Document:

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                                                                    EXHIBIT 10.8

LICENSE AGREEMENT

between

Bayer AG
D-51368 Leverkusen
Germany
- hereinafter referred to as "Bayer" -

and

Memory Pharmaceuticals Corporation
100 Philips Parkway
Montvale, New Jersey  07645
U.S.A.

- hereinafter referred to as "Memory" -

RECITALS

1.    Bayer has disclosed and transferred to Memory confidential information and
      a sample of Bayer's compound Bay z 4406 under the provisions of a Secrecy
      Agreement dated August 6, 1998, as extended by Agreement dated July 2,
      1999 (the "Secrecy Agreement"), and a Confidentiality and Non-Use
      Agreement dated July 6, 1999 as extended by Agreement dated June 30, 2000,
      and as modified by an Agreement dated May 23, 2000 (the "Confidentiality
      Agreement").

2.    Memory has evaluated such Bayer compound, the patent rights and know how
      related thereto, and has been granted by Bayer an exclusive evaluation
      period under an Agreement dated May 23, 2000, amended by a Letter
      Agreement dated November 21, 2000.

3.    Memory has informed Bayer in writing that it elects to acquire an
      exclusive license from Bayer pursuant to the provisions of the Agreement
      of May 23, 2000 and its amendment of November 21, 2000.

Now, therefore, in consideration of the mutual set forth in this License
Agreement, the parties hereby agree as follows:

ARTICLE 1 - DEFINITIONS

For purposes of this Agreement, the terms defined in this Article shall have the
meanings specified below:

1.1.  "Additional Component" shall mean a component which is diagnostically
      useable or therapeutically active alone or in a combination which does not
      require Compound, and such component does not contain Compound.

1.2.  "Affiliate" shall mean a corporation or other legal entity that controls,
      is controlled by, or is under common control with such party. For purposes
      of this definition, "control means the ownership, directly or indirectly,
      of more than fifty percent (50%) of the outstanding equity securities of a

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      corporation which are entitled to vote in the election of directors or a
      more than fifty percent (50%) interest in the net assets or profits of an
      entity which is not a corporation.

1.3.  "Combination Product(s)" shall mean a Finished Product that includes the
      Compound and at least one Additional Component.

1.4.  "Compound" shall mean the Bayer compound having the code no. Bay z 4406,
      which is (+)-3-isopropyl 5-(2-methoxyethyl)
      4-(2-chloro-3-cyanophenyl)-2,6-dimethyl-1,4-dihydro-3,
      5-pyridinedicarboxylate.

1.5.  "Distributor" shall mean any business entity which has the right to
      distribute Finished Products within a country.

1.6.  "Finished Product" shall mean any and all pharmaceutical preparations
      which are in a form ready for use by an end user without further
      formulation, processing or chemical transformation, which contain
      Compound.

1.7.  "Field" shall mean the treatment of human peripheral and central nervous
      system related disorders.

1.8.  "First Commercial Sale" shall mean the initial transfer of a Finished
      Product for value and not for demonstration, testing or promotional
      purposes.

1.9.  "Know How" shall mean any and all manufacturing information, technical
      information, testing and analytic methods, results, data and
      specifications or know-how which Bayer owns or has rights to include in
      the license grant in Article 2 hereof pertaining to Compound, Finished
      Product and Field.

1.10. "IND" shall mean the application for an Investigative New Drug in the
      United States or a foreign equivalent thereof.

1.11. "Listed Country" shall mean the United States of America, Japan, Germany,
      France, Italy, United Kingdom, Canada, Mexico, Spain, The Netherlands,
      Belgium or Luxembourg.

1.12. "Major Country" shall mean the United States of America, Japan, Germany,
      France, Italy or the United Kingdom.

1.13. "NDA" shall mean a New Drug Application in the United States to obtain an
      approval to market and sell Finished Product, or a foreign equivalent
      thereof.

1.14. "Net Sales" shall mean the total gross sales (number of units shipped
      times the invoiced price per unit) of Finished Product, or, if applicable,
      Combination Product sold by Memory and/or a Sublicensee and/or a
      Distributor to Third Parties less certain deductions explained below, but
      only to the extent that such deductions are borne by Memory and/or a
      Sublicensee and not separately invoiced, and are related to Finished
      Product sold under the terms of this Agreement:

      a)    Allowances actually granted to Third Party customers such as
            ordinary and customary trade discounts, quantity discounts, cash
            discounts, rebates (including rebates to social and welfare
            systems), and sales commissions but together not more than [*]% of
            gross sales. Notwithstanding the foregoing, in the event that the
            requested allowances are

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            higher than [*]% of the gross sales in an individual country, Memory
            shall be entitled to deduct from the gross sales more than [*]%, if
            Memory produces evidence and informs Bayer respectively in writing
            that the sum of the deductions as set forth herein before is more
            than [*] %; provided, however, that such allowances are granted in
            the ordinary course of business and consistent with the business
            practices in the pharmaceutical industry.

      b)    Government mandated rebates.

      c)    Taxes and governmental charges, other than income tax. This
            deduction includes import duties, excise taxes, tariffs, use taxes,
            etc., which are imposed on Finished Product and borne by the seller
            of Finished Product.

      d)    Credits and/or allowances actually given for rejection, return or
            recall of previously sold Finished Product, but not in excess of the
            original selling price of the Finished Product rejected, returned or
            recalled.

      e)    Outbound transportation and delivery charges (including insurance
            premiums related to transportation and delivery) prepaid or allowed.

      Notwithstanding anything herein to the contrary, the following shall not
      be considered a sale of a Finished Product, or, if applicable, Combination
      Product under this Agreement: (i) the transfer of a Finished Product, or,
      if applicable, Combination Product to a Sublicensee or a Distributor for
      sale by the Sublicensee or the Distributor in a transaction that will be
      royalty bearing, regardless of whether there is an internal transfer price
      associated with the transfer; or (ii) the transfer of a Finished Product,
      or, if applicable, Combination Product to a Third Party, an Affiliate of
      Memory or a Sublicensee without consideration or for nominal consideration
      to Memory and/or the Sublicensee in connection with the development or
      testing of a Finished Product. For purposes of clarification, in the event
      of any Net Sales generated by Memory directly via an unaffiliated
      wholesaler of Finished Product or, if applicable, Combination Product and
      not through a Sublicensee, "Net Sales" shall mean, and royalties shall be
      calculated based upon, the Net Sales of Memory to the wholesalers and not
      the sales of Finished Product or, if applicable, Combination Product by
      the wholesaler to its customers.

1.15. "Patent Rights" shall mean (a) Bayer's patents and patent applications as
      specified in Annex A which is an integral part of this Agreement,
      including any patents issuing from such patent applications; (b) any
      divisional applications, continuation applications, continuation in part
      applications or substitutes, reissues, reexaminations, renewals or the
      like related to the patents and patent applications listed in Annex A; (c)
      claims of continuation in part applications and patent applications, and
      patents issued therefrom, to the extent the claims are directed to the
      subject matter specifically described in the patent rights described in
      (a) and (b) above and (d) below; and (d) all patent rights referred to in
      Art. 2.3 below.

1.16. "Royalty Period" shall mean the calendar quarter, or partial calendar
      quarter, commencing with the First Commercial Sale of any Licensed
      Product, and each calendar quarter thereafter until the obligation to pay
      royalties expires.

1.17. "Sublicensee" shall mean a Memory Affiliate or a Third Party; provided
      that such Affiliate or Third Party has received certain sublicense rights
      from Memory as set forth in Art. 2.6.

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1.18. "Third Party" shall mean any third party except Memory, a Memory
      Affiliate, Bayer or a Bayer Affiliate.

ARTICLE 2 - GRANT OF RIGHTS

2.1.  Subject to the terms and conditions set forth herein, Bayer hereby grants
      Memory a world-wide, exclusive, royalty-bearing non-transferable license
      under Patent Rights and Know How to manufacture, have manufactured, use
      and/or have used Compound in order to manufacture, have manufactured, use,
      offer for sale, have sold, import, export, register and/or market Finished
      Products within the Field.

2.2.  Memory acknowledges that its rights under Patent Rights are limited to
      those expressly granted herein, and that Memory is expressly prohibited
      from selling, transferring or otherwise making available to Third Parties
      Compound and/or Finished Products for use outside the Field.

2.3.  As far as Bayer owns or controls, at any time, patent rights not mentioned
      in Annex A, which claim Compound and/or its use in the Field, those patent
      rights shall be regarded as Patent Rights provided that manufacture sale
      or use of the Finished Product in the Field would infringe or violate
      those patent rights. The patent rights under this Art. 2.3 shall however
      not include any patent or patent application of Bayer claiming specific
      formulations possibly useful for Compound.

2.4.  Except as otherwise provided herein, the right, title and interest in the
      Patent Rights are affected by the license pursuant to Art. 2.1 only to the
      extent as such Patent Rights are claiming Compound and its use within the
      Field.

2.5.  Bayer hereby grants to Memory an option to acquire a non-exclusive,
      world-wide, non-transferable license pursuant to the terms set forth in
      this Agreement (i) under Bayer's rights belonging to the patent families
      of US-5,707,655 and/or US-5,900,425 in relation to controlled release
      formulations disclosed in such patent families and developed by Bayer for
      its Nimodipin(R) product, and, if applicable, (ii) under corresponding
      Bayer know-how; provided, however, that Memory may exercise such option
      and use such rights only for the manufacture, sale and use of Finished
      Products within the Field. No additional consideration shall be payable by
      Memory to Bayer upon exercise of such option. The option granted to Memory
      under this Art. 2.5 will automatically expire, if Memory does not exercise
      this option in writing before the end of the first clinical phase II
      trials during the development of the Finished Product in the Field.

2.6.  Memory shall have the right to grant sublicenses under the licenses and
      rights granted by Bayer to Memory under this Art. 2; provided, however,
      that Memory shall continue to be responsible for all obligations of Memory
      set forth in this License Agreement.

ARTICLE 3 - DEVELOPMENT AND MARKETING

3.1.  In consideration of the rights granted to Memory under this Agreement,
      Memory shall use commercially reasonable efforts (i) to develop (through
      research, development, marketing and/or sublicensing activities, either
      alone or in collaboration with Third Parties) Finished

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      Products, and (ii) to register and market (either alone and/or in
      collaboration with Third Parties) Finished Products in the United States,
      Japan and in four countries of the European Union which Memory shall
      select from the group consisting of Germany, France, United Kingdom, Italy
      and Spain.

3.2.  Neither Bayer nor a Bayer Affiliate shall have any obligation to provide
      Memory, a Memory Affiliate and/or a Sublicensee with any service or
      assistance as to (i) the non-clinical and clinical development of Compound
      and Finished Products, and (ii) the registration and marketing of Finished
      Products. Memory is solely responsible, and is hereby authorized by Bayer
      to contact a Third Party contractor in order to establish an ongoing
      supply of Compound which Memory needs for the non-clinical and clinical
      development of Finished Products as well as for marketing purposes. Bayer
      does not have any obligation to supply Memory with Compound.

ARTICLE 4 - PAYMENTS, RECORDS AND REPORTS

4.1.  In further consideration of the rights granted to Memory under this
      Agreement, Memory shall make the following payments to Bayer:

      (i)   0.25 Mio US $ (two hundred fifty thousand U.S. Dollars) within 30
            (thirty) days following the effective date of this Agreement;

      (ii)  0.75 Mio US $ (seven hundred fifty thousand U.S. Dollars) within 30
            (thirty) days following the first IND approval;

      (iii) [*] US $ ([*] U.S. Dollars) within 30 (thirty) days following the
            [*];

      (iv)  [*] US $ ([*] U.S. Dollars) within 30 (thirty) days following the
            [*];

      (v)   [*] US $ ([*] U.S. Dollars) within 30 (thirty) days following the
            [*]; provided that, if the [*], then this payment shall be due on
            the date that is the earlier of (a) 6 (six) months from the date of
            such [*], or (b) thirty (30) days following the [*]. If the payment
            described in this paragraph is made pursuant to (a) of this
            paragraph, then such payment shall bear interest from the date that
            is thirty (30) days following the [*] through the date of actual
            payment. Such interest shall be calculated based on the three (3)
            month LIBOR rate in effect on the business day immediately preceding
            the start of such thirty (30) day period, as reported in the Wall
            Street Journal.

      (vi)  [*] US $ ([*] U.S. Dollars) within 60 (sixty) days following the
            [*]; provided that, if the [*], then this payment shall be due on
            the date that is the earlier of (a) 6 (six) months from the date of
            such [*], or (b) sixty (60) days following the [*]. If the payment
            described in this paragraph is made pursuant to (a) of this
            paragraph, then such payment shall bear interest from the date that
            is sixty (60) days following the [*] through the date of actual
            payment. Such interests shall be calculated based on the three (3)
            month LIBOR rate in effect on the business day immediately preceding
            the start of such sixty (60) day period, as reported in the Wall
            Street Journal.

      (vii) a [*]% ([*] percent) royalty on the worldwide Net Sales proceeds
            received by Memory's Sublicensees, irrespective of the royalty
            rate(s) actually to be paid by Sublicensee(s) to Memory, if any;

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      (viii) in the event that the worldwide royalties received by Memory from
            any of its Sublicensee(s) exceeds [*]% ([*] percent), then Memory
            will pay to Bayer an additional royalty of [*]% ([*] percent) of
            such amounts in excess of [*]% ([*] percent) [example: if royalties
            received from a Sublicensee are 12%, royalties to be paid to Bayer
            would be [*]% plus [*]% of the next [*]% ([*]%), resulting in a
            total royalty rate of [*]%].

4.2.  In the event that Memory shall generate in any calendar year Net Sales of
      Finished Product directly or via a Distributor and not through a
      Sublicensee, Memory shall, in addition to the payments specified under
      Art. 4.1, pay to Bayer royalties based on such annual Net Sales as
      follows:

      -     a [*] % ([*] percent) royalty on the worldwide Net Sales during such
            calendar year generated by Memory, if such Net Sales do not exceed
            [*] US $ ([*] US Dollars);

      -     a [*]% ([*] percent) royalty on the entire worldwide Net Sales
            generated during such calendar year by Memory, if such Net Sales lie
            in a range from more than [*] US $ ([*] US Dollars) to [*] US $ ([*]
            US Dollars);

      -     a [*] % ([*] percent) royalty on the entire worldwide Net Sales
            generated during such calendar year by Memory, if such Net Sales lie
            in a range from more than [*] US $ ([*] US Dollars) to [*] US $ ([*]
            US Dollars);

      -     a [*] % ([*] percent) royalty on the entire worldwide Net Sales
            generated during such calendar year by Memory, if such Net Sales lie
            in a range from more than [*] US $ ([*] US Dollars) to [*] US $ ([*]
            US Dollars); or

      -     a [*] % ([*] percent) royalty on the entire worldwide Net Sales
            generated by Memory, if such Net Sales exceed [*] US $ ([*] US
            Dollars).

4.3.  Notwithstanding any other provision herein, in the event that Bayer does
      not have any Patent Rights affording patent protection relating to the
      manufacture, sale and use of Compound in a Listed Country, the royalties
      payable by Memory to Bayer with respect to Net Sales in such Listed
      Country shall be as follows:

      (i)   if Memory generates any Net Sales directly or via a Distributor in
            one of the Listed Countries in which Bayer does not have any Patent
            Rights affording such patent protection, then the royalties payable
            by Memory to Bayer with respect to Net Sales in this Listed Country
            shall be reduced to [*]% ([*] percent) of the royalty rates defined
            in Art. 4.2 of this Agreement;

      (ii)  if Net Sales are generated by any of Memory's Sublicensee(s) in one
            of the Listed Countries in which Bayer does not have any Patent
            Rights affording such patent protection, then the royalties payable
            by Memory to Bayer with respect to Net Sales in this Listed Country
            shall be reduced to [*]% ([*] percent); the royalty payments to be
            made by Memory according to Art. 4.1 (viii) of this Agreement, i.e.
            the royalties to be paid by Memory to Bayer if the royalties
            received by Memory from any of its Sublicensee(s) exceed [*]%, are
            however not affected by the provisions of this Art. 4.3 of this
            Agreement;

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      (iii) if Bayer does not have any Patent Right affording such patent
            protection in a country which does not belong to the Listed
            Countries, then the royalty rates for that country shall not be
            reduced.

4.4.  No multiple royalties shall be payable because any Finished Product, is
      covered by more than one Patent Right.

4.5.  In the event that a Combination Product is sold, then Net Sales of the
      Combination Product shall be calculated using one of the following
      methods:

            (a) By multiplying the Net Sales of the Combination Product during
            the applicable royalty accounting period ("accounting period") by a
            fraction, the numerator of which is the average gross selling price
            in the Major Countries of the Finished Product, and the denominator
            of which is the average gross selling price in the Major Countries
            of the Combination Product, or

            (b) In the event that no such separate sales are made of the
            Finished Product or the Combination Product in the Major Countries
            during the applicable accounting period, Net Sales for purposes of
            determining royalties payable hereunder shall be subject of
            discussions between Memory and Bayer in good faith in order to
            identify a fair and reasonable arrangement. If the parties are
            unable to resolve a dispute arising from their discussion under this
            Art. 4.5(b) within 45 days, each party shall have the right to
            initiate the Dispute Resolution Procedure as set forth in Article.
            8.8.

4.6.  Memory agrees to pay Bayer, concurrently with the delivery of the report
      set forth in Article 4.8, royalties on aggregate Net Sales during the
      prior Royalty Period at the royalty rates specified in the Articles 4.1 -
      4.5.

4.7.  On each anniversary of the effective date of this Agreement, Memory shall
      deliver to Bayer a report containing the following information with
      respect to each Sublicensee to whom Memory has transferred rights during,
      the period since the last such report or, in the case of the first such
      period since the effective date of this Agreement:

      a)    identification of the Sublicensee and the kind of rights granted to
            it;

      b)    the financial terms and conditions of the Sublicense Agreement so
            far relevant to the provisions of the Articles 4.1 - 4.3.

4.8.  Prior to the First Commercial Sale of a Finished Product, Memory agrees to
      provide biannual summary reports on the status of its research and
      development activities covered by the license granted herein. Commencing
      with the First Commercial Sale of a Finished Product in any country,
      within sixty (60) days after the conclusion of each Royalty Period Memory
      shall deliver to Bayer a report containing the following information:

      a)    gross sales of Finished Products, in each country of sale, made by
            or on behalf of Memory and/or its Sublicensees during the applicable
            Royalty Period;

      b)    calculation of Net Sales for the applicable Royalty Period in each
            country of sale, together with the exchange rates used for
            conversion; and

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      c)    calculation of the amount payable to Bayer for the applicable
            Royalty Period.

      If no royalties or other payments are due to Bayer for any Royalty Period,
      the report shall so state. Concurrent with these reports, Memory shall
      remit to Bayer any payment due for the applicable Royalty Period. The
      method of payment shall be by check or wire transfer as directed from time
      to time by Bayer. All amounts payable to Bayer under this Article 4 will
      first be calculated in the currency of sale and then converted into U.S.
      dollars in accordance with Art. 4.9, and such amounts shall be paid
      without deduction of any withholding taxes, value-added taxes, or other
      charges applicable to such payments. All reports provided to Bayer
      hereunder shall be maintained in confidence by Bayer.

4.9.  All payments due under this Agreement shall be payable in United States
      dollars. Conversion of foreign currency ("Other Currency") to U.S. dollars
      shall be made at the conversion rate existing in the United States (as
      reported in the Wall Street Journal) on the last working day of the
      applicable calendar quarter. Such payments shall be without deduction of
      exchange, collection, or other charges. In the event that any Other
      Currency shall, at the time the applicable payment by Memory to Bayer is
      due, not be convertible into U.S. dollars and freely transferable by
      reason of any governmental regulation or any moratorium, embargo, banking
      restriction or other restriction, the obligation of Memory to make payment
      of such payment shall be suspended until such time a such Other Currency
      shall be convertible into U.S. dollars and freely transferable to the
      United States.

4.10. Memory shall maintain, and shall ensure that any Sublicensee shall
      maintain, complete and accurate records of Finished Products made, used,
      or sold under this Agreement and any amounts payable to Bayer in relation
      to such Finished Products, which records shall contain sufficient
      information to permit Bayer to confirm the accuracy of any reports
      delivered to Bayer. Memory and its Sublicensees shall retain such records
      relating to a given Royalty Period for at least five (5) years after the
      conclusion of that Royalty Period, during which time Bayer shall have the
      right, at its expense, to cause an independent certified public accountant
      (who shall be subject to confidentiality obligations) to inspect such
      records during normal business hours for the sole purpose of verifying any
      reports and payments delivered under this Agreement; provided, however,
      that not more than one such audit shall be permitted during any twelve
      (12) month period. Such accountant shall not disclose to Bayer any
      information other than information relating to accuracy of reports and
      payments delivered under this Agreement and shall provide Memory with a
      copy of any report given to Bayer. The parties shall reconcile any
      underpayment or overpayment within thirty (30) days after the accountant
      delivers the results of the audit. In the event that any audit performed
      under this Article reveals an underpayment in such Royalty Period in
      excess of the greater of $[*] or [*] percent ([*] %) of the amount
      actually paid, Memory shall bear the full cost of such audit.

4.11. Any payments by Memory that are not paid on or before the date such
      payments are due under this Agreement shall bear interest at [*]
      percentage points above the base prime rate of interest most recently
      reported by The Wall Street Journal, calculated based on the number of
      days that payment is delinquent.

ARTICLE 5 - REPRESENTATIONS AND WARRANTIES

5.1.  Each party represents and warrants to the other that it has the legal
      right and power to enter into this Agreement, to extend the rights and
      licenses granted to the other in this Agreement, and to

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      fully perform its obligations hereunder, and that the performance of such
      obligations will not conflict with its charter documents or any
      agreements, contracts, or other arrangements to which it is a party.

5.2.  Bayer represents and warrants to Memory that, as of the effective date of
      this Agreement, it possesses the exclusive right, title, and interest in
      and to the Patent Rights and that it has the full legal right and power to
      enter into the obligations and grant the rights and licenses set forth in
      this Agreement. Bayer shall be responsible for and shall control the
      prosecution, grant and maintenance of all Patent Rights and shall, at
      Bayer's cost and expense, use reasonable efforts in order to prosecute and
      maintain such Patent Rights in good faith consistent with its customary
      patent policy and its reasonable business judgment, and shall in good
      faith consider the interests of Memory in so doing. Bayer will, upon
      request of Memory, provide Memory with information concerning the status
      of Patent Rights. In the event that Bayer recognizes that a patent
      protection in relation to a patent application mentioned in Annex A cannot
      be obtained, or that a granted patent is becoming nullified prior to its
      expiration, or that another event happens which might have an influence on
      the Patent Rights, Bayer shall inform Memory in writing without undue
      delay in reasonable time in advance of the event. If Bayer elects not to
      (i) file foreign or PCT applications claiming priority to a pending U.S.
      patent application within the one-year statutory period; (ii) continue
      prosecution of a patent application; or (iii) maintain any Patent Rights,
      Bayer shall so notify Memory in sufficient time for Memory to assume the
      filing, prosecution and/or maintenance of such application or patent in
      Bayer's name at Memory's expense; and thereafter Memory shall have the
      right (but not the obligation), at its expense and discretion, to file,
      prosecute or maintain any such applications or patents. Bayer agrees to
      execute, and agrees to use reasonable efforts to ensure that its employees
      shall execute, all documents necessary or useful for Memory to file,
      prosecute and/or cause the issuance of such applications. Memory shall
      have no further royalty or other obligations under this Agreement with
      respect to such patents or applications.

5.3.  Bayer represents, warrants and covenants that (i) neither Bayer nor a
      Bayer Affiliate will manufacture, use, sell, have sold, import, export,
      develop, register or market the Compound, or any product containing
      Compound as its active ingredient, or license or otherwise permit any
      Third Party to do any of the foregoing, in any case whether within or
      outside the Field, during the term of this Agreement; and (ii) at the
      effective date of this Agreement, to Bayer's actual knowledge, there are
      no claims or demands of any person, firm, corporation or entity pertaining
      to Patent Rights, and no proceedings have been instituted or are pending
      or are threatened which challenge the right of Bayer to, or involve, the
      Patent Rights.

5.4   Nothing in this Agreement shall be construed as:

      a)    a warranty or representation by Bayer as to the validity or scope of
            any patent included within the Patent Rights;

      b)    a warranty or representation that the exploitation of the Patent
            Rights or the manufacture, use or sale of compound and/or Finished
            Products is or will be free from infringement of patents of third
            parties, or is or will be technically and/or economically feasible
            or useful;

      c)    an obligation of either party to bring or prosecute actions or suits
            against Third Parties for infringement;

      d)    creating any agency, partnership, joint venture or similar
            relationship between Bayer and Memory; or

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      e)    conferring by implication, estoppel or otherwise any license,
            immunity or right under any patent of Bayer other than those
            specified in Article 2 of this Agreement.

5.4.  a)    Each party promptly shall advise the other party of any possible
            infringement of any of the Patent Rights pertaining to manufacture,
            sale and/or use of Compound by a Third Party of which such party
            becomes aware, and such party shall supply the other party with any
            evidence available pertaining to the possible infringement.

            Memory shall have the first right (but not the obligation) to defend
            the Patent Rights with respect to the manufacture, sale and/or use
            rights for Compound against infringement or interference by any
            Third Party, in its own name and/or the name of Bayer, at Memory's
            own expense, including the bringing of any legal action for
            infringement or the defending of any counterclaim of invalidity or
            action of a Third Party for declaratory judgment of non-infringement
            or interference. Memory may settle any such actions, solely at its
            own expense and through counsel of its selection; provided, however,
            that Bayer shall be entitled, in each such instance, to participate
            through counsel of its own selection, at its own expense, and any
            settlement that is reasonably likely to have an adverse effect on
            the manufacture, sale and/or use rights for Compound included in the
            Patent Rights shall not be entered into without Bayer's prior
            written consent (which consent shall not be unreasonably withheld or
            delayed). Bayer shall provide reasonable assistance to Memory, as
            requested, and Memory shall reimburse Bayer for its reasonable
            out-of-pocket expenses in connection with such requested assistance.
            Memory shall be entitled to retain any recovery obtained as a result
            of such action, whether by judgment, award, decree or settlement.

            In the event that Memory fails to initiate and prosecute or
            participate in such legal action within one hundred twenty (120)
            days, Bayer shall have the right to initiate legal action, at its
            own expense, to uphold the Patents Rights against Third Parties.
            Memory shall provide reasonable assistance to Bayer as requested,
            and Bayer shall reimburse Memory for its reasonable out-of-pocket
            expenses in-connection with any such requested assistance. Bayer may
            settle any such actions, solely at its own expense and through
            counsel of its selection; provided, however, that Memory shall be
            entitled, in each such instance, to participate through counsel of
            its own selection, at its own expense, and any settlement that is
            reasonably likely to have an adverse effect on the manufacture, sale
            and/or use rights for Compound included in the Patent Rights shall
            not be entered without Memory's prior written consent (which consent
            shall not be unreasonably withheld or delayed). Memory shall provide
            reasonable assistance to Bayer as requested, and Bayer shall
            reimburse Memory for its reasonable out-of-pocket expenses in
            connection with any such requested assistance. Bayer shall be
            entitled to retain any recovery obtained as a result of such action,
            whether by judgment, award, decree or settlement.

      b)    In any infringement suit which either party may institute to enforce
            the Patent Rights pertaining to the manufacture, sale and/or use
            rights for Compound, or in a suit for patent infringement which is
            brought by a Third Party against Memory, which Memory is required to
            defend, the other party hereto shall at the request and the expense
            of the party initiating or defending such suit, cooperate in all
            reasonable respects and, to the extent reasonably possible, have its
            employees testify when requested and make available relevant
            records, papers, information, samples, specimens and the like.

ARTICLE 6 - INDEMNIFICATION

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>

6.1.  Memory shall indemnify, defend, and hold harmless Bayer and its directors,
      officers, employees, managers, agents and representatives and their
      respective successors, heirs and assigns against any liability, damage,
      loss, or expense (including reasonable attorneys' fees and expenses)
      (collectively, "Losses") incurred by or imposed upon the foregoing
      indemnitees or any one of them in connection with any claims, suits,
      actions, demands, or judgments ("Claims") (i) concerning Compound,
      Finished Product, Combination Product, process or service that is made,
      used, sold or provided by Memory pursuant to any right or license granted
      under this Agreement and/or (ii) relating to or arising from any breach by
      Memory of any representation, warranty or covenant made by it in this
      Agreement.

6.2.  Bayer shall indemnify, defend and hold harmless Memory and its respective
      directors, officers, employees, managers, agents and representatives, and
      their respective successors, heirs and assigns, from and against any and
      all Losses incurred by or imposed upon the foregoing indemnitees or any of
      them in connection with any Claims relating to or arising from any breach
      by Bayer of any representation, warranty or covenant made by it in this
      Agreement.

6.3.  Any person or entity seeking indemnification under this Article 6
      (collectively, the "Indemnified Parties") shall promptly give notice to
      the party required to provide indemnification hereunder (the "Indemnifying
      Party") with respect to any Claims as to which it asserts a right to
      indemnification, and within thirty (30) days thereafter, further notify
      Indemnifying Party of the details of such Claim and the amount thereof;
      provided, however, that the failure to give such notification shall not
      relieve the Indemnifying Party from any liability that it may have
      pursuant to the provisions of this Article 6 as long as the failure to
      give such notice within such time is not prejudicial to the Indemnifying
      Party. Notice to the Indemnifying Party for the purpose of this Article 6
      shall include the filing of the service upon the Indemnifying Party of any
      legal action or any other form of actual notice. Bayer or Memory, as the
      case may be, may set off the amount of any Claim or Claims in respect of
      which such Indemnified Parties are entitled to indemnification hereunder
      against amounts otherwise due to the Memory or Bayer, as the case may be,
      hereunder. If the Indemnifying Party does not promptly and to the
      Indemnified Parties' satisfaction assume the defense of any Claim, the
      Indemnified Parties may do so at the Indemnifying Party's cost and
      expense. The Indemnifying Party may not compromise or settle any Claim
      without the prior written consent of the Indemnified Parties.

ARTICLE 7 - TERM AND TERMINATION

7.1.  This Agreement shall commence upon being signed by both parties (the
      "Effective Date") and shall remain in effect until the expiration of the
      last to expire of the Patent Rights, unless earlier terminated as provided
      in this Article. The term for payment of royalties for each Finished
      Product and, if applicable, for each Combination Product shall commence
      with the First Commercial Sale and shall end on a country by country basis
      upon either (i) the date on which the last Patent Right in such country
      expires, or (ii) ten (10) years after the First Commercial Sale of the
      Finished Product and, if applicable, Combination Product in such country,
      whichever is longer.

7.2.  In the event that Memory determines that it has a material scientific
      and/or technical problem relating to the development and/or regulatory
      approval of Compound or Finished Product in the Field, or a material
      economic and/or business problem relating to the development and/or
      regulatory approval and/or marketing of Compound or Finished Product in
      the Field, Memory may terminate this Agreement by giving 30 (thirty) days
      prior written notice thereof to Bayer,

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>

      setting forth the specific reason(s) for termination in detail. Bayer will
      evaluate these reasons in good faith and in case that Bayer according to
      its sole decision does not accept these reasons, it shall so notify Memory
      in writing within forty five (45) days of its receipt of Memory's notice
      and Memory and Bayer shall then enter into the Dispute Resolution
      Procedure in accordance with the provisions of Art. 8.8; provided,
      however, that Memory shall not be obligated to enter into any arbitration.
      In the event that this Dispute Resolution Procedure fails Memory may
      terminate this Agreement immediately.

7.3.  In the event that Memory fails to make timely payment of any amounts due
      to Bayer under this Agreement Bayer may terminate this Agreement upon
      thirty (30) days written notice to Memory, unless Memory pays all past-due
      amounts prior to the expiration of such thirty (30)-day notice period.

7.4.  In the event that either party commits a material breach of any of its
      obligations under this Agreement, other than that stated in Art. 7.3, and
      such party fails to remedy that breach within ninety (90) days after
      receiving written notice thereof from the other party, that other party
      may immediately terminate this Agreement upon written notice to the
      breaching party.

7.5.  Upon expiration of this Agreement pursuant to Art. 7.1, or upon
      termination of this Agreement by Memory pursuant to Art. 7.4, Memory shall
      have a fully paid up worldwide license under the terms set forth in
      Article 2 with respect to Memory's activities as to Compound and/or
      Finished Product subsequent to the date of expiration or any such
      termination.

7.6.  Upon termination of this Agreement by Memory pursuant to Art. 7.2, all
      rights and licenses granted to Memory by Bayer under this Agreement shall
      terminate immediately. If Bayer is interested to proceed with the
      development and/or marketing of Finished Product, and to use the data and
      results obtained by Memory during the development, and/or the NDA
      approvals of Memory, the parties shall negotiate reasonable terms and
      conditions under which Bayer may use Memory's data and results and/or NDA
      approvals.

7.7.  Upon termination of this Agreement by Bayer pursuant to Art. 7.3 or Art.
      7.4, all rights and licenses granted to Memory by Bayer under this
      Agreement shall terminate immediately. If Bayer is interested to proceed
      with the development and/or marketing of Finished Product, Memory shall
      disclose to Bayer all data and results obtained by Memory during the
      development, and shall further transfer free of charge the right, title
      and interest in all such data and results, including inventions, to Bayer.
      If applicable, Memory shall also assign to Bayer its NDA approvals for
      Finished Products in all countries free of charge.

7.8.  Memory agrees that, in the event that this Agreement is terminated
      pursuant to the terms, hereof, Memory shall so notify each Sublicensee
      within twenty (20) days of such termination.

7.9.  The milestones payments and the royalty payments to be made by Memory
      under Art. 4 shall not be refunded following the expiration or termination
      of this Agreement. Any milestone payment and/or royalty payment shall
      however not become due if notice of termination was given by the party
      entitled to do so prior to the due date of any such payment.

7.10. The expiration or termination of this Agreement for any reason whatsoever
      shall be without prejudice to any obligations or rights on the part of
      either party which have accrued prior to such termination, and shall not
      affect or prejudice any provision, of this Agreement which is expressly or
      by implication provided to come into effect on, or continue in effect
      after such termination.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>

7.11. Unless otherwise expressly provided herein, upon expiration or termination
      of this Agreement for any reason whatsoever, neither party shall be
      entitled to claim indemnification or compensation on any ground
      whatsoever, including but not limited to loss of investment, loss of
      profit, business goodwill etc. with respect to such expiration or
      termination to the exclusion of damages caused by willful misconduct or
      gross negligence of a party hereto.

7.12. Pending the conclusion of any Dispute Resolution Procedure or arbitration
      procedure pursuant to the terms hereof, the parties shall continue to
      perform their obligations hereunder to the extent not in dispute and no
      default hereunder shall be deemed to occur until such decision is rendered
      (whereupon any party determined to be in default hereunder shall have the
      benefit of any applicable grace and/or cure periods).

ARTICLE 8 - MISCELLANEOUS

8.1.  All notices, requests, demands and other communications required or
      permitted to be given pursuant to this Agreement shall be in writing and
      shall be deemed to have been duly given upon the date of receipt if
      delivered by hand, recognized international overnight courier, confirmed
      facsimile transmission, or registered or certified mail, return receipt
      requested, postage prepaid to the following addresses or facsimile
      numbers:

      If to Memory:                        If to Bayer:

      Memory Pharmaceuticals Corp.         Bayer AG
      100 Philips Parkway                  D-51368 Leverkusen
      Montvale, New Jersey 07645 / U.S.A.  Germany
      Attention:  Chief Executive Officer  International Cooperation
                                           and Licensing
                                           Building:  Q 30
                                           (++49)-214-30 64840
      Facsimile:  (201) 802-7190

      Either party may change its designated address and facsimile number by
      notice to the other party in the manner provided in this Section.

8.2.  This Agreement shall be governed by and construed in accordance with the
      laws of the Federal Republic of Germany.

8.3.  This Agreement may not be assigned by either party without the prior
      written consent of the other party, except that either party may assign
      this Agreement to any of its Affiliates or to a successor in connection
      with the merger, consolidation, or sale of all or substantially all of its
      assets or that portion of its business pertaining to the subject matter of
      this Agreement, with prompt written notice to the other party of any such
      assignment. This Agreement shall inure to the benefit of and be binding
      upon the parties and their respective lawful successors and assigns.

8.4.  Nothing in this Agreement shall be construed so as to require the
      commission of any act contrary to law, and wherever there is any conflict
      between any provision of this Agreement and any statute, law, ordinance or
      treaty, the latter shall prevail, but in such event the affected
      provisions

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>

      of the Agreement shall be conformed and limited only to the extent
      necessary to bring it within the applicable legal requirements.

8.5.  This Agreement may be amended, supplemented, or otherwise modified only by
      means of a written instrument signed by both parties. Any waiver of any
      rights or failure to act in a specific instance shall relate, only to such
      instance and shall not be construed as an agreement to waive any rights or
      fail to act in any other instance, whether or not similar.

8.6.  Neither party shall be responsible to the other for any failure of delay
      in performing any of its obligations under this Agreement or for other
      non-performance hereof if such delay or non-performance is caused by any
      circumstances unavoidable or beyond the reasonable control of a party such
      as, but not limited to, strike, stoppage of labor, lockout or other labor
      trouble, fire, flood, accident, act of God or of government or of the
      public enemy of a Party ("Force Majeure").

      However, the party affected by such Force Majeure shall use its best
      reasonable efforts to avoid, remove or remedy such circumstances. Either
      party temporarily excused from performance hereunder by such circumstances
      shall resume performance with utmost dispatch when such circumstances are
      removed or remedied. Either party claiming Force Majeure as an excuse for
      delay in performance shall give the other party written notice thereof
      without undue delay as a condition of its right to invoke Force Majeure.

8.7.  The provisions of the Secrecy Agreement and the Confidentiality Agreement
      are not affected or modified by this Agreement and shall remain unchanged
      and in force. Notwithstanding the foregoing, the parties acknowledge and
      agree that Memory may contact third party contractors in order to
      establish an ongoing supply of the Compound or for other commercial
      purposes. In connection therewith, Memory may disclose Bayer's
      confidential information to such third party contractors for their use in
      connection therewith. As far as Memory is entitled to grant certain rights
      and licenses to its Affiliates and Third Parties under this Agreement,
      Memory may disclose Bayer's confidential information on a need to know
      basis to such Affiliates and Third Parties. Such Affiliates and Third
      Parties, including third party contractors, will however in any case in
      advance be bound to terms as stringent as provided under the
      Confidentiality Agreement.

8.8.  The parties recognise that disputes as to certain matters may from time to
      time arise during the term of this Agreement which relate to either
      party's rights and/or obligations hereunder. It is the objective of the
      parties to establish a procedure at the level of their executive officers
      (the "Dispute Resolution Procedure") to facilitate the resolution of
      disputes arising under this Agreement in an expedient manner by
      co-operation. To accomplish this objective, the parties agree to follow
      the procedure set forth herein, if and when the parties are unable to
      resolve a dispute within forty-five (45) days of being requested by a
      party to do so. The establishment of the Dispute Resolution Procedure
      shall not be used to override any right specifically given to a party, to
      take action or have final decision-making authority on any topic.

      If the parties are unable to resolve a dispute within forty-five (45) days
      of being requested by a Party to do so, either party may initiate the
      Dispute Resolution Procedure by written notice to the other. The
      respective executive officers designated below or their successors, shall
      then attempt to resolve the dispute by good faith negotiations within
      fifteen (15) days after such notice is received. Said designated officers
      are as follows:

                  For Bayer:  Head of Pharmaceuticals Business Group

                  For Memory: Chief Executive Officer

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>

      In the event that the designated executive officers are not able to
      resolve a dispute in accordance with the Dispute Resolution Procedure as
      set forth hereunder, either party may at any time after such fifteen (15)
      day period proceed with arbitration as provided hereinafter.

8.9.  All disputes arising in connection with this Agreement shall be finally
      settled under the rules of conciliation and arbitration of the
      International Chamber of Commerce by 3 (three) arbitrators appointed in
      accordance with said rules. The arbitration shall be held in the English
      Language. The arbitrators shall determine which party, or the extent to
      which each party, shall bear the costs and expenses of such arbitration.
      The place of arbitration shall be Paris, France. However, arbitration may
      only be requested for by any party following a period of thirty (30) days
      after the Dispute Resolution Procedure pursuant to Art. 8.8 has failed.
      Within this period of thirty (30) days any party may file a request for
      Conciliation to the Secretariat of the International Court of Arbitration
      of the International Chamber of Commerce to provide the possibility of
      settling such dispute in a Conciliation under the rules of conciliation of
      the International Chamber of Commerce. The other party is not obliged to
      accept such conciliation. The outcome of the Conciliation is not binding
      for any party and does not exclude any party from entering into an
      arbitration.

8.10. In the event that any provision of this Agreement shall, for any reason,
      be held to be invalid or unenforceable in any respect, such invalidity or
      unenforceability shall not affect any other provision hereof, and the
      parties shall negotiate in good faith to modify the Agreement to preserve
      (to the extent possible) their original intent.

8.11. This Agreement constitutes the entire Agreement between the parties with
      respect to the subject matter hereof and supersedes all prior agreements
      or understandings between the parties relating to the subject matter
      hereof.

IN WITNESS WHEREOF, the undersigned have duly executed and delivered this
Agreement as a sealed instrument effective as of the Effective Date.

Montvale, New Jersey
Date:  June 7, 2001
Memory Pharmaceuticals Corporation

   /s/ Joanne M. Leonard
------------------------------           -----------------
Joanne M. Leonard
Chief Financial Officer

Leverkusen, Germany
Date:  June 13, 2001
Bayer AG

   /s/ Dr. Brocks                           /s/ Dr. Kohler
------------------------------           -----------------
Dr. Brocks                               Dr. Kohler
(International Cooperations and          (Patents and Licensing)
Licensing)

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED<PAGE>
                                                                    EXHIBIT 10.9

                    COLLABORATION AND LICENSE AGREEMENT

      This AGREEMENT, having a date of July 29, 2002, is made by and among, on
the one hand, F.HOFFMANN-LA ROCHE LTD, a Swiss corporation having its principal
place of business at Grenzacherstrasse 124, CH-4070, Basel, Switzerland and
HOFFMANN-LA ROCHE INC., a New Jersey corporation, having its principal place of
business at 340 Kingsland Street, Nutley, New Jersey 07110 ("Roche") and, on the
other hand, MEMORY PHARMACEUTICALS CORP., a Delaware corporation, having its
principal place of business at 100 Philips Parkway, Montvale, New Jersey 07645
("Memory").

                                  INTRODUCTION

1.    Memory has discovered compounds active as PDE4 inhibitors, including a
      compound known as MEM1414, and owns related intellectual property rights.

2.    Roche has expertise in the research, development, manufacture and
      commercialization of pharmaceutical products.

3.    The parties wish to collaborate to develop MEM1414 for commercialization;
      develop potential back-up compounds and other PDE4 inhibitors focused on
      central nervous system indications; and explore potential applications for
      other therapeutic areas such as respiratory disease.

4.    In consideration of the mutual covenants and promises contained in this
      Agreement and other good and valuable consideration, the receipt and
      sufficiency of which are hereby acknowledged, Memory and Roche agree as
      follows:

                             ARTICLE 1. DEFINITIONS

As used in this Agreement, the following terms, whether used in the singular or
plural, shall have the following meanings:

1.1   "Affiliate" means (a) a business entity which owns, directly or
      indirectly, at least fifty percent (50%) of the voting shares or other
      means of control of a Party; or (b) a business entity in which at least
      fifty percent (50%) of the voting shares or other means of control are
      owned by a Party, either directly or indirectly; or (c) a business entity,
      the majority ownership of which is directly or indirectly common to the
      majority ownership of a Party. Anything to the contrary in this paragraph
      notwithstanding, [*], a Delaware corporation, shall not be deemed an
      Affiliate of Roche unless Roche provides written notice to Memory of its
      desire to include [*] as an Affiliate of Roche. Notwithstanding the
      preceeding provisions, once an entity ceases to be an Affiliate, then such
      entity shall, without any further action, cease to have any rights,
      including license and sublicense rights, under this Agreement that it has
      by reason of being an Affiliate.

      In addition, Roche is presently seeking permission to acquire an interest
      in [*]. Nothing in this Agreement is to be construed as binding [*] to any
      of the terms and conditions contained in this Agreement. However, should
      [*] become a Roche Affiliate it shall be bound by the terms and conditions
      of this Agreement. If [*] should become a Roche Affiliate but not agree to
      be bound by the terms and conditions of this Agreement, then [*] shall
      have none of the rights and obligations of an Affiliate of Roche under
      this Agreement, and Roche shall not grant a sublicense to [*] under this
      Agreement without prior written consent of Memory.

1.2   "Agreement Term" means the term of this Agreement, more fully described in
      Section 16.1.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
1.3   "Bioequivalent Product" means, with respect to a given Product sold in a
      given country of the Territory by Roche, its Affiliate or sublicensee, a
      product sold by a Third Party in such country containing the same PDE4
      inhibitor (or an acid, salt or ester thereof) as such Product.

1.4   "Clinical Candidate" shall be a PDE4 inhibitor that the JLT approves after
      consideration of the guidelines as provided in the Research Workplan.

1.5   "Collaboration Compound" means any PDE4 inhibitor that (i) either or both
      Parties or its Affiliates conceives in the conduct of the Research
      Collaboration, or (ii) the JLT otherwise agrees shall constitute a
      Collaboration Compound pursuant to the Research Workplan.

1.6   "Collaboration Patent Right" means a Patent Right Covering an
      Invention.

1.7   "Collaboration Technology" means all Know-How generated in the conduct of
      the Research Collaboration, other than Collaboration Compounds.
      Collaboration Technology includes all Inventions, other than Collaboration
      Compounds.

1.8   "Combination Product" means any product containing both a pharmaceutically
      active agent which causes it to be considered a Product and one or more
      other pharmaceutically active agents which are not Products.

1.9   "Composition of Matter Claim" means, for a given Product in a given
      country of the Territory, a Valid Claim of a Memory Patent Right or a
      Collaboration Patent Right that Covers the molecule per se of the PDE4
      inhibitor that is included in such Product, in whole or as a component
      thereof, as an active ingredient of such Product.

1.10  "Cover" (including the variations such as "Covered", "Coverage" or
      "Covering") shall mean that the making, using, offering for sale, selling
      or importing of a given product would infringe a claim of a Patent Right
      in the absence of a license under such Patent Right. The determination of
      whether a product is Covered by a particular Patent Right shall be made on
      a country-by-country basis.

1.11  "Effective Date" means the date that all conditions subsequent under
      Section 16.1(a) have occurred.

1.12  "Europe" means the United Kingdom, Germany, Italy, France and Spain.

1.13  "Field" shall mean prophylaxis and treatment of diseases, in all
      indications, for either human or veterinary use.

1.14  "IND" means an Investigational New Drug Application filed with the United
      States Food and Drug Administration ("FDA") for human clinical testing of
      a drug.

1.15  "Initiation of Phase II" means the date that a patient is first dosed by
      or on behalf of Roche, its Affiliate or sublicensee with a Product in a
      Phase II clinical trial.

1.16  "Initiation of Phase III" means the date that a patient is first dosed by
      or on behalf of Roche, its Affiliate or sublicensee with a Product in a
      Phase III clinical trial.

1.17  "Invention" means an invention that is made in the conduct of the Research
      Collaboration.

1.18  "JLT" means that committee organized and operating as provided in Article
      7.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
1.19  "Joint Invention" means an Invention having at least one co-inventor who
      is an employee, consultant or agent of each of the Parties or its
      Affiliate.

1.20  "Know-How" means data, knowledge and information, including materials,
      samples, chemical manufacturing data, toxicological data, pharmacological
      data, preclinical data, assays, platforms, formulations, specifications,
      quality control testing data, that are necessary or useful for the
      discovery, manufacture, development or commercialization of Product in the
      Territory.

1.21  "Launch" means, with respect to a Product in a country of the Territory,
      the date of the first commercial sale by Roche, its Affiliate or its
      sublicensee of the given Product in the given country after Regulatory
      Approval in such country.

1.22  "Major Market Countries" means the US, Canada, Japan, Europe, China and
      Korea.

1.23  "Memory Compound" means any PDE4 inhibitor for which Memory either prior
      to the Effective Date or during the Agreement Term has rights, whether by
      reason of its own conception of such inhibitor, or under agreement with a
      Third Party.

1.24  "Memory Invention" means an Invention having as inventors only employees,
      consultants or agents of Memory or its Affiliate.

1.25  "Memory Know-How" means all Know-How that Memory owns, or otherwise has
      the right to grant the licenses herein, during the Agreement Term.

1.26  "Memory Patent Rights" means all Patent Rights that Memory owns, or
      otherwise has the right to grant the licenses herein, during the Agreement
      Term. Schedule A lists all Memory Patent Rights that Cover the Memory
      Compounds as of the date hereof ("Base Patents").

1.27  "NCE" means a PDE4 inhibitor that itself, or its ester, salt or other
      noncovalent derivative, has not been the subject of a Regulatory Approval.

1.28  "NDA" means a New Drug Application filed with the FDA, or its foreign
      equivalent, for a drug.

1.29  "NDA Filing" means for a given Product, the date that Roche, its Affiliate
      or sublicensee files an NDA for the Product.

1.30  "Net Sales" and the related term "Adjusted Gross Sales" mean:

      "Adjusted Gross Sales" means the amount of gross sales of the Product
      invoiced by Roche, its Affiliates and its sub-licensees to independent
      third parties less deductions of returns (including allowances actually
      given for spoiled, damaged, out-dated, rejected, returned Product sold,
      withdrawals and recalls), rebates to the extent consistently applied by
      Roche to its products (price reductions, rebates to social and welfare
      systems, charge backs, cash sales incentives (but only to the extent it is
      a sales related deduction which is accounted for within Roche on a
      product-by-product basis)), government mandated rebates and similar types
      of rebates (e.g., P.P.R.S, Medicaid, each as consistently applied by Roche
      to its products), volume (quantity) discounts, each as consistently
      applied by Roche to its products, taxes (value added or sales taxes,
      government mandated exceptional taxes and other taxes directly linked to
      the gross sales amount), it being understood that income and capital gains
      taxes are not the type of taxes contemplated as a deduction in this
      definition of Adjusted Gross Sales."

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      "Net Sales" means, for the US, the amount calculated by subtracting from
      the amount of Adjusted Gross Sales a lump sum deduction of [*] percent
      ([*]%) of Adjusted Gross Sales in lieu of those sales related deductions
      which are not accounted for within Roche on a product by product basis
      (e.g. outward freights, postage charges, transportation insurance,
      packaging materials for dispatch of goods, custom duties, bad debt,
      discounts granted later than at the time of invoicing, and cash
      discounts).

      "Net Sales" means, for the ROW Territory, the amount calculated by
      subtracting from the amount of Adjusted Gross Sales a lump sum deduction
      of [*] percent ([*]%) of Adjusted Gross Sales in lieu of those sales
      related deductions which are not accounted for within Roche on a product
      by product basis (e.g. outward freights, postage charges, transportation
      insurance, packaging materials for dispatch of goods, custom duties, bad
      debt, discounts granted later than at the time of invoicing, and cash
      discounts).

      Notwithstanding the foregoing, amounts received by Roche, its Affiliates
      and sublicensees for the sale of Product among Roche, its Affiliates or
      sublicensees for resale shall not be included in the computation of
      Adjusted Gross Sales and Net Sales."

1.31  "Neurological Indication" means prophylaxis or treatment of Alzheimers'
      disease, prophylaxis or treatment of mild cognitive impairment ("MCI") or
      treatment of vascular dementia.

1.32  "Non-Memory Compound" means a PDE4 inhibitor, other than a Memory Compound
      or a Collaboration Compound, with respect to which the initial IND for the
      inhibitor is for a Neurological Indication or Psychiatric Indication, and
      which initial IND has been filed within five (5) years after the Effective
      Date by Roche or its Affiliate.

1.33  "Other Indication" means any indication other than a Neurological
      Indication or a Psychiatric Indication.

1.34  "Party" means Roche and/or Memory.

1.35  "Patent Right" means all rights under any patent or patent application in
      any country of the Territory, including any substitution, extension or
      supplementary protection certificate, reissue, reexamination, renewal,
      division, continuation or continuations-in-part thereof.

1.36  "Phase II" means the second phase of human clinical trials of a drug
      required by the US FDA to gain evidence of efficacy in the target
      population, determine optimal dosage, and obtain expanded evidence of
      safety for Product(s), as described in 21 CFR Parts 312, as it may be
      amended.

1.37  "Phase III" means the third phase of human clinical trials of a drug
      required by the US FDA to gain evidence of efficacy in the target
      population, and obtain expanded evidence of safety for Product(s), as
      described in 21 CFR Part 312, as it may be amended.

1.38  "Product" means any and all products that include, in whole or as a
      component thereof, a Memory Compound or a Collaboration Compound.

1.39  "Psychiatric Indication" means depression, anxiety or mixed
      anxiety/depression.

1.40  "Regulatory Approval" means any approvals (including pricing and
      reimbursement approvals), licenses, registrations or authorizations of any
      national or international or local regulatory agency, department, bureau
      or other governmental entity, necessary for the manufacture and sale

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      of a Product in the Field in a regulatory jurisdiction in the Territory by
      Roche, its Affiliate or sublicensee.

1.41  "Research Collaboration" means the collaborative non-clinical research
      program between the Parties, more fully described in the Research
      Workplan.

1.42  "Research Workplan" means the plan of preclinical and non-clinical
      development activities attached as Schedule B, as it may be amended from
      time to time.

1.43  "Research Term" shall have the meaning provided in Section 7.1(b)(iii).

1.44  "Roche Invention" means an Invention having as inventors only employees,
      consultants or agents of Roche or its Affiliate.

1.45  "ROW Territory" means all countries and territories other than the US.

1.46  "Territory" means all countries and territories in the world.

1.47  "Third Party" means a person or entity other than (i) Memory or any of its
      Affiliates, or (ii) Roche or any of its Affiliates.

1.48  "US" means the United States of America and its possessions and
      territories, including Puerto Rico.

1.49  "Valid Claim" means a claim in any (i) unexpired and issued Memory Patent
      Right or Collaboration Patent Right that has not been disclaimed, revoked
      or held invalid by a final unappealable decision of a court of competent
      jurisdiction or government agency or (ii) pending patent application that
      is a Memory Patent Right or a Collaboration Patent Right which application
      has been on file with the applicable patent office for no more than ten
      (10) years and for which there has been reasonably consistent activity to
      advance to issuance of a patent.

                            ARTICLE 2. LICENSE GRANTS

2.1   License Grants. Subject to the terms and conditions of this Agreement,
      Memory grants to Roche the sole and exclusive license, including the right
      to grant sublicenses pursuant to Section 2.2, under the Memory Patents and
      to use the Memory Know-How, to make, use, offer for sale, sell and import
      Products in the Territory for use in the Field.

      The exclusivity of the above license is subject to the retained right of
      Memory and its respective Affiliates to conduct preclinical and
      non-clinical development activities related to Product, solely to the
      extent expressly contemplated by this Agreement. In addition, nothing in
      this Agreement grants to Roche any right or license to use Memory Know-How
      for any purpose other than to make, use, offer for sale, sell and import
      Products in the Territory for use in the Field. Further, nothing in this
      Agreement shall limit the right of Memory to use Memory Know-How for any
      purpose not related to the making, using, offering for sale, selling or
      importing Products in the Territory for use in the Field.

2.2   Sublicense Rights. The rights and licenses granted to Roche under Section
      2.1 shall include the right to grant sublicenses to its Affiliates and
      Third Parties under such rights and licenses, in whole or in part, solely
      to the extent necessary to make, use, offer for sale, sell or import
      Products in the Territory for use in the Field. If Roche grants such a
      sublicense, Roche shall ensure that all of the applicable terms and
      conditions of this Agreement shall apply to the

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      Affiliate or Third Party sublicensee to the same extent as they apply to
      Roche for all purposes. Roche assumes full responsibility for the
      performance of all obligations and observance of all terms so imposed on
      such Affiliate or Third Party sublicensee and will itself account to
      Memory for all payments due under this Agreement by reason of such
      sublicense.

      Notwithstanding the above, Roche shall not have the right to sublicense
      the rights granted to Roche under Section 2.1 to any Third Party in a
      Major Market Country, except upon the prior written approval of Memory,
      which approval Memory shall not unreasonably withhold.

      Any sublicense may, at the written election of Memory, continue in full
      force and effect after the termination of any of the underlying licenses
      granted herein to Roche (the foregoing shall apply to a termination in
      whole or in part of such underlying licenses). Upon the licenses granted
      herein to Roche becoming fully paid up pursuant to Section 16.1(b), any
      and all sublicenses granted by Roche similarly shall become fully paid up
      as to Memory.

2.3   Memory Co-Promotion Right. If Roche wishes to offer a right to co-promote
      a Product to a Third Party for the United States of America, then Roche
      shall first present an offer to Memory for such rights. Memory shall have
      a right to enter into good faith negotiations with Roche for up to ninety
      (90) days from the date Memory receives the offer, provided Memory can
      provide a capable established sales force or equivalent alternative. If,
      at the end of the ninety (90) day period, the Parties have been unable to
      reach an agreement granting Memory co-promotion rights in the United
      States of America, then Roche shall be free to offer the rights to a Third
      Party, provided that Roche shall not make an offer more favorable to any
      such Third Party than the offer last made to Memory by Roche without first
      giving Memory at least thirty (30) days to accept such more favorable
      offer if Memory can provide an established sales force or alternative
      having at least equivalent capability to the Third Party.

2.4   Products Containing Non-Memory Compounds. Roche represents, and Memory
      acknowledges, that prior to the date hereof Roche has, or during the
      Agreement Term Roche may have rights in or to Non-Memory Compounds,
      whether by reason of its own conception, or acquired under agreement with
      a Third Party. Memory shall have the right from time to time to request an
      inventory of Non-Memory Compounds, and Roche shall promptly provide Memory
      with such inventory. With respect to each Non-Memory Compound, Memory
      shall be entitled to receive the financial consideration from Roche as
      provided in Schedule C.

      Memory covenants not to sue Roche relating to any Non-Memory Compound, so
      long as Memory shall be entitled to receive the financial consideration
      with respect thereto under Schedule C, unless Roche is in breach of its
      obligations relating to Non-Memory Compounds under this Agreement.

2.5   Requirement to Divest. If Roche is required by a relevant government
      authority in a given country of the Territory to divest rights to a Memory
      Compound, Collaboration Compound, and/or Product, not yet Launched in such
      country, then Roche shall use its reasonable best efforts to obtain
      authority to fulfill such requirement by returning rights to Memory to the
      Memory Compound, Collaboration Compound and/or Product without
      consideration to Memory or Roche (except as provided in Section 16.4(c))
      under the conditions of Section 16.4.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                              ARTICLE 3. DILIGENCE

3.1   Diligence. Roche shall use reasonable diligence in proceeding with the
      development, including obtaining required Regulatory Approvals,
      manufacturing, marketing and sale of Products in the Major Market
      Countries.

      Reasonable diligence as used in this Agreement shall mean the same
      standard of effort as used by Roche, or in any case not less than common
      in the industry taken as a whole, in the research, development, clinical
      testing, manufacturing, marketing and sale of a product which (i) must
      receive regulatory approval in Major Market Countries and (ii) has similar
      potential as the Product, taking into account scientific, business and
      marketing and return on investment considerations. It is understood that
      such Product potential may change from time to time based upon changing
      scientific, business and marketing and return on investment
      considerations. The Parties also acknowledge that, even within the Major
      Market Countries, Roche (and its Affiliates) does not always seek to
      market its own products in every such country or seek to obtain regulatory
      approval in every such country or for every potential indication. As a
      result, the exercise by Roche of reasonable diligence is to be determined
      by judging its efforts taken as a whole in the following regions on a
      region-by-region basis (the regions being North America (US and Canada),
      Europe and Asia (Japan, China and Korea)).

      If Memory believes in good faith that Roche has failed to utilize
      reasonable diligence as required in the above paragraph, then Memory may
      give Roche written notice of such alleged failure, identifying the Product
      and region at issue and giving specific detailed reasons of such
      allegation. Within sixty (60) days following Roche's receipt of any such
      notice from Memory ("Response Period"), Roche shall have the right to
      provide Memory with a written response specifying, in reasonable detail,
      how it has used reasonable diligence as required in the above paragraph.

      If Roche has failed to provide within the Response Period a written
      response, in reasonable detail, indicating the manner in which it is in
      compliance with its obligations under this Section 3.1 or in which it has
      remedied any breach thereof, or Roche has failed within the Response
      Period to remedy any breach of its obligations under this Section 3.1,
      then Memory shall have the right to terminate this Agreement, in whole or
      in part, as described below in this Section 3.1, upon written notice to
      Roche effective as of the end of the Response Period. Memory shall have
      the right to terminate this Agreement as to any region described above if
      Roche fails to comply with its obligations under this Section 3.1 with
      respect to the Products (taken as a whole) in such region. Memory shall
      have the right to terminate this Agreement in the Territory with respect
      to any Product if Roche fails to comply with its obligations under this
      Section 3.1 for such Product in at least two of the three regions
      described above. Memory shall have the right to terminate this Agreement
      in its entirety if Roche fails to comply with its obligations under this
      Section 3.1 for the Products (taken as a whole) in at least two of the
      three regions described above.

      In the event of a dispute between the Parties with respect to whether
      Roche has complied with its obligation under this Section 3.1, then such
      dispute shall be resolved in accordance with Article 17. The consequences
      of any termination under this Section shall be as set forth in Section
      16.4 and Article 17.

3.2   [*]

      The Parties confirm and agree that nothing in this Section 3.2 limits the
      obligations of Roche or the rights of Memory under Section 3.1.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                       ARTICLE 4. PAYMENTS TO MEMORY

4.1   Payment for Platform Technology. Roche shall pay Memory a total of [*]
      dollars ($[*]), which shall be non-refundable and non-creditable, and due
      and payable as follows:
<TABLE>
<CAPTION>
            Event                                     Payment (mio US$)
            -----                                     -----------------
<S>                                                   <C>
            The Effective Date                              8

            JLT decides on MEM 1414                         2
            as a Clinical Candidate for
            Alzheimers' disease

            [*]                                            [*]

            [*]                                            [*]
</TABLE>

      Each payment in this Section 4.1 shall be due and payable by Roche within
      thirty (30) days after occurrence of the applicable Event (except that the
      payment of $8,000,000 payable on the Effective Date shall be paid within
      fifteen (15) calendar days of the occurrence of the Effective Date)
      Notwithstanding anything to the contrary, Roche will make each of such
      payments only once, for the first occurrence of a respective Event,
      regardless of how many times the Event may be achieved.

4.2   CRO Reimbursement. Roche shall promptly reimburse Memory the actual amount
      of payments by Memory to contract research organizations ("CROs") for
      MEM1414, not to exceed one million five hundred thousand dollars (US
      $1,500,000). Such reimbursement shall only apply to amounts previously
      paid in respect of the 10 kilogram GMP MEM1414 batch produced by MediChem
      Research Inc., or hereafter paid to any CRO for MEM1414. Such
      reimbursement shall not become due and payable from Roche to Memory in any
      amount until after the JLT analyzes the relevant study reports from the
      CROs.

4.3   Development Event Based Payments.

      (a)   Neurological Indications. Roche shall pay to Memory the following
            non-refundable and non-creditable payments upon the first occurrence
            of the following Events for a Product.

(i)   First Product
<TABLE>
<CAPTION>
#     Event                                           Payment (mio US$)
      -----                                           -----------------
<S>                                                   <C>
1.    [*]                                             [*]

2.    [*]                                             [*]

3.    [*]                                             [*]

4.    [*]                                             [*]

5.    [*]                                             [*]

6.    [*]                                             [*]

7.    [*]**                                           [*]
</TABLE>

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
<TABLE>
<S>                                                   <C>
8.    [*]                                             [*]
</TABLE>

**    For the US, the Product should not have a black box warning in its label
      at time of Launch and should not receive one during its first 6 months on
      the market. During that period there should not be any "Dear Doctor"
      letters issued by the US FDA regarding this Product. In the US, the
      Product is the first or second non-achetylcholinesterase inhibitor (AChEI)
      having regulatory approval for the treatment of mild to moderate dementia
      of the Alzheimer's type or MCI, and a third non-AchEI having
      regulatory approval for the treatment of mild to moderate dementia of the
      Alzheimer's type or MCI does not launch in the US during the 6 month
      period following the Launch of the Product in the US.

(ii)  Second Product

      Roche shall pay to Memory the following non-refundable and non-creditable
      payments upon the first occurrence of the following Events for a Product
      having an NCE that is different from an NCE for which any payment occurred
      under Section 4.3(a)(i).

<TABLE>
<CAPTION>
      Event                                           Payment (mio US$)
      -----                                           -----------------
<S>                                                   <C>
      [*] for a Neurological Indication                     [*]

      [*] for a Neurological Indication                     [*]

      [*] for a Neurological Indication                     [*]

      [*] for a Neurological Indication                     [*]

      [*] for a Neurological Indication                     [*]
</TABLE>

      (b)   Psychiatric Indications. Roche shall pay to Memory the following
            non-refundable and non-creditable payments upon the first occurrence
            of the following Events for a Product having an NCE that is
            different from an NCE for which any payment occurred under Sections
            4.3(a).
<TABLE>
<CAPTION>
      Event                                           Payment (mio US$)
      -----                                           -----------------
<S>                                                   <C>
      [*] for depression                                    [*]

      [*] for depression                                    [*]

      [*] for depression                                    [*]

      [*] for depression                                    [*]

      [*] for depression                                    [*]

      [*] for depression                                    [*]

      [*] for depression                                    [*]

      [*]**                                                 [*]

      [*] for anxiety                                       [*]
</TABLE>

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
**    In the US, the Product does not have a black box warning in its label at
      time of Launch and does not receive one during its first 6 months on the
      market in the US. During that period there is not any "Dear Doctor"
      letters issued by the US FDA regarding this Product. The Product is the
      first PDE4 inhibitor having regulatory approval in the US for the
      treatment of depression, and a second PDE4 inhibitor having regulatory
      approval for the treatment of depression does not launch in the US during
      the 6 month period following the Launch of the Product in the US.

      (c)   Other Indications. Roche shall pay to Memory the following
            non-refundable, non-creditable payments upon the first occurrence of
            the following Events for a Product having an NCE that is different
            from those NCE's for which any payment occurred under Sections
            4.3(a) and/or 4.3(b).
<TABLE>
<CAPTION>
      Event                                           Payment (mio US$)
      -----                                           -----------------
<S>                                                   <C>
      [*] for an Other Indication                           [*]

      [*] for an Other Indication                           [*]

      [*] for an Other Indication                           [*]

      [*] for an Other Indication                           [*]

      [*] for an Other Indication                           [*]
</TABLE>

      (d)   Each payment in Section 4.3(a)(i), 4.3(a)(ii), 4.3(b) and
            4.3(c) shall be due and payable by Roche within thirty (30)
            days after occurrence of the applicable Event.  Roche will
            make each of such payments only once, for the first occurrence
            of a respective Event, regardless of how many times the Event
            may be subsequently achieved with a Product.  An Event shall
            be deemed to have occurred regardless of whether a Product or
            a Non-Memory Compound first achieved the Event.

      (e)   For the avoidance of doubt, the Parties confirm and agree that no
            amount payable under this Article 4 shall reduce any royalties
            payable under Article 5.

                              ARTICLE 5. ROYALTIES

5.1   Royalties.

      (a)   Roche shall pay to Memory the following payments for a given Product
            having a Regulatory Approval in the US for a Neurological
            Indication, based upon the Net Sales of such Product in the US,
            which such Net Sales shall be subject to adjustment as provided in
            this Article 5. Such royalty payments shall be calculated by
            multiplying the following percentages by the following annual Net
            Sales of such Product in the US (all Net Sales amounts in $ US
            million):
<TABLE>
<CAPTION>
ANNUAL US NET SALES           PERCENT (%) OF NET SALES
-------------------           ------------------------
<S>                           <C>
[*]                           [*]
[*]                           [*]
[*]                           [*]
[*]                           [*]
</TABLE>

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      By way of illustration, assume in calendar year 2012 that (i) Net Sales of
      the Product in the US total $950,000,000 and (ii) no adjustments or
      deductions to payments under this Article 5 apply. The royalties due and
      payable by Roche to Memory for such Net Sales would be $[*], calculated as
      follows:

<TABLE>
<CAPTION>
   US NET SALES (IN              APPLICABLE             AMOUNT PAYABLE (IN
      MILLIONS)        SALES-BASED PAYMENT PERCENTAGE        MILLIONS)
      ---------        ------------------------------        ---------
<S>                    <C>                              <C>
[*]                     [*]                             [*]
[*]                     [*]                             [*]
[*]                     [*]                             [*]
[*]                     [*]                             [*]
[*]                                                     [*]
</TABLE>

      Notwithstanding the foregoing, if for a given Product there is no
      Regulatory Approval in the US for a Neurological Indication, then, Roche
      shall pay to Memory the following payments for such Product, based upon
      the Net Sales of such Product in the US, which such Net Sales shall be
      subject to adjustment as provided in this Article 5. Such royalty payments
      shall be calculated by multiplying the following percentages by the
      following annual Net Sales of such Product in the US (all Net Sales
      amounts in $ US million):

<TABLE>
<CAPTION>
ANNUAL US NET SALES           PERCENT (%) OF NET SALES
-------------------           ------------------------
<S>                           <C>
[*]                           [*]
[*]                           [*]
[*]                           [*]
[*]                           [*]
</TABLE>

(b)   Roche shall pay to Memory the following payments for a given Product
      having a Regulatory Approval in Europe for a Neurological Indication,
      based upon the Net Sales of such Product in all countries of the Territory
      other than the US ("ROW Territory"), which such Net Sales shall be subject
      to adjustment as provided in this Article 5. Such royalty payments shall
      be calculated by multiplying the following percentages by the following
      annual worldwide Net Sales of such Product in the ROW Territory (all Net
      Sales amounts in $ US million):

<TABLE>
<CAPTION>
ANNUAL ROW TERRITORY NET SALES     PERCENT (%) OF NET SALES
------------------------------     ------------------------
<S>                                <C>
[*]                                [*]
[*]                                [*]
[*]                                [*]
[*]                                [*]
</TABLE>

      Notwithstanding the foregoing, if for a given Product there is no
      Regulatory Approval in Europe for a Neurological Indication, then, Roche
      shall pay to Memory the following payments for such Product, based upon
      the Net Sales of such Product in the ROW Territory, which such Net Sales
      shall be subject to adjustment as provided in this Article 5. Such royalty
      payments shall be calculated by multiplying the following percentages by
      the following annual worldwide Net Sales of such Product in the ROW
      Territory (all Net Sales amounts in $ US million):
<TABLE>
<CAPTION>
ANNUAL ROW TERRITORY NET SALES    PERCENT (%) OF NET SALES
------------------------------    ------------------------
<S>                               <C>
[*]                               [*]
</TABLE>

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
<TABLE>
<CAPTION>
ANNUAL ROW TERRITORY NET SALES    PERCENT (%) OF NET SALES
------------------------------    ------------------------
<S>                               <C>
[*]                               [*]
[*]                               [*]
[*]                               [*]
</TABLE>

      Any reduction in royalty rates provided for in this Section 5.1 by reason
      of not having a Regulatory Approval for a Neurological Indication shall
      cease after the relevant Regulatory Approval for a Neurological Indication
      is obtained and for so long as it is maintained.

5.2   Term of Royalty Payments. Roche shall calculate and make royalty payments
      to Memory under this Article 5 commencing on Launch in any country. The
      Net Sales of a given country shall be included for purposes of calculating
      royalties under this Section until the later of (a) expiration of the last
      to expire of Composition of Matter Claim in such country and (b) ten (10)
      years from the Launch of such Product in such country. With respect to the
      ten (10) year period, the EU will be considered as one country.

5.3   Adjustments Related to Valid Claims. For a given Product, if in, or with
      respect to, a country of the Territory no Valid Claim Covers such Product,
      then Roche may calculate royalties for such Product using only [*] percent
      ([*]%) of the amount Roche would have used for such country to calculate
      royalties for such Product if a Valid Claim Covered such Product in such
      country unless prior to ten years from the Launch of such Product in, or
      with respect to, such country (EU considered as one country) a Valid Claim
      Covering such Product exists in, or with respect to, such country in which
      case Roche shall resume calculating royalties using [*] percent ([*]%) of
      such amount.

5.4   Adjustments Related to Third Party Competition. For a given Product in a
      given calendar quarter, if in a country of the Territory (a) a Third Party
      is selling Bioequivalent Product, and (b) Roche has an obligation to make
      payments under this Agreement with respect to Net Sales of the given
      Product in such country, and (c) a Valid Claim Covers the given Product in
      such country and (d) in such country, sales of units of Bioequivalent
      Products in aggregate total at least [*] percent ([*]%) of the aggregate
      sales of units of Bioequivalent Products and Products as measured at the
      end of such calendar quarter, and (e) Roche has, if it is reasonable under
      the circumstances, brought in the country and continued to diligently
      prosecute a patent infringement suit under any relevant Composition of
      Matter Claims against the Third Party or another in privity, then Roche
      shall have the right to calculate royalties with respect to such calendar
      quarter by including only [*] percent ([*]%) of the amount Roche would
      have otherwise included for such country to calculate sales-based payments
      if no Bioequivalent Product existed in such country.

5.5   Adjustments Related to Third Party Payments. Roche or its Affiliate shall
      pay and be responsible for the entire consideration owed to any Third
      Party pursuant to the terms of any existing or future patent licensing
      agreement relating to Product. Roche shall have the right to deduct a
      maximum of [*] percent ([*]%) of the consideration actually paid by Roche
      or its Affiliate to a Third Party (other than [*] or [*] with respect to
      license under a patent which Covers the molecule per se of the PDE4
      inhibitor that is included in a given Product, from payments otherwise due
      and payable by Roche to Memory under this Agreement. In no event as a
      result of this Section 5.5 shall Roche reduce the royalties owed to Memory
      under this Article 5 by greater than [*] percent ([*]%) of Net Sales in
      the Territory for a given calendar quarter (and Roche shall be entitled to
      accumulate amounts not permitted to be deducted in a prior period and
      deduct such amounts in a future period).

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      Notwithstanding the above, (i) any payment owed under an agreement between
      Memory and The Trustees of Columbia University dated July 22, 1998, as it
      may be amended, shall be the sole responsibility of Memory, and (ii) any
      payment owed under any agreement between Roche or its Affiliate and any
      Third Party entered into prior to the Effective Date shall be the sole
      responsibility of Roche, for which Roche shall not be entitled to any
      deduction from payments due and payable to Memory under this Agreement.

5.6   Bonus Royalty. Roche shall pay to Memory a one-time, non-refundable and
      non-creditable amount after the first occurrence of the following event
      with respect to Product having Regulatory Approval in the US for a
      Neurological Indication:

<TABLE>
<CAPTION>
      Event                                                 Payment (US$)
      -----                                                 -------------
<S>                                                         <C>
      Net Sales in the US                                         [*]
      exceeds [*] dollars ($[*])
      for a full calendar year (Jan 1 - Dec. 31)
      during the Agreement Term.
</TABLE>

      Roche shall pay to Memory a one-time, non-refundable and non-creditable
      amount after the first occurrence of the following event with respect to a
      Product:
<TABLE>
<CAPTION>
      Event                                                 Payment (US$)
      -----                                                 -------------
<S>                                                         <C>
      Net Sales in the US                                         [*]
      exceeds [*] dollars ($[*]) for a full calendar
      year (Jan 1 - Dec. 31)
      during the Agreement Term.
</TABLE>

      Each payment in this Section 5.6 shall be due and payable by Roche within
      thirty (30) days after occurrence of the applicable Event. Notwithstanding
      anything to the contrary, Roche will make each of such payments only once,
      for the first occurrence of a respective Event with a Product, regardless
      of how many times the Event may be achieved.

5.7   Combination Products. In the event Roche or its Affiliates intend to sell
      a Combination Product, the Parties shall meet approximately one (1) year
      prior to the anticipated commercial launch of such Combination Product to
      negotiate in good faith and agree to an appropriate adjustment to Net
      Sales to reflect the relative significance and value of the Product and
      the other pharmaceutically active agent(s) contained in the Combination
      Product. If, after good faith negotiations (not to exceed ninety (90)
      days), the Parties cannot agree to an appropriate adjustment, Net Sales
      shall equal Net Sales of the Combination Product multiplied by a fraction,
      the numerator of which is the reasonable fair market value of the Product
      and the denominator of which is the reasonable fair market value in the
      aggregate, of all pharmaceutically active agents contained in the
      Combination Product.

5.8   Mechanisms for Adjustments. In no event shall any adjustments pursuant to
      Sections 5.3, 5.4 and/or 5.5 result in Memory receiving royalties for a
      given calendar quarter pursuant to Section 5.1 in amount less than [*]% of
      the amounts set forth therein as if no adjustment (s) had been made. If
      Roche obtains a license to a PDE4

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      inhibitor from a Third Party and includes such PDE4 inhibitor in a
      Product, as a result of which the Product becomes a Combination Product,
      Roche shall not be entitled to an adjustment pursuant to Section 5.5 as a
      result of such license.

                     ARTICLE 6. PAYMENT, REPORTING, AUDITING

6.1   Currency and Conversion.

      (a)   All payments under this Agreement shall be in U.S. Dollars by wire
            transfer of immediately available funds in accordance with
            instruction or instructions from the Party being paid.

      (b)   Whenever calculation of Net Sales requires conversion from any
            foreign currency, Roche shall convert the amount of Net Sales in
            foreign currencies as computed in Roche's central Swiss Francs Sales
            Statistics for the countries concerned, using for internal foreign
            currency translation Roche's then current standard practices
            actually used on a consistent basis in preparing its audited
            financial statements.

      (c)   For sublicensees in a country, when calculating the Net Sales, the
            sublicensee shall report to Roche the amount of such sales within
            thirty (30) days from the end of the reporting period, after having
            converted each applicable monthly sales in foreign currency into
            Swiss Francs using the average rate of exchange published in the
            Wall Street Journal (or some other source agreed upon by the Parties
            for any particular country) for each respective month of the
            reporting period.

6.2   Payments. After the Launch of the Product in any country of the Territory,
      Roche shall calculate royalty payments set forth in Article 5 quarterly as
      of March 31, June 30, September 30 and December 31 (each being the last
      day of a reporting period). Roche shall pay such payments quarterly within
      sixty (60) days after the end of each reporting period in which Net Sales
      occur during the Agreement Term.

      With each such payment, Roche shall deliver to Memory the following
      information split among U.S., Europe and rest of world:

      (a)   Adjusted Gross Sales for each Product;

      (b)   Net Sales for each Product;

      (c)   the royalty payments due to Memory for the reporting period;

      If Memory reasonably requests additional information relating to gross
      sales of the Products in the Major Market Countries (excluding China and
      Korea), deductions therefrom to calculate Adjusted Gross Sales or Net
      Sales and/or adjustments thereto, Roche agrees to provide such information
      to Memory within a reasonable time, provided, that Memory shall have the
      rights to exercise such requests not more than once during any period of
      twelve (12) consecutive months.

      In the event Roche does not pay Memory any amounts due under this
      Agreement, including pursuant to Articles 4 and 5, within the applicable
      time period set forth herein, without limiting Memory's rights under
      Article 16, such payment shall bear interest, to the extent permitted by
      applicable law, at the rate of interest (prime rate) as published in the
      weekly Federal Reserve H.15 bulletin plus [*]% (or a successor or similar
      publication) from time to time, for the applicable period calculated on
      the number of days such a payment is overdue.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
6.3   Taxes.

      (a)   Memory shall pay all applicable taxes levied on Memory under this
            Agreement.

      (b)   If provision is made in law or regulation of any country for
            withholding of taxes of any type, levies on Memory or other charges
            against Memory with respect to any amounts payable under this
            Agreement to Memory, Roche shall promptly pay such tax, levy or
            charge for and on behalf of Memory to the proper governmental
            authority, and shall promptly furnish Memory with receipt of such
            payment. Roche shall have the right to deduct any such tax, levy or
            charge actually paid from payment due Memory or be promptly
            reimbursed by Memory if no further payments are due Memory. Each
            Party agrees to assist the other Party in claiming exemption from
            such deductions or withholdings under double taxation or similar
            agreement or treaty from time to time in force and in minimizing the
            amount required to be so withheld or deducted.

6.4   Blocked Countries. If by reason of law Roche is unable to convert to U.S.
      Dollars a portion of the amount due by Roche under this Agreement, then
      Roche shall notify Memory in writing and, upon written request from
      Memory, Roche shall pay to Memory such portion, in the currency of any
      other country designated by Memory and legally available to Roche.

6.5   Accounting.

      (a)   Roche shall maintain and cause its Affiliates and sublicensees to
            maintain books of account containing all particulars that may be
            necessary for the purpose of calculating all payments under this
            Agreement. Such books of account shall be kept at their principal
            place of business. Memory shall have the right to engage Roche's
            independent, certified public accountant to perform, on behalf of
            Memory, an audit of such books and records of Roche and its
            Affiliates and sublicensees as is necessary to confirm any amounts
            payable to Memory under this Agreement for the period or periods
            requested by Memory and the correctness of any report or payments
            made under this Agreement.

      (b)   Such audits shall be conducted during normal business hours upon
            reasonable prior written notice from Memory (minimum of thirty (30)
            days) in such a manner as to not unnecessarily interfere with
            Roche's normal business activities, and shall include results of no
            more than three (3) preceding calendar years prior to audit
            notification.

      (c)   Such audit shall not occur more frequently than once per calendar
            year nor more frequently than once with respect to records covering
            any specific period of time. Notwithstanding the preceding, if
            Memory reasonably believes, after reviewing information received
            from Roche's independent public accountant, that an additional audit
            is appropriate to address an apparent discrepancy between Roche's
            returns and other information as is necessary for reporting
            hereunder, Memory shall have the right, by an audit specialty firm
            reasonably acceptable to Roche, employed by Memory and at Memory's
            own expense, to perform such appropriate audit procedures.

      (d)   The use of all information, data, documents and abstracts referred
            above shall be for the sole purpose of verifying statements or
            compliance with this Agreement, shall be treated as Roche
            Confidential Information subject to Article 15 of this Agreement
            and, except in the event of a dispute between the Parties regarding
            amounts payable hereunder or the results of any audit, need not be
            retained more than three (3) years from the end of the

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
            calendar year to which each shall pertain. Audit results shall be
            shared by Roche and Memory.

      (e)   If any audit hereunder reveals an underpayment, Roche shall promptly
            make up such underpayment. If any audit hereunder reveals an
            overpayment, Memory shall promptly reimburse such overpayment.
            Memory shall bear the full cost of any audit under this Section 6.5,
            unless such audit discloses an underpayment by Roche of more than
            [*] percent ([*]%) of the amount owed hereunder if Net Sales exceeds
            [*] dollars ($[*]) in the Territory for the calendar year, or [*]
            percent ([*]%) of the amount owed hereunder if Net Sales are equal
            to or less than [*] dollars ($[*]) in the Territory for the calendar
            year, in which case Roche shall bear the full cost of such audit as
            performed by Roche's independent, certified public accountant and
            any audit specialty firm employed by Memory, together with interest
            on any such underpayment from the date otherwise due through the
            date of payment at the rate set forth in Section 6.2.

      (f)   The failure of Memory to request verification of any payment
            calculation during which corresponding records are required to be
            retained under this Section 6.5 shall be considered acceptance of
            such reporting by Memory.

                      ARTICLE 7. THE RESEARCH COLLABORATION

7.1   The Research Collaboration

      (a)   The Parties agree to conduct a Research Collaboration in accordance
            with the Research Workplan. The goal of the Research Collaboration
            shall be to (1) deliver to Roche an IND package for the lead Memory
            Compound MEM1414 and (2) identify back-up and follow-up Memory
            Compounds and Collaboration Compounds for MEM1414, and identify a
            lead compound for depression, as well as back-up compounds.

      (b)           (i) The original term of the Research Collaboration shall be
                    for a period of two (2) years from the Effective Date of
                    this Agreement ("Original Term"), unless this Agreement is
                    terminated sooner in accordance with Article 16. Except as
                    provided in Article 16, neither Party may terminate the
                    Research Collaboration.

                    (ii) The Original Term of the Research Collaboration may be
                    extended by mutual written agreement prior to the expiration
                    of the Original Term. During such extension, the Research
                    Collaboration will explore potential applications of
                    Products for other therapeutic areas such as respiratory
                    disease, in addition to those goals of the Original Term.

                    (iii) The total time period during which the Research
                    collaboration is ongoing, including any extensions of the
                    Original Term, is the "Research Term."

7.2   Joint Liaison Team. A Joint Liaison Team ("JLT") shall govern the Research
      Collaboration by overseeing two subteams: (1) a subteam for developing an
      IND package for the lead compound MEM1414 and (2) a subteam for developing
      back-up and follow-up compounds for Neurological Indications; developing
      lead compounds for Psychiatric Indications as well as back-up compounds
      for Psychiatric Indications; and commencing to explore potential
      applications of Memory Compounds and Collaboration Compounds for other
      therapeutic areas such as respiratory disease.

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<PAGE>
      (a)   Organization. The JLT shall consist of six (6) members, three (3)
            members to be designated by Roche and three (3) members to be
            designated by Memory. Each Party shall notify the other Party of the
            member(s) designated by such Party, in writing, within thirty (30)
            days after the Effective Date. The Committee shall function only
            during the Research Term unless otherwise agreed by the Parties. Any
            Party may withdraw the designation of any of its members of the JLT
            and designate a replacement at any time by giving prior written
            notice of the withdrawal and identifying the replacement to the
            other Party. The chairperson of the JLT shall be from Roche.

      (b)   Meetings. The JLT shall hold quarterly meetings on mutually
            agreeable dates during the Research Term, with the location of the
            meetings to alternate between Memory and Roche, or their
            Affiliate's, facilities. The frequency and location of such meetings
            may be modified by mutual agreement of the Parties. Notwithstanding
            the foregoing, two of the quarterly meetings per year may be held by
            videoconference. Each Party shall pay its own expenses associated
            with the meeting. Each Party may, in its discretion, invite
            non-member employees ("invitee") to attend meetings of the JLT.

            The JLT shall meet in January, 2003 to analyze relevant study
            reports from the CROs, as contemplated by Section 4.2.

            The JLT shall meet in January, 2003 to decide if MEM1414 is a
            Clinical Candidate.

      (c)   Decision-Making. Decisions of the JLT shall be by consensus, with
            each Party having one collective vote. If the JLT is unable to
            decide a matter by consensus, the Parties shall refer such matter
            for resolution to the Head of Global Research on behalf of Roche and
            the Chief Scientific Officer of Memory ("Research Collaboration
            Executives"). If the Research Collaboration Executives are unable to
            resolve any such matter after good faith discussions, then the final
            decision shall rest with Roche, provided that no such decision on
            any matter may have the effect of increasing the economic burdens,
            including FTE burdens of Memory (except for any increases which in
            the aggregate are immaterial).

7.3   Research Support. For the Original Term, Roche shall pay to Memory a total
      of seven million dollars (US $7,000,000), which amount shall be
      non-refundable and non-creditable, and which will be due and payable in
      eight (8) equal installments of eight hundred and seventy five thousand
      dollars (US $875,000) per installment, each installment due and payable
      within thirty (30) days after (1) the first day of each calendar quarter
      during the Original Term and (2) receipt by Roche of an invoice for such
      sums. If the Effective Date of this Agreement is July 31, 2002, the first
      payment and the last payment under this Section shall be due and payable
      respectively within thirty (30) days after (1) October 1, 2002/July 1,
      2004 and (2) receipt by Roche of an invoice for such sum.

7.4   Research Collaboration Activities. Subject to the oversight of the JLT,
      during the Research Term each Party shall diligently conduct, at its cost
      except as provided in Section 7.3, those research activities that are
      assigned in the Research Workplan. At no cost to Roche, except as provided
      for in Sections 4.2 and 7.3, Memory shall use all reasonable best efforts
      to maintain in full force and effect all agreements and relationships with
      Third Parties in effect as of the Effective Date so that there is no
      interruption in the development of an IND package for MEM1414 during any
      transition from Memory to the JLT.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
7.5   Progress Reports. At least fifteen (15) days prior to each quarterly
      meeting of the JLT, each subteam shall prepare written progress reports
      for the JLT summarizing progress to date in achieving the primary goals
      for the Research Collaboration, including an inventory of Collaboration
      Compounds, Collaboration Technology and Memory Compounds. Following each
      such meeting, the JLT shall prepare a report summarizing the discussions
      held and conclusions reached and setting forth plans for the Research
      Collaboration for the next three (3) months.

7.6   Acknowledgement of Obligations. Each Party will cause each of its and its
      Affiliates FTEs, as specified in the Research Workplan, prior to and as a
      condition of becoming a member of the Research Collaboration, to review
      and acknowledge in writing that they understand and agree to abide by the
      terms and conditions of this Agreement related to the Research
      Collaboration (Article 7), Intellectual Property (Article 13),
      Confidential Information (Article 15, specifically as related to
      non-disclosure and non-use restrictions).

7.7   Screening. During the Agreement Term Roche shall have the right to use
      Memory Compounds and Collaboration Compounds in Roche screening assays.

                         ARTICLE 8. CLINICAL DEVELOPMENT

8.1   Development. Roche, at its sole cost, shall (1) pursue clinical
      development of Products and (2) obtain all government and health authority
      approvals which are required for Products to be manufactured and offered
      for sale in the Territory, including authorizations as may be required for
      the production, importation, pricing, reimbursement, and sale of Products
      in the Territory.

8.2   Development Review Team.

      (a)   Development Review Team Membership. For given Product, no later than
            thirty (30) days after development of an IND filing package for the
            Product, the Parties shall establish a Development Review Team
            consisting of up to three (3) representatives from Roche and one (1)
            representative of Memory. Each Party may select alternative
            representatives to replace its Development Review Team members
            selected by such Party as necessary, and may have other
            representatives attend meetings of the Development Review Team in
            addition to the representatives of the Team. All guidance provided
            by the Development Review Team shall be based upon the majority
            opinion of the Development Review Team.

      (b)   Development Review Team Meetings and Responsibilities. No less than
            two times per year for so long as the Development Review Team
            contemplates clinical development of a Memory Compound or
            Collaboration Compound in the Territory for the purpose of obtaining
            Regulatory Approval in a country of the Territory, Roche shall
            organize meetings of the Development Review Team.

            At its meetings, the Development Review Team shall conduct a peer
            review of Roche's development of Products in the Territory and shall
            provide Roche with strategic guidance with respect to Roche's
            development of Products in the Territory.

            Roche shall report to the Development Review Team on all significant
            clinical and regulatory issues relating to Products, and the
            Development Review Team shall make recommendations and provide
            strategic guidance with respect to such issues.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED

<PAGE>
      (c)   Costs. Each party shall be responsible for bearing its own costs
            related to the Development Review Team.

                          ARTICLE 9. REGULATORY AFFAIRS

Roche, at its sole cost, shall pursue all regulatory affairs in the Territory
related to Product, including the preparation and filing of applications for
Regulatory Approval, as well as any or all governmental approvals required to
manufacture, or have manufactured, and sell Products. Roche shall be responsible
for pursuing, compiling and submitting all regulatory filing documentation, and
for interacting with regulatory agencies, for all Products in all countries in
the Territory. Roche or its Affiliates shall own and file all regulatory filings
and Regulatory Approvals for all Products in all countries of the Territory.

Roche shall supply Memory with a copy of all material communications related to
Product to or from the regulatory agencies for all Major Market Countries (other
than China and Korea). Upon request of Memory, Roche shall supply Memory with a
copy of all such communications in all countries.

Roche, at its sole cost, shall report to appropriate authorities in accordance
with local requirements all adverse events related to use of Products worldwide.
Adverse events related to the use of Product worldwide shall be in a single
database, centralized, held and owned by Roche. Roche shall notify Memory of
material adverse events related to Products.

                       ARTICLE 10. MANUFACTURE AND SUPPLY

10.1  Clinical Supplies of Product. Roche understands and acknowledges that as
      of the Effective Date, pursuant to an agreement with Memory, Medichem
      Research Inc. is providing Phase I clinical supply of MEM1414. Beyond the
      clinical supply provided by Memory through Medichem, Roche shall supply at
      its own cost all clinical supply of Product and placebo to be used in the
      Territory during the Agreement Term, either by itself, or through a Third
      Party. Memory shall use all reasonable best efforts to maintain in full
      force and effect all agreements and relationships with Third Parties in
      effect as of the Effective Date so Roche has uninterrupted access to
      non-clinical and Phase I clinical supply prior to and during any
      manufacturing transition from Memory to Roche during the Agreement Term,
      at no cost to Roche. In addition, Memory shall use its reasonable best
      efforts to cause transfer of a manufacturing transfer package to Roche to
      enable to Roche commence manufacture of MEM1414 in a timely manner.

10.2  Commercial Supply. Roche shall be solely and exclusively responsible at
      its own expense for the manufacture and supply of Product for sale in the
      Territory, either by itself or through Third Parties.

                          ARTICLE 11. COMMERCIALIZATION

11.1  Responsibilities of Roche. Except as expressly set forth in Section 2.3
      and Section 3.1, Roche, at its own expense, shall have sole responsibility
      and decision making authority for the marketing, promotion, sale and
      distribution of Product in the Territory. During the Agreement Term, upon
      written request of Memory not to exceed once per year, Roche will fully
      inform Memory regarding the commercialization of Products in the Territory
      by Roche, its Affiliates and sublicensees.

                             ARTICLE 12. TRADEMARKS

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
Roche shall own worldwide all trademarks on and in connection with Products, and
shall, at its cost, be responsible for procurement, maintenance and enforcement
of all worldwide trademarks registration on and in connection with Products.

        ARTICLE 13. OWNERSHIP OF INTELLECTUAL PROPERTY AND PATENT RIGHTS

13.1  Ownership of Intellectual Property.

      As between the Parties, Memory shall own all Memory Inventions, Roche
      shall own all Roche Inventions, and Memory and Roche shall jointly own all
      Joint Inventions. Except to the extent any Collaboration Technology is
      exclusively licensed by one Party to the other Party hereunder, each Party
      shall have the right to practice Collaboration Technology, including
      Inventions, and to grant licenses to Affiliates and Third Parties to such
      Collaboration Technology, without the other party's consent and without
      any duty to account to the other Party with respect thereto. Each Party
      shall require all of its employees to assign all inventions related to
      Products made by them to such Party.

13.2  Patent Prosecution and Maintenance.

      (a)   Base Patents. Memory shall have the right, but not the obligation,
            to prepare, file, prosecute (including interference and opposition
            proceedings) and maintain (including interferences, re-examination
            and opposition proceedings) (collectively, "Handle") the Base
            Patents.

            Memory shall use reasonable efforts to consult with Roche as to the
            Handling of the Base Patents in sufficient time (for example 30 days
            for instances where actions are due within 3 months of a
            communication from a Patent Office) before any action is due to
            allow Roche to provide comments thereon, which comments Memory must
            reasonably consider if provided to Memory at least thirty (30) days
            before such action is due.

            Should Memory decide that it does not desire to Handle a Base Patent
            in a given country, it shall provide written notice to Roche thereof
            no less than sixty (60) days prior to the date when the Base Patent
            would become abandoned in such country. After receiving such notice,
            Roche may, but is not obligated, to Handle the Base Patent in such
            country.

            (i)   Except as provided in Section 13.2 (a)(ii) and (iii) below,
                  Memory shall be responsible for payment of the reasonable
                  costs to Handle the Base Patents.

            (ii)  Roche will assume and pay for the reasonable costs to Handle
                  any given Base Patents as described in Schedule A as Memory 1,
                  2 and 3 in Europe from and after national phase entry in
                  Europe. For a given Base Patent as described in Schedule A as
                  Memory 1, 2 and 3 no less than three (3) months before PCT
                  national phase entry, Roche shall provide to Memory in writing
                  a list of countries, other than the US and Europe, for which
                  Roche requests that a national phase entry be filed ("Other
                  Countries"). Unless the Parties otherwise agree after
                  discussion in good faith, such list shall include Japan and
                  additional countries, consistent with Roche's practices for
                  Roche's other potential products. Roche shall be responsible
                  for the payment of the reasonable costs to Handle the Base
                  Patents as described in Schedule A as Memory 1, 2 and 3 in the
                  Other Countries.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
            (iii) For a given Base Patent in a given country for which Roche
                  shall be responsible under Section 13.2(a)(ii) for the payment
                  of the reasonable costs to Handle such Base Patent, Roche may
                  elect, at its option, to discontinue the payment of such
                  costs, upon giving at least ninety (90) day's prior written
                  notice to Memory. At Memory's request, Roche shall advise to
                  the specific reasons for such decision. Memory may, in its
                  sole discretion, continue to Handle such Base Patent in such
                  country, at its own expense. If, however, a Valid Claim of
                  such Base Patent Covers a Product in such country in which
                  Roche Launches the Product, Roche shall reimburse Memory for
                  all reasonable costs to Handle such Base Patent with respect
                  to such country.

      (b)   Inventions.

            (i)   Priority Applications. Each Party promptly will notify the
                  other Party in writing ("Patent Notice") of any Inventions on
                  which it intends to file a patent application.

                  Within sixty (60) days after receipt of the Patent Notice, the
                  Parties shall agree upon which Party shall prepare and file a
                  priority application ("Invention Priority Application")
                  Covering such Invention. As a general rule, Memory shall
                  prepare and file an Invention Priority Application Covering
                  Memory Inventions and Roche shall prepare and file an
                  Invention Priority Application Covering Roche Inventions. For
                  a Joint Invention, if both Parties wish to have an Invention
                  Priority Application filed, then the Parties shall agree upon
                  a mutually acceptable external patent counsel for such
                  activity.

                  For purposes of this Article, the Party preparing and filing
                  an Invention Priority Application is a "Filing Party" and the
                  other Party is a "Non-Filing Party". For a Joint Invention,
                  the Parties shall agree which shall be the Filing Party and
                  which shall be the Non-Filing Party on a case-by-case basis.

                  (A)   Subject to Subsection 13.2(b)(iii), and any other
                        provision in this Article 13, the Non-Filing Party will
                        reimburse the Filing Party for fifty percent (50%) of
                        the reasonable and documented external costs for
                        preparing, filing and prosecuting the Invention Priority
                        Application and maintaining any resulting Patent Rights
                        within forty-five (45) days of invoice by the Filing
                        Party;

                  (B)   The Filing Party promptly will prepare and send to the
                        Non-Filing Party a draft of the Invention Priority
                        Application for the Non-Filing Party's comment and
                        approval; and

                  (C)   The Non-Filing Party shall confirm receipt of the draft
                        Invention Priority Application and provide its comments
                        on the draft to the Filing Party within thirty (30) days
                        after receipt thereof ("Comment Period").

                  After reasonably considering the Non-Filing Party's comments,
                  the Filing Party shall file the Invention Priority
                  Application. If the Non-Filing Party fails to provide comments
                  on a draft within the Comment Period, the Filing Party shall
                  be free to file the Application at the end of the Comment
                  Period or later.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                  If Non-Filing Party does not timely notify the Filing Party in
                  writing of interest in a Invention Priority Application, the
                  Filing Party shall be free to file the application at its sole
                  expense and discretion.

            (ii)  Corresponding Application in Foreign Countries. Within nine
                  (9) months after the filing of an Invention Priority
                  Application, the Filing Party shall provide the Non-Filing
                  Party a written list of countries ("Country List") in which
                  the Filing Party intends to file patent applications that
                  claim priority from the given Invention Priority Application.
                  The Non-Filing Party, as promptly as practicable, shall notify
                  the Filing Party in writing of those countries on the Country
                  List and any additional countries ("Additional Countries")
                  where the Non-Filing Party requests that patent applications
                  be filed. In turn, the Filing Party promptly shall notify the
                  Non-Filing Party if it agrees with the filing of applications
                  in such Additional Countries selected by the Non-Filing Party.

                  The Filing Party shall file patent applications at least in
                  those countries where the Non-Filing Party and the Filing
                  Party agree to the filing of patent applications ("Mutually
                  Agreed to Countries") as well as in Additional Countries
                  selected by the Non-Filing Party that are not within the
                  Mutually Agreed to Countries. The Filing Party shall have the
                  option of filing an international application designating at
                  least the Mutually Agreed to Countries, to be followed by
                  national filings in the desired countries.

                  The Filing Party shall be responsible for the filing and
                  prosecution of the patent applications and the maintenance of
                  the granted patents as to the Mutually Agreed to Countries.
                  Subject to the provisions of Section 13.2(b)(iii) as to the
                  Mutually Agreed to Countries, the Filing Party and the
                  Non-Filing Party each will pay fifty percent (50%) of the
                  reasonable external costs relating to the preparation, filing
                  and prosecution of the patent applications and the maintenance
                  of the granted patents.

                  As to those countries where the Non-Filing Party and the
                  Filing Party do not agree to the filing of patent
                  applications, the Party requesting the filing in said country
                  shall be responsible for all costs relating to the filing and
                  prosecution of the patent applications and the maintenance of
                  the granted patents in said countries.

                  Should the Non-Filing Party not respond to the Filing Party
                  within thirty (30) days after the date the Filing Party
                  provides the Country List, then the Filing Party shall be free
                  to initiate patent filings, at the Filing Party's sole expense
                  and discretion, in the countries the Filing Party has selected
                  or still selects.

                  The Filing Party's failure to notify the Non-Filing Party to
                  the contrary within thirty (30) days after the date upon which
                  the Non-Filing Party notifies the Filing Party of the
                  Additional Countries will be deemed an agreement on the part
                  of the Filing Party to file patent applications in all such
                  Additional Countries and to pay fifty percent (50%) of the
                  reasonable external costs associated with such filings.

            (iii) Withdrawal of Funding/Lack of Further Interest. If, in a
                  country, at any time, the Non-Filing Party decides not to
                  continue funding the prosecution of a patent

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                  application or maintenance of a patent under this Section
                  13.2, the Non-Filing Party shall notify the Filing Party in
                  writing ("Withdrawal Notice"), and the Non-Filing Party shall
                  be relieved from paying any further expenses with regard to
                  the patent filing in the country. After receiving the
                  Withdrawal Notice, the Filing Party may but is not obligated,
                  at its sole expense and discretion, to continue to prosecute
                  and maintain the patent filing in the country.

                  If, in a country, at any time, the Filing Party decides not to
                  continue the prosecution of a patent application or
                  maintenance of a patent under this Section 13.2, and such
                  patent application or patent is not one as to which the
                  Non-Filing Party has already sent a Withdrawal Notice, then
                  the Filing Party shall notify the Non-Filing Party in writing
                  no less than sixty (60) days prior to the date when the patent
                  application or patent would become abandoned in such country.
                  At the Non-Filing Party's written request and no cost to the
                  Filing Party, the Filing Party shall then assign to the
                  non-Filing Party such patent application or patent in such
                  country, and the Non-Filing Party may thereafter continue to
                  prosecute and maintain the patent filing in the country, at
                  the Non-Filing Party's own cost and in the Non-Filing Party's
                  name, to the extent the Non-Filing Party desires to do so

                  To the extent the provisions of this Section 13.2(b)(iii)
                  conflict with any other provision of this Section 13.2, this
                  Section 13.2(b)(iii) shall control.

            (iv)  Copies of Communications with Patent Offices. For the Mutually
                  Agreed to Countries and Additional Countries, the Filing Party
                  shall consult with the Non-Filing Party as to the prosecution
                  and maintenance of all patent applications and patents
                  claiming Inventions in sufficient time (for example 30 days
                  for instances where actions are due within 3 months of a
                  communication from a Patent Office) before any action is due
                  to allow the Non-Filing Party to provide comments thereon,
                  which comments the Filing Party must reasonably consider.

13.3  Cooperation. The Parties agree to cooperate in the preparation,
      prosecution and maintenance of all patent applications filed under Article
      13, including obtaining and executing necessary powers of attorney and
      assignments by the named inventors, providing relevant technical reports
      to the filing Party concerning the invention disclosed in such patent
      application, obtaining execution of such other documents which shall be
      needed in the filing and prosecution of such patent applications,
      discussing in good faith foreign filing strategy, and, as requested,
      updating each other regarding the status of such patent applications.

13.4  Infringement. Each Party shall promptly provide written notice to the
      other Party during the Agreement Term of any known infringement or
      suspected infringement of any Memory Patent Right or Collaboration Patent
      Right by a Third Party making, using, offering for sale, selling, or
      importing a PDE4 inhibitor or a product containing a PDE4 inhibitor
      (collectively "PDE4 Infringement").

      Roche shall have the first right to bring and control any action or
      proceeding with respect to such PDE4 Infringement at its own expense and
      by counsel of its own choice, and Memory shall have the right, at its own
      expense, to be represented in any such action by counsel of its own
      choice. If Roche fails to bring any such action or proceeding with respect
      to PDE4 Infringement within (a) [*] days following the notice of alleged
      infringement or (b) [*] days before the time limit, if any, set forth in
      the appropriate laws and regulations for the filing of such actions,
      whichever

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      comes first, Memory shall have the right to bring and control any such
      action at its own expense and by counsel of its own choice, and Roche
      shall have the right, at its own expense, to be represented in any such
      action by counsel of its own choice.

      A Party that elects to bring and control an infringement action pursuant
      to this Section 13.4 shall provide prompt written notice to the other
      Party of any such suit commenced or action taken by such Party.

      Upon written request, the Party bringing suit or taking action
      ("Initiating Party") shall keep the other Party informed of the status of
      any such suit or action and shall provide the other Party with copies of
      all substantive documents and communications filed in such suit or action.
      The Initiating Party shall have the sole and exclusive right to select
      counsel for any such suit or action.

      The Initiating Party shall, except as provided below, pay all expenses of
      the suit or action, including, without limitation, the Initiating Party's
      attorneys' fees and court costs. After deducting the Parties' attorneys
      fees and court costs in connection with any such suit or action, any
      damages, settlement fees or other consideration received as a result of
      such suit or action shall belong to the Initiating Party, except to the
      extent such damages, settlement fees or other consideration are
      attributable to lost profits with respect to Products in the Territory,
      which shall form part of the Net Sales for determining amounts due to
      Memory in any calendar year.

      If the Initiating Party believes it reasonably necessary, upon written
      request to the other Party, the other Party shall join as a party to the
      suit or action but shall be under no obligation to participate except to
      the extent that such participation is required as the result of its being
      a named party to the suit or action. At the Initiating Party's written
      request, the other Party shall offer reasonable assistance to the
      Initiating Party at no charge to the Initiating Party except for
      reimbursement of reasonable out-of-pocket expenses incurred by the other
      Party in rendering such assistance. The other Party shall have the right
      to participate and have its own representation in any such suit or action
      at its own expense.

      The Initiating Party shall have the right to control settlement; provided,
      however, that no settlement shall be entered into without the written
      consent of the other Party, not to be unreasonably withheld.

      For the avoidance of doubt, Memory shall have the right, but not the
      obligation, to bring and control and action or proceeding with respect to
      any Memory Patent Right relating to infringement other than PDE4
      Infringement, at its own expense, without obligation or notice to Roche.

13.5  Hatch-Waxman. Notwithstanding anything to the contrary, should a Party
      receive a certification for a Product pursuant to the Drug Price
      Competition and Patent Term Restoration Act of 1984 (Public Law 98-417),
      as amended, or its equivalent in a country other than the United States of
      America, then such Party shall immediately provide the other Party with a
      copy of such certification. Roche shall have [*] days from the date on
      which it receives or provides a copy of such certification to provide
      written notice to Memory ("H-W Suit Notice") whether Roche will bring
      suit, at its expense, within a [*] day period from the date of such
      certification. Should such [*] day period expire without Roche bringing
      suit or providing such H-W Suit Notice, then Memory shall be free to
      immediately bring suit in its name. If Roche brings suit, at Roche's
      written request, Memory agrees to be named as a party to such suit.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
13.6  Patent Notices. All notices provided under this Article 13 to Roche shall
      be given to:

            F.Hoffmann-La Roche Ltd
            Grenzacherstrasse 124
            CH-4070 Basel, Switzerland
            Attn: Head, Patent Law

      with copies of all notices relating to U.S. cases to:

            Hoffmann-La Roche Inc.
            340 Kingsland Street
            Nutley, New Jersey 07110
            Attn: Chief Patent Counsel.

      All notices provided under this Article 13 to Memory shall be given to:

            Memory Pharmaceutical Corp.
            100 Philips Parkway
            Montvale, New Jersey 07645
            Attn: Head of Business Development

      With copies of all notices to:

            Millen, White, Zelano and Branigan, P.C.
            Arlington Courthouse, Plaza I
            2200 Clarendon Blvd, Suite 1400
            Arlington, Virginia 22201
            Attn: Anthony Zelano, Esq.

                   ARTICLE 14. REPRESENTATIONS AND WARRANTIES

14.1  Representations and Warranties of Both Parties.

      (a)   Each Party warrants and represents to the other Party that it has
            the full right and authority to enter into this Agreement and that
            it is not aware of any impediment which would inhibit its ability to
            perform the terms and conditions imposed on it by this Agreement.

      (b)   Each Party represents and warrants that all of its FTEs, as
            specified in the Research Workplan, and its Affiliates FTEs, as
            specified in the Research Workplan, have entered into an agreement
            with it or its Affiliate assigning to it or its Affiliate all their
            rights to Inventions.

14.2  Representations and Warranties of Memory.

      (a)   Corporate Action. Memory represents and warrants to Roche that all
            corporate action on the part of Memory, its officers, directors and
            stockholders necessary for (i) the authorization, execution and
            delivery of this Agreement and (ii) the performance of all
            obligations of Memory hereunder has been taken and this Agreement
            constitutes the legal and binding obligation of Memory, enforceable
            against Memory in accordance with its terms.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      (b)   No Conflict. Memory represents and warrants to Roche that the
            execution of this Agreement and the performance of the transactions
            contemplated by this Agreement by Memory will not conflict with or
            result in a breach of any of the terms, conditions or provisions of,
            or constitute a default under any agreement or other instrument to
            which Memory is a party or by which it or any of its property is
            bound.

      (c)   Right to Grant Licenses. Memory represents and warrants to Roche
            that it has the right to grant Roche the licenses and sublicenses
            that Memory hereby grants to Roche under this Agreement.

      (d)   Third Party Patent Infringement. Memory represents and warrants that
            as of the Effective Date, to its actual knowledge of its senior
            executives, after consultation with patent counsel, there is no
            issued patent right owned or controlled by any Third Party which
            Covers the lead compound identified by Memory to Roche (MEM1414) and
            would prevent Roche from selling such Memory Compound in any country
            of the Territory. As of the date hereof, the Base Patents are owned
            exclusively by Memory and Memory's senior executives, after
            consultation with patent counsel, have no actual knowledge of any
            information that would, in their opinion, render invalid and/or
            unenforceable Composition of Matter Claims for MEM1414 in such Base
            Patents.

      (e)   No Material Mistatements. Memory warrants and represents to Roche
            that (i) its senior executives have not intentionally failed to
            disclose any information actually known to them which in their
            reasonable opinion, would be material to Roche entering into this
            Agreement, and to the actual knowledge of such senior executives
            such information does not contain any untrue statement of material
            fact or omit to state a material fact; (ii) it has provided correct
            and complete copies of all documents furnished to Roche.

14.3  Representations and Warranties of Roche. Roche represents and warrants to
      Memory that all corporate action on the part of Roche, its officers,
      directors and stockholders necessary for (i) the authorization, execution
      and delivery of this Agreement and (ii) the performance of all obligations
      of Roche hereunder has been taken and this Agreement constitutes the legal
      and binding obligation of Roche, enforceable against Roche in accordance
      with its terms. The execution of this Agreement and the performance of the
      transactions contemplated by this Agreement by Roche will not conflict
      with or result in a breach of any of the terms, conditions or provisions
      of, or constitute a default under any agreement or other instrument to
      which Roche is a party or by which it or any of its property is bound.

14.4  Disclaimer. THE FOREGOING REPRESENTATIONS AND WARRANTIES ARE IN LIEU OF
      ALL OTHER REPRESENTATIONS AND WARRANTIES NOT EXPRESSLY SET FORTH HEREIN.
      MEMORY AND ROCHE DISCLAIM ALL OTHER REPRESENTATIONS AND WARRANTIES,
      WHETHER EXPRESS OR IMPLIED, WITH RESPECT TO EACH OF THEIR RESEARCH,
      DEVELOPMENT AND COMMERCIALIZATION EFFORTS HEREUNDER, INCLUDING, WITHOUT
      LIMITATION, WHETHER THE PRODUCTS CAN BE SUCCESSFULLY DEVELOPED OR
      MARKETED, THE ACCURACY, PERFORMANCE, UTILITY, RELIABILITY, TECHNOLOGICAL
      OR COMMERCIAL VALUE, COMPREHENSIVENESS, MERCHANTABILITY OR FITNESS FOR ANY
      PARTICULAR PURPOSE WHATSOEVER OF THE PRODUCTS. IN NO EVENT SHALL EITHER
      MEMORY OR ROCHE BE LIABLE FOR SPECIAL, INDIRECT, INCIDENTAL OR
      CONSEQUENTIAL DAMAGES ARISING OUT OF THIS AGREEMENT BASED ON CONTRACT,
      TORT OR ANY OTHER LEGAL THEORY.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                      ARTICLE 15. CONFIDENTIAL INFORMATION

15.1  Treatment of Confidential Information. In carrying out rights and
      obligations under this Agreement, the Parties will be sharing proprietary
      information ("Confidential Information") with each other. Except as
      permitted by this Agreement, each Party shall and shall cause its
      Affiliates to treat Confidential Information received from the other Party
      as it treats its own proprietary information. In particular, it shall not
      disclose, divulge or otherwise communicate such Confidential Information
      to Third Parties, or use it for any purpose except pursuant to and in
      order to carry out its obligations under this Agreement during the
      Agreement Term and for a period of [*] years thereafter; provided that,
      each Party (i) may disclose the Confidential Information to such of its
      directors, officers, employees, Affiliates, consultants, subcontractors,
      sublicensees or agents to the extent reasonably necessary to carry out its
      obligations under this Agreement, and (ii) hereby agrees to exercise every
      reasonable precaution to prevent and restrain the unauthorized disclosure
      or use of Confidential Information.

15.2  Release from Restrictions. The provisions of Section 15.1 shall not apply
      to any Confidential Information which:

      (a)   was known or used by the Receiving Party or its Affiliates prior to
            its date of disclosure to the Receiving Party or its Affiliates by
            the Disclosing Party or its Affiliates, as evidenced by the prior
            written records of the Receiving Party or its Affiliates; or

      (b)   either before or after the date of the disclosure to the Receiving
            Party or its Affiliates, is lawfully disclosed to the Receiving
            Party or its Affiliates by a Third Party rightfully in possession of
            the Confidential Information; or

      (c)   either before or after the date of the disclosure to the Receiving
            Party or its Affiliates, becomes published or generally known to the
            public through no fault or omission on the part of the Receiving
            Party or its Affiliates, but such inapplicability applies only after
            such information is published or becomes generally known; or

      (d)   is independently developed by the Receiving Party or its Affiliates
            without reference to or reliance upon any Confidential Information
            of the Disclosing Party or its Affiliates; or

      (e)   is reasonably determined to be required to be disclosed by the
            Receiving Party or its Affiliates to comply with applicable
            securities of other laws, to defend or prosecute litigation or to
            comply with governmental regulations, provided that, the Receiving
            Party or its Affiliates uses all reasonable efforts to provide prior
            written notice of such disclosure to the Disclosing Party or its
            Affiliates and to take reasonable and lawful actions to not be
            required to disclose and/or minimize the degree of such disclosure.

      (f)   is disclosed to a Party's financial sources or potential acquirors
            of its stock or assets (directly or indirectly) so long as, with
            respect to a potential purchase the potential acquirer or financial
            source executes a confidentiality agreement which is at least as
            restrictive as the provisions of this Article 15.

15.3  Exceptions. The restrictions set forth in this Article 15 shall not
      prevent either Party from (i) preparing, filing, prosecuting or
      maintaining a patent application or its resulting patents related to a
      Product in accordance with the terms of this Agreement or (ii) disclosing
      Confidential Information to governmental agencies to the extent required
      or desirable to secure government approval for the development or
      marketing of a Product.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
15.4  Publications. During the Agreement Term, the following provisions shall
      apply with respect to the disclosure in scientific journals, publications
      or scientific presentations by any Party relating to any scientific work
      performed as part of the Research Collaboration:

      (a)   A Party (the "Publishing Party") shall provide the other Party with
            a copy of any proposed publication relating to the work performed
            and/or the results achieved in the conduct of the Collaboration at
            least forty-five (45) days prior to submission for publication so as
            to provide such other Party an opportunity to recommend any changes
            it reasonably believes are necessary to preserve the Confidential
            Information belonging in whole or in part to such other Party, and
            the incorporation of such recommended changes shall not be
            unreasonably refused;

      (b)   If such other Party in writing notifies ("Notice") the Publishing
            Party, within forty-five (45) days of receipt of the copy of the
            proposed publication, that such publication in its reasonable
            judgment (i) contains an Invention for which the other Party
            reasonably desires patent protection or (ii) disclosure to
            competitors could be expected to have a material adverse effect on
            the commercial value of any Confidential Information, the Publishing
            Party shall prevent such publication or delay such publication for a
            mutually agreeable period of time. In the case of Inventions, a
            delay shall be for a period reasonably sufficient to permit the
            timely preparation and filing of a patent application(s) or
            application(s) on the Invention, and in no event less than ninety
            (90) days from the date of Notice.

                        ARTICLE 16. TERM AND TERMINATION

16.1  (a)   Conditions Subsequent. The effectiveness of this Agreement and the
            transaction contemplated hereunder shall be subject to and shall be
            contingent upon the satisfaction under the following condition
            subsequent to the execution of this Agreement by February 28, 2003.
            The condition subsequent shall be the earlier to occur of (i)
            approval of the transaction by the Federal Trade Commission or the
            appropriate US anti-trust authorities or (ii) the expiration or
            termination of all applicable waiting periods, requests for
            information ( and any extensions thereof) under the
            Hart-Scott-Rodino Antitrust Improvements Act of 1976.

            Subject to the terms and conditions of this Agreement, each Party
            shall use all reasonable efforts to take, or cause to be taken, all
            reasonable actions and to do, or cause to be done, all things
            necessary and appropriate to satisfy the condition subsequent and to
            consummate the transactions contemplated by this Agreement in
            accordance with the terms hereof.

            Each Party shall cooperate with the other Party in the preparation,
            execution and filing of all documents that are required or permitted
            to be filed on or before the Effective Date for the purpose of
            consummating this transaction, including, filings pursuant to the
            Hart-Scott-Rodino Antitrust Improvements Act of 1976. Each Party
            shall bear its own costs with respect to preparing, executing and
            filing such documents.

      (b)   Agreement Term. The Agreement Term shall commence on the Effective
            Date and end, unless earlier terminated upon the mutual agreement of
            the Parties or in accordance with the provisions of this Article 16,
            on the date of expiration of all royalty and other payment
            obligations (the "Expiration Date") under this Agreement. Upon the
            occurrence of the Expiration Date, if any, the licenses granted to
            Roche by Memory

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
            under this Agreement to make, have made, use, offer for sale, sell
            and import Products shall be fully paid-up.

16.2  Termination for Breach. (a) Each Party ("non-breaching Party") shall be
      entitled to terminate this Agreement by written notice to the other Party
      ("breaching Party") in the event that the breaching Party is in default of
      any of its material obligations hereunder and fails to remedy such default
      within sixty (60) days (thirty (30) days for payment defaults) after
      provision of written notice thereof by the non-breaching Party. Any such
      notice shall specifically state that the non-breaching Party intends to or
      reserves the right to terminate this Agreement in the event that the
      breaching Party shall fail to timely remedy the default.

      The effective date of termination under this Section for breach of a
      material obligation shall be the date sixty (60) days after provision of
      written notice thereof by the non-breaching Party.

      In the event Roche does not pay any full payment by reason of a good faith
      dispute as to whether such payment is due pursuant to the terms of this
      Agreement, Memory shall not have the right to terminate this Agreement as
      a result of such nonpayment until resolution of the dispute.

16.3  Roche's Right to Terminate. Beginning on the second anniversary of the
      Effective Date, Roche shall have the unilateral right to terminate this
      Agreement on a region-by-region basis (the regions being North America (US
      and Canada), Europe and Japan) or Product-by-Product, either on a
      worldwide basis or as to North America (US and Canada) only or ex-North
      America only, at any time by providing six (6) months prior written notice
      to Memory; provided, however, that if the Parties do not agree as to a
      proposed sublicense for which Memory has withheld consent, Roche shall,
      after the second anniversary, have a unilateral right to terminate this
      Agreement for the territory to which such proposed sublicense relates.
      Notwithstanding the preceding sentence, if there has been a launch of a
      Product in a Major Market Country, then such prior notice must be for
      twelve (12) months. The effective date of termination under this Section
      shall be the date six (6) months (or twelve (12) months as the case may
      be) after Roche provides such written notice to Memory. The first date
      that Roche shall have a right to provide written notice to Memory of
      intention to terminate this Agreement, in whole or in part, shall be the
      date that is eighteen (18) months after the Effective Date.

      Notwithstanding the above, Roche shall have the unilateral right to
      terminate this Agreement in its entirety prior to the second anniversary
      of the Effective Date only in the event that for each of the three
      different Memory PDE4 inhibitor chemical series, Memory 1, 2 and 3 as seen
      in Schedule A, a lead compound from each series, selected by the JLT,
      fails to progress due to failure of each compound to pass GLP safety and
      toxicity studies, defined as those GLP safety and toxicity studies
      generally required by the FDA for entry into man.

16.4   Consequences of Termination.

      Upon (a) any termination of this Agreement in its entirety pursuant to
      Section 16.2, (b) termination of this Agreement by Roche of this Agreement
      in its entirety or in a region or country or in respect of a Product
      pursuant to Section 16.3, or (c) termination of this Agreement by Memory
      in its entirety or in a region pursuant to Article 3, and rights and
      licenses of any kind or nature granted by Memory to Roche under this
      Agreement (or, as applicable, with respect to termination of this
      Agreement as to a country, region or Product, respectively) shall
      terminate on the effective date of termination, provided Roche shall
      maintain a non-exclusive license to practice Collaboration Technology to
      make, use and sell products other than PDE4 inhibitors. In the event of
      any such termination, the following shall apply.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      (a)   Roche shall, upon Memory's written request, assign and transfer to
            Memory, or its Affiliates as requested by Memory, at no expense to
            Memory, or its Affiliates, and free of any liens, pledges or
            security interests other than those incurred in the
            commercialization of the Product, all of Roche's right, title and
            interest in and to (i) all trademarks and trademark applications
            used or intended for use specifically for the relevant Product(s),
            (ii) all regulatory filings (such as INDs and drug master files),
            Regulatory Approvals, and clinical trial agreements (to the extent
            assignable and not cancelled) for the relevant Product(s), and (iii)
            all data, including clinical data, materials and information of any
            kind or nature whatsoever, in Roche's possession or in the
            possession of its Affiliates or its or their respective agents
            related to the relevant Product(s) and (iv) all rights relating to
            the infringement of Memory Patent Rights and Collaboration Patent
            Rights, related to the relevant Product(s). Without limiting the
            generality of the preceding sentence, Memory shall, upon such
            transfer, have the right to disclose such filings, approvals and
            data to (i) governmental agencies of the country or region to the
            extent required or desirable to secure government approval for the
            development, manufacturing or sale of Product in the country or
            region, (ii) Third Parties acting on behalf of Memory, its
            Affiliates or sublicensees, to the extent reasonably necessary or
            desirable for the development, manufacture, or sale of Product in
            the country or region, and (iii) Third Parties to the extent
            reasonably necessary or desirable to market Product in the country
            or region. All such filings, approvals and data transferred to
            Memory pursuant to this Section 16.4 shall be deemed to be Memory
            Confidential Information.

      (b)   In addition, for a given Product and country or region so
            terminated, or for the Territory in the case of termination of this
            Agreement in its entirety, Roche hereby grants to Memory a sole and
            exclusive, non-royalty bearing fully paid-up license, under Roche
            intellectual property (including Collaboration Technology and Patent
            Rights Covering Collaboration Technology and Collaboration
            Compounds, and including any trademarks used or intended for use in
            connection with the sale of Product), to make, have made, use, offer
            for sale, sell and import such Product(s) in such country, region or
            the Territory, as applicable.

      (c)   Roche shall supply, or cause to be supplied, to Memory, upon
            Memory's written request, Memory or its licensee's clinical and/or
            commercial requirements of Product(s), pursuant to a supply
            agreement to be negotiated in good faith by the parties, provided
            that (i) such requirements shall be supplied to Memory or its
            licensee at Roche's direct manufacturing costs and allocation of
            manufacturing overhead, and (ii) Roche's supply obligation shall not
            continue for more than [*] years after such termination, and (iii)
            Roche shall maintain the same Product(s) quality and specifications
            as immediately prior to notice of termination, and (iv) as to other
            terms, such agreement shall be reasonably consistent with Roche's
            other arm's length supply agreements, and (v) Memory shall use
            reasonable best efforts to effect a transfer as soon as practicable
            of Product(s) manufacturing activities from Roche to another
            supplier. In addition, Roche shall also transfer to Memory and its
            designated supplier a manufacturing transfer package that will
            enable Memory or such designated supplier to manufacture the
            Product(s) in a timely manner.

      Roche shall take prompt actions, including the execution of such
      instruments, agreements and documents, as are necessary or desirable to
      effect the foregoing. It is agreed such transfers and actions shall be
      completed in a manner that will permit Memory to continue without
      interruption the business of developing, manufacturing, marketing and
      selling the Product(s).

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
16.5  Royalty and Payment Obligations. Termination of this Agreement by either
      Party for any reason will not release Roche from any obligation to pay
      royalties or make any payments to Memory which were accrued prior to the
      effective date of termination (including for sales made and Events
      achieved under Article 4, prior to the date of termination). However,
      termination of this Agreement by either Party for any reason will release
      Roche from any obligation to pay royalties or make any payments to Memory
      which would have otherwise become accrued after the effective date of
      termination.

16.6  Termination for failure to satisfy the condition subsequent. Either Party
      may terminate this Agreement in its entirety, upon ten (10) days prior
      written notice to the other Party if the condition subsequent under
      Section 16.1a has not been fulfilled by February 28, 2003, in which case,
      upon termination there shall be no liabilities for obligations on the part
      of either party except that Article 15 shall survive such termination and
      except for any breach of section 16.1(a).

16.7  Survival of Obligations. Section 2.2 (the last sentence only), Section 2.4
      and Schedule C, Article 6 (except for Section 6.2), Section 7.6, Section
      13.1, Article 15, Section 16.4, Section 16.5, Section 16.7, Article 17,
      Article 18, and any definitions used in such Section of Article, shall
      survive the termination of this Agreement in its entirety. Except for
      obligation which clearly are not intended to continue in respect of a
      partial termination (including the diligence obligation, and except as
      provided in Section 16.5, royalty obligations), with respect to the
      region, country or Product terminated, all obligations in this Agreement
      shall survive a partial termination.

                             ARTICLE 17. ARBITRATION

      Any dispute, controversy or claim ("Dispute") arising out of or in
relation to this Agreement, or the breach, termination or invalidity thereof,
that cannot be settled amicably by the Parties after a good faith discussion to
resolve the Dispute by the appropriate officers of the Parties, shall be
submitted by either Party to arbitration conducted in accordance with the rules
then in effect of the American Arbitration Association ("AAA"). Arbitration
shall take place in Newark, New Jersey and shall be conducted by three (3)
arbitrators, one of whom shall be designated by each Party, and the third
selected by the other two (2) arbitrators, all within the time limits
established by the then existing rules of the AAA. If the two (2) designated
arbitrators are unable to agree upon a third arbitrator by two (2) months after
submission of the matter to arbitration, the AAA shall select such third
arbitrator within three (3) months of such original submission. The written
decision of the arbitrators shall be final and binding on the parties and may be
enforced in any court having jurisdiction over the Parties or their current
assets. The award rendered by the arbitrators shall include the cost of
arbitration, reasonable attorneys' fees and reasonable costs for expert and
other witnesses, and in the event of a termination, in whole or in part, a
transition procedure, including the performance of transition services by Roche,
so as to maintain the value of the assets being transferred to Memory and, to
the extent contemplated by Section 16.4, permit Memory to conduct the business
being transferred to it. The parties shall be entitled to discovery as provided
in the Federal Rules of Civil Procedure. If the issues in dispute involve
scientific or technical matters, at least one of the arbitrators chosen
hereunder shall have educational training and/or experience sufficient to
demonstrate a reasonable level of knowledge in the Field and pharmaceutical drug
development. Notwithstanding the preceding provisions of this Article 17, with
respect to any breach or threatened breach of this Agreement of Section 15.1,
16.4 or any other provision where a Party would not be appropriately compensated
by the payment of money, a party has a right to seek injunctive relief from any
court of competent jurisdiction to enjoin such breach or threatened breach
and/or to seek specific performance.

In the event of a Dispute, a Party shall have no right to toll or delay any
obligation in this Agreement unrelated to the Dispute as a result of the
Dispute. By way of example, if Roche owes Memory

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
$5,000,000 and claims a $2,000,000 payment is not due by reason of breach of
Memory, then Roche shall pay the $5,000,000, and the parties will resolve such
$2,000,000 Dispute pursuant to Article 17.

                            ARTICLE 18. MISCELLANEOUS

18.1  Indemnification.

      (a)   Roche agrees to defend Memory and the other Memory Indemnified
            Parties at Roche's cost and expense, and will indemnify and hold
            Memory and its directors, officers, employees and agents (the
            "Memory Indemnified Parties") harmless from and against any claims,
            losses, costs, damages, fees or expenses arising out of or otherwise
            relating to (i) activities of Roche and its Affiliates in the
            conduct of the Collaboration, (ii) the development, manufacture,
            use, offer for sale, sale or other disposition of any Product or
            Non-Memory Compound by Roche, its Affiliates or sublicensees, and
            each of their distributors, representatives or anyone in privity
            therewith, or (iii) the gross negligence or willful misconduct of
            Roche, its Affiliates or sublicensees. In the event of any such
            claim against the Memory Indemnified Parties by a Third Party,
            Memory shall promptly notify Roche in writing of the claim (provided
            that any failure or delay to notify shall not excuse any obligations
            of Roche except to the extent Roche is actually prejudiced thereby)
            and Roche shall solely manage and control, at its sole expense, the
            defense of the claim and its settlement provided further that Roche
            shall not settle any such claim, if such settlement may have an
            adverse effect on Memory, without the prior written consent of
            Memory, which consent shall not be unreasonably withheld. The Memory
            Indemnified Parties shall cooperate with Roche and may, at their
            option and expense, be represented in any such action or proceeding.
            Roche shall not be liable for any litigation costs or expenses
            incurred by the Memory Indemnified Parties without Roche's written
            authorization.

      (b)   Memory agrees to defend Roche and the other Roche Indemnified
            Parties at Memory's cost and expense, and will indemnify and hold
            Roche and its directors, officers, employees and agents (the "Roche
            Indemnified Parties") harmless from and against any claims, losses,
            costs, damages, fees and expenses arising out of any claim, arising
            out of or otherwise relating to (i) activities of Memory in the
            conduct of the Collaboration, (ii) the development, manufacture,
            use, offer for sale, sale or other disposition of any Product by
            Memory, its Affiliates, licensees other than Roche, sublicensees and
            each of their distributors, representatives or anyone in privity
            therewith (but only to the extent same is a consequence of Section
            2.5, Article 3 and/or 16), and (iii) the gross negligence or willful
            misconduct of Memory, its Affiliates, licensees, distributors,
            representatives or anyone in privity therewith. In the event of any
            such claim against the Roche Indemnified Parties by an Independent
            Third Party, Roche shall promptly notify Memory in writing of the
            claim (provided that any failure or delay to notify shall not excuse
            any obligation of Memory except to the extent Memory is actually
            prejudiced thereby) and Memory shall solely manage and control, at
            its sole expense, the defense of the claim and its settlement
            provided further that Memory shall not settle any such claim if such
            settlement may have an adverse effect on Roche without the prior
            written consent of Roche, which consent shall not be unreasonably
            withheld. The Roche Indemnified Parties shall cooperate with Memory
            and may, at their option and expense, be represented in any such
            action or proceeding. Memory shall not be liable for any litigation
            costs or expenses incurred by the Roche Indemnified Parties without
            Memory's written authorization.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
18.2  Publicity. Neither Party shall originate any publicity, news release or
      other public announcement, written or oral, relating to this Agreement,
      including its terms, without the prior approval of the other Party except
      solely to the extent a Party reasonably believes same is otherwise
      required by law. Such approval shall not be unreasonably withheld. Each
      Party shall to the extent consistent with applicable laws and regulations
      limit the disclosure of the financial terms set forth in this Agreement
      (such as by requesting confidential treatment of such terms in documents
      required to be filed with the US Securities and Exchange Commission).

18.3  Force Majeure. Neither Party to this Agreement shall be responsible to the
      other Party for nonperformance or delay in performance of the terms or
      conditions of this Agreement due to acts of God, acts of governments, war,
      riots, strikes, accidents in transportation, or other causes beyond the
      reasonable control of such Party, but such force majeure shall toll any
      and all obligations and time periods for so long as such force majeure
      continues.

18.4  Bankruptcy. All licenses (and to the extent applicable rights) granted
      under or pursuant to this Agreement by Memory to Roche are, and shall
      otherwise be deemed to be, for purposes of Section 365(n) of Title 11, US
      Code (the "Bankruptcy Code"), licenses of rights to "intellectual
      property" as defined under Section 101(60) of the Bankruptcy Code. Unless
      Roche elects to terminate this Agreement under Article 16, the Parties
      agree that Roche, as a licensee or sublicensee of such rights under this
      Agreement, shall retain and may fully exercise all of its rights and
      elections under the Bankruptcy Code, subject to the continued performance
      of its obligations under this Agreement.

18.5  Governing Law . This Agreement shall be governed by and interpreted in
      accordance with the laws of New Jersey without giving effect to principles
      of conflicts of law.

18.6  Waiver. The waiver by a Party of a breach or a default of any provision of
      this Agreement by the other Party shall not be construed as a waiver of
      any succeeding breach of the same or any other provision, nor shall any
      delay or omission on the part of a Party to exercise or avail itself of
      any right, power or privilege that it has or may have hereunder operate as
      a waiver of any right, power or privilege by such Party.

18.7  Notices. Any notice or other communication in connection with this
      Agreement must be in writing and may be given by any of the following
      methods: (i) personal delivery against a signed receipt; (ii) registered
      or certified mail, postage prepaid, return receipt requested; or (iii) by
      overnight delivery service which obtains a signed receipt. Notice shall be
      effective when delivered to the addressee at the address listed below or
      such other address as the addressee shall have specified in a written
      notice actually received by the addresser.

      If to Memory:

            Memory Pharmaceuticals Corp.
            100 Philips Parkway
            Montvale, New Jersey 07645
            Attn: Head of Business Development

      and

            Sills Cummis Radin Tischman Epstein & Gross, P.A.
            One Riverfront Plaza
            Newark, New Jersey 07102

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
            Attn: Ira A. Rosenberg, Esq.

      If to Roche:

            F.Hoffmann-La Roche Ltd
            Grenzacherstrasse 124
            CH-4070
            Basel, Switzerland
            Attn: Legal Department

      and

            Hoffmann La-Roche Inc.
            340 Kingsland Street
            Nutley, NJ  07110
            Attn.: Corporate Secretary

18.8  No Agency. Nothing herein shall be deemed to constitute either Party as
      the agent or representative of the other Party. Each Party shall be an
      independent contractor, not an employee or partner of the other Party.
      Each Party shall be responsible for the conduct of activities at its own
      facilities and for any liabilities resulting therefrom. Neither Party
      shall be responsible for the acts or omissions of the other Party, and
      neither Party will have authority to speak for, represent or obligate the
      other Party in any way without prior written authority from the other
      Party.

18.9  Entire Agreement. This Agreement and the Schedules hereto (which Schedules
      are deemed to be a part of this Agreement for all purposes) contain the
      full understanding of the Parties with respect to the subject matter
      hereof and supersede all prior understandings and writings relating
      thereto. No waiver, alteration or modification of any of the provisions
      hereof shall be binding unless made in writing and signed by the Parties.

18.10 Headings. The headings contained in this Agreement are for convenience of
      reference only and shall not be considered in construing this Agreement.

18.11 Severability. In the event that any provision of this Agreement is held by
      a court of competent jurisdiction to be unenforceable because it is
      invalid or in conflict with any law of any relevant jurisdiction, the
      validity of the remaining provisions shall not be affected, and the
      Parties shall negotiate a substitute provision that, to the extent
      possible, accomplishes the original business purpose. During the period of
      such negotiation, and thereafter if no substituted provision is agreed
      upon, any such provision which is enforceable in part but not in whole
      shall be enforced to the maximum extent permitted by law.

18.12 Assignment. Neither this Agreement nor any of the rights or obligations
      hereunder may be assigned by either Party without the prior written
      consent of the other Party, except to an Affiliate of the assigning Party
      or to any other party who acquires all or substantially all of the
      pharmaceutical business of the assigning Party by merger, sale of assets
      or otherwise, so long as such Affiliate or other party agrees in writing
      to be bound by the terms of this Agreement. Notwithstanding the preceding,
      if Memory assigns its rights and/or obligations under this Agreement to a
      party who acquires all or substantially all of the pharmaceutical business
      of Memory by merger, sale of assets or otherwise, then Memory's rights
      under Section 2.3 shall become null and void.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
18.13 Successors and Assigns. Except as otherwise provided herein, this
      Agreement shall be binding upon and inure to the benefit of the Parties
      hereto and their successors and permitted assigns under Section 18.12.

18.14 Interpretation. The words "include," "includes" and "including" shall be
      deemed to be followed by the phrase "without limitation." All references
      herein to Articles, Sections, and Schedules shall be deemed references to
      Articles and Sections of, and Schedules to, this Agreement unless the
      context shall otherwise require. Except as otherwise expressly provided
      herein, all terms of an accounting or financial nature shall be construed
      in accordance with international accounting standards ("IAS"), as in
      effect from time to time. Unless the context otherwise requires, countries
      shall include territories.

18.15 Counterparts. This Agreement may be executed in any number of
      counterparts, each of which shall be deemed an original but all of such
      together shall constitute one and the same instrument.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
      IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed in their names by their properly and duly authorized officers or
representatives as of the dates below written.

MEMORY PHARMACEUTICALS CORP.      HOFFMANN-LA ROCHE INC.

By: /s/ Tony Scullion             By: /s/ Dennis E. Burns
    -------------------------         -----------------------------------------

Title: Chief Executive Officer    Title: VP, Global Head of Business Development
       -----------------------           --------------------------------------

                                  F.HOFFMANN-LA ROCHE LTD

                                  By: /s/ Brad Bolzon
                                      -----------------------------------------

                                  Title: EVP, PL
                                         --------------------------------------

                                  By: Dr. Melanie Frey
                                      -----------------------------------------

                                   Title: Authorized Signatory
                                          --------------------------------------

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                                   SCHEDULE A

                              MEMORY PATENT RIGHTS

I.    MEMORY 1

      A.    U.S.

            (a)   First US provisional filed January 22, 2001 (60/262,651).

            (b)   Second US provisional filed February 8, 2001 (60/267,196).

            (c)   Third US provisional filed July 19, 2001 (60/306,140)

            (d)   A regular US patent application (10/051,309) was filed on
                  January 22, 2002, claiming priority to the above-mentioned
                  three US provisional applications.

      B.    PCT

            An International PCT application (PCT/US02/01508) was also filed on
            January 22, 2002, claiming priority to the above-mentioned three US
            provisional applications.

      C.    Additional

            (a)   An application filed July 19, 2002

            (b)   A second application filed July 19, 2002

II.   MEMORY 2

      A.    U.S.

            (a)   First US provisional filed February 8, 2001 (60/267,195)

            (b)   Second US provisional filed January 7, 2002 (60/344,824).

            (c)   A regular US patent application (10/067,996) was filed on
                  February 8, 2002, claiming priority to the above-mentioned two
                  US provisional applications.

            (d)   Possible Second US family to be filed; awaiting analysis from
                  MPC.

      B.    PCT

            An International PCT application (no serial no issued yet) was also
            filed on February 8, 2002, claiming priority to the above-mentioned
            two US provisional applications.

III.  MEMORY 3

      A.    U.S.

            A first US provisional application (Memory 3 V1) was filed October
            16, 2001 (60/329,314).

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
IV.   MEMORY 4 (CYCLIC AMP PHOSPHODIESTERASE ISOFORM 4D7 AND METHODS OF USE)

      A.    U.S.

            (a)   First US provisional filed November 15, 2001 (60/331,422)

            (b)   Second US provisional filed January 23, 2002 (60/349,985).

V.    MEMORY 5 (CYCLIC AMP PHOSPHODIESTERASE ISOFORMS AND METHODS OF USE)

      A.    U.S.

            (a)   U.S. provisional application filed June 25, 1999 (60/141,196

            (b)   A regular U.S. Patent Application was filed June 23, 2000
                  (09/602,735), claiming priority to the above-mentioned
                  provisional application.

      B.    PCT

            An International Patent Application was filed June 23, 2000, and was
            published January 4, 2001 (WO 01/00851). This application claims
            priority the above-mentioned provisional application.

      C.    EP

            A European Patent Application was filed December 21, 2001 claiming
            priority to the above-mentioned provisional application and
            International application (application EP 00944829.1; publication EP
            1190070).

      D.    JP

            A Japanese Patent Application was filed December 25, 2001 claiming
            priority to the above-mentioned provisional application and
            International application (JP 2001-506843).

      E.    AU

            An Australian Patent Application was filed December 20, 2001
            claiming priority to the above-mentioned provisional application and
            International application (AU 58864/00).

      F.    CA

            A Canadian Patent Application was filed December 20, 2001 claiming
            priority to the above-mentioned provisional application and
            International application (serial no. not yet issued).

      G.    MX

            A Mexican Patent Application was filed December 25, 2001 claiming
            priority to the above-mentioned provisional application and
            International application (serial no. not yet issued).

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                                   SCHEDULE B

                                RESEARCH WORKPLAN

[*]

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
                                   SCHEDULE C

                           USE OF NON-MEMORY COMPOUNDS

1     Development Event Based Payments. If Roche (alone or with its Affiliates)
      develops a Non-Memory Compound for a Neurological Indication or a
      Psychiatric Indication, then Roche shall pay Memory for such Non-Memory
      Compound achieving the Events of Sections 4.3(a) and 4.3(b) as if such
      Non-Memory Compound were a Product except (i) Roche shall pay [*] percent
      ([*]%) of such payments related to IND, Phase II and Phase III Events, and
      (ii) [*] percent ([*]%) of all other payments provided under Section
      4.3(a) and 4.3(b).

      If Roche (alone or with its Affiliates) develops a Non-Memory Compound for
      an Other Indication, then Roche shall pay Memory for such Non-Memory
      Compound achieving the Events of Sections 4.3(c) as if such Non-Memory
      Compound were a Product except (i) Roche shall pay [*] percent ([*]%) of
      such payments related to IND, Phase II and Phase III Events, and (ii) [*]
      percent ([*]%) of all other payments provided under Section 4.3(c).

      Each payment in this Schedule C shall be due and payable by Roche within
      thirty (30) days after occurrence of the applicable Event. Roche will make
      each of such payments only once, for the first occurrence of a respective
      Event, regardless of how many times the Event may be subsequently achieved
      with a Non-Memory Compound. An Event shall be deemed to have occurred
      regardless of whether a Product or a Non-Memory Compound first achieved
      the Event.

2.    ROYALTIES.

      (a)   Roche shall pay to Memory the following payments for a given product
            containing a Non-Memory Compound having a Regulatory Approval in the
            US for a Neurological Indication, based upon the net sales (defined
            as in Section 1.30 but applied to the given product) of such product
            in the US. Such royalty payments shall be calculated by multiplying
            the following percentages by the following annual net sales of such
            product in the US (all Net Sales amounts in $ US million):

<TABLE>
<CAPTION>
      ANNUAL US NET SALES           PERCENT (%) OF NET SALES
      -------------------           ------------------------
<S>                             <C>
[*]                             [*]
[*]                             [*]
[*]                             [*]
[*]                             [*]
</TABLE>

            Notwithstanding the foregoing, if for such product there is
            Regulatory Approval in the United States of America for a
            Psychiatric Indication, but no Regulatory Approval in the US for a
            Neurological Indication, then Roche shall pay to Memory the
            following payments for such product, based upon the net sales of
            such product in the US. Such royalty payments shall be calculated by
            multiplying the following percentages by the following incremental
            annual net sales of such product in the US (all Net Sales amounts in
            $ US million):

<TABLE>
<CAPTION>
      ANNUAL US NET SALES           PERCENT (%) OF NET SALES
      -------------------           ------------------------
<S>                             <C>
[*]                             [*]
[*]                             [*]
[*]                             [*]
[*]                             [*]
</TABLE>

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
            Notwithstanding the foregoing, if for such product there is no
            Regulatory Approval in the US for a Neurological Indication or a
            Psychiatric Indication, then Roche shall pay to Memory the following
            payments for such product, based upon the net sales of such product
            in the US. Such royalty payments shall be calculated by multiplying
            the following percentages by the following incremental annual net
            sales of such product in the US (all Net Sales amounts in $ US
            million):

<TABLE>
<CAPTION>
      ANNUAL US NET SALES           PERCENT (%) OF NET SALES
      -------------------           ------------------------
<S>                             <C>
[*]                             [*]
[*]                             [*]
[*]                             [*]
[*]                             [*]
</TABLE>

      (b)   Roche shall pay to Memory the following payments for a given product
            containing a Non-Memory Compound having Regulatory Approval in
            Europe for a Neurological Indication, based upon the net sales
            (defined as in Section 1.30 but applied to the given product) of
            such product in all countries in the ROW Territory. Such royalty
            payments shall be calculated by multiplying the following
            percentages by the following incremental annual worldwide net sales
            of such product in the ROW Territory (all net sales amounts in $ US
            million):

<TABLE>
<CAPTION>
ANNUAL ROW TERRITORY NET SALES      PERCENT (%) OF NET SALES
------------------------------      ------------------------
<S>                             <C>
[*]                             [*]
[*]                             [*]
[*]                             [*]
[*]                             [*]
</TABLE>

            Notwithstanding the foregoing, if for such product there is
            Regulatory Approval in the Europe for a Psychiatric Indication but
            no Regulatory Approval in Europe for a Neurological Indication,
            then, Roche shall pay to Memory the following payments for such
            product, based upon the net sales of such product in the ROW
            Territory. Such royalty payments shall be calculated by multiplying
            the following percentages by the following annual worldwide net
            sales of such product in the ROW Territory (all net sales amounts in
            $ US million):

<TABLE>
<CAPTION>
ANNUAL ROW TERRITORY NET SALES      PERCENT (%) OF NET SALES
------------------------------      ------------------------
<S>                             <C>
[*]                             [*]
[*]                             [*]
[*]                             [*]
[*]                             [*]
</TABLE>

            Notwithstanding the foregoing, if for such product there is no
            Regulatory Approval in the Europe for a Neurological Indication or a
            Psychiatric Indication, then Roche shall pay to Memory the following
            payments for such product, based upon the net sales of such product
            in the ROW Territory. Such royalty payments shall be calculated by
            multiplying the following percentages by the following incremental
            annual net sales of such product in the ROW Territory (all Net Sales
            amounts in $ US million):

<TABLE>
<CAPTION>
ANNUAL ROW TERRITORY NET SALES      PERCENT (%) OF NET SALES
------------------------------      ------------------------
<S>                             <C>
[*]                             [*]
</TABLE>

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED
<PAGE>
<TABLE>
<CAPTION>
ANNUAL ROW TERRITORY NET SALES      PERCENT (%) OF NET SALES
------------------------------      ------------------------
<S>                             <C>
[*]                             [*]
[*]                             [*]
[*]                             [*]
</TABLE>

            Roche shall calculate and pay royalty payments to Memory under this
            Schedule C commencing on the launch of the product in any country.
            The net sales of a given country shall be included for purposes of
            calculating royalties under this Section until the later of (i) ten
            (10) years from the launch of such product in such country, or (ii)
            expiration of the last to expire Memory Patent Right Covering the
            product in country, after which time Roche's license from Memory for
            such product shall be fully-paid up for such country.

            All of the provisions of Article VI, including the timing of
            payments and rights under Section 6.5, shall apply to the payments
            required pursuant to this Schedule C.

            There shall be no further adjustments to such royalty payments.

                     [*] CONFIDENTIAL TREATMENT IS REQUESTED

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