Document:

Exhibit
10.43

Portions of this Exhibit were
omitted and filed separately with the Secretary of the Commission pursuant to
an application for confidential treatment filed with the Commission pursuant to
Rule 24b-2 under the Securities Exchange Act of 1934.  Such omissions are designated as **.

CONFIDENTIAL

Execution
Copy

RESEARCH
AND LICENSE AGREEMENT

by and
among

WYETH,

acting
through its

WYETH
PHARMACEUTICALS DIVISION,

and

PHARMACOPEIA
DRUG DISCOVERY, INC.

Dated as
of December 22, 2006

TABLE OF
CONTENTS

	
  

  	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
  1

  	
   DEFINITIONS.

  	
   

  	
  1

  
	
   

  	
  1.1.

  	
   

  	
  “Affiliate(s)”

  	
   

  	
  1

  
	
   

  	
  1.2.

  	
   

  	
  “Agreement Compound”

  	
   

  	
  2

  
	
   

  	
  1.3.

  	
   

  	
  “Calendar Quarter”

  	
   

  	
  2

  
	
   

  	
  1.4.

  	
   

  	
  “Change of Control Transaction”

  	
   

  	
  2

  
	
   

  	
  1.5.

  	
   

  	
  “Collaboration Compound”

  	
   

  	
  3

  
	
   

  	
  1.6.

  	
   

  	
  “Commercialization” or “Commercialize”

  	
   

  	
  3

  
	
   

  	
  1.7.

  	
   

  	
  “Commercially Reasonable Efforts”

  	
   

  	
  3

  
	
   

  	
  1.8.

  	
   

  	
  “Competing Pharmaceutical Company”

  	
   

  	
  3

  
	
   

  	
  1.9.

  	
   

  	
  “Compound Classification Disputes”

  	
   

  	
  3

  
	
   

  	
  1.10.

  	
   

  	
  “Compound Selection Criteria”

  	
   

  	
  3

  
	
   

  	
  1.11.

  	
   

  	
  “Confidential Information”

  	
   

  	
  3

  
	
   

  	
  1.12.

  	
   

  	
  “Control” or “Controlled”

  	
   

  	
  4

  
	
   

  	
  1.13.

  	
   

  	
  “Copyright”

  	
   

  	
  4

  
	
   

  	
  1.14.

  	
   

  	
  “Core Structure”

  	
   

  	
  4

  
	
   

  	
  1.15.

  	
   

  	
  “Derivative Compound”

  	
   

  	
  4

  
	
   

  	
  1.16.

  	
   

  	
  “Derivative Tail”

  	
   

  	
  4

  
	
   

  	
  1.17.

  	
   

  	
  “Development” or “Develop”

  	
   

  	
  4

  
	
   

  	
  1.18.

  	
   

  	
  “Development Compound”

  	
   

  	
  4

  
	
   

  	
  1.19.

  	
   

  	
  “Diligence Failure”

  	
   

  	
  4

  
	
   

  	
  1.20.

  	
   

  	
  “Disclosing Party”

  	
   

  	
  4

  
	
   

  	
  1.21.

  	
   

  	
  “Discovery Compounds”

  	
   

  	
  5

  
	
   

  	
  1.22.

  	
   

  	
  “Discovery Compound Criteria”

  	
   

  	
  5

  
	
   

  	
  1.23.

  	
   

  	
  “Effective Date” has the

  	
   

  	
  5

  
	
   

  	
  1.24.

  	
   

  	
  “Exchange Act”

  	
   

  	
  5

  
	
   

  	
  1.25.

  	
   

  	
  “Executive Officers”

  	
   

  	
  5

  
	
   

  	
  1.26.

  	
   

  	
  “FDA”

  	
   

  	
  5

  
	
   

  	
  1.27.

  	
   

  	
  “FD&C Act”

  	
   

  	
  5

  
	
   

  	
  1.28.

  	
   

  	
  “Fields”

  	
   

  	
  5

  
	
   

  	
  1.29.

  	
   

  	
  “First Commercial Sale”

  	
   

  	
  5

  
								

 

 i
 

 

	
  

  	
  1.30.

  	
   

  	
  “FTE”

  	
   

  	
  5

  
	
   

  	
  1.31.

  	
   

  	
  “IND”

  	
   

  	
  5

  
	
   

  	
  1.32.

  	
   

  	
  “Indemnified Party”

  	
   

  	
  5

  
	
   

  	
  1.33.

  	
   

  	
  “Indemnifying Party”

  	
   

  	
  5

  
	
   

  	
  1.34.

  	
   

  	
  “Initial Term”

  	
   

  	
  6

  
	
   

  	
  1.35.

  	
   

  	
  “JAK-3 Exclusivity Period”

  	
   

  	
  6

  
	
   

  	
  1.36.

  	
   

  	
  “JAK-3 Kinase Inhibitor”

  	
   

  	
  6

  
	
   

  	
  1.37.

  	
   

  	
  “JAK-3 Kinase Inhibitory Activity”

  	
   

  	
  6

  
	
   

  	
  1.38.

  	
   

  	
  “Joint IP”

  	
   

  	
  6

  
	
   

  	
  1.39.

  	
   

  	
  “Joint Know-How”

  	
   

  	
  6

  
	
   

  	
  1.40.

  	
   

  	
  “Joint Patent Right(s)”

  	
   

  	
  6

  
	
   

  	
  1.41.

  	
   

  	
  “Joint Research Committee”

  	
   

  	
  6

  
	
   

  	
  1.42.

  	
   

  	
  “JRC”

  	
   

  	
  6

  
	
   

  	
  1.43.

  	
   

  	
  “Know-How” of a compound or product

  	
   

  	
  6

  
	
   

  	
  1.44.

  	
   

  	
  “Lead Developer”

  	
   

  	
  6

  
	
   

  	
  1.45.

  	
   

  	
  “Liability”

  	
   

  	
  6

  
	
   

  	
  1.46.

  	
   

  	
  “Manufacturing” or “Manufacture”

  	
   

  	
  7

  
	
   

  	
  1.47.

  	
   

  	
  “Major Market Countries”

  	
   

  	
  7

  
	
   

  	
  1.48.

  	
   

  	
  “Material Structural Feature”

  	
   

  	
  7

  
	
   

  	
  1.49.

  	
   

  	
  “NDA”

  	
   

  	
  7

  
	
   

  	
  1.50.

  	
   

  	
  “Net Sales”

  	
   

  	
  7

  
	
   

  	
  1.51.

  	
   

  	
  “Non-Assert IP”

  	
   

  	
  7

  
	
   

  	
  1.52.

  	
   

  	
  “Non-Licensed Compounds”

  	
   

  	
  7

  
	
   

  	
  1.53.

  	
   

  	
  “Passed Compounds”

  	
   

  	
  7

  
	
   

  	
  1.54.

  	
   

  	
  “Patent Rights”

  	
   

  	
  7

  
	
   

  	
  1.55.

  	
   

  	
  “PCT”

  	
   

  	
  8

  
	
   

  	
  1.56.

  	
   

  	
  “Person”

  	
   

  	
  8

  
	
   

  	
  1.57.

  	
   

  	
  “Pharmacopeia Change of Control Transaction”

  	
   

  	
  8

  
	
   

  	
  1.58.

  	
   

  	
  “Pharmacopeia Compounds”

  	
   

  	
  8

  
	
   

  	
  1.59.

  	
   

  	
  “Pharmacopeia Available Compound”

  	
   

  	
  8

  
	
   

  	
  1.60.

  	
   

  	
  “Pharmacopeia Field”

  	
   

  	
  9

  
	
   

  	
  1.61.

  	
   

  	
  “Pharmacopeia Indemnified Party”

  	
   

  	
  9

  
	
   

  	
  1.62.

  	
   

  	
  “Pharmacopeia IP”

  	
   

  	
  9

  

 

 ii
 

 

	
  

  	
  1.63.

  	
   

  	
  “Pharmacopeia Know-How” that
  is reasonably necessary to

  	
   

  	
  9

  
	
   

  	
  1.64.

  	
   

  	
  “Pharmacopeia Patent Right”

  	
   

  	
  9

  
	
   

  	
  1.65.

  	
   

  	
  “Pharmacopeia Product”

  	
   

  	
  9

  
	
   

  	
  1.66.

  	
   

  	
  “Pharmacopeia Third Party Agreement(s)”

  	
   

  	
  9

  
	
   

  	
  1.67.

  	
   

  	
  “Phase I Clinical Study”

  	
   

  	
  9

  
	
   

  	
  1.68.

  	
   

  	
  “Phase II Clinical Study”

  	
   

  	
  9

  
	
   

  	
  1.69.

  	
   

  	
  “Phase III Clinical Study”

  	
   

  	
  9

  
	
   

  	
  1.70.

  	
   

  	
  “Pre-Development Compound”

  	
   

  	
  10

  
	
   

  	
  1.71.

  	
   

  	
  “Pre-IND”

  	
   

  	
  10

  
	
   

  	
  1.72.

  	
   

  	
  “Primary Prosecution Countries”

  	
   

  	
  10

  
	
   

  	
  1.73.

  	
   

  	
  “Product(s)”

  	
   

  	
  10

  
	
   

  	
  1.74.

  	
   

  	
  “Regulatory Approval”

  	
   

  	
  10

  
	
   

  	
  1.75.

  	
   

  	
  “Regulatory Authorit(y/ies)”

  	
   

  	
  10

  
	
   

  	
  1.76.

  	
   

  	
  “Research”

  	
   

  	
  10

  
	
   

  	
  1.77.

  	
   

  	
  “Research Plan”

  	
   

  	
  11

  
	
   

  	
  1.78.

  	
   

  	
  “Research Collaboration”

  	
   

  	
  11

  
	
   

  	
  1.79.

  	
   

  	
  “Research Term”

  	
   

  	
  11

  
	
   

  	
  1.80.

  	
   

  	
  “Royalty Term”

  	
   

  	
  11

  
	
   

  	
  1.81.

  	
   

  	
  “SEC”

  	
   

  	
  11

  
	
   

  	
  1.82.

  	
   

  	
  “Selection Conditions”

  	
   

  	
  11

  
	
   

  	
  1.83.

  	
   

  	
  “Selection Notice”

  	
   

  	
  11

  
	
   

  	
  1.84.

  	
   

  	
  “Term”

  	
   

  	
  11

  
	
   

  	
  1.85.

  	
   

  	
  “Territory”

  	
   

  	
  11

  
	
   

  	
  1.86.

  	
   

  	
  “Third Part(y/ies)”

  	
   

  	
  11

  
	
   

  	
  1.87.

  	
   

  	
  “Third Party IP Rights”

  	
   

  	
  11

  
	
   

  	
  1.88.

  	
   

  	
  “Third Party Suit”

  	
   

  	
  11

  
	
   

  	
  1.89.

  	
   

  	
  “Top 10 Pharmaceutical Company”

  	
   

  	
  11

  
	
   

  	
  1.90.

  	
   

  	
  “Trademarks”

  	
   

  	
  11

  
	
   

  	
  1.91.

  	
   

  	
  “Unpatented Product”

  	
   

  	
  11

  
	
   

  	
  1.92.

  	
   

  	
  “Valid Claim”

  	
   

  	
  11

  
	
   

  	
  1.93.

  	
   

  	
  “Wyeth Available Compound”

  	
   

  	
  12

  
	
   

  	
  1.94.

  	
   

  	
  “Wyeth Compounds”

  	
   

  	
  12

  
	
   

  	
  1.95.

  	
   

  	
  “Wyeth Development Track”.

  	
   

  	
  12

  

 

 iii
 

 

	
  

  	
  1.96.

  	
   

  	
  “Wyeth Field”

  	
   

  	
  12

  
	
   

  	
  1.97.

  	
   

  	
  “Wyeth Indemnified Party”

  	
   

  	
  12

  
	
   

  	
  1.98.

  	
   

  	
  “Wyeth IP”

  	
   

  	
  12

  
	
   

  	
  1.99.

  	
   

  	
  “Wyeth Know-How”

  	
   

  	
  12

  
	
   

  	
  1.100.

  	
   

  	
  “Wyeth Patent Right”

  	
   

  	
  12

  
	
   

  	
  1.101.

  	
   

  	
  “Wyeth Product”

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  LICENSES

  	
   

  	
  13

  
	
   

  	
  2.1.

  	
   

  	
  Licenses to Wyeth

  	
   

  	
  13

  
	
   

  	
  2.2.

  	
   

  	
  Licenses to Pharmacopeia

  	
   

  	
  13

  
	
   

  	
  2.3.

  	
   

  	
  Retained Rights

  	
   

  	
  13

  
	
   

  	
  2.4.

  	
   

  	
  Sublicensing

  	
   

  	
  13

  
	
   

  	
  2.5.

  	
   

  	
  Direct Licenses to Affiliates

  	
   

  	
  14

  
	
   

  	
  2.6.

  	
   

  	
  Restrictions

  	
   

  	
  14

  
	
   

  	
  2.7.

  	
   

  	
  Covenant Not to Sue

  	
   

  	
  15

  
	
   

  	
  2.8.

  	
   

  	
  Right of Reference

  	
   

  	
  15

  
	
   

  	
  2.9.

  	
   

  	
  365(n) of Bankruptcy Code

  	
   

  	
  15

  
	
   

  	
  2.10.

  	
   

  	
  Know-How Transfer

  	
   

  	
  16

  
	
   

  	
  2.11.

  	
   

  	
  No Implied Rights

  	
   

  	
  16

  
	
   

  	
  2.12.

  	
   

  	
  Pharmacopeia Third Party Activities

  	
   

  	
  17

  
	
   

  	
  2.13.

  	
   

  	
  No Obligation To Disclose Non-Agreement Compounds

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  RESEARCH COLLABORATION

  	
   

  	
  17

  
	
   

  	
  3.1.

  	
   

  	
  Scope

  	
   

  	
  17

  
	
   

  	
  3.2.

  	
   

  	
  Compound Selection

  	
   

  	
  17

  
	
   

  	
  3.3.

  	
   

  	
  Term of the Research Collaboration

  	
   

  	
  19

  
	
   

  	
  3.4.

  	
   

  	
  Joint Research Committee

  	
   

  	
  19

  
	
   

  	
  3.5.

  	
   

  	
  Research Plan

  	
   

  	
  22

  
	
   

  	
  3.6.

  	
   

  	
  Funding of the Research Collaboration

  	
   

  	
  22

  
	
   

  	
  3.7.

  	
   

  	
  Subcontracting

  	
   

  	
  23

  
	
   

  	
  3.8.

  	
   

  	
  Notice of Derivative Compounds

  	
   

  	
  24

  
	
   

  	
  3.9.

  	
   

  	
  License Verification

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  PRODUCT DEVELOPMENT, COMMERCIALIZATION AND
  REGULATORY MATTERS

  	
   

  	
  25

  
							

 

 iv
 

 

	
  

  	
  4.1.

  	
   

  	
  Product Development

  	
   

  	
  25

  
	
   

  	
  4.2.

  	
   

  	
  Regulatory Approvals and Communications

  	
   

  	
  25

  
	
   

  	
  4.3.

  	
   

  	
  Adverse Experiences and Product Labeling

  	
   

  	
  25

  
	
   

  	
  4.4.

  	
   

  	
  Progress Reports

  	
   

  	
  26

  
	
   

  	
  4.5.

  	
   

  	
  Supply; Scale-up; Assistance

  	
   

  	
  27

  
	
   

  	
  4.6.

  	
   

  	
  Commercialization

  	
   

  	
  28

  
	
   

  	
  4.7.

  	
   

  	
  Wyeth Diligence

  	
   

  	
  28

  
	
   

  	
  4.8.

  	
   

  	
  Wyeth **

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  CONSIDERATION

  	
   

  	
  28

  
	
   

  	
  5.1.

  	
   

  	
  Upfront Payment

  	
   

  	
  28

  
	
   

  	
  5.2.

  	
   

  	
  Designation Payments

  	
   

  	
  28

  
	
   

  	
  5.3.

  	
   

  	
  Event Payments

  	
   

  	
  28

  
	
   

  	
  5.4.

  	
   

  	
  Royalties

  	
   

  	
  30

  
	
   

  	
  5.5.

  	
   

  	
  Reports and Payments

  	
   

  	
  31

  
	
   

  	
  5.6.

  	
   

  	
  Maintenance of Records; Audits

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  INTELLECTUAL PROPERTY

  	
   

  	
  33

  
	
   

  	
  6.1.

  	
   

  	
  Ownership

  	
   

  	
  33

  
	
   

  	
  6.2.

  	
   

  	
  Patent Rights

  	
   

  	
  34

  
	
   

  	
  6.3.

  	
   

  	
  Trademarks and Copyrights

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
  CONFIDENTIALITY

  	
   

  	
  41

  
	
   

  	
  7.1.

  	
   

  	
  Confidentiality

  	
   

  	
  41

  
	
   

  	
  7.2.

  	
   

  	
  Authorized Disclosure and Use

  	
   

  	
  42

  
	
   

  	
  7.3.

  	
   

  	
  Know-How, Other Information

  	
   

  	
  43

  
	
   

  	
  7.4.

  	
   

  	
  SEC Filings

  	
   

  	
  43

  
	
   

  	
  7.5.

  	
   

  	
  Public Announcements; Publications

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  44

  
	
   

  	
  8.1.

  	
   

  	
  Representations and Warranties of Each Party

  	
   

  	
  44

  
	
   

  	
  8.2.

  	
   

  	
  Additional Representations and Warranties of
  Pharmacopeia

  	
   

  	
  45

  
	
   

  	
  8.3.

  	
   

  	
  Additional Representations and Warranties of Wyeth

  	
   

  	
  47

  
	
   

  	
  8.4.

  	
   

  	
  Disclaimer

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  GOVERNMENT APPROVALS; TERM AND TERMINATION

  	
   

  	
  48

  
												

 

 v
 

 

	
  

  	
  9.1.

  	
   

  	
  Government Approvals

  	
   

  	
  48

  
	
   

  	
  9.2.

  	
   

  	
  Term

  	
   

  	
  48

  
	
   

  	
  9.3.

  	
   

  	
  Termination for Cause

  	
   

  	
  48

  
	
   

  	
  9.4.

  	
   

  	
  Termination by Wyeth

  	
   

  	
  48

  
	
   

  	
  9.5.

  	
   

  	
  Effects of Termination

  	
   

  	
  49

  
	
   

  	
  9.6.

  	
   

  	
  Survival of Certain Obligations

  	
   

  	
  50

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  INDEMNIFICATION AND INSURANCE

  	
   

  	
  51

  
	
   

  	
  10.1.

  	
   

  	
  Indemnification by Wyeth

  	
   

  	
  51

  
	
   

  	
  10.2.

  	
   

  	
  Indemnification by Pharmacopeia

  	
   

  	
  51

  
	
   

  	
  10.3.

  	
   

  	
  Procedure

  	
   

  	
  52

  
	
   

  	
  10.4.

  	
   

  	
  Insurance

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  DISPUTE RESOLUTION

  	
   

  	
  53

  
	
   

  	
  11.1.

  	
   

  	
  General

  	
   

  	
  53

  
	
   

  	
  11.2.

  	
   

  	
  Failure of Executive Officers to Resolve Dispute

  	
   

  	
  53

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
  MISCELLANEOUS

  	
   

  	
  53

  
	
   

  	
  12.1.

  	
   

  	
  Assignment

  	
   

  	
  53

  
	
   

  	
  12.2.

  	
   

  	
  Further Actions

  	
   

  	
  53

  
	
   

  	
  12.3.

  	
   

  	
  Force Majeure

  	
   

  	
  53

  
	
   

  	
  12.4.

  	
   

  	
  Correspondence and Notices

  	
   

  	
  54

  
	
   

  	
  12.5.

  	
   

  	
  Amendment

  	
   

  	
  55

  
	
   

  	
  12.6.

  	
   

  	
  Waiver

  	
   

  	
  55

  
	
   

  	
  12.7.

  	
   

  	
  Severability

  	
   

  	
  55

  
	
   

  	
  12.8.

  	
   

  	
  Descriptive Headings

  	
   

  	
  55

  
	
   

  	
  12.9.

  	
   

  	
  Governing Law

  	
   

  	
  55

  
	
   

  	
  12.10.

  	
   

  	
  Jurisdiction;
  Venue; Service of Process

  	
   

  	
  55

  
	
   

  	
  12.11.

  	
   

  	
  Waiver of Jury
  Trial

  	
   

  	
  56

  
	
   

  	
  12.12.

  	
   

  	
  Entire Agreement
  of the Parties

  	
   

  	
  57

  
	
   

  	
  12.13.

  	
   

  	
  Independent
  Contractors

  	
   

  	
  57

  
	
   

  	
  12.14.

  	
   

  	
  Compliance with
  Laws

  	
   

  	
  57

  
	
   

  	
  12.15.

  	
   

  	
  Patent Marking

  	
   

  	
  57

  
	
   

  	
  12.16.

  	
   

  	
  Counterparts

  	
   

  	
  57

  
								

 

 vi

Schedules
and Exhibits

Schedules

Schedule 1.8          Competing
Pharmaceutical Companies

Schedule 1.10        Compound
Selection Criteria

Schedule 1.22        Discovery
Compound Criteria

Schedule 1.62        Pharmacopeia
Compounds

Schedule 1.75        Primary
Prosecution Countries

Schedule 3.7          Approved
Subcontractors

Schedule 8.2          Disclosure Schedules

Exhibits

Exhibit A                Research Plan Outline

RESEARCH AND LICENSE AGREEMENT

 

This Research and License Agreement (the “Agreement”)
is entered into as of December 22, 2006 (the “Effective
Date”), by and between Wyeth, together with its Affiliates (as
defined below), acting through its Wyeth Pharmaceuticals Division, a
corporation organized and existing under the laws of the State of Delaware and
having a place of business at 500 Arcola Road, Collegeville, Pennsylvania 19426
(collectively, “Wyeth”) and Pharmacopeia Drug
Discovery, Inc., a corporation organized and existing under the laws of the
State of Delaware and having a principal place of business at 3000 Eastpark
Blvd., Cranbury, NJ 08512 (together with its Affiliates, if any, “Pharmacopeia”). 
Wyeth and Pharmacopeia may each be referred to herein individually as a “Party” and collectively as the “Parties.”

WHEREAS, Wyeth is engaged in the research, development and
commercialization of pharmaceutical and health care products;

WHEREAS, Pharmacopeia is engaged in the research and development of
pharmaceutical and health care products, and has developed and owns proprietary
rights to certain technology for optimizing compounds for use in products
having applicability in the Fields (defined below);

WHEREAS, Pharmacopeia has identified certain JAK-3 Kinase Inhibitors
(as defined below), and Wyeth and Pharmacopeia desire to collaborate to
discover and research additional JAK-3 Kinase Inhibitors; and

WHEREAS, Wyeth desires to obtain from Pharmacopeia, and Pharmacopeia
desires to grant to Wyeth, exclusive rights to research, develop, manufacture
and commercialize certain compounds and products.

NOW THEREFORE, in consideration of the mutual promises and covenants
set forth below and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties hereby agree as
follows:

1.                                      DEFINITIONS. 

1.1.                                               “Affiliate(s)”  means, with respect
to any Person or entity, any other Person or entity which controls, is
controlled by or is under common control with such Person or entity.  A Person or entity will be regarded as in
“control” of another entity if it owns or controls at least fifty percent (50%)
of the equity securities of the subject entity entitled to vote in the election
of directors (or, in the case of an entity that is not a corporation, for the
election of the corresponding managing authority); provided, however,
that the term “Affiliate” will not include subsidiaries or other entities in
which a Party or its Affiliates owns a majority of the
ordinary voting power necessary to elect a majority of the board
of directors or other governing board, but is restricted from electing
such majority by contract or otherwise, until such time as such restrictions
are no longer in effect.

1.2.                                               “Agreement Compound”  means a Pharmacopeia Compound, a Wyeth
Compound, a Collaboration Compound, or a Derivative Compound.  Notwithstanding the preceding sentence,
Agreement Compounds shall not include any Non-Licensed Compounds.  For purpose of clarity, compounds that are
synthesized (i) as part of the Research Collaboration by either Party or its
Affiliates or (ii) by Wyeth during the Derivative Tail, but that in either case
((i) and (ii)) are not JAK-3 Kinase Inhibitors, will not be Agreement
Compounds.

1.3.                                               “Calendar Quarter”  means each respective
period of three (3) consecutive calendar months ending on March 31, June 30,
September 30 or December 31, for so long as this Agreement is in effect.

1.4.                                               “Change
of Control Transaction” means, with
respect to any Party, an event in which: (a) any person (as the term “person”
is used for purposes of Section 13(d) or 14(d) of the Exchange Act) not
then beneficially owning more than fifty percent (50%) of the voting power of
the outstanding securities of such Party or any of its controlling Affiliates
acquires or otherwise becomes the beneficial owner (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of securities of such Party or
any of its controlling Affiliates representing more than fifty percent (50%) of
the voting power of the then outstanding securities of such Party with respect
to the election of directors of such Party; (b) such Party (i) consummates a
merger, consolidation or similar transaction with another Person where the
voting securities of such Party or any of its controlling Affiliates
outstanding immediately preceding such transaction (or the voting securities
issued with respect to the voting securities of such Party or any of its
controlling Affiliates outstanding immediately preceding such transaction)
represent less than fifty percent (50%) of the voting power of such Party or
any of its controlling Affiliates or surviving entity, as the case may be,
following such transaction, (ii) sells or otherwise transfers to any Person(s)
in one or more related transactions more than fifty percent (50%) of its
consolidated total assets, or assets from which more than fifty percent (50%)
of its consolidated operating income for its most recent financial year was
derived, (iii) disposes by sale, assignment, exclusive license or otherwise of
all or substantially all of its intellectual property rights, except for
licenses under such intellectual property rights in the ordinary course of
business and any isolated sale or assignment of specific items of intellectual
property, or (iv) liquidates, dissolves or winds-up; or (c) with respect
to any Party having equity securities registered under the Exchange Act, any
“person” (as the term “person” is used for the purposes of Sections 13(d) or
14(d) of the Exchange Act) other than the other Party acquires forty percent
(40%) or more of the voting power of the then-outstanding voting securities of
such Party or any of its controlling Affiliates.  For the purposes of this definition, a
“Controlling Affiliate” is an Affiliate that “controls”: a Party, as such term
is used in the definition of “Affiliate” in Section 1.1 (Affiliate).

 2
 

1.5.                                               “Collaboration Compound” means any JAK-3 Kinase Inhibitor, other than a
Pharmacopeia Compound or a Wyeth Compound, that is (a) conceived or synthesized
by either Party alone or jointly with the other Party in the course of the
Research Collaboration during the Research Term; or (b) within the scope of
(i.e., is covered by) a composition of matter claim of a Patent Right that has
a priority date after the Effective Date and is Controlled solely by
Pharmacopeia or Wyeth (or any of their Affiliates) or jointly by Pharmacopeia
and Wyeth, which Patent Right also claims any compound in category (a) as a
composition of matter.  In the event that the Research
Collaboration is terminated by Wyeth pursuant to Section 9.4.1
(Termination Without Cause) prior to the **, Collaboration Compounds will
include any JAK-3 Kinase Inhibitor (other than a Pharmacopeia Compound or a
Wyeth Compound) that is derived from a Pharmacopeia Compound, a Wyeth Compound
or another Collaboration Compound by Wyeth during the period from the **.  For purposes of this definition, a compound
will be deemed to have been “derived” from a compound if it: (i) is **, (ii) is
otherwise **, (iii) is based **, or (iv) is within the scope of ** category
(i), (ii) or (iii) above as a composition of matter.

1.6.                                               “Commercialization”
or “Commercialize” means activities
directed to obtaining pricing and reimbursement approvals, marketing,
promoting, Manufacturing for commercial purposes, distributing, importing or
selling a Product.  Commercialization
will not include any activities related to Development.

1.7.                                               “Commercially
Reasonable Efforts”  means (i) with respect to the efforts to be
expended by any Party other than as provided in subsection (ii) or (iii) below,
those **; (ii) with respect to the **, and (iii)
with respect to the **.

1.8.                                               “Competing
Pharmaceutical Company” means **.

1.9.                                               “Compound
Classification Disputes” has the
meaning set forth in Section 3.4.6(a) (Compound Classification Disputes).

1.10.                                        “Compound Selection Criteria” means those procedures and criteria not materially inconsistent
with the criteria that a Party uses to make decisions regarding whether to
advance compounds for further studies in its **.  Wyeth’s initial Compound Selection Criteria
for advancing a compound from a **, and from a ** are set forth on
Schedule 1.10 (Compound Selection Criteria).  Pharmacopeia’s initial Compound Selection
Criteria for selection of ** and for advancing a ** will be provided by
Pharmacopeia to the JRC **.  Each Party’s
Compound Selection Criteria may, upon written notice to the JRC, be amended by
such Party in the course of conducting its overall business from time to time.

1.11.                                        “Confidential
Information”
of a Party
means all Know-How or other information regarding such Party’s technology,
products, business information

 3
 

or
objectives, whether or not designated as confidential by the disclosing Party
at the time any such Know-How or other information is disclosed by the
disclosing Party to the other Party.

1.12.                                        “Control”
or “Controlled”  means with respect to any Know-How,
information, compound, product or intellectual property right, the possession
(whether by ownership or license, other than pursuant to this Agreement) by a
Party of the ability to grant to the other Party access or a license as
provided herein under such item or right without violating the terms of any
agreement or other arrangements with any Third Party.

1.13.                                        “Copyright”
means the copyright in any work of
authorship used in connection with the Commercialization of a Product.

1.14.                                        “Core
Structure” means a **.  

1.15.                                        “Derivative Compound”  means any JAK-3 Kinase Inhibitor, other than a
Pharmacopeia Compound, a Wyeth Compound, a Collaboration Compound, that is
derived from a Pharmacopeia Compound, a Wyeth Compound or a Collaboration
Compound by Wyeth during the Derivative Tail. 
For purposes of this Section, a compound will be deemed to have been
“derived” from a compound if it: (i) is **, (ii) is otherwise **, (iii) is **,
or (iv) is within the scope of ** category (i), (ii) or (iii) above; in each
case wherein ** JAK-3 Kinase Inhibitor.

1.16.                                        “Derivative
Tail” means the ** period beginning
at the later of (a) the end of the Research Collaboration or (b) the ** of the
start of the Research Term.

1.17.                                        “Development”
or “Develop”  means (i) Research
and (ii) clinical research and drug development activities, including without
limitation clinical toxicology, Manufacturing process development, quality
assurance and quality control development, statistical analysis, clinical
studies (including pre- and post-approval studies), Manufacturing for clinical
studies, regulatory affairs, pharmacovigilance and Regulatory Approval, and
clinical study regulatory activities (including regulatory activities other
than those directed to obtaining pricing and reimbursement approvals).

1.18.                                        “Development Compound”  means a Pre-Development Compound designated by a Party, at its sole
discretion in accordance with its Compound Selection Criteria, for inclusion **
(e.g., **).

1.19.                                        “Diligence
Failure” has the meaning set forth in
Section 9.3 (Termination for Cause).

1.20.                                        “Disclosing
Party”  has the meaning set forth in Section 7.1
(Confidentiality) hereof.

 4
 

1.21.                                        “Discovery Compounds”  means Pharmacopeia Compounds, Wyeth Compounds
or Collaboration Compounds that meet the **, as determined by the JRC during
the Research Term.

1.22.                                        “Discovery Compound Criteria”  means the criteria attached as Schedule 1.22 to
the Agreement, as may be amended from time to time by the JRC during the
Research Term.

1.23.                                        “Effective
Date” has the meaning set
forth in the Preamble.

1.24.                                        “Exchange
Act”  means the Securities Exchange
Act of 1934, as amended.

1.25.                                        “Executive
Officers”  means the President of Wyeth Pharmaceuticals (or an executive
officer of Wyeth designated by such President of Wyeth Pharmaceuticals) and the
Chief Executive Officer of Pharmacopeia (or an executive officer of
Pharmacopeia designated by such Chief Executive Officer).

1.26.                                        “FDA”  means the United States Food and Drug
Administration or any successor agency thereto.

1.27.                                        “FD&C
Act”  means the United States Federal Food, Drug, and
Cosmetic Act (21 U.S.C. § 301 et seq.), as amended, and the rules and
regulations promulgated thereunder.

1.28.                                        “Fields”
means the Wyeth Field and the
Pharmacopeia Field.

1.29.                                        “First Commercial Sale”  means, in any particular country in the
Territory, the first sale in that country for use by the general public of a
Product after Regulatory Approval of such Product has been granted by the
Regulatory Authority of that country.

1.30.                                        “FTE”  means the full time equivalent effort of one
scientist with either a **  or equivalent
degree consisting of ** done by such an employee of Pharmacopeia or of a
subcontractor approved in advance by the JRC in accordance with Section 3.7
(Subcontracting) on or directly related to and in support of the Research Plan.

1.31.                                        “IND”  means an Investigational New Drug Application,
as defined in the FD&C Act, that is required to be filed with the FDA
before beginning clinical testing of a Product in human subjects, or an
equivalent foreign filing.

1.32.                                        “Indemnified
Party”  has the meaning set forth in Section 10.3 (Procedure) hereof.

1.33.                                        “Indemnifying
Party”  will have the meaning set
forth in Section 10.3 (Procedure) hereof.

 5
 

1.34.                                        “Initial
Term”  has the meaning set forth in
Section 3.3.1 (Research Term).

1.35.                                        “JAK-3
Exclusivity Period”  means **.

1.36.                                        “JAK-3
Joint Patent Right” means **.

1.37.                                        “JAK-3
Kinase Inhibitor”  means a molecule
that has JAK-3 Kinase Inhibitory Activity at an **.

1.38.                                        “JAK-3
Kinase Inhibitory Activity” means,
when used to describe a compound, that the compound binds to the protein
tyrosine kinase enzyme known as Janus Activating Kinase 3 (JAK-3).  

1.39.                                        “Joint IP”  means Joint Patent Rights
and Joint Know-How.

1.40.                                        “Joint
Know-How” means any
Know-How that is jointly owned by the Parties in accordance with
Section 6.1 (Ownership).

1.41.                                        “Joint
Patent Right(s)”  means those Patent
Right(s) that claim Joint Know-How.

1.42.                                        “Joint
Research Committee”  has the meaning
set forth in Section 3.4 (Joint Research Committee)
hereof.

1.43.                                        “JRC”
means the Joint Research Committee.

1.44.                                        “Know-How”  means proprietary information or other
know-how, whether or not patentable, and whether stored or transmitted in oral,
documentary, electronic, or other form, including without limitation, ideas,
concepts, formulas, methods, procedures, designs, compositions, plans,
documents, data, inventions, discoveries, developments, works of authorship,
biological and chemical materials, and any information relating to research and
development plans, experiments, results, compounds, therapeutic leads,
candidates, products, preclinical and clinical data, trade secrets, chemical
synthesis, scale-up and manufacturing, toxicology, regulatory, stability, and
any other information relevant to the **.  

1.45.                                        “Lead Developer”  means (i) Wyeth for all Wyeth Available
Compounds that Wyeth has designated as ** pursuant to ** or selected for
Development from among the Passed Compounds pursuant to Section 3.2.4
(Compound Selection) and (ii) Pharmacopeia for all Pharmacopeia Available
Compounds, on an Agreement Compound-by-Agreement Compound basis, upon selection
by Pharmacopeia of such Agreement Compound pursuant to Section 3.2.4
(Compound Selection).

1.46.                                        “Liability”
has the meaning set forth in Section 10.1 (Indemnification by Wyeth)
hereof.

 6
 

1.47.                                        “License
Verification Notice” has the meaning
set forth in Section 3.8 (Notice of Compounds).

1.48.                                        “Major Market Countries” means the United States, France, Germany, United Kingdom, Italy,
Spain, and Japan.  

1.49.                                        “Manufacturing”
or “Manufacture” means activities directed to producing, manufacturing, processing,
filling, finishing, packaging, labeling, quality assurance testing and release,
shipping and storage of a Product.

1.50.                                        “Material
Structural Feature”  means a **.

1.51.                                        “NDA”
means a “New Drug Application” filed
with the FDA as described in 21 CFR §314, or any corresponding application for
Regulatory Approval in any country other than the U.S.

1.52.                                        “Net Sales” means, **.

It is
understood that ** is made.

Notwithstanding
the foregoing, Net Sales will not include **. 
Additionally, for the sake of clarity, sales of a **.

Notwithstanding
the foregoing, if a **.

In the event
that Wyeth or its sublicensees **.

In the event
that Wyeth or its sublicensees**.

1.53.                                        “Non-Assert
IP”  means any Patent Rights
Controlled by a Party or its Affiliates that claim (a) the **, or (b) a
**.  For clarity, the foregoing does not
include any **.

1.54.                                        “Non-Licensed
Compounds” has the meaning set
forth in Section 3.9 (License Verification).

1.55.                                        “Non-Licensed Compound Notice” has the meaning set forth in Section 3.9
(License Verification).

1.56.                                        “Passed Compounds” means any Pharmacopeia Compound or
Collaboration Compound that has become a “Passed Compound” pursuant to
Section 3.2 (Compound Selection and Reversion) and is available for
selection by the Parties for Development pursuant to Section 3.2 (Compound
Selection and Reversion).  Passed
Compounds do not include **.

1.57.                                        “Patent
Rights”  means any and all
(a) patents, (b) pending patent applications, including, without limitation,
all provisional applications, substitutions, continuations,
continuations-in-part, divisions, renewals, and all

 7
 

patents granted thereon, (c) all patents-of-addition,
reissues, reexaminations and extensions or restorations by existing or future
extension or restoration mechanisms, including, without limitation,
supplementary protection certificates or the equivalent thereof (d) inventor’s
certificates, and (e) all United States and foreign counterparts of any of the
foregoing.

1.58.                                        “PCT”
means the Patent Cooperation Treaty.

1.59.                                        “Person”  means an individual,
sole proprietorship, partnership, limited partnership, limited liability
partnership, corporation, limited liability company, business trust, joint
stock company, trust, incorporated association, joint venture or similar entity
or organization, including a government or political subdivision, department or
agency of a government.

1.60.                                        “Pharmacopeia
Available Compound”  means:  

(a)  any Pharmacopeia Compound or Collaboration
Compound selected by Pharmacopeia for Development in accordance with
Section 3.2.4 (Compound Selection) and for which Pharmacopeia is
fulfilling the diligence obligations required under Section 3.2.4
(Compound Selection); and

(b)  any Pharmacopeia Compound or Collaboration
Compound with respect to which Pharmacopeia has undertaken Development in the
Wyeth Field if permitted under Section 4.1 and for which Pharmacopeia is
fulfilling the diligence obligations required under Section 3.2.4
(Compound Selection).

1.61.                                        “Pharmacopeia Change of Control Transaction” means a Change of Control Transaction where
Pharmacopeia is the Party undergoing change of control.

1.62.                                        “Pharmacopeia Compounds” means all JAK-3 Kinase Inhibitors that:

(a)                             are
identified on Schedule 1.62, or 

(b)                            are
synthesized by Pharmacopeia or Wyeth in the course of the Research
Collaboration from compounds in category ** and (i) are **; (ii) are otherwise
** (iii) are based on ** (a) above; provided, however, **; or 

(c)                             are
synthesized by Pharmacopeia during the Research Term (but excluding any JAK-3
Kinase Inhibitor identified by Pharmacopeia utilizing information obtained in
the Research Collaboration); or 

(d)                            come
into Control of Pharmacopeia ** 

 8
 

(e)                             were
Controlled by Pharmacopeia **, as substantiated by reasonable documentation,
but were not listed on Schedule 1.62. 

Pharmacopeia
Compounds further will include isomers, enantiomers, prodrugs, hydrates,
solvates, metabolites and all pharmaceutically acceptable salts of the
foregoing.

1.63.                                        “Pharmacopeia
Field”  means all uses of a Product in
non-human animals, and all topical uses of a Product for the treatment or prevention
of skin and eye diseases in humans where such Product would be applied directly
to the skin or eye and would have its therapeutic effect at or near a target
site on the skin or eye.

1.64.                                        “Pharmacopeia
Indemnified Party”  has the meaning
set forth in Section 10.1 (Indemnification by Wyeth).

1.65.                                        “Pharmacopeia IP”  means Pharmacopeia Patent Rights and
Pharmacopeia Know-How.

1.66.                                        “Pharmacopeia Know-How” means all Know-How Controlled by Pharmacopeia
**.  It is
understood that Pharmacopeia Know-How shall not include any **.

1.67.                                        “Pharmacopeia
Patent Right” means all
Patent Rights Controlled by Pharmacopeia **.  It is
understood that Pharmacopeia Patent Rights shall not include any **.

1.68.                                        “Pharmacopeia Product” means a pharmaceutical preparation containing a
Pharmacopeia Available Compound.  For
purposes of clarity, any pharmaceutical preparations containing the same
Pharmacopeia Available Compound will be deemed to be the same Pharmacopeia
Product.

1.69.                                        “Pharmacopeia
Third Party Agreement(s)”  means any
(i) **, and (ii) any other ** by Pharmacopeia.

1.70.                                        “Phase
I Clinical Study”  means a study of an Agreement Compound or
Product in human patients with the endpoint of determining initial tolerance,
safety and/or pharmacokinetic information in single dose, single ascending
dose, multiple dose and/or multiple ascending dose regimens.

1.71.                                        “Phase
II Clinical Study”  means a study of an Agreement Compound or
Product in human patients to determine initial efficacy and dose range finding
before embarking on Phase III Clinical Studies.

1.72.                                        “Phase
III Clinical Study”  means a pivotal study in human patients with a
defined dose or a set of defined doses of an Agreement Compound or Product
designed to ascertain efficacy and safety of such Agreement Compound for the

 9
 

purpose of
preparing and submitting applications for Regulatory Approval to the competent
Regulatory Authorities in a country of the world.

1.73.                                        “Pre-Development Compound”  means an Agreement Compound selected by a Party, at its sole
discretion in accordance with its Compound Selection Criteria, for further
Development studies prior to being considered for advancement as a Development
Compound.

1.74.                                        “Pre-IND”
means any Development studies conducted
after compound discovery that are intended to obtain information needed to
assess, according to a Party’s applicable Compound Selection Criteria, whether
to file an IND for a particular compound.

1.75.                                        “Primary
Prosecution Countries”  means the
countries set forth on Schedule 1.75.

1.76.                                        “Product(s)”  means Pharmacopeia Product(s) or Wyeth Product(s), as the case may
be.

1.77.                                        “Project Team” has the meaning set forth in Section 3.4.1
(Composition)

1.78.                                        “Regulatory
Approval”  means the technical,
medical and scientific licenses, registrations, authorizations and approvals
(including, without limitation, approvals of NDAs, supplements and amendments,
pre- and post- approvals, pricing approvals, and labeling approvals) of any
national, supra-national, regional, state or local regulatory agency,
department, bureau, commission, council or other governmental entity, necessary
for the commercial Manufacture, distribution, marketing, promotion, offer for
sale, use, import, export and sale of Product(s) in a regulatory
jurisdiction.  For the sake of clarity,
Regulatory Approval will not be deemed to have been obtained in a country until
any applicable governmental pricing and governmental reimbursement approvals
(other than those required by Medicaid or Medicare) have also been obtained in
such country.

1.79.                                        “Regulatory
Authorit(y/ies)”  means any national (e.g., the FDA),
supra-national (e.g., the European Commission, the Council of the European
Union, or the European Agency for the Evaluation of Medicinal Products),
regional, state or local regulatory agency, department, bureau, commission,
council or other governmental entity in each country of the world involved in
the granting of Regulatory Approval for the Product.

1.80.                                        “Research”
means those discovery and preclinical
activities undertaken by or on behalf of a Party or its Affiliates with respect
to an Agreement Compound, or Product incorporating such Agreement Compound,
prior to conducting clinical studies using such Agreement Compound or Product,
including, without limitation, medicinal chemistry and synthesis, purification
and other discovery efforts, test method development and stability testing,
delivery

 10
 

system
development, pharmacology, preclinical toxicology, and formulation of such
Agreement Compound or Product.

1.81.                                        “Research
Plan” means the written
plan for the conduct of the Research Collaboration described in
Section 3.5 (Research Plan).

1.82.                                        “Research
Collaboration”  has the meaning set forth in Section 3.1
(Scope).

1.83.                                        “Research
Term”  has the meaning set forth in Section 3.3.1 (Research Term).

1.84.                                        “Royalty
Term”  means, **, the period **.

1.85.                                        “SEC”
means the United States Securities and
Exchange Commission.

1.86.                                        “Selection
Conditions” means the occurrence of
both of the following events (a) ** and (b) **.

1.87.                                        “Selection
Notice”  means written notice to the
JRC or the other Party, as applicable, nominating a **, as applicable.

1.88.                                        “Term”
has the meaning set forth in
Section 9.2 (Term).

1.89.                                        “Territory”  means the entire world.

1.90.                                        “Third
Part(y/ies)”  means any Person(s) other than Wyeth,
Pharmacopeia or their respective Affiliates.

1.91.                                        “Third
Party IP Rights”  will have the
meaning set forth in Section 6.2.3(b) (Option to Negotiate) hereof.

1.92.                                        “Third
Party Suit” has the meaning set forth
in Section 6.2.3(c) (Third Party Infringement Suit).

1.93.                                        “Top
10 Pharmaceutical Company” means, **.

1.94.                                        “Trademarks”  means those registered and unregistered
trademarks used in connection with the Commercialization of any Product by a
Party or its Affiliates or sublicensees hereunder.

1.95.                                        “Unpatented
Product”  means a Wyeth Product, the
making, use, sale, offering for sale, or importation of which does not infringe
at least one Valid Claim of a Pharmacopeia Patent Right or Joint Patent Right
in the particular country where the sale of such Wyeth Product has occurred.

1.96.                                        “Valid Claim”  means a claim of any issued, unexpired U.S. or foreign patent that
has not been revoked or held unenforceable or invalid by a decision of a court
or governmental agency of competent jurisdiction from which no appeal can be
taken, or with respect to which an appeal is not taken within the time

 11
 

allowed for appeal, and that has not been disclaimed
or admitted to be invalid or unenforceable through reissue, disclaimer, or
otherwise.

1.97.                                        “Wyeth
Available Compound”  means:

(a)                             during
the Research Term, all Agreement Compounds other than Pharmacopeia Available
Compounds and Non-Licensed Compounds; and

(b)                            after
the Research Term, (i) **, and (ii) **, in each case ((i) and (ii)) other than **.

1.98.                                        “Wyeth Compounds” means JAK-3 Kinase Inhibitors that (a) Wyeth,
in its sole discretion, contributes to the Research Collaboration for
evaluation by the JRC pursuant to Section 3.2.1 (Discovery Compounds) and
which are Controlled by Wyeth as of the Effective Date of the Agreement or come
into Control of, or are synthesized by, Wyeth during the Research Term (but
excluding any JAK-3 Kinase Inhibitor identified by Wyeth utilizing information
obtained in the Research Collaboration), or (b) are synthesized by Wyeth or
Pharmacopeia in the course of the Research Collaboration from compounds in
category (a) above and are (i) **; (ii) otherwise obtained ** (iii) based on **
(a) above; provided, however, **. 
Wyeth Compounds further will include isomers, enantiomers, prodrugs,
hydrates, solvates, metabolites and all pharmaceutically acceptable salts of
the foregoing.  Notwithstanding the foregoing, **.  Furthermore, **.  

1.99.                                        “Wyeth
Development Track” means **.

1.100.                                 “Wyeth
Field”  means all human therapeutic
and prophylactic uses of a Product other than uses included within the
Pharmacopeia Field.

1.101.                                 “Wyeth
Indemnified Party”  has the meaning
set forth in Section 10.2 (Indemnification by Pharmacopeia) hereof.

1.102.                                 “Wyeth IP” means Wyeth Patent Rights and Wyeth Know-How.

1.103.                                 “Wyeth
Know-How” means any Know-How
Controlled by Wyeth **.

1.104.                                 “Wyeth Patent Right”  means all Patent Rights Controlled by Wyeth **.

1.105.                                 “Wyeth Product”  means a pharmaceutical preparation containing a
Wyeth Available Compound.  For purposes
of clarity, any pharmaceutical preparations containing the same Wyeth Available
Compound will be deemed to be the same Wyeth Product.  For the
avoidance of doubt, a Wyeth Product will not be considered to be separate,
distinct and different from another Wyeth Product solely on the basis of its
use for a different indication, method of production or manufacture, method of
delivery or dosage level.

 12
 

2.                                      LICENSES.

2.1.                                               Licenses
to Wyeth.

2.1.1.                            **
License.  Subject to the terms and
conditions of this Agreement, Pharmacopeia hereby grants Wyeth a **, as
determined by the JRC.

2.1.2.                            **
Licenses.  Subject to the terms and
conditions of the Agreement, including the rights reserved by Pharmacopeia
under Section 2.3 (Retained Rights) and Section 2.12 (Pharmacopeia Third Party
Activities): 

(a)                             ** Period. Pharmacopeia hereby grants Wyeth **; 

(b)                            ** Rights. Subject to Section 4.1 (Product Development), Pharmacopeia
hereby grants Wyeth **; and  

(c)                             ** Compounds. Pharmacopeia hereby grants Wyeth **.

2.2.                                               Licenses
to Pharmacopeia.

2.2.1.                            **
License.  Subject to the terms and
conditions of this Agreement, Wyeth hereby grants Pharmacopeia **, as
determined by the JRC.

2.2.2.                            **
License.  Subject to the terms and
conditions of this Agreement, with respect to **, Wyeth hereby grants
Pharmacopeia **.

2.3.                                               Retained
Rights.

2.3.1.                            **
Period.  After the **.

2.3.2.                            **
Retained Rights.  **.

2.4.                                               Sublicensing.  Wyeth may grant to its Affiliates and to
Third Parties sublicenses of the rights granted to it under
Section 2.1.2(c) (Development and Commercialization License) at any time
at its sole discretion; provided that, within thirty (30) days following the
execution of any such sublicense, Wyeth shall provide Pharmacopeia with at
least the following information with respect to each sublicensee: (i) the
identity of the sublicensee; (ii) a description of the Product, and the
rights granted to the sublicensee; and (iii) the territory in which the
Product will be sold. Each such sublicense will be subject to the requirements
of 35 U.S.C. § 200 et seq. and implementing regulations, and shall be subject
and subordinate to, and consistent with, the terms and conditions of this
Agreement, and Wyeth shall remain responsible to Pharmacopeia for the
compliance of each such sublicensee with the financial and other obligations due
under this Agreement.  No sublicense granted by Wyeth may be
assigned, transferred or further sublicensed to any Third Party without the
prior written consent of Pharmacopeia.

 13
 

2.5.                                               Direct
Licenses to Affiliates. 
Wyeth may at any time request and authorize Pharmacopeia to grant
licenses directly to Affiliates of Wyeth by giving written notice designating
to whom a direct license is to be granted. 
Upon receipt of any such notice, Pharmacopeia will enter into and sign a
separate direct license agreement with such designated Affiliate of Wyeth and
will enter into and sign an amendment to this Agreement as may be necessary to
reflect entry into such direct license. 
All such direct license agreements will be consistent with the terms and
conditions of this Agreement, except for such modifications as may be required
by the laws and regulations in the country in which the direct license will be
exercised; provided, however, that Pharmacopeia will have no obligation to enter into
any such direct license agreement if the effect of entering into such agreement
(and continuing as a party to this Agreement) would be to increase the level of
obligations owed by Pharmacopeia, or decrease the consideration owed to
Pharmacopeia, relative to the obligations owed by or consideration owed to
Pharmacopeia under this Agreement.  In
countries where validity of the direct license agreement requires prior
government approval or registration, such direct license agreement will not
become binding between the parties thereto until such approval or registration
is granted, which approval or registration will be obtained by Wyeth.  All costs of making a direct license,
including Pharmacopeia’s reasonable attorneys fees, under this Section 2.5
will be borne by Wyeth.

2.6.                                               Restrictions.

2.6.1.                            **
Restrictions.  Subject to Section
2.1.2 (Wyeth's ** License) and Section 2.2.2 (Pharmacopeia's ** License),
**.  During the **.  

2.6.2.                            Pharmacopeia
Restrictions.  

(a)                             ** JAK-3 Compounds. 
Subject to Section 2.2.2 (** License), 
during the **.

(b)                            ** Licenses.  Subject
to Section 2.2.2 (** License), during the **.

(c)                             Joint Patent Rights. 
Subject to the rights retained by Pharmacopeia under clauses (i), (iii),
and (iv) of Section 2.3.2 (** Retained Rights) and Section 4.1 (Product
Development), Pharmacopeia will not **.

(d)                            ** Compounds.  Subject
to the rights retained by Pharmacopeia under clauses (i) and (iii) of Section
2.3.2 (** Retained Rights), **.

(e)                             ** Compounds. Except in the exercise of Pharmacopeia’s right
under Section 4.1 (Product Development) to **, 
Pharmacopeia will not **.  

 14

2.6.3.                            Wyeth
Restrictions.  During the **.

2.6.4.                            Termination
of Restrictions.  Without limiting
any remedy that a Party may have under this Agreement, in equity or at law, in
the event that either Party rejects this Agreement under Section 365 of the
Bankruptcy Code, the covenants set forth in this Section 2.6 (Restrictions)
shall terminate and cease to restrict the non-bankrupt Party.

2.7.                                               Covenant
Not to Sue.  Subject to any **
granted by either Party under any agreement with a Third Party  entered into in compliance with the terms of
this Agreement:

(a)                             Covenant
by each Party.  Each Party
hereby ** covenants and warrants that it will not (and will cause its
Affiliates, successors, and assigns not to) **; and

(b)                            Covenant
by Pharmacopeia. Pharmacopeia **.

(c)                             
Limitation on Covenant.  Nothing in
Section 2.7(a) (Covenant by Each Party) or 2.7(b) (Covenant by
Pharmacopeia) shall be construed to **.

(d)                            Successors and Assigns. The covenants in Section 2.7(a)
(Covenant by Each Party) will inure to the benefit of and will bind the
respective successors and permitted assigns of the Parties and their
Affiliates.

2.8.                                               Right
of Reference.  Each Party hereby
grants to the other Party a “Right of Reference,” as that term is defined in 21
C.F.R. § 314.3(b), to any data Controlled by such Party or its Affiliates that
relates to any Agreement Compound or Product for which the other Party is the
Lead Developer, and such Party will provide a signed statement to this effect,
if requested by the other Party, in accordance with 21 C.F.R. § 314.50(g)(3).

2.9.                                               365(n)
of Bankruptcy Code.  All rights and
licenses now or hereafter granted under or pursuant to any Section of this
Agreement, are rights to “intellectual property” (as defined in
Section 101(35A) of Title 11 of the United States Code, as amended (such
Title 11, the “Bankruptcy Code”)).  Each
Party hereby grants to other Party and all Affiliates of such other Party a
right of access and to obtain possession of, and to benefit from copies of, (i)
pre-clinical and clinical research data and results, (ii) laboratory and compound
samples required by the JRC to be delivered to Wyeth to the extent not
previously delivered and to the extent still available to Pharmacopeia, all of
which ((i) and (ii)) constitute “embodiments” of intellectual property pursuant
to Section 365(n) of the Bankruptcy Code), and (iii) all other embodiments
of such intellectual property, whether any of the foregoing are in the granting
Party’s possession or control or in the possession and control of Third Parties.

 15
 

Each Party agrees not to
interfere with the other Party’s and other Party’s Affiliates exercise of
rights and licenses to intellectual property licensed hereunder and embodiments
thereof in accordance with this Agreement and agrees to use reasonable efforts
to assist such other Party and Affiliates to obtain such intellectual property
and embodiments thereof in the possession or control of Third Parties as
reasonably necessary or desirable for such other Party and Affiliates to
exercise such rights and licenses in accordance with this Agreement.  The Parties acknowledge and agree that all
payments payable under this Agreement will constitute “royalties” within the
meaning of Bankruptcy Code Section 365(n) other than
FTE payments payable to Pharmacopeia under Section 3.6 (Funding of the Research
Collaboration) and Designation Payments payable to Pharmacopeia under Section 5.2
(Designation Payments).  Furthermore, the
Parties agree that **, Designation Payments payable to Pharmacopeia under
Section 5.2 (Designation Payments) will also constitute
“royalties” within the meaning of Bankruptcy Code Section 365(n).

2.10.                                        Know-How
Transfer.

2.10.1.                     Disclosure of
Pharmacopeia Know-How.   Pharmacopeia will disclose the
Pharmacopeia Know-How to Wyeth during the Research Term.  Without limiting the generality of the
foregoing, at Wyeth’s request within a reasonable time not to exceed ** days
from the date of Wyeth’s request, Pharmacopeia will deliver to Wyeth, as ** or
as otherwise contemplated under a Research Plan, copies (for documentation and
information) or samples (for tangible materials) of any documents, files,
diagrams, plans, specifications, designs, recipes, schematics, reports, notes,
data, models, prototypes, chemical or biological materials, or other documentation
or tangible materials recording or embodying the Pharmacopeia Know-How in
Pharmacopeia’ possession.  In addition,
at Wyeth’s request, and on a commercially reasonable schedule and at a
commercially reasonable venue **, technically qualified scientists and
engineers from each Party will meet and/or participate in telephone conference
calls as reasonably necessary to exchange knowledge necessary to fully transfer
all such Pharmacopeia Know-How.

2.10.2.                     Disclosure
and Transfer of Joint Know-How.  Each
Party will promptly disclose any Joint Know-How to the other Party.  Any such Joint Know-How transfer will be
accomplished through reciprocal delivery of documentation and
meetings/telephone calls in like manner as provided in Section 2.10.1
(Disclosure of Pharmacopeia Know-How).

2.11.                                        No
Implied Rights.  Except as expressly
provided in this Agreement, neither Party will be deemed by estoppel or
implication to have granted the other Party

 16
 

any license or
other right with respect to any intellectual property of such Party.

2.12.                                        Pharmacopeia Third Party Activities.  It is understood that **.  Accordingly, so long as **.

2.13.                                        No
Obligation To Disclose Non-Agreement Compounds. For
the avoidance of doubt, nothing in this Agreement will require Pharmacopeia to
disclose to Wyeth any compound other than Agreement Compounds.

3.                                      RESEARCH COLLABORATION.

3.1.                                               Scope.  During the Research Term, Wyeth and
Pharmacopeia will engage in a research collaboration to Research and evaluate
JAK-3 Kinase Inhibitors in the appropriate assays and pre-clinical models of **,
and to select ** through the selection procedures set forth in this Article 3
and pursuant to the other terms and conditions of this Agreement (the “Research Collaboration”). 
The Research Collaboration will be conducted in accordance with the
Research Plan. The JRC will have the sole authority to determine the activities
to be undertaken by Pharmacopeia FTEs and Wyeth personnel working in the
Research Collaboration during the Research Term.  In general, the Parties agree that medicinal
chemistry and primary, in vitro
biology will be undertaken by Pharmacopeia, and that in vivo biology and animal pharmacology will be undertaken
by Wyeth.  **.

3.2.                                               Compound
Selection.

3.2.1.                            Discovery Compounds.  The JRC will establish a procedure under
which ** will be evaluated to determine whether such compounds meet the
Compound Selection Criteria for **.  The
JRC will follow such procedures in making determinations regarding whether a
compound meets such Compound Selection Criteria.  If the JRC reasonably believes that it does
not have sufficient data to determine whether a compound meets such Compound
Selection Criteria, it may request that reasonable further data for such
compound be generated pursuant to a Research Plan, in order to make such
determination.  At the ** the JRC
following the provision of such reasonable further data to the JRC, the JRC
will make a final determination as to the status of the compound in
question.  Subject to Section 3.4.6
(Dispute Resolution), if the JRC does not determine ** at that time, **.  Any such Wyeth Compound will remain **.

3.2.2.                            Pre-Development Compounds.  Within ** of an Agreement Compound being
designated as a ** pursuant to Section 3.2.1 (Discovery Compounds), Wyeth
will have the ** by providing written notice of such designation to the JRC.
Any ** that is not **.  Wyeth may also
designate a ** as a ** prior to the expiration of such **

 17
 

period by providing written notice to Pharmacopeia of
such designation.  At the end of the Research
Term, any **.

3.2.3.                            Development Compounds.  Wyeth may, at any time and at its sole
discretion, designate as ** any ** that meet the applicable Compound Selection
Criteria.

3.2.4.                            Compound Selection.

(a)                             General
Selection Procedures During the Research Term.

(i)                                     Selection
by Pharmacopeia.  During the Research
Term, for any **.

(ii)                                  Selection
by Either Party.  Any ** for purposes
of this Agreement.

(iii)                               **
Pre-Development Compounds. 
Notwithstanding the other provisions of this Section 3.2.4 (Compound Selection),
**.

(b)                            Passed
Compounds at End of Research Term. At the end of the Research Term, all **.  Notwithstanding the foregoing, if at the end
of the Research Term any **.

(c)                             Selection
of Agreement Compounds After Research Term.

(i)                                     Selection
by Pharmacopeia. After the Research Term, all **.

(ii)                                  Wyeth
Compounds. After the Research Term, all **.

(iii)                               Collaboration
Compounds Invented Solely by Wyeth. After the Research Term, all **.

(iv)                              Collaboration
Compounds Invented Jointly.  If the **.

(v)                                 Pharmacopeia
Compounds and Collaboration Compounds Invented by Pharmacopeia.  If the **.

(d)                            Effect
of Selection.  If a ** with respect
to such compound.  If a ** by either
Party.

(e)                             Diligence.
Pharmacopeia will use **.  If Pharmacopeia
fails to do so for any **.  Such compound’s
becoming ** for a breach by Pharmacopeia of this Section 3.2.4(e)
(Diligence).

 18
 

3.2.5.                            Notice
of Designation.  Both during and after the **, each
Party will promptly notify the other in writing upon designating ** pursuant to
this Agreement.  Such notice shall
include a **.

3.2.6.                            No
Simultaneous Development of the Same Agreement Compound.  For clarity,  in no event may **, at the same time, under any
circumstances. For example, ** of a topical ** treatment must be undertaken
with a ** of an oral or injectable **.

3.2.7.                            **
After Research Term.  Each Party may **.  For example, such **.  Notwithstanding the foregoing, neither Party
shall be obligated to ** contemplated by this Section.

3.2.8.                            Pharmacopeia
Compound Selection Criteria.  Prior to
selecting a Passed Compound pursuant to Section 3.2.4 (Compound Selection),
Pharmacopeia will submit to the JRC reasonable Compound Selection Criteria that
will be used by Pharmacopeia for selecting a compound as a Pre-Development
Compound and for advancing a Pre-Development Compound to a Development Compound,
which Compound Selection Criteria will be consistent with industry standards
and generally comparable, where applicable, to the Compound Selection Criteria
used by Wyeth taking into account the requirements of a therapeutic product for
the indications and routes of delivery in the Pharmacopeia Field.

3.3.                                               Term
of the Research Collaboration.

3.3.1.                            Research
Term.  Unless earlier terminated in
accordance with Section 9 (Government Approvals; Term and Termination),
the term of the Research Collaboration will ** (the “Initial
Term”) and for the duration of any extension described in
Section 3.3.2 (Extensions) (the entire period being the “Research Term”).

3.3.2.                            Extensions.  Wyeth will have the option, exercisable in
its sole discretion, by providing written notice to Pharmacopeia ** prior to
the end of the Initial Term, to extend the Research Collaboration for an
additional year.  In addition, the Parties will be entitled to extend the
Research Term for additional ** upon mutual agreement.

3.4.                                               Joint
Research Committee.

3.4.1.                            Composition.  Within thirty (30) days after the Effective
Date, the Parties will establish a Joint Research Committee (the “Joint Research Committee” or “JRC”)
to oversee and govern the Research Collaboration.  The JRC will be in effect only during the
Research Term.  The JRC will be composed
of three (3) representatives from each Party and will be co-chaired by one
representative of each Party.  Each Party
may replace any of its 

 19
 

representatives at any time upon written notice to the
other Party.  From time to time, the JRC
may establish subcommittees to oversee particular projects or activities, and
such subcommittees will be constituted as the JRC decides.  ** (each such **) **.  During the Research Term, **.  Each Project Team shall include **.

3.4.2.                            Responsibilities.  The JRC’s responsibilities will be
to (i) create the Research Plan and update it within ninety (90) days of the
end of each year of the Research Term; (ii) manage the implementation of the
Research Plan, including but not limited to implementing the chemistry and
biology activities associated with Agreement Compounds to be evaluated
thereunder; (iii) either directly or through **, direct the chemistry efforts
carried out by both Parties and determine the division of labor under the
Research Plan including the activities to which all Pharmacopeia ** and all
Wyeth ** allocated; (iv) determine whether Agreement Compounds have achieved
the Compound Selection Criteria for **, if appropriate; (v) manage the process
of the Agreement Compound selection by the Parties, as described in
Section 3.2 (Compound Selection and Reversion); (vi) maintain an
up-to-date list of ** and Agreement Compounds selected by either Party for Development
pursuant to a Selection Notice, which list will specify whether each compound
is a **.  All Compound Classification
Disputes, as well as any dispute as to whether an Agreement Compound meets the **,
will be resolved in accordance with the procedures set forth in Section 3.4.6
(Dispute Resolution).  However, the
procedures set forth in Section 3.4.6 (Dispute Resolution) **.

3.4.3.                            Meetings. 
The JRC will meet at least four (4) times annually,
face-to-face, unless otherwise agreed by the co-chairs, and may arrange other
meetings as the co-chairs deem necessary by teleconference or video.  At the first meeting of the JRC, to be held
within thirty (30) days of the Effective Date, the JRC will agree to an initial
Research Plan for the Research Collaboration and will evidence such Research
Plan by attaching it to the minutes of such meeting.  Each Party will have the right, upon thirty
(30) days prior written notice to the other Party, to call a special meeting of
the JRC to vote on any issue subject to the JRC’s jurisdiction, either
in-person by teleconference, or video, as the co-chairs of the JRC may agree.  Project Teams will maintain continuous and
open communication through in-person meetings, teleconferences and e-mail.

3.4.4.                            End of Jurisdiction.  After the Research Term, or on an
Agreement Compound-by-Agreement Compound basis, at such time as an Agreement
Compound is designated by a Party as a **, the JRC will have no further jurisdiction,
and all activities for further research and

 20
 

Development of such ** will be managed by the Lead
Developer with respect to such **.

3.4.5.                            Voting.  Decisions of the JRC will be made by
unanimous consent, with each Party having one vote.  The JRC may act without a meeting if an
action by unanimous written consent is signed by all members of the JRC.

3.4.6.                            Dispute
Resolution.

(a)                             ** Disputes.  If a
dispute regarding ** cannot be resolved at the JRC within fifteen (15) business
days, the matter will be resolved by, first, referring the ** Dispute to a team
of legal counsel, the team consisting of two lawyers having experience in
chemistry, with one selected by each Party. 
If the team of legal counsel is unable to resolve the matter within
fifteen (15) business days, the matter will then be referred for resolution to an
independent patent lawyer having experience in chemistry who is acceptable to
both members of the team of legal counsel. 
The decision of the mutually agreed outside legal counsel will be
binding on the Parties.

(b)                            If,
pursuant to Section 3.4.2 (Responsibilities) a dispute, **, cannot be
resolved at the JRC within fifteen (15) business days, the matter will be
brought by the JRC co-chairs to the Executive Vice President, Wyeth Discovery
Research, and the Chief Scientific Officer, Pharmacopeia.  If agreement cannot be reached between these
two individuals within fifteen (15) business days, then the matter will be
brought to the President, Wyeth Research and the CEO, Pharmacopeia for good
faith discussion and timely resolution. 
If agreement cannot be reached at this level within forty-five (45) days
then: (i) **; and (ii) for **.  Unless
and until resolution of a dispute has been achieved, the Parties’ activities
pursuant to the Research Collaboration will continue as set forth in the most
current applicable Research Plan.

3.4.7.                            Minutes.  The JRC will keep accurate and complete
minutes of its meetings that record all proposals, recommendations and actions
taken.  All records of the JRC will be
available at all times to each Party. 
The Parties will alternate the taking and production of minutes.  The Party responsible for producing the
minutes will provide a set of draft minutes to the other Party within fifteen
(15) days after the applicable JRC meeting. 
The other Party shall respond with any proposed changes, within fifteen
(15) days after receiving such draft minutes. 
The Parties then will finalize and sign the minutes within the following
fifteen (15) days.  Any dispute related
to the minutes

 21
 

will be resolved in good faith by the JRC’s co-chairs
within ten (10) days of occurrence of such dispute.  In the event that the co-chairs are unable to
resolve such dispute, the dispute shall be resolved according to the dispute
resolution procedures set forth above.

3.4.8.                            Inventory
of **.  Within ** after the end of
the Research Term, the JRC will prepare and deliver to each Party an aggregate,
final list of all ** and Agreement Compounds selected by either Party to date
for Development pursuant to a Selection Notice, such list having the
information set forth in subsection (vi) of Section 3.4.2
(Responsibilities).

3.5.                                               Research
Plan.  The initial outline of a
Research Plan and the work to be accomplished during the first year of the
Research Collaboration, including the division of labor between Wyeth and
Pharmacopeia, is set forth in Exhibit A.  Based upon such initial outline, the JRC will
prepare a Research Plan within thirty (30) days after the Effective Date or
such other time as the co-chairs of the JRC may agree, but in no event later
than sixty (60) days after the Effective Date, pursuant to Section 3.4.3
(Meetings). The JRC will review the Research Plan on at least an annual basis
and submit any proposed modifications or updates to the Parties for review and
approval, as set forth in Section 3.4.2 (Responsibilities); any such
modifications or updates will not become effective until approved in writing by
the co-chair of the JRC from each of the Parties.

3.6.                                               Funding
of the Research Collaboration.

3.6.1.                            Research
Funding.  Wyeth will pay Pharmacopeia
at the rate of three million dollars ($3,000,000) per year for **.  Unless otherwise agreed by the Parties, Wyeth
shall not be obligated to fund more than ** during the Initial Term.  The number of FTEs utilized by Pharmacopeia
during each year of the Initial Term **. 
As of the beginning of each year of the Research Term after the Initial Term,
the amount paid by Wyeth for the efforts of **. Other than
as set forth in this Section 3.6.1 (Research Funding) or as otherwise
agreed by the Parties in writing, each Party will be solely responsible for its
costs and expenses incurred in performing its obligations under the Research
Collaboration.

3.6.2.                            Quarterly
Payments; Annual Certification.  The
payments pursuant to this Section 3.6 shall be paid in equal quarterly installments,
in advance.  The initial payment shall be
made within thirty (30) days after the Effective Date, and subsequent payments
shall be made on or before the beginning of each calendar quarter thereafter.  Within thirty (30) days after the end of each
calendar year during the Research Term, Pharmacopeia will deliver to Wyeth
written certification executed by the Chief Financial Officer of Pharmacopeia
confirming the number of full or partial FTEs supplied

 22
 

by Pharmacopeia during
the previous calendar year in the performance of Pharmacopeia’s obligations
under the Research Plan.  In the event
that the **, then Wyeth will receive a proportional credit that may be applied against
future quarterly FTE payments, or if no future FTE payments are required to be
paid,  then Pharmacopeia will refund to
Wyeth an amount equal to the amount of the overpayment.

3.6.3.                            Records
and Audits.  During the Research Term
and for a period of three (3) years thereafter, Pharmacopeia will keep and
maintain accurate and complete records showing the time devoted and activities
performed by each FTE in performing Pharmacopeia’s obligations under the
Research Collaboration in sufficient detail such that the number of FTEs
applied to the Research Collaboration, during each Calendar Quarter thereof,
can be accurately determined.  Upon
fifteen (15) days prior written notice from Wyeth, Pharmacopeia will permit a
Wyeth representative to examine, at Wyeth’s sole expense, the relevant books
and records of Pharmacopeia as may be reasonably necessary to verify the
accuracy of the reports submitted to Wyeth under Section 3.6.2 (Payments)
for the number of FTEs applied to the performance of Pharmacopeia’s obligations
under the Research Collaboration. The Wyeth representative will be provided
access to such books and records at Pharmacopeia’s facility(ies) where such
books and records are normally kept and such examination will be conducted
during Pharmacopeia’s normal business hours. 
If the number of FTEs actually utilized by Pharmacopeia in any calendar
year of the Research Collaboration was less than the number funded by Wyeth
during such period, Pharmacopeia will credit or refund the excess payments to
Wyeth as provided in Section 3.6.2 (Quarterly Payments; Annual Certification) within
thirty (30) days of its receipt of the auditor’s report so concluding.  Additionally, **. All information of
Pharmacopeia which is subject to review under this Section 3.6.3 (Records
and Audits) will be deemed to be Confidential Information subject to the provisions
of Section 7, and such Confidential Information will not be disclosed to
any Third Party or used for any purpose other than verifying the performance of
Pharmacopeia and the information provided by Pharmacopeia to Wyeth; provided,
however, that such Confidential Information may be disclosed to Third
Parties to the extent necessary to enforce or exercise Wyeth’s rights under
this Agreement or as otherwise expressly permitted under this Agreement.

3.7.                                               Subcontracting.  Wyeth
may engage Third Party subcontractors (including contract research
organizations) to perform certain of its obligations under this Agreement.  Pharmacopeia will not, without the JRC’s
prior written consent, engage or use any Third Party subcontractors (including
contract research organizations) to perform any of its obligations.  The Pharmacopeia

 23
 

subcontractors
identified in Schedule 3.7 will be reviewed and taken up for approval by the JRC
within sixty (60) days after the Effective Date.  Any Third Party subcontractor engaged to perform
obligations of a Party (the “Subcontracting
Party”) set forth in this Agreement shall have sufficient expertise
to meet the qualifications typically required by such Subcontracting Party for
the performance of work similar in scope and complexity to the subcontracted
activity.  The activities of any
such Third Party subcontractors shall be considered activities of the
Subcontracting Party under this Agreement. 
A Subcontracting Party shall be responsible for ensuring compliance by
its Third Party subcontractors, if any, with the terms of this Agreement,
including obligations of confidentiality. 
Further, the Subcontracting Party shall ensure in any subcontracting
arrangement that it obtains sole ownership of all inventions, data and related
intellectual property rights made or developed by such Third Party
subcontractor involving the manufacture or use of any Agreement Compound.

3.8.                                               Notice
of Compounds.  If Wyeth is
considering nominating as a Pre-Development Compound any **, in each case, that
meets Wyeth’s Compound Selection Criteria for a Pre-Development Compound, Wyeth
will  provide Pharmacopeia with a written
description of such **, including the chemical structure of such ** and any
applicable U.S. patent numbers and application numbers that are Controlled by
Pharmacopeia ** (such written description, the “License **”).

3.9.                                               License
**.  Upon receipt of a License
Verification Notice, Pharmacopeia will evaluate the ** identified in the
License Verification Notice to determine whether **, and will notify Wyeth of
such determination within thirty (30) days after receiving the written
description of the chemical structure of such compound from Wyeth.  Such notice will be accompanied by reasonable
documentation supporting Pharmacopeia’s position, including a **.  If Pharmacopeia notifies Wyeth **, Wyeth may,
by providing written notice to Pharmacopeia within thirty (30) days of
receiving the Non-Licensed Compound Notice, refer the matter to an independent
outside attorney mutually acceptable to Wyeth and Pharmacopeia with expertise
in pharmaceutical patents and licensing, who shall determine whether **.  The Parties shall comply promptly with such
attorney’s reasonable request for documentation supporting their respective positions.  The attorney’s determination as to whether
such ** will be binding upon the Parties. 
The Party receiving an adverse determination in such matter shall be
responsible for all of such independent attorney’s fees in connection
therewith.

 24
 

4.                                      PRODUCT
DEVELOPMENT, COMMERCIALIZATION AND REGULATORY MATTERS.

4.1.                                               Product
Development.   Each
Party will have the right to Develop its selected Agreement Compounds as a Lead
Developer within such Party’s respective Field in accordance with the terms of
this Agreement.  However, if **.  Each Party will be responsible for its own
Development expenses, unless subsequently agreed otherwise by the Parties.

4.2.                                               Regulatory
Approvals and Communications.  Each
Party will be responsible for and own all regulatory filings, regulatory
approvals, communications with regulatory authorities, updates and maintenance,
including, without limitation, all adverse experience reporting related to
Products for which it is the Lead Developer.

4.3.                                               Adverse
Experiences and Product Labeling.

4.3.1.                            Definitions.  Unless otherwise defined herein, the terms
used surrounding adverse experiences will have the meaning set forth in US Code
of Federal Regulations (CFR), title 21 parts 312 and 314 and the International
Conference on Harmonization (ICH) of Technical Requirements of Pharmaceuticals
for Human Use E2A, in effect as of the Effective Date and as may be amended
from time to time.

4.3.2.                            Pharmacovigilance.  Upon commencement of Phase I Clinical
Studies, **.

4.3.3.                            Information.  To the extent either Party has or receives any
information regarding any adverse drug experience which may be related to the
use of any Product, such Party will immediately, but in no event later than
three (3) calendar days of receipt by such Party, provide the other Party with
all such information in English as follows:

If to Wyeth:

Facsimile:  ** or

Overnight courier (only) to:

Global Safety Surveillance Epidemiology & Labeling

GSSEL Triage Unit

Wyeth Research

**

If to
Pharmacopeia:

Facsimile:  ** or

Overnight courier (only)
to:

 25
 

Pharmacopeia Drug
Discovery, Inc.

**

4.3.4.                            Labeling
Responsibilities.  Wyeth shall be solely responsible
for the administrative aspects of preparing, updating and maintaining product
labeling for Wyeth Products. 
Furthermore, Wyeth shall be solely responsible for developing and
maintaining the Developmental Core Data Sheet (DCDS) and Core Data Sheet (CDS)
for Wyeth Products and, for marketed Wyeth products, the local label.    Such labeling may include, but is not
limited to, text and graphical contents of printed labels and labeling
components, including but not necessarily limited to healthcare professional
leaflets or inserts, patient leaflets or inserts, and cartons.  Wyeth shall notify Pharmacopeia of any
modifications to the Wyeth DCDS or Wyeth CDS and shall provide Pharmacopeia
with a copy of such modifications.

Pharmacopeia shall be
solely responsible for the administrative aspects of preparing, updating and
maintaining product labeling for Pharmacopeia Products.  Furthermore, Pharmacopeia shall be solely
responsible for developing and maintaining the Developmental Core Data Sheet
(DCDS) and Core Data Sheet (CDS) for Pharmacopeia Products and, for marketed
Pharmacopeia Products, the local label.  
Such labeling may include, but is not limited to, text and graphical contents
of printed labels and labeling components, including but not necessarily
limited to healthcare professional leaflets or inserts, patient leaflets or
inserts, and cartons. Pharmacopeia shall notify Wyeth of any modifications to
the Pharmacopeia DCDS or Pharmacopeia CDS and shall provide Wyeth with a copy
of such modifications.

4.3.5.                            Pharmacovigilance
Agreement.  If necessary, the Parties
agree to meet after the Effective Date to establish a detailed
Pharmacovigilance Agreement outlining the responsibilities of each Party in
connection with the collection and reporting of adverse drug experiences which
will supersede this Section 4.3 (Adverse Experiences and Product Labeling).

4.4.                                               Progress
Reports.

4.4.1.                            Lead
Developer Information.  During the Research Term, the Lead
Developer with respect to a Pre-Development Compound will provide the other
Party with ** at each JRC meeting. Such information will include, but not be
limited to:

·                  **;

·                  **; and

·                  **.

 26
 

4.4.2.                            Agreement
Compound Performance.  During the
Research Term, for each Agreement Compound designated as a **, the JRC minutes
will include, if applicable, ** of the performance of such Agreement Compound
against the relevant Compound Selection Criteria.

4.4.3.                            Twice-Annual
Summaries.  Each Party will provide
the other Party with twice annual, written reports within thirty (30) days
following June 30th and December 31st of
each calendar year, presenting a summary of the research and Development
activities accomplished by such Party during the just ended six (6) month
period with regard to each (i) ** and (ii) after the Research Term, each ** or
**.  Such reports will include, as
applicable, **.  During the Research
Term, such reports will also include any proposed **. Upon reasonable request,
the Parties will also **.

4.4.4.                            Pre-Clinical
Data.  In each case where a summary
has been provided by Wyeth for a ** Compound that subsequently becomes a ** and
is subsequently selected by Pharmacopeia for Development in the Pharmacopeia
Field pursuant to Section 3.2.4 (Compound Selection), Wyeth will provide
Pharmacopeia with the **.

4.5.                                               Supply;
Scale-up; Assistance.

4.5.1.                            Supply
of Agreement Compounds.  During the
Research Term, Pharmacopeia will provide ** quantities of Agreement Compounds
that are not **, as reasonably necessary to carry out the Research Plan, as
part of the work carried out by the Pharmacopeia FTEs funded by Wyeth, and also
as reasonably necessary for Wyeth or its Third Party contractors to perform the
activities assigned to it by the JRC.

4.5.2.                            Scale-Up
and Supply by Lead Developer.  From
the point at which a Party has selected an Agreement Compound as a **, or for
clinical development, such Party, as Lead Developer, will be responsible for
scale-up and supply of its own needs of active pharmaceutical ingredients and
formulated clinical supplies for ongoing Development.  Pharmacopeia will ensure the timely transfer
of any Pharmacopeia Know-How to Wyeth to enable Wyeth to scale-up and
manufacture all Pharmacopeia Compounds and Collaboration Compounds for which
Wyeth is the Lead Developer.

4.5.3.                            Wyeth
Assistance.  The Parties will discuss
in good faith any assistance that Wyeth may be able to provide Pharmacopeia in
its scale-up needs and manufacture of clinical supplies for Pharmacopeia
Compounds for which Pharmacopeia is the Lead Developer.

 27
 

4.6.                                               Commercialization.  Wyeth will have the exclusive right to
Commercialize Products incorporating Wyeth Available Compounds and the sole
authority and responsibility in all matters related to such Commercialization,
subject to the terms of this Agreement. 
Pharmacopeia will have the exclusive right to Commercialize Products
incorporating Pharmacopeia Available Compounds and the sole authority and
responsibility in all matters related to such Commercialization, subject to the
terms of this Agreement.  The Party
holding such exclusive rights will **.

4.7.                                               Wyeth
Diligence.  As a condition for Wyeth
maintaining the licenses granted under Section 2.1 (Licenses to Wyeth),
Wyeth will both (i) itself or through its Affiliates or sublicensees **; and
(ii) **.

4.8.                                               Wyeth
**.  In the event that **.

5.                                      CONSIDERATION.

5.1.                                               Upfront
Payment.  In partial consideration
for Pharmacopeia’s contributions under the Research Collaboration, Wyeth will
pay to Pharmacopeia five million dollars ($5,000,000.00) within thirty (30) days
after the Effective Date.  Such amount
shall be non-refundable and shall not be creditable against any other amounts
due to Pharmacopeia under this Agreement.

5.2.                                               Designation Payments.

5.2.1.                            Payments.
 Wyeth will pay to Pharmacopeia the
following nonrefundable Designation Payments within thirty (30) days following
the first achievement by Wyeth, its Affiliates, sublicensees or other
designees, as the case may be, of each of the following designations with
respect to any Agreement Compound:

(a)                             $**
for each Agreement Compound (up to ** for a ** $**) that is designated by Wyeth
** under Section 3.2.2 (**); and

(b)                            $** for
each Agreement Compound (up to ** for a ** $**) that is designated by Wyeth as
a ** under Section 3.2.3 (**).

5.2.2.                            **.  A **.

5.3.                                               Event
Payments.  Wyeth will pay to Pharmacopeia the following nonrefundable amounts
within thirty (30) days following the first achievement by Wyeth, its
Affiliates, sublicensees or other designees, as the case may be, of each of the
following events with respect to any Wyeth Available Compound (or corresponding
Wyeth Product).

5.3.1.                            **.  For the ** or corresponding Wyeth Product to
achieve the following events through Commercialization by Wyeth:

 28

 

	
  Event

  	
   

  	
  Event Payment

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  

 

5.3.2.                            **.  For the ** or corresponding Wyeth Product to
achieve the following events through Commercialization by Wyeth:

	
  Event

  	
   

  	
  Event Payment

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  

 

5.3.3.                            **.  For the ** or corresponding Wyeth Product to
achieve the following events through Commercialization by Wyeth:

	
  Event

  	
   

  	
  Event Payment

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  
	
  **

  	
   

  	
  $**

  

 

 29
 

 

 

5.3.4.                            **;
Each Payment **.  Notwithstanding the
foregoing, after the payments pursuant to this Section 5.3 (Event Payments) are
made with respect to ** under this Section 5.3 for any Wyeth Available Compound,
**.  Each payment specified in this
Section 5.3 (Event Payments) is payable **.  For example, **.

5.4.                                               Royalties.

5.4.1.                            Product
Royalties.  Wyeth will pay to
Pharmacopeia royalties during the Royalty Term as set forth in Sections 5.4.2
(Wyeth Product Royalties), subject to the adjustments provided in Section 5.4.3
(Royalty Adjustments).

5.4.2.                            Wyeth
Product Royalties.

(a)                             Wyeth
will pay to Pharmacopeia marginal royalties in the amount equal to the Marginal
Royalty Rate (set forth below) on the aggregate worldwide Net Sales obtained by
Wyeth or its Affiliates or sublicensees from the sale of Wyeth Products on a
Wyeth Product-by-Wyeth Product basis during each calendar year in the
applicable Royalty Term:

	
  Annual Worldwide Net Sales
  Level

  	
   

  	
  Marginal Royalty Rate

  (% of the Applicable Portion

  of Annual Net Sales)

  
	
  **

  	
   

  	
  **

  
	
  **

  	
   

  	
  **

  
	
  **

  	
   

  	
  **

  
	
  **

  	
   

  	
  **

  

 

The Marginal Royalty
Rates set forth in the table above will apply **.  For example, **.  In the example above, the **.

(b)                            After
the **.

5.4.3.                            Royalty
Adjustments.

(a)                             **.  For any Wyeth
Product that is an **.

 30
 

(b)                            **.  If Wyeth
determines in good faith that a **.

(c)                             Limit on **.  Notwithstanding
the **.  For example, **.

5.4.4.                            **
Royalties; **.  Royalties will be **.

5.5.                                               Reports
and Payments.

5.5.1.                            Royalty
Statements and Payments.  Within
thirty (30) days of the end of each Calendar Quarter, Wyeth will deliver to
Pharmacopeia a written good faith estimate for such Calendar Quarter of
aggregate Net Sales and royalties due under this Agreement.  Within sixty (60) days after the end of each
Calendar Quarter, Wyeth will deliver to Pharmacopeia a final  report setting forth for such Calendar
Quarter the following information, on a Wyeth Product-by-Wyeth Product and
country-by-country basis: (a) the Net Sales of each Wyeth Product, (b) the
basis for any adjustments to the royalty payable for the sale of each Wyeth
Product, and (c) the royalty due hereunder for the sale of each Wyeth
Product.  No such reports will be due for
any Wyeth Product before **.  The total
royalty due for the sale of Wyeth Products during such Calendar Quarter will be
remitted at the time such report is made.

5.5.2.                            Taxes
and Withholding.  All payments under
this Agreement will be made without any deduction or withholding for or on
account of any tax unless such deduction or withholding is required by
applicable laws or regulations.  If Wyeth
is so required to deduct or withhold, Wyeth will (a) promptly notify
Pharmacopeia of such requirement, (b) pay to the relevant authorities the full
amount required to be deducted or withheld promptly upon the earlier of
determining that such deduction or withholding is required or receiving notice
that such amount has been assessed against Pharmacopeia, and (c) promptly
forward to Pharmacopeia an official receipt (or certified copy) or other
documentation reasonably acceptable to Pharmacopeia evidencing such payment to
such authorities, and provide any further assistance reasonably requested by
Pharmacopeia to enable Pharmacopeia to obtain the benefit of any such
deduction. 
Provided, however, that if any
payments are made to Pharmacopeia, other than under Section 5.4, by a Wyeth
Affiliate that is incorporated outside of the United States, Wyeth shall
indemnify Pharmacopeia, on an after-tax basis, against any taxes required to be
deducted or withheld from such payment by such Wyeth Affiliate; provided
further, however, that this indemnification obligation shall arise only to the
extent that such obligation to deduct or withhold results solely from Wyeth’s
assignment of its rights and obligations to such Wyeth Affiliate.

 31
 

5.5.3.                            Currency.  All amounts payable and calculations
hereunder will be in United States dollars. 
As applicable, Net Sales and any royalty deductions will be converted
into United States dollars in accordance with Wyeth’s customary and usual conversion
procedures, consistently applied, which procedures are in accordance with
Generally Accepted Accounting Principles in the United States.

5.5.4.                            Blocked
Payments.  In the event that, by
reason of applicable laws or regulations in any country, it becomes impossible
or illegal for Wyeth to transfer, or have transferred on its behalf, royalties
or other payments to Pharmacopeia, such royalties or other payments will be
deposited in local currency in the relevant country to the credit of
Pharmacopeia in a recognized banking institution designated by Pharmacopeia or,
if none is designated by Pharmacopeia within a period of thirty (30) days, in a
recognized banking institution selected by Wyeth and identified in a notice in
writing given to Pharmacopeia.

5.5.5.                            Additional
Provisions Relating to Royalties. 
Pharmacopeia acknowledges and agrees that nothing in this Agreement
(including, without limitation, any exhibits or attachments hereto) will be
construed as representing an estimate or projection of either (a) the number of
Wyeth Products that will or may be successfully Developed or Commercialized or
(b) anticipated sales or the actual value of any Wyeth Product and that the
figures set forth in Section 5.2 (Designation Payments) or elsewhere in
this Agreement or that have otherwise been discussed by the Parties are merely
intended to define Wyeth’s royalty obligations to Pharmacopeia in the event
such sales performance is achieved. 
WYETH MAKES NO REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED,
THAT IT WILL BE ABLE TO SUCCESSFULLY DEVELOP OR COMMERCIALIZE ANY AGREEMENT
COMPOUND OR WYETH PRODUCT OR, IF COMMERCIALIZED, THAT IT WILL ACHIEVE ANY
PARTICULAR SALES LEVEL OF SUCH WYETH PRODUCT(S).

5.6.                                               Maintenance
of Records; Audits.

5.6.1.                            Record
Keeping.  Wyeth will keep accurate
books and accounts of record in connection with the sale of Wyeth Products, in
sufficient detail to permit accurate determination of all figures necessary for
verification of royalties to be paid hereunder. 
Wyeth will maintain such records for a period of at least ** after the
end of the calendar year in which they were generated.

5.6.2.                            Audits.  Upon thirty (30) days prior written notice
from Pharmacopeia, Wyeth will permit an independent certified public accounting
firm of nationally recognized standing selected by

 32
 

Pharmacopeia and
reasonably acceptable to Wyeth, to examine, at Pharmacopeia’s sole expense, the
relevant books and records of Wyeth as may be reasonably necessary to verify
the accuracy of the reports submitted by Wyeth in accordance with Section 5.5.1
(Royalty Statements and Payments) and the payment of royalties under this
Agreement.  An examination by
Pharmacopeia under this Section 5.6.2 (Audits) will occur not more than
once in any calendar year and will be limited to the pertinent books and
records for any calendar year ending not more than ** before the date of
the request.  The accounting firm will be provided access to
such books and records at Wyeth’s facility(ies) where such books and records
are normally kept and such examination will be conducted during Wyeth’s normal
business hours.  Wyeth may require the
accounting firm to sign a standard non-disclosure agreement before providing
the accounting firm access to Wyeth’s facilities or records.  Upon completion of the audit, the accounting
firm will provide both Wyeth and Pharmacopeia a written report disclosing
whether the reports submitted by Wyeth are correct or incorrect, whether the
royalties paid are correct or incorrect, and, in each case, the specific details
concerning any discrepancies.  No other
information will be provided to Pharmacopeia.

5.6.3.                            Underpayments/Overpayments.  If such accounting firm concludes that
additional royalties were due to Pharmacopeia, Wyeth will pay to Pharmacopeia
the additional royalties within thirty (30) days of the date Wyeth receives
such accountant’s written report so concluding. 
If such underpayment **.  If such
accounting firm concludes that Wyeth overpaid royalties to Pharmacopeia,
Pharmacopeia within thirty (30) days of the date receives such accountant’s
report so concluding will refund such overpayments to Wyeth less the expense of
the audit.

5.6.4.                            Confidentiality.  All financial information of Wyeth which is
subject to review under this Section 5.6 (Maintenance of Records; Audits)
will be deemed to be Wyeth’s Confidential Information subject to the provisions
of Article 7 hereof, and Pharmacopeia will not disclose such Confidential
Information to any Third Party or use such Confidential Information for any
purpose other than verifying payments to be made by Wyeth to Pharmacopeia
hereunder.

6.                                      INTELLECTUAL PROPERTY.

6.1.                                               Ownership.  A Party will own all Know-How (and all Patent
Rights relating to such Know-How) invented (for inventions) or first made or
discovered (for other Know-How) solely by employees of such Party, or by other
Persons having an obligation to assign its rights in such Know-How to the
Party.  Each Party will jointly own with
the other Party all Know-How (and all Patent

 33
 

Rights relating to such
Know-How) that is invented (for inventions) or first made or discovered (for
other Know-How) by an employee of Wyeth, or other Person having an obligation
to assign its rights to Wyeth, and an employee of Pharmacopeia or other Person
having an obligation to assign its rights to Pharmacopeia.  All determinations of inventorship under this
Agreement will be made in accordance with United States patent law.

6.2.                                               Patent
Rights.

6.2.1.                            Filing,
Prosecution and Maintenance of Patent Rights; Use Restrictions.

(a)                             Pharmacopeia’s Patent Rights.

(i)                                     Pharmacopeia
will prepare, file, prosecute and maintain Pharmacopeia Patent Rights, to the
extent possible given any applicable patent office deadlines that exist as of
the Effective Date, in and through all patent offices, patent treaties and
countries **.  Pharmacopeia will **.  In the event that Wyeth becomes the Lead
Developer of an Agreement Compound falling within the claims of any
Pharmacopeia Patent Right, Wyeth will thereafter **.

(ii)                                  Following
the Effective Date and at all times during the Term, Pharmacopeia will, or will
cause its patent counsel of record to, timely provide Wyeth with complete
copies of all current substantive correspondence (including correspondence with
relevant patent offices/authorities, foreign associates, and other outside
counsel) relating to the Pharmacopeia Patent Rights.  Upon the request of Wyeth, **, Pharmacopeia
will, or will cause its outside counsel to promptly furnish to Wyeth copies of
all documents and correspondence relating to the preparation, filing,
prosecution and maintenance of the Pharmacopeia Patent Rights, including, if
requested, complete copies of the file wrapper for each of the Pharmacopeia
Patent Rights and other related substantive correspondence with relevant patent
offices/authorities, foreign associates, or outside counsel.  Further, Pharmacopeia will consult and
reasonably cooperate with Wyeth with respect to the preparation, filing,
prosecution and maintenance of all Pharmacopeia
Patent Rights, including: (A) furnishing Wyeth with advance drafts of
all proposed filings; (B) allowing Wyeth a reasonable opportunity and
reasonable time to review and

 34
 

comment regarding such
drafts before any applicable filings are due; and (C) (x) with respect to the
claims of any Pharmacopeia Patent Rights claiming compositions or methods of
making or using Wyeth Available Compounds of which Wyeth is the Lead Developer,
accepting all comments and instructions offered by Wyeth, (y) with respect to any
claims of any Pharmacopeia Patent Rights claiming compositions or methods of
making or using other Wyeth Available Compounds, not unreasonably refusing to
accept  Wyeth’s comments, and (z) with
respect to all other claims of any Pharmacopeia Patent Rights, considering in
good faith any reasonable comments offered by Wyeth.  If under either of clause (x) or (y) above, **.

(iii)                               For
any Pharmacopeia Patent Right proposed by Pharmacopeia for filing after the
Effective Date, if **. Wyeth will **.

(iv)                              If
Pharmacopeia elects not to file a patent application included in the
Pharmacopeia Patent Rights **, or elects to cease the prosecution and/or
maintenance of any Pharmacopeia Patent Right in any country or as a PCT
application, Pharmacopeia will provide Wyeth with written notice immediately,
but not less than fifteen (15) days before any action is required, upon the
decision to not file or continue the prosecution or maintenance of such Patent
Right.  If the Pharmacopeia Patent Right
that Pharmacopeia has chosen to abandon covers a **, then, in addition to any
other remedies Wyeth may have under this Agreement, Pharmacopeia will permit
Wyeth, in Wyeth’s sole discretion, to file or continue prosecution or
maintenance of any such Pharmacopeia Patent Right in such country **; provided,
however, that in such event such **. 
Upon request from Wyeth, Pharmacopeia will execute such documents and
perform such acts, **, as may be reasonably necessary to permit Wyeth to file,
prosecute or maintain such Pharmacopeia Patent Right in such country.  Wyeth’s rights under this Section will
be in addition to any other rights and remedies which Wyeth may have as a
result of Pharmacopeia’s failure to satisfy its obligations hereunder.

(b)                            Wyeth’s Patent Rights.  Wyeth
will be solely responsible for prosecuting and maintaining all Wyeth Patent
Rights, at its discretion and its sole expense.

 35
 

(c)                             Joint Patent Rights.  Before
such time as a Party assumes responsibility for a Joint Patent Right as the
Lead Developer of an Agreement Compound falling within the claims of such Joint
Patent Right, **.  While so responsible, **
will provide ** with copies of all substantive correspondence (including
correspondence with relevant patent offices/authorities, foreign associates,
and other outside counsel) relating to the Joint Patent Rights, and consult
with ** concerning such filings and will consider in good faith ** comments on
the prosecution and maintenance of such Joint Patent Rights.  If ** becomes the Lead Developer of an
Agreement Compound falling within the claims of such Joint Patent Right and **
is not a Lead Developer of a different Agreement Compound falling within the
claims of the same Joint Patent Right, ** will assume responsibility for
prosecuting and maintaining such Joint Patent Rights in the Primary Prosecution
Countries, and as PCT applications, at its expense; provided, however,
that if ** subsequently becomes the Lead Developer of a different Agreement
Compound falling within the claims of such Joint Patent, ** will assume
responsibility for prosecuting and maintaining such Joint Patent Rights in the
Primary Prosecution Countries, and as PCT applications, **.  In any event, the Party responsible for the
prosecution and maintenance of Joint Patent Rights will consult with the other
Party with respect to the prosecution and maintenance of such Joint Patent and
will give reasonable consideration to the opinions of the other Party with
respect to such prosecution and maintenance.  If the Party
responsible for the prosecution and maintenance of Joint Patent Rights under
this Section 6.2.1(c) elects not to file a patent application included in
the Joint Patent Rights as required by this Section 6.2.1(c), or elects to
cease the prosecution and/or maintenance of any Joint Patent Right in any
country or as a PCT application, the responsible Party will provide the other
Party with written notice immediately, but not less than fifteen (15) days
before any action is required, upon the decision to not file or continue the
prosecution or maintenance of such Patent Right.  If ** is the responsible Party and the Joint
Patent Right that ** has chosen to abandon covers a **, then ** will permit **,
in ** sole discretion, to file or continue prosecution or maintenance of any
such Joint Patent Right in such country at ** expense.  Likewise, if ** is the responsible Party and
the Joint Patent Right that ** has chosen to abandon covers a ** Product, then **
will permit **, in ** sole discretion, to file or continue prosecution or
maintenance of any such Joint Patent Right in such country at ** expense.  Upon request from the other Party

 36
 

with respect to any Joint
Patent Right proposed to be abandoned by the responsible Party, the responsible
Party will execute such documents and perform such acts, at the other Party’s expense,
as may be reasonably necessary to permit the other Party to file, prosecute or
maintain such Joint Patent Right in such country.

6.2.2.                            Enforcement
of IP Rights.

(a)                             Notice.  If either
Wyeth or Pharmacopeia becomes aware of any infringement, of any issued patent
or misappropriation of any trade secret, anywhere in the world, within the
Pharmacopeia IP or Joint IP, which activity adversely affects or is reasonably
expected to adversely affect any Wyeth Available Compound, Wyeth Product,
Pharmacopeia Available Compound, or Pharmacopeia Product, such Party will
promptly notify the other Party in writing to that effect.

(b)                            Enforcement.  With
respect to infringement or misappropriation of any Joint IP or Pharmacopeia IP by
any Third Party that claims (for Patent Rights) or relates to (for Know-How)
any Wyeth Available Compound of which Wyeth is the Lead Developer or Wyeth
Product , Wyeth will have the first right, but not the obligation, to take
action to obtain a discontinuance of infringement and misappropriation or bring
suit against such Third Party to enforce such Joint IP or Pharmacopeia IP within
three (3) months from the date of notice and to join Pharmacopeia as a party
plaintiff.  With respect to infringement
or misappropriation of Pharmacopeia IP or Joint IP by any Third Party that
claims (for Patent Rights) or relates to (for Know-How) any Pharmacopeia  Available Compound of which Pharmacopeia is
the Lead Developer or Pharmacopeia Product, Pharmacopeia will have the first
right, but not the obligation, to take action to obtain a discontinuance of
infringement and misappropriation or bring suit against such Third Party to
enforce such Joint IP or Pharmacopeia IP within three (3) months from the date
of notice and to join Wyeth as a party plaintiff.  Notwithstanding the
foregoing, **.  With respect
to infringement or misappropriation by any Third Party of any Joint IP that
does not claim (for Patent Rights) or relate to (for Know-How) any Agreement
Compound for which either Party is the Lead Developer, Wyeth will have the
first right, but not the obligation, to take action to obtain a discontinuance
of infringement and misappropriation or bring suit against such Third Party to
enforce such Joint IP within three (3) months from the date of notice and to
join Pharmacopeia as a party plaintiff. 
With respect to infringement

 37
 

or misappropriation by
any Third Party of any Pharmacopeia IP that does not claim (for Patent Rights)
or relate to (for Know-How) any Agreement Compound for which either Party is
the Lead Developer, Pharmacopeia will have the first right, but not the
obligation, to take action to obtain a discontinuance of infringement and
misappropriation or bring suit against such Third Party to enforce such Pharmacopeia
IP within three (3) months from the date of notice and to join Wyeth as a party
plaintiff. The Party taking action under this Section 6.2.2(b)
(Enforcement) will bear all the expenses of any such suit brought.  If, after the expiration of the three (3)
month period (or, if earlier, the date upon which the Party having the first
option provides written notice that it does not plan to bring suit), the Party
having the first option has not obtained a discontinuance of infringement or
misappropriation of the applicable IP or filed suit against any such Third
Party to enforce such applicable IP, then the other Party will have the right,
but not the obligation, to bring suit against such Third Party; provided,
however, that the other Party will bear all the expenses of such
suit.  Each Party will cooperate with the
other in any such suit brought against a Third Party, and will have the right
to consult with the other Party and to participate in and be represented by
independent counsel in such litigation at its own expense.  The Party bringing suit will incur no
liability to the other Party as a consequence of such litigation or any
unfavorable decision resulting therefrom; provided, however, that
the Party bringing suit will not, without the other Party’s prior written
consent, enter into any settlement or consent decree that admits that any of
the other Party’s sole IP or any Joint IP is invalid or unenforceable or that requires
any payment by or admits or imparts liability to the other Party.  Any recoveries obtained by either Party as a
result of any proceeding against a Third Party infringer will be allocated as
follows:

(i)                                     Such
recovery will **;

(ii)                                  With
respect to **; and

(iii)                               The
Party **.

6.2.3.                            Infringement
and Third Party Licenses.

(a)                             Infringement of Third Party Patents - Course of Action.  If the making, having made, importing,
exporting, using, offering for sale or selling of any ** is alleged by a Third
Party to infringe a Third Party’s patent, the Party becoming aware of

 38
 

such allegation will
promptly notify the other Party. 
Additionally, if either Party determines that, based upon the review of
a Third Party’s patent or patent application or other intellectual property
rights, it may be desirable to obtain a license from such Third Party with
respect thereto, such Party will promptly notify the other Party of such
determination.

(b)                            Option to Negotiate. 
Subject to Section 6.2.3(c) (Third Party Infringement Suit), in the
event that a Party, pursuant to Section 6.2.3(a) (Infringement of Third
Party Patents - Course of Action), notifies the other Party that it has
determined that it may be desirable to obtain a license under one or more
patents or patent applications or other intellectual property rights owned or
Controlled by a Third Party (collectively, “Third Party IP Rights”),
which Third Party IP Rights (i) relate to any ** and (ii) if valid and issued, may,
in the absence of a license from such Third Party, be infringed by the
Development or Commercialization of any ** by or on behalf of ** or any of its
Affiliates or sublicensees, ** will have the first right, but not the
obligation, to negotiate and enter into an agreement with such Third Party,
whereby ** is granted a license under such Third Party IP Rights permitting **
to practice such Third Party IP Rights.

(c)                             Third Party Infringement Suit.  If a Third Party sues a Party, or its
Affiliates or sublicensees, alleging that the Development or Commercialization
of any Agreement Compound or Product pursuant to this Agreement infringes or
will infringe such Third Party’s Patent Rights or misappropriates such Third
Party’s Know-How (a “Third Party Suit”),
then the Party that is the Lead Developer of such Agreement Compound or Product
will have the first right, but not the obligation, to control the defense of
the suit, and the other Party will provide all cooperation reasonably requested
by the Lead Developer in connection therewith. 
If the Lead Developer assumes control of the defense of such suit, the
Lead Developer will bear all costs and expenses of such defense.  In any Third Party Suit of which the Lead
Developer chooses to control the defense pursuant to this Section 6.2.3(c)
(Third Party Infringement Suits), the Lead Developer will keep the other Party
reasonably informed of all material developments in connection with any such
suit; provided that if the other Party is named as a defendant in any such
suit, the other Party shall have the right to participate in the defense using
counsel of its choice at its own expense. The Lead Developer will incur no
liability to the other Party as a consequence of such litigation or any
unfavorable decision resulting therefrom; provided, however,

 39
 

that the Lead Developer
will not, without the other Party’s prior written consent, enter into any
settlement or consent decree that requires any payment by or admits or imparts any
other liability to the other Party.  Wyeth
will **.  Any portion of the **.

6.2.4.                            Patent
Certifications.  Each Party will
immediately give written notice to the other of any certification of which it
becomes aware filed pursuant to 21 U S C. § 355(b)(2)(A) or §
355(j)(2)(A)(vii) (or any amendment or successor statute thereto), any similar
statutory or regulatory requirement enacted in the future regarding biologic
products, or any similar statutory or regulatory requirement in any non-U.S.
country in the Territory claiming that a Pharmacopeia Patent Right or Joint
Patent Right covering any Product is invalid or that infringement will not
arise from the manufacture, use or sale of such Product by a Third Party.  Upon the giving or receipt of such notice,
the Lead Developer of such Product will have the first right, but not the
obligation, to bring an infringement action against such Third Party.  In such a case, the Lead Developer will
notify the other Party at least ten (10) days prior to the date set forth by
statute or regulation of its intent to exercise, or not exercise, this
right.  Any infringement action against a
Third Party arising under this Section 6.2.4 (Patent Certifications) will
be governed by the provisions of Section 6.2.2(b) (Enforcement) hereof.

6.2.5.                            Patent
Term Restoration.  The Parties hereto
will cooperate with each other in obtaining patent term restoration, or its
equivalent anywhere in the world, including under 35 U.S.C. § 156 and its
foreign counterparts, where applicable to the Pharmacopeia Patent Rights and
Joint Patent Rights.  If elections with
respect to obtaining such patent term restoration are to be made with respect
to any Pharmacopeia Patent Right or Joint Patent Right that claims the
composition or method of using any **, ** will make such election, and ** will
abide by such election.  ** will make
such election with respect to any Pharmacopeia Patent Right or Joint Patent
Right that does not claim the composition or method of using any **.

6.2.6.                            Orange
Book Listings.

(a)                             Pharmacopeia
Products.  At least thirty (30)
business days prior to the expiration of the time period under 21 C.F.R. §
314.53 for submitting patent information pertaining to Pharmacopeia Patent
Rights or Joint Patent Rights with respect to a Pharmacopeia Product,
Pharmacopeia will submit to Wyeth any such draft submission, including any
forms such as Form FDA 3542, Form FDA 3542a or any equivalent thereof, for
Wyeth’s review and comment.  Pharmacopeia
will consider in

 40
 

good faith any comments
made by Wyeth pursuant to this Section. 
In the event that the Parties, after good faith discussions at the JRC,
cannot agree with respect to any decision to be made under this Section,
Pharmacopeia will make such decision.

(b)                            Wyeth
Products.  At least thirty (30)
business days prior to the expiration of the time period under 21 C.F.R. §
314.53 for submitting patent information pertaining to Pharmacopeia Patent
Rights or Joint Patent Rights with respect to a Wyeth Product, Wyeth will
submit to Pharmacopeia any such draft submission, including any forms such as
Form FDA 3542, Form FDA 3542a or any equivalent thereof, for Pharmacopeia’s
review and comment.  Wyeth will consider
in good faith any comments made by Pharmacopeia pursuant to this Section.  In the event that the Parties, after good
faith discussions at the JRC, cannot agree with respect to any decision to be
made under this Section, Wyeth will make such decision.

6.3.                                               Trademarks
and Copyrights.  The Party that is
the Lead Developer of a Product will, in its sole discretion, select and own
all Trademarks related to such Product. 
The other Party will neither use nor seek to register, anywhere in the
world, any trademarks which are confusingly similar to any Trademark or any
other trademarks, trade names, trade dress or logos used by or on behalf of the
Lead Developer or its Affiliates or sublicensees in connection with any other
Products.  The other Party will and
hereby does assign to the Lead Developer all its rights, title, and interests
in all Copyrights applicable to such Product.

7.                                      CONFIDENTIALITY.

7.1.                                               Confidentiality.  Except to the extent expressly authorized by
this Agreement or otherwise agreed in writing, the Parties agree that, for the
Term and for ** years thereafter, each Party (the “Receiving
Party”), receiving any Confidential Information of the other Party
(the “Disclosing Party”) hereunder will keep
such Confidential Information confidential and will not publish or otherwise
disclose or use such Confidential Information for any purpose other than as
provided for in this Agreement except for Confidential Information that the
Receiving Party can establish:

(a)                             was
already known by the Receiving Party (other than under an obligation of
confidentiality), at the time of disclosure by the Disclosing Party and such
Receiving Party has documentary evidence to that effect;

 41
 

(b)                            was
generally available to the public or otherwise part of the public domain at the
time of its disclosure to the Receiving Party;

(c)                             became
generally available to the public or otherwise part of the public domain after
its disclosure or development, as the case may be, and other than through any
act or omission of a Party in breach of this confidentiality obligation;

(d)                            was
disclosed to that Party, other than under an obligation of confidentiality, by
a Third Party who had no obligation to the Disclosing Party not to disclose
such information to others; or

(e)                             was
independently discovered or developed by or on behalf of the Receiving Party
without the use of the Confidential Information belonging to the other Party
and the Receiving Party has documentary evidence to that effect.

7.2.                                               Authorized
Disclosure and Use.

7.2.1.                            Disclosure.  Notwithstanding the foregoing Section 7.1
(Confidentiality), each Party may disclose Confidential Information belonging
to the other Party to the extent such disclosure is reasonably necessary to:

(a)                             file
or prosecute patent applications covering Joint Know-How as contemplated by
this Agreement,

(b)                            prosecute
or defend litigation,

(c)                             exercise
rights hereunder provided such disclosure is covered by terms of
confidentiality similar to those set forth herein, and

(d)                            comply
with applicable governmental laws and regulations.

In the event a Party will deem it necessary to
disclose pursuant to this Section 7.2.1 (Disclosure), Confidential
Information belonging to the other Party, the Disclosing Party will to the
extent possible give reasonable advance notice of such disclosure to the other
Party and take reasonable measures to ensure confidential treatment of such
information.

7.2.2.                            Use.  Notwithstanding the foregoing Section 7.1
(Confidentiality), each Party will have the right to use Confidential
Information of the other Party as expressly licensed in this Agreement and as
necessary in carrying out its responsibilities under this Agreement in the
Development  and Commercialization of its
respective Products.

 42

7.3.                                               Know-How,
Other Information.  For purposes of
this Agreement, all Joint Know-How, all Pharmacopeia Know-How that specifically
relates to Agreement Compounds and is not otherwise published in a Pharmacopeia
Patent Right, and all compound lists and classification information prepared by
the JRC pursuant to Section 3.4.2 (Responsibilities) and Section 3.4.8
(Inventory of Agreement Compounds) will be treated as the Confidential
Information of both Parties.  Each Party
will be deemed to be both the Disclosing Party and Receiving Party of such
Know-How, lists and information.

7.4.                                               SEC
Filings.  Either Party may disclose
the terms of this Agreement and developments in connection with this Agreement
to the extent required, in the reasonable opinion of such Party’s legal
counsel, to comply with applicable laws, including, without limitation, the
rules and regulations promulgated by the SEC. 
Notwithstanding the foregoing, before disclosing this Agreement or any
of the terms hereof pursuant to this Section 7.4 (SEC Filings), the
Parties will consult with one another on the terms of this Agreement to be
redacted in making any such disclosure. 
If a Party discloses this Agreement or any of the terms hereof in
accordance with this Section 7.4 (SEC Filings), such Party agrees, at its
own expense, to seek confidential treatment of portions of this Agreement or
such terms, as may be reasonably requested by the other Party.

7.5.                                               Public
Announcements; Publications.

7.5.1.                            Coordination.  Pharmacopeia and Wyeth will, from time to
time, and at the request of the other Party, discuss and agree on the general
information content relating to this Agreement which may be publicly disclosed
(including, without limitation, by means of any printed publication or oral
presentation), provided, however,
that neither Party, subject to Section 7.5.2 (Announcements) and Section 7.5.4
(Publications) below, will have any obligation to consult with the other Party
with respect to any scientific publication or public announcement concerning
its Development or Commercialization activities with respect to Products under
this Agreement; provided, however, that, prior to the First
Commercial Sale of any Product, the Lead Developer of such Product will use
reasonable efforts to notify the other Party at least one (1) business day in
advance of issuing any press release and at least five (5) business days in
advance of any such scientific publication becoming publicly available.

7.5.2.                            Announcements.  Except as may be expressly permitted under
Section 7.4 (SEC Filings) or Section 7.5.4 (Publications) or as may
be appropriate for each Party to make in connection with its own or with the
other Party’s Development or Commercialization activities as contemplated
hereunder, neither Party will make any public announcement regarding this
Agreement or the Development or Commercialization of Products without the prior
written approval of

 43
 

the other Party.  For the sake of clarity, nothing in this
Agreement will prevent either Party from making any scientific publication or
public announcement concerning its own or the other Party’s Development or
Commercialization activities with respect to Products under this Agreement; provided,
however, that neither Party will disclose any of the other Party’s
Confidential Information in any such publication or announcement without
obtaining such other Party’s prior written consent to do so.  Non-limiting examples of announcements
contemplated hereunder are press releases related to the achievement of any
milestone event by either Party, and the publication of significant clinical
data by either Party.

7.5.3.                            Press
Release Announcing This Agreement.  Notwithstanding
anything to the contrary in this Agreement, Pharmacopeia shall issue a mutually
agreed press release announcing the execution of this Agreement promptly after
the Effective Date of the Agreement.  The
press release shall include the customary information concerning agreements of
this nature and scope of the matters contemplated hereby.

7.5.4.                            Publications.  During the Term, each Party will submit to
the other Party for review and approval all proposed academic, scientific and
medical publications and public presentations relating to any Agreement
Compound or Product, for review in connection with preservation of Patent Rights
and/or to determine whether any of the other Party’s Confidential Information
should be modified or deleted.  Written
copies of such proposed publications and presentations will be submitted to the
other Party no later than sixty (60) days before submission for publication or
presentation and the other Party will provide its comments with respect to such
publications and presentations within thirty (30) business days of its receipt
of such written copy.  The review period
may be extended for an additional sixty (60) days in the event the other Party
can demonstrate reasonable need for such extension including, but not limited
to, the preparation and filing of patent applications.  By mutual agreement, this period may be
further extended. Wyeth and Pharmacopeia will each comply with standard
academic practice regarding authorship of scientific publications and
recognition of contribution of other parties in any publications relating to
the research work to be conducted under this Agreement.

8.                                      REPRESENTATIONS AND WARRANTIES.

8.1.                                               Representations
and Warranties of Each Party.  Each
of Pharmacopeia and Wyeth hereby represents, warrants, and covenants to the
other Party hereto as follows:

 44
 

(a)                             it is
a corporation or entity duly organized and validly existing under the laws of
the state or other jurisdiction of its incorporation or formation;

(b)                            the
execution, delivery and performance of this Agreement by such Party has been
duly authorized by all requisite corporate action and does not require any
shareholder action or approval;

(c)                             it
has the power and authority to execute and deliver this Agreement and to
perform its obligations hereunder;

(d)                            the
execution, delivery and performance by such Party of this Agreement and its
compliance with the terms and provisions hereof does not and will not conflict
with or result in a breach of any of the terms and provisions of or constitute
a default under (i) a loan agreement, guaranty, financing agreement, agreement
affecting a product or other agreement or instrument binding or affecting it or
its property; (ii) the provisions of its charter or operative documents or
bylaws; or (iii) any order, writ, injunction or decree of any court or
governmental authority entered against it or by which any of its property is
bound; and

(e)                             it
will at all times comply with all applicable material laws and regulations
relating to its activities under this Agreement.

8.2.                                               Additional
Representations and Warranties of Pharmacopeia.  In addition to the representations and
warranties made by Pharmacopeia elsewhere in this Agreement, Pharmacopeia
hereby represents, warrants, and covenants to Wyeth, as of the Effective Date,
that:

(a)                             Schedule 8.2
identifies all of the Pharmacopeia Patent Rights ** along with the following
information with respect to each identified Patent Right, as applicable: (i)
country, (ii) title, (iii) application number, (ii) application filing date,
(v) patent number, (vi) patent issue date, and (vii) listed inventor(s).  As of the **, to the best of Pharmacopeia’s knowledge,
the Pharmacopeia Patent Rights are not invalid or unenforceable, in whole or in
part.  Other than the Pharmacopeia Patent
Rights set forth on Schedule 8.2, to the best of Pharmacopeia’s
knowledge, Pharmacopeia does not Control any Patent Rights relating to JAK-3
Kinase Inhibitors.

(b)                            All
rights, title, and interests in the Pharmacopeia Patent Rights are owned by
Pharmacopeia free and clear of any liens, charges, encumbrances, licenses, or
other claim of right or

 45
 

ownership by any Third
Party other than those arising under the Pharmacopeia Third Party Agreements.

(c)                             Pharmacopeia
has the full right, power and authority to grant the licenses granted or to be
granted to Wyeth under this Agreement.

(d)                            No
Pharmacopeia Patent Right existing as of the Effective Date is subject to any
funding agreement with any government or governmental agency.  To the extent that any of the Pharmacopeia
Patent Rights arose from work funded in whole or in part by U.S. federal
funding, all requirements necessary to vest the entire right, title and
interest in Pharmacopeia have been satisfied.

(e)                             Pharmacopeia
has delivered to Wyeth **.

(f)                               To
the best of Pharmacopeia’s knowledge, no license granted by Pharmacopeia to any
Third Party, conflicts with the license grants to Wyeth under this
Agreement.  No license granted by any
Third Party to Pharmacopeia conflicts with the license grants to Wyeth under
this Agreement.

(g)                            Pharmacopeia has not received any notice from
any Third Party asserting any ownership rights to any Pharmacopeia Know-How or
Pharmacopeia Patent Right; and Pharmacopeia has not received any notice of, and
there is not any pending or to the best of Pharmacopeia’s knowledge threatened,
action, suit, proceeding or claim by a Third Party (i) asserting that
Pharmacopeia is infringing or has misappropriated or otherwise is violating any
patent, trade secret or other proprietary right of any Third Party or
(ii) relating to the Pharmacopeia Patent Rights.

(h)                            There
is no dispute pending, or to the best of Pharmacopeia’s knowledge threatened, regarding
any conflicts between any licenses granted by Pharmacopeia to a Third Party.

(i)                                To
the best of Pharmacopeia’s knowledge, as of the Effective Date, (i) the
practice of the Pharmacopeia Patent Rights and Pharmacopeia Know-How in the
course of the Research Collaboration, and (ii) the making, use or sale of
Pharmacopeia Compounds existing as of the Effective Date, does not infringe any
issued patent owned or possessed by any Third Party.  To the best of Pharmacopeia’s knowledge, as
of the Effective Date, there are no Third Party patent applications pending
which, if issued, would be infringed by (i) the practice of the

 46
 

Pharmacopeia Patent
Rights or Pharmacopeia Know-How in the course of the Research Collaboration or (ii)
the making, use or sale of Pharmacopeia Compounds existing as of the Effective
Date.

(j)                                Pharmacopeia
has not granted any license to any Third Party with respect to the Pharmacopeia
Compounds set forth on Schedule 1.62 (Pharmacopeia Compounds).

(k)                             During
the Term, Pharmacopeia will not enter into any agreement with any Third Party
that would adversely affect the rights granted to Wyeth under this Agreement
other than agreements entered into in compliance with the terms and conditions of this
Agreement.

(l)                                The
Pharmacopeia Compounds identified on Schedule 1.58 (Pharmacopeia
Compounds) constitute all  compounds owned
or Controlled by Pharmacopeia that have been identified by Pharmacopeia as
JAK-3 Kinase Inhibitors.

8.3.                                               Additional
Representations and Warranties of Wyeth. 
In addition to the representations and warranties made by Wyeth
elsewhere in this Agreement, Wyeth hereby represents, warrants, and covenants
to Pharmacopeia as of the Effective Date, that:

(a)                             Wyeth
has the full right, power and authority to grant the licenses granted or to be
granted to Pharmacopeia under this Agreement.

(b)                            Wyeth
will not provide any compounds or Know-How to Pharmacopeia that Wyeth knows
would, if used by Pharmacopeia in working under the Research Collaboration,
infringe an issued patent owned or possessed by a Third Party.

(c)                             Neither
any license granted by Wyeth to any Third Party, nor any license granted by any
Third Party to Wyeth conflicts with the license grants to Pharmacopeia under
this Agreement.

(d)                            During
the Term of this Agreement, Wyeth will not enter into any agreement with any
Third Party that would materially adversely affect the rights granted to
Pharmacopeia under this Agreement.

8.4.                                               Disclaimer.  EXCEPT AS OTHERWISE EXPRESSLY SET FORTH
HEREIN, THE PARTIES MAKE NO REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY
KIND, EITHER EXPRESS OR IMPLIED, AND PARTICULARLY THAT PRODUCTS WILL BE
SUCCESSFULLY DEVELOPED HEREUNDER, AND IF PRODUCTS ARE DEVELOPED,

 47
 

WITH RESPECT TO SUCH
PRODUCTS, THE PARTIES DISCLAIM ALL IMPLIED WARRANTIES OF TITLE,
NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

9.                                      GOVERNMENT APPROVALS; TERM AND TERMINATION.

9.1.                                               Government
Approvals.  Pharmacopeia and Wyeth
will cooperate and use respectively all reasonable efforts to make all registrations,
filings and applications, to give all notices and to obtain as soon as
practicable all governmental or other consents, transfers, approvals, orders,
qualifications authorizations, permits and waivers, if any, and to do all other
things necessary or desirable for the consummation of the transactions as
contemplated hereby.

9.2.                                               Term.  The term of this Agreement will commence on
the Effective Date and will extend, unless this Agreement is terminated earlier
in accordance with this Article 9, on a Wyeth Product-by-Wyeth Product and
country-by-country basis until the expiration of the Royalty Term applicable to
the sale of such Wyeth Product in such country (“Term”).  Upon expiration of the Term, the license
rights granted to Wyeth under Section 2.1.2 with respect to such Wyeth Product
will **.

9.3.                                               Termination
for Cause.  Either Party may
terminate this Agreement in its entirety at any time during the Term by giving
written notice to the other Party in the event that the other Party commits a
material breach of its obligations under this Agreement and such breach remains
uncured for ninety (90) days or, in the event such breach is for failure to
pay, forty-five (45) days, measured from the date written notice of such breach
is given to the breaching Party; provided, however,
that if any breach other than non-payment is not reasonably curable within
ninety (90) days and so long as the Party alleged to be in breach is using
Commercially Reasonable Efforts to cure such breach, such termination will be delayed
for a reasonable period of time in order to permit such Party reasonable time
to cure such breach.  If the alleged
material breach relates to non-payment of an amount that is subject to a bona
fide good faith dispute between the Parties as to whether such payment is due,
the forty-five (45) day cure period will be tolled pending resolution of such
dispute; provided, however,
that if such amount is part of a larger payment due, only the cure period for
the amount in dispute will be tolled.  Notwithstanding
the foregoing, if a **.

9.4.                                               Termination
by Wyeth.

9.4.1.                            Termination
Without Cause.  Wyeth will have the
right, exercisable upon ** prior written notice, provided at any time after the
** of the Effective Date to Pharmacopeia, to terminate the Research
Collaboration and/or this Agreement  either (a) in its entirety, or (b) through a
Partial Termination in one or more countries of the Territory.

 48
 

9.4.2.                            Termination
Upon Cessation of Development.  In
the event that Wyeth determines to discontinue Development and
Commercialization of ** in all countries of the Territory, then Wyeth will
terminate this Agreement in its entirety by providing written notice to
Pharmacopeia, which termination will be effective upon the delivery of such
notice.  In the event that Wyeth
determines to discontinue Development and Commercialization of all Wyeth
Available Compounds in any particular Major Market Country, then Wyeth will
terminate this Agreement in such Major Market Country by providing written
notice to Pharmacopeia, which Partial Termination will be effective upon the
delivery of such notice.

9.4.3.                            Termination
for a Material Safety, Efficacy or Regulatory Issue.  Wyeth will have the right to terminate
this Agreement, at any time, on a Wyeth Product-by-Wyeth Product basis, by
giving ** prior written notice to Pharmacopeia in the event of any safety,
efficacy or regulatory issue that would have a material adverse effect on Wyeth’s
ability to Develop  or Commercialize any
Wyeth Product, as determined in Wyeth’s reasonable judgment and according to
Wyeth’s standard internal procedures for evaluating such safety, efficacy or
regulatory issues.

9.4.4.                            **
of Either Party.  If a **.  In all other respects the Agreement will
remain in full force and effect.

9.4.5.                            **.  If a **, the following will occur:

(a)                             Notwithstanding
Sections ** to give effect to this provision.

(b)                            If any
**.

9.5.                                               Effects
of Termination.

9.5.1.                            Effect
of Termination by Wyeth for Cause. 
If Wyeth terminates this Agreement pursuant to Section 9.3 (Termination
for Cause):

(a)                             The **;

(b)                            All **;
and

(c)                             Pharmacopeia
shall **.

In the event of a
termination resulting from ** breach of this Agreement.

9.5.2.                            Effect
of Termination by Pharmacopeia for Cause. 
If Pharmacopeia terminates this Agreement pursuant to Section 9.3
(Termination for Cause):

 49
 

(a)                             The **;

(b)                            If the
Agreement is terminated **;  and

(c)                             In
the case of a **.

Nothing in this Section 9.5.2
(Effect of Termination by Pharmacopeia for Cause) shall limit any other remedy
Pharmacopeia may have for Wyeth’s breach of this Agreement.  In the event that, despite the termination of
this Agreement or any **, Wyeth continues to sell Wyeth Products in a
terminated country, Pharmacopeia will remain entitled to receive all payments
that would have been due under this Agreement with respect to such sales.

9.5.3.                            Effect
of Termination by Wyeth Upon Discontinuation of Development.  If Wyeth terminates this Agreement pursuant
to Section 9.4.2 (Termination for Cessation of Development):

(a)                             If
the Agreement is terminated **; and

(b)                            If the
termination is a **.

**.

9.5.4.                            Effect
of Termination by Wyeth Without Cause. 
If Wyeth terminates this Agreement pursuant to Section 9.4
(Termination by Wyeth) hereof with respect to ** under this Agreement with
respect to such sales.  If Wyeth
terminates this Agreement **.

9.5.5.                            Disposition
of Inventories of Products.  Following termination or expiration of this
Agreement with respect to one or more Wyeth Products, Wyeth, its Affiliates and
its sublicensees will have the right to continue to sell their existing
inventories of such Products after the effective date of such termination or
expiration, subject to Pharmacopeia’s continuing right to receive all payments
that would have been due under this Agreement with respect to such sales.

9.6.                                               Survival
of Certain Obligations.  Expiration
or termination of the Agreement will not relieve the Parties of any obligation
accruing before such expiration or termination. 
The provisions of Articles 7 (Confidentiality) and 10 (Indemnification
and Insurance) and Sections 4.8 (Wyeth Materials), 5.6 (Maintenance of
Records; Audits), 6.1 (Ownership), 6.3 (Trademarks and Copyrights), 9.5
(Effects of Termination), 9.6 (Survival of Certain Obligations), 12.4
(Correspondence and Notices) and 12.9 (Governing Law) will survive the
expiration or termination of the Agreement. 
Section 9.2 (Term) (and as applied therewith Article 2 (Licenses))
will survive the expiration of the Agreement. 
Any expiration or early termination of this Agreement will be without
prejudice to the rights of either Party against the

 50
 

other accrued or accruing
under this Agreement before expiration or early termination.  Furthermore, if Wyeth continues to Develop
Agreement Compounds or sell Wyeth Products despite termination of this
Agreement for any reason (other than termination by Wyeth this Agreement
pursuant to Section 9.3 (Termination for Cause) resulting from an uncured
material breach of Section 2.6 (Restrictions), 8.2(b), 8.2(g), 8.2(i), and
8.2(j) (Additional Representations and Warranties of Pharmacopeia)), then 5.2
(Designation Payments), 5.3 (Event Payments), Section 5.4 (Royalties) 5.5
(Reports and Payments), and 5.6 (Maintenance of Records and Audits) will
survive the expiration or termination of the Agreement with respect to such
sales.

10.                               INDEMNIFICATION AND INSURANCE.

10.1.                                        Indemnification
by Wyeth.  Wyeth will indemnify,
defend and hold harmless Pharmacopeia, each of its Affiliates, and each of its
and its Affiliates’ employees, officers, directors and agents (each, a “Pharmacopeia Indemnified Party”) from and against any and
all liability, loss, damage, expense (including reasonable attorneys’ fees and
expenses) and cost (collectively, a “Liability”)
that the Pharmacopeia Indemnified Party may be required to pay to one or more
Third Parties resulting from or arising out of: (a) any intentional misconduct
or gross negligence on the part of Wyeth or its Affiliates in performing any
activity contemplated by this Agreement; (b) the development, preclinical and
clinical testing, manufacture, distribution, sale and/or use (including but not
limited to product liability claims) of any Wyeth Product, or the personal
injury or death of any person as a result of use of any Wyeth Product sold by
Wyeth, its Affiliates or sublicensees; or (c) the material breach by Wyeth of
any of its representations, warranties or covenants set forth in this
Agreement; except, (i) in each case ((a), (b), and (c)), to the extent
caused by the gross negligence or intentional misconduct of Pharmacopeia or any
Pharmacopeia Indemnified Party and (ii) for Liability arising from intellectual
property infringement and trade secret misappropriation.

10.2.                                        Indemnification
by Pharmacopeia.  Pharmacopeia will
indemnify, defend and hold harmless Wyeth, its Affiliates, and each of its and
its Affiliates’ employees, officers, directors and agents (each, a “Wyeth Indemnified Party”) from and against any and all
Liabilities that the Wyeth Indemnified Party may be required to pay to one or
more Third Parties resulting from or arising out of: (a) any intentional
misconduct or gross negligence on the part of Pharmacopeia or its Affiliates in
performing any activity contemplated by this Agreement; (b) the material breach
by Pharmacopeia of any of its representations, warranties or covenants set
forth in this Agreement; or the development, preclinical and clinical testing,
manufacture, distribution, sale and/or use (including but not limited to
product liability claims) of any Pharmacopeia Product, or the personal injury or
death of any person as a result of use of any Product supplied by Pharmacopeia
for use in clinical trials to the extent caused by a manufacturing defect, except,
(i) in each case ((a), (b), and (c)), to the extent caused by the gross
negligence or intentional misconduct of

 51
 

Wyeth or any Wyeth
Indemnified Party and (ii) for Liability arising from intellectual property
infringement or trade secret misappropriation.

10.3.                                        Procedure.  Each Party will notify the other in the event
it becomes aware of a claim for which indemnification may be sought
hereunder.  In case any proceeding
(including any governmental investigation) will be instituted involving any
Party in respect of which indemnity may be sought pursuant to this Article 10,
such Party (the “Indemnified Party”) will promptly
notify the other Party (the “Indemnifying Party”)
in writing within fifteen (15) days and the Indemnifying Party and Indemnified
Party will meet to discuss how to respond to any claims that are the subject
matter of such proceeding.  The
Indemnifying Party, upon request of the Indemnified Party, will retain counsel
reasonably satisfactory to the Indemnified Party to represent the Indemnified
Party and will pay the fees and expenses of such counsel related to such
proceeding.  The Indemnified Party agrees
to cooperate fully with the Indemnifying Party in the defense of any such
claim, action or proceeding, or any litigation resulting from any such
claim.  In any such proceeding, the
Indemnified Party will have the right to retain its own counsel, but the fees
and expenses of such counsel will be at the expense of the Indemnified Party
unless (a) the Indemnifying Party and the Indemnified Party will have mutually
agreed to the retention of such counsel or (b) the named parties to any such
proceeding (including any impleaded parties) include both the Indemnifying
Party and the Indemnified Party and representation of both Parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them.  All such fees and expenses
will be reimbursed as they are incurred. The Indemnifying Party will not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the Indemnifying Party agrees to indemnify the Indemnified Party
from and against any loss or liability by reason of such settlement or
judgment.  The Indemnifying Party will
not, without the written consent of the Indemnified Party, effect any settlement
of any pending or threatened proceeding in respect of which the Indemnified
Party is, or arising out of the same set of facts could have been, a party and
indemnity could have been sought hereunder by the Indemnified Party, unless
such settlement includes an unconditional release of the Indemnified Party from
all liability on claims that are the subject matter of such proceeding.

10.4.                                        Insurance.  Each Party further agrees to use Commercially
Reasonable Efforts to obtain and maintain, with respect to any Product for
which such Party is the Lead Developer, commercial general liability insurance,
including products liability insurance, with reputable and financially secure
insurance carriers to cover its indemnification obligations under Sections 10.1
(Indemnification by Wyeth) or 10.2 (Indemnification by Pharmacopeia), as
applicable, or self-insurance (or any combination thereof) (i) upon **; and
(ii) upon **.  Insurance will be procured
with carriers having an A.M. Best Rating of A-VII or better.

 52
 

11.                               DISPUTE RESOLUTION

11.1.                                        General.  Any controversy, claim or dispute arising out
of or relating to this Agreement will be settled, if possible, through good
faith negotiations between the Parties. 
If however, the Parties are unable to settle such dispute after good
faith negotiations, the matter will be referred to the Executive Officers to be
resolved by negotiation in good faith as soon as is practicable but in no event
later than thirty (30) days after referral. 
Such resolution, if any, of a referred issue will be final and binding
on the Parties.

11.2.                                        Failure
of Executive Officers to Resolve Dispute. 
If the Executive Officers are unable to settle the dispute after good
faith negotiation in the manner set forth above, either Party may seek
resolution of the dispute through and any remedies available at law or in
equity from any court of competent jurisdiction as provided in Section 12.9
(Governing Law) hereof.

12.                               MISCELLANEOUS.

12.1.                                        Assignment.  Neither Party will assign this Agreement nor
any rights or obligations hereunder without the prior written consent of the
other Party, which consent will not be unreasonably withheld or delayed, except
as follows:  Either Party may assign its
rights and obligations under this Agreement by way of sale of such Party itself
or the sale of the portion of the business of such Party to which this
Agreement relates, through merger, sale of assets and/or sale of stock or
ownership interest, provided that such sale is not primarily for the benefit of
such Party’s creditors.  Either Party may
assign its rights and obligations under this Agreement to an Affiliate of such
Party, provided that such Party will remain liable for all of its rights and
obligations under this Agreement.  Each
Party will promptly notify the other Party of any assignment or transfer under
the provisions of this Section.  This
Agreement will be binding upon the successors and permitted assigns of the
Parties, and the name of a Party appearing herein will be deemed to include the
names of such Party’s successors and permitted assigns to the extent necessary
to carry out the intent of this Agreement. 
Any assignment not in accordance with this Section 12.1
(Assignment) will be void.

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

12.3.                                        Force
Majeure.  Neither Party will be
liable to the other for delay or failure in the performance of the obligations
on its part contained in this Agreement if and to the extent that such failure
or delay is due to circumstances beyond its control which it could not have
avoided by the exercise of reasonable diligence.  It will notify the other Party promptly
should such circumstances arise, giving an indication of the likely extent and
duration thereof, and will use all Commercially Reasonable Efforts to resume
performance of its

 53
 

obligations as soon as
practicable; provided, however, that neither Party will be
required to settle any labor dispute or disturbance.

12.4.                                        Correspondence
and Notices.

12.4.1.                     Ordinary
Notices.  Correspondence, reports,
documentation, and any other communication in writing between the Parties in
the course of ordinary implementation of this Agreement will be delivered by
hand, sent by facsimile transmission (receipt verified), or by airmail to the
employee or representative of the other Party who is designated by such other
Party to receive such written communication. 
During the Research Term, all such notices will be conveyed via the JRC.

12.4.2.                     Extraordinary
Notices.  Extraordinary notices and
other communications hereunder (including, without limitation, any notice of
force majeure, breach, termination, change of address, etc.) will be in writing
and will be deemed given if delivered personally or by facsimile transmission
(receipt verified), mailed by registered or certified mail (return receipt
requested), postage prepaid, or sent by nationally recognized express courier
service, to the Parties at the following addresses (or at such other address
for a Party as will be specified by like notice; provided, however,
that notices of a change of address will be effective only upon receipt
thereof):

All correspondence to
Wyeth will be addressed as follows:

Wyeth Pharmaceuticals

500 Arcola Road

Collegeville,
Pennsylvania  19426

Attn: **

Fax:  **

with a copy to:

Wyeth

Five Giralda Farms

Madison, New Jersey  07940

Attn:  **

Fax:  **

All correspondence to
Pharmacopeia will be addressed as follows:

Pharmacopeia Drug
Discovery, Inc.

3000 Eastpark Boulevard

Cranbury, NJ 08512-3516

Attn:  Chief
Executive Officer

with
a copy to:

Pharmacopeia Drug
Discovery, Inc.

3000 Eastpark Boulevard

Cranbury, NJ 08512-3516

Attn:  General Counsel

Fax:
**

 54
 

12.5.                                        Amendment.  No amendment, modification or supplement of
any provision of this Agreement will be valid or effective unless made in
writing and signed by a duly authorized officer of each Party.

12.6.                                        Waiver.  No provision of the Agreement will be waived
by any act, omission or knowledge of a Party or its agents or employees except
by an instrument in writing expressly waiving such provision and signed by a
duly authorized officer of the waiving Party. 
The waiver by either of the Parties of any breach of any provision
hereof by the other Party will not be construed to be a waiver of any
succeeding breach of such provision or a waiver of the provision itself.

12.7.                                        Severability.  If any clause or portion thereof in this
Agreement is for any reason held to be invalid, illegal or unenforceable, the
same will not affect any other portion of this Agreement, as it is the intent
of the Parties that this Agreement will be construed in such fashion as to
maintain its existence, validity and enforceability to the greatest extent
possible.  In any such event, this
Agreement will be construed as if such clause of portion thereof had never been
contained in this Agreement, and there will be deemed substituted therefor such
provision as will most nearly carry out the intent of the Parties as expressed
in this Agreement to the fullest extent permitted by applicable law.

12.8.                                        Descriptive
Headings.  The descriptive headings
of this Agreement are for convenience only, and will be of no force or effect
in construing or interpreting any of the provisions of this Agreement.

12.9.                                        Governing
Law.  This Agreement will be governed
by and interpreted in accordance with the substantive laws of the State of New
York, without regard to conflict of law principles thereof.

12.10.                                 Jurisdiction;
Venue; Service of Process.

12.10.1.              Jurisdiction.  Each Party to this Agreement, by its
execution hereof, (a) hereby irrevocably submits to the exclusive jurisdiction
of the state courts of the State of New York located in New York City or the
United States District Court for the Southern District of New York located in
New York City for the purpose of any Claim between the parties arising in whole
or in part under or in connection with this Agreement, (b) hereby waives to the
extent not prohibited by applicable law, and agrees not to assert, by way of
motion, as a defense or otherwise, in any such Claim, any claim that it is not
subject personally to the jurisdiction of the above-named courts, that

 55
 

its property is exempt or
immune from attachment or execution, that any such Claim brought in one of the
above-named courts should be dismissed on grounds of forum non
conveniens, should be transferred or removed to any court other than
one of the above-named courts, or should be stayed by reason of the pendency of
some other proceeding in any other court other than one of the above-named
courts, or that this Agreement or the subject matter hereof may not be enforced
in or by such court and (c) hereby agrees not to commence any such Claim other
than before one of the above-named courts. 
Notwithstanding the previous sentence, a Party may commence any Claim in
a court other than the above-named courts solely to seek pre-litigation
attachment of assets or preliminary injunction relief prior to litigation on
the merits in the above-named courts or for the purpose of enforcing an order
or judgment issued by one of the above-named courts.

12.10.2.              Venue.  Each Party agrees that for any Claim
between the parties arising in whole or in part under or in connection with
this Agreement, such Party bring Claims only in the City of New York.  Each Party further waives any claim and will
not assert that venue should properly lie in any other location within the
selected jurisdiction.

12.10.3.              Service
of Process.  Each Party hereby (a)
consents to service of process in any Claim between the parties arising in
whole or in part under or in connection with this Agreement in any manner
permitted by New York law, (b) agrees that service of process made in
accordance with clause (a) or made by registered or certified mail, return
receipt requested, at its address specified pursuant to Section 12.4
(Correspondence and Notices), will constitute good and valid service of process
in any such Claim and (c) waives and agrees not to assert (by way of motion, as
a defense, or otherwise) in any such Claim any claim that service of process
made in accordance with clause (a) or (b) does not constitute good and valid
service of process.

12.11.                                 Waiver
of Jury Trial.  TO THE EXTENT NOT
PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, THE PARTIES HEREBY WAIVE,
AND COVENANT THAT THEY WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR
OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN
PART UNDER OR IN CONNECTION WITH THIS AGREEMENT, WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE.  THE PARTIES AGREE THAT ANY OF THEM MAY FILE A
COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING,
VOLUNTARY AND BARGAINED FOR AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE
ITS RIGHT TO

 56
 

TRIAL BY JURY IN ANY
PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY OF THE
CONTEMPLATED TRANSACTIONS WILL INSTEAD BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY. 

12.12.                                 Entire
Agreement of the Parties.  This Agreement constitutes and contains the
complete, final and exclusive understanding and agreement of the Parties and
cancels and supersedes any and all prior negotiations, correspondence,
understandings and agreements, whether oral or written, among the Parties
respecting the subject matter hereof and thereof.

12.13.                                 Independent
Contractors.  Both Parties are independent contractors
under this Agreement.  Nothing herein contained
will be deemed to create an employment, agency, joint venture or partnership
relationship between the Parties hereto or any of their agents or employees, or
any other legal arrangement that would impose liability upon one Party for the
act or failure to act of the other Party. 
Neither Party will have any express or implied power to enter into any
contracts or commitments or to incur any liabilities in the name of, or on
behalf of, the other Party, or to bind the other Party in any respect
whatsoever.

12.14.                                 Compliance
with Laws.  In exercising their
rights under this Agreement, the Parties shall fully comply in all material
respects with the requirements of any and all applicable laws, regulations,
rules and orders of any governmental body having jurisdiction over the exercise
of rights under this Agreement including, without limitation, those applicable
to the discovery, development, manufacture, distribution, import and export and
sale of Products pursuant to this Agreement.

12.15.                                 Patent
Marking.  Wyeth agrees to mark and
have its Affiliates and sublicensees mark all Products sold pursuant to this
Agreement in accordance with the applicable statute or regulations relating to
patent marking in the country or countries of manufacture and sale thereof.

12.16.                                 Counterparts.  This Agreement may be executed in any number
of counterparts, each of which need not contain the signature of more than one
Party but all such counterparts taken together will constitute one and the same
agreement.

 57

IN WITNESS WHEREOF,
duly authorized representatives of the Parties have duly executed this
Agreement to be effective as of the Effective Date.

	
  

  	
   

  	
   

  
	
  WYETH,

  	
   

  	
  PHARMACOPEIA DRUG DISCOVERY,

  
	
   

  	
   

  	
  INC.

  
	
  acting through its

  	
   

  	
   

  
	
  Wyeth Pharmaceuticals Division

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By 

  	
   

  	
   

  	
  By 

  	
   

  	
   

  
	
  Name:

  	
   

  	
  Name:

  
	
  Title:

  	
   

  	
  Title:

  
						

 

SCHEDULE 1.8

COMPETING
PHARMACEUTICAL COMPANIES

**

SCHEDULE 1.10

COMPOUND
SELECTION CRITERIA

**

**

   
 

**

**

 1.10-2
 

 

**

**

 1.10-3

SCHEDULE 1.22

**

**

An Agreement compound
shall meet the following criteria prior to designation by the JRC as a  **:

**

 1

SCHEDULE 1.62

PHARMACOPEIA
COMPOUNDS

**

SCHEDULE
1.75

PRIMARY
PROSECUTION COUNTRIES

**

SCHEDULE
3.7

PROPOSED
PHARMACOPEIA SUBCONTRACTORS

The following
subcontractors have been proposed by Pharmacopeia for review and approval by
the JRC within sixty (60) days after the Effective Date.

**

SCHEDULE
8.2

PHARMACOPEIA
DISCLOSURE SCHEDULE

**

EXHIBIT A

RESEARCH
PLAN OUTLINE

**Exhibit 10.2

FIRST AMENDMENT TO LEASE AGREEMENT

THIS
FIRST AMENDMENT TO LEASE AGREEMENT (this “First Amendment”) is made on this 13th day of March,
2007, by and between LIBERTY PROPERTY LIMITED
PARTNERSHIP, a Pennsylvania limited partnership (“Landlord”), and INTERNATIONAL HEALTH PARTNERS, INC., an Indiana corporation
(“Tenant”).

BACKGROUND:

A.            Landlord and Tenant entered into a certain Lease
Agreement dated April 22, 2004 (the “Lease”), covering certain premises
containing approximately 7,097 rentable square feet (“Premises”) known as Suite
107, located in Landlord’s building (“Building”) at 120 Gibraltar Road,
Horsham, Pennsylvania, as more fully described in the Lease.

B.            Tenant desires to decrease the size of the Premises and
to extend the Term of the Lease and Landlord has agreed to such decrease and
extension subject to the provisions of this First Amendment.  Accordingly, Landlord and Tenant desire to
amend the Lease.

NOW,
THEREFORE,  the parties hereto, in
consideration of the mutual promises and covenants contained herein and in the
Lease, and intending to be legally bound, hereby agree that the Lease is
amended as follows:

1.             All capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to them in the Lease.

2.             Effective retroactive to December 1, 2006 (the “Effective
Date”), Section 1(a) of
the Lease defining “PREMISES” is
amended by reducing the approximate rentable square feet of the Premises from
7,097 rentable square feet to 7,067 rentable square feet.  The Premises, including the 30 rentable
square feet of space (the “Surrender Space”) being surrendered pursuant to this
First Amendment, is shown on Exhibit “A-1” attached hereto.

3.             Tenant has heretofore vacated and surrendered the
Surrender Space to Landlord.

4.             The “TERM” of the Lease is hereby
extended for one (1) additional term of thirty-six (36) months (the “Extended
Term”) commencing on June 1, 2007 and expiring at 11:59 P.M. local time on May
31, 2010.

5.             Section 1(c)(iii) of the Lease, defining “EXPIRATION
DATE”, is hereby amended to extend the Expiration Date until
May 31, 2010.

6.             Effective March 1, 2007, Section 1(d)(i) of the Lease, entitled “MINIMUM
ANNUAL RENT”, is amended by deleting the schedule contained
therein in its entirety and substituting the following schedule therefor:

	
  

  	
  Period

  	
   

  	
   

  	
   

  	
  Annual

  	
   

  	
   

  	
   

  	
  Monthly

  	
   

  	
   

  
	
  *3/1/07 — 5/31/07

  	
   

  	
   

  	
  ----------------

  	
   

  	
   

  	
   

  	
  $

  	
  7,508.69

  	
   

  	
   

  
																	

 

 

*Notwithstanding anything
contained in this First Amendment to the contrary, Landlord shall
provide Tenant with a credit in the amount of $95.64 against Tenant’s monthly
installment of Minimum Annual Rent for the first month of this period, which
credit represents Landlord’s reimbursement to Tenant for Tenant’s overpayment
of Minimum Annual Rent in the months of December, January and February.  Accordingly, Tenant’s monthly installment of
Minimum Annual Rent payable to Landlord on March 1, 2007 shall be in the amount
of $7,413.05.

7.             Effective March 1, 2007, Tenant shall pay on account of Estimated “ANNUAL OPERATING EXPENSES”,
pursuant to Section 1(d)(ii) of the Lease, an amount equal to the product of
7,067 multiplied by Landlord’s then current per square foot estimate thereof,
payable in equal monthly installments, subject to adjustment and reconciliation
as set forth in the Lease.

8.             Effective retroactive to the Effective Date,
Section 1(e) of the Lease, defining “PROPORTIONATE SHARE”, is amended by
deleting the reference to “14.45%” and substituting “14.39%” therefor.

9.             Tenant’s “MINIMUM ANNUAL RENT” obligation for
the Extended Term shall be as follows:

	
  

  	
  Period

  	
   

  	
   

  	
   

  	
  Annual

  	
   

  	
   

  	
   

  	
  Monthly

  	
   

  	
   

  
	
  6/1/07 — 5/31/08

  	
   

  	
   

  	
  $

  	
  93,637.75

  	
   

  	
   

  	
   

  	
  $

  	
  7,803.15

  	
   

  	
   

  
	
  6/1/08 — 5/31/09

  	
   

  	
   

  	
  $

  	
  97,171.25

  	
   

  	
   

  	
   

  	
  $

  	
  8,097.60

  	
   

  	
   

  
	
  6/1/09 — 5/31/10

  	
   

  	
   

  	
  $

  	
  100,704.75

  	
   

  	
   

  	
   

  	
  $

  	
  8,392.06

  	
   

  	
   

  
																		

 

10.           Tenant accepts the Premises in its “as is” “where
is” condition and Landlord shall have no obligations whatsoever to improve or
pay for improvements to the Premises for Tenant’s use and occupancy, except as
otherwise expressly set forth in the Lease.

11.           Tenant agrees that it has dealt with no brokers in
connection with this First Amendment. 
Tenant agrees to indemnify and hold Landlord harmless from any and all
claims for commissions or fees in connection with the Premises and this First
Amendment from any real estate brokers or agents with whom Tenant may have
dealt.

12.           Except as expressly modified herein, the terms and
conditions of the Lease shall remain unchanged and in full force and
effect.  Specifically, without limitation, in the event of any default by Tenant
of any of its obligations under the Lease, as hereby amended, Landlord shall be
entitled to pursue all remedies available under the Lease, as hereby amended,
or otherwise at law or in equity. 
Accordingly, Tenant agrees to the following:

(a)           When the Lease, as hereby amended,
and the Term or any extension thereof shall have been terminated on account of
any default by Tenant, or when the Term or any extension thereof shall have
expired, Tenant hereby authorizes any attorney of any court of record of the
Commonwealth of Pennsylvania to appear for Tenant and for anyone claiming by,
through or under Tenant and to confess judgment against all such parties, and
in favor of Landlord, in ejectment and for the recovery of possession of the
Premises, for which the Lease, as hereby amended, or a true and correct copy
thereof shall be good and sufficient warrant.

AFTER THE ENTRY OF ANY SUCH JUDGMENT A WRIT OF
POSSESSION MAY BE ISSUED THEREON WITHOUT FURTHER NOTICE TO TENANT AND WITHOUT A
HEARING.  If for any reason
after such action shall have been commenced it shall be determined and
possession of the Premises remain in or be restored to Tenant, Landlord shall
have the right for the same default and upon any subsequent default(s) or upon
the termination of the Lease, as hereby amended, or Tenant’s right of
possession as therein set forth, to again confess judgment as therein provided,
for which the Lease, as hereby amended, or a true and correct copy thereof
shall be good and sufficient warrant.

(b)           In addition to the rights and
remedies provided in subsection (a) above, if Tenant shall default in the
payment of the Rent due under the Lease, as hereby amended, Tenant hereby
authorizes any attorney of any court of record of the Commonwealth of
Pennsylvania to appear for Tenant and to confess judgment against Tenant, and
in favor of Landlord, for all sums due under the Lease, as hereby amended, plus
interest, costs and an attorney’s collection commission equal to the greater of
10% of all such sums or $1,000, for which the Lease, as hereby amended, or a
true and correct copy thereof shall be good and sufficient warrant.  TENANT UNDERSTANDS THAT
THE FOREGOING PERMITS LANDLORD TO ENTER A JUDGMENT AGAINST TENANT WITHOUT PRIOR
NOTICE OR HEARING.  ONCE SUCH A JUDGMENT
HAS BEEN ENTERED AGAINST TENANT, ONE OR MORE WRITS OF EXECUTION OR WRITS OF
GARNISHMENT MAY BE ISSUED THEREON WITHOUT FURTHER NOTICE TO TENANT AND WITHOUT
A HEARING, AND, PURSUANT TO SUCH WRITS, LANDLORD MAY CAUSE THE SHERIFF OF THE
COUNTY IN WHICH ANY PROPERTY OF TENANT IS LOCATED TO SEIZE TENANT’S PROPERTY BY
LEVY OR ATTACHMENT.  IF THE JUDGMENT
AGAINST TENANT REMAINS UNPAID AFTER SUCH LEVY OR ATTACHMENT, LANDLORD CAN CAUSE
SUCH PROPERTY TO BE SOLD BY THE SHERIFF EXECUTING THE WRITS, OR, IF SUCH
PROPERTY CONSISTS OF A DEBT OWED TO TENANT BY ANOTHER ENTITY, LANDLORD CAN
CAUSE SUCH DEBT TO BE PAID DIRECTLY TO LANDLORD IN AN AMOUNT UP TO BUT NOT TO
EXCEED THE AMOUNT OF THE JUDGMENT OBTAINED BY LANDLORD AGAINST TENANT, PLUS THE
COSTS OF THE EXECUTION.  Such
authority shall not be exhausted by one exercise thereof, but judgment may be
confessed as aforesaid from time to time as often as any of said rental and
other sums shall fall due or be in arrears, and such powers may be exercised as
well after the expiration of the initial Term of the Lease, as hereby amended,
and during any extended or renewal Term of the Lease, as hereby amended, and
after the expiration of any extended or renewal Term of the Lease, as hereby
amended.

(c)           The warrants to confess judgment set
forth above shall continue in full force and effect and be unaffected by
amendments to the Lease or other agreements between Landlord and Tenant even if
any such amendments or other agreements increase Tenant’s obligations or expand
the size of the Premises.  Tenant waives
any procedural errors in connection with the entry of any such judgment or in
the issuance of any one or more writs of possession or execution or garnishment
thereon.

(d)           TENANT
KNOWINGLY AND EXPRESSLY WAIVES (i) ANY RIGHT, INCLUDING, WITHOUT LIMITATION,
UNDER ANY APPLICABLE 

STATUTE,
WHICH TENANT MAY HAVE TO RECEIVE A NOTICE TO QUIT PRIOR TO LANDLORD COMMENCING
AN ACTION FOR REPOSSESSION OF THE PREMISES AND (ii) ANY RIGHT WHICH TENANT MAY
HAVE TO NOTICE AND TO HEARING PRIOR TO A LEVY UPON OR ATTACHMENT OF TENANT’S
PROPERTY OR THEREAFTER.

13.           Tenant acknowledges and agrees that the Lease is in full
force and effect.  To the best of Tenant’s
knowledge, as of the date hereof, Landlord is not in default under the Lease.

14.           This First Amendment shall be binding upon and inure to
the benefit of the parties and their respective successors and permitted
assigns.

IN
WITNESS WHEREOF,  Landlord and Tenant, intending to
be legally bound, have executed this First Amendment as of the day and year
first above written.

	
  

  	
   

  	
  LANDLORD:

  
	
   

  	
   

  	
  LIBERTY PROPERTY LIMITED PARTNERSHIP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Liberty Property Trust, Sole General Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: 

  	
   

  	
  /s/ James J. Mazzarelli

  	
   

  
	
   

  	
   

  	
   

  	
  Name: James J. Mazzarelli, Jr.

  	
   

  
	
   

  	
   

  	
   

  	
  Title: Senior Vice President, Regional Director

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TENANT:

  
	
   

  	
   

  	
  INTERNATIONAL HEALTH PARTNERS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Alex Soufflas

  	
   

  
	
   

  	
   

  	
   

  	
  Name: Alex Soufflas

  	
   

  
	
   

  	
   

  	
   

  	
  Title: CFO & EVP

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00119-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00119-of-00352.parquet"}]]