employees, agents or their
respective successors, heirs or assigns.

     8.3  VRI shall add, at VRl's expense, GAMBLE as an additional insured on
VRI's clinical trial insurance policy, which provides limits of liability of
$2,000,000 per incident and aggregate, effective upon the Effective Date of this
AGREEMENT, to provide insurance coverage for GAMBLE for the clinical trials.

     8.4  VRI, at VRl's expense, shall maintain policies of comprehensive
general liability insurance and will obtain product liability insurance in
amounts not less than $1,000,000 per incident and $2,000,000 annual aggregate
and shall add GAMBLE as an additional insured on VRI's policy, which provides
such limits of liability. Such insurance shall provide (i) product liability
coverage, (ii) negligence, and (iii) broad form contractual liability coverage,
for VRI's indemnification under Section 8.1 of this AGREEMENT. The minimum
amounts of insurance coverage required under these provisions shall not be
construed to create a limit of VRI's liability with respect to VRI's
indemnification obligation under Section 8.1 of this AGREEMENT. VRI shall
maintain such comprehensive general liability insurance and product liability
insurance beyond the expiration or termination of this AGREEMENT and for a
reasonable period after the termination of the clinical trials, which in no
event shall be less than fifteen (15) years after the clinical trials.

     8.5  This Section 8 shall survive expiration or termination of this
AGREEMENT.

<PAGE>

10.  CONFIDENTIALITY

     10.1 CONFIDENTIAL INFORMATION. As used in this AGREEMENT, "Confidential
Information" means all information transmitted by a party hereto or obtained by
a party hereto in connection with the performance of the clinical trials and
other services described in Section 3 hereof or of any such other services to be
provided by the parties as described herein, subject to the exceptions specified
below. "Confidential Information" means information of any type, not generally
known, about the business, processes, services, products, suppliers, customers,
clients or plans of GAMBLE or VRI ("the parties hereto") of any client of the
parties hereto (regardless of whether the parties hereto have executed a
confidentiality agreement with such customer), which is used or useful in the
conduct of business of the parties hereto, or which confers or tends to confer a
competitive advantage over one who does not possess such information. Such
information includes, but is not limited to, information relating to trade
secrets, Technical Information, patent applications, know-how, research,
development, design, engineering, quality control or service techniques,
information about existing, new or envisioned products, processes or services
and their development, performance, scientific, engineering or technical
information, laboratory notebooks, notes, computer programs, source codes,
object codes, software manuals, sketches, drawings, reports, formulae, gels,
slides, sequences, biological materials living or otherwise, photographs,
negatives, prototypes, models, correspondence, and other documents and things,
and information relating to purchasing, sales, marketing, licensing, contracts
with third parties, and pricing, whether or not in writing and whether or not
labeled or identified as confidential or proprietary. Confidential Information
may be disclosed in writing or orally or may be obtained by observation or
inspection. All data, materials, information, and records developed by a party
hereto in the course of performing this AGREEMENT shall be considered
Confidential Information. However, Confidential Information shall not include
information that a party hereto can demonstrate: (i) is in or enters the public
domain through no fault of such party; (ii) is disclosed to a party hereto by a
third party entitled to disclose it; (iii) was known to a party hereto before
the date of this AGREEMENT; OR (iv) is required by law to be disclosed, provided
reasonable advance notice of such requirement is given to a party hereto before
such disclosure.

     10.2 CONFIDENTIALITY. Without prior written consent, the parties hereto
will not disclose the other party's Confidential Information to any third party
other than employees, agents or others of the parties hereto who must
necessarily be informed thereof, but only if and to the extent that any such
person has a need for such information. A party hereto will only use
Confidential Information for the purpose of fulfilling its obligations under
this AGREEMENT. The parties hereto agree that they will take such reasonable
steps as may be necessary to prevent the disclosure or use of any such materials
by their officers, employees or agents except as provided herein, including but
not limited to obtaining and enforcing appropriate confidentiality agreements
with such persons. All obligations of confidentiality and nondisclosure set
forth in this AGREEMENT shall survive the termination or expiration of this
AGREEMENT.

     10.3 The parties agree that clinical trial data generated by GAMBLE under
the terms of the AGREEMENT will not be published by VRI prior to its publication
by GAMBLE's principal investigators. To the extent not published, the results of
the clinical trials will be held in confidence by GAMBLE. Subject to the
foregoing, VRI will have the unrestricted right to use or disclose such clinical
trial data.

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