Document:

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

                             CROSS-LICENSE AGREEMENT

         This Agreement (the "Agreement") is entered into as of October 14, 2002
(the "Execution  Date") by and between Wyeth  (formerly,  American Home Products
Corporation)  by and  through  Genetics  Institute,  L.L.C.  (formerly  Genetics
Institute,  Inc.), a Delaware limited  liability company with a business address
at  87  CambridgePark   Drive,   Cambridge,   Massachusetts   02140  ("GI")  and
MetaMorphix,  Inc.,  a Delaware  corporation  with a  business  address at 8510A
Corridor Road, Savage,  Maryland 20763  ("MetaMorphix").  GI and MetaMorphix may
each be referred to herein  individually  as a "Party" and  collectively  as the
"Parties".

         WHEREAS,  as of December 1, 1994, GI, MetaMorphix and The Johns Hopkins
University ("JHU") entered into that certain Collaboration  Agreement (the "1994
Agreement")  relating to the  discovery,  characterization,  and  development of
factors in the TGF-B Superfamily (referred to by GI as "BMPs" and by MetaMorphix
and JHU as "GDFs,"/as such terms are more fully defined in that Agreement);

         WHEREAS,  as of January 26, 1999, the Parties and JHU entered into that
certain Amended and Restated Collaboration Agreement (as subsequently amended by
the Sponsored  Research  Amendments (as defined  below),  the "1999  Agreement")
relating to the discovery,  characterization,  and development of factors in the
TGF-B  Superfamily  (referred to by GI as "BMPs" and by  MetaMorphix  and JHU as
"GDFs," as such terms are more fully defined in that Agreement), which agreement
supercedes and replaces the 1994 Agreement;

         WHEREAS,  effective as of January 1, 2001, the Parties and JHU executed
and  delivered  that  certain  First  Amendment  to 1999  Amended  and  Restated
Collaboration  Agreement and, effective as of June 30, 2002, the Parties and JHU
executed  and  delivered  that  certain  Second  Amendment  to 1999  Amended and
Restated  Collaboration   Agreement   (collectively,   the  "Sponsored  Research
Amendments")  each  relating  to  Additional  Sponsored  Research at JHU focused
solely upon MetaMorphix Factor GDF-8; and

         WHEREAS,  the  Parties  desire to disclose  and share  freely with each
other Confidential  Information regarding MetaMorphix Factor GDF-8 and to expand
the  present  cross  licenses  (granted  under the 1999  Agreement)  between the
Parties in respect,  only,  to  MetaMorphix  Factor  GDF-8 and all  internal and
external  research  related to such Factor,  including,  but not limited to, the
June 1, 1998 -- December 31, 2000 Sponsored  Research at JHU in accordance  with
Section  3.3 of the  1999  Agreement  and the  postJanuary  1,  2001  Additional
Sponsored Research in accordance with the Sponsored Research Amendments.

         NOW THEREFORE,  in consideration of the foregoing premises,  the mutual
covenants,  agreements,  representations,  and  warranties  set forth herein and
other good and valuable  consideration,  the receipt and sufficiency of which is
hereby acknowledged

CONFIDENTIAL                          -1-
<PAGE>

by each of the Parties,  the Parties  hereby  covenant,  agree,  represent,  and
warrant as follows:

1.        DEFINITIONS.

         1.1      EXISTING  DEFINITIONS.  Unless expressly  defined herein,  all
                  capitalized  terms  used  in this  Agreement  shall  have  the
                  meanings  assigned to such terms in the 1999 Agreement and are
                  incorporated  herein by  reference.  For the sake of  clarity,
                  where a capitalized term is defined in both this Agreement and
                  in the  1999  Agreement,  the  definition  set  forth  in this
                  Agreement  shall  control with respect to the use of such term
                  in this  Agreement,  and the  definition set forth in the 1999
                  Agreement  shall  control with respect to the use of such term
                  in the 1999 Agreement.

         1.2      ADDITIONAL DEFINITIONS.  Solely for purposes of this Agreement
                  (it being  understood  and agreed that nothing in this Section
                  1.2 shall be deemed to be an amendment of any provision in the
                  1999 Agreement),  the following  capitalized  terms shall have
                  the respective meanings assigned thereto in this Section 1.2:

         1.2.1    "CONTROL" OR  "CONTROLLED"  shall mean with respect to any (i)
                  item of information,  including, without limitation, any GDF-8
                  KnowHow,  or (ii) intellectual  property right, the possession
                  (whether by purchase, assignment or license) by a Party of the
                  ability to grant to the other Party access and/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.

         1.2.2    "EFFECTIVE  DATE" shall mean the next  business day  following
                  the last to occur of: (i) the  delivery to each Party of fully
                  executed counterparts of this Agreement,  (ii) a determination
                  made  by GI  that a  notification  of  this  Agreement  is not
                  required  to  be  made  under  the  HSR  Act,   and  (iii)  if
                  notification  of this  Agreement  is required to be made under
                  the HSR Act,  the  expiration  or earlier  termination  of any
                  notice and waiting period under the HSR Act.

         1.2.3    "EXCLUDED  PRODUCT" shall mean any GI Excluded  Product or any
                  MetaMorphix Excluded Product.

         1.2.4    "GDF-8"  shall mean the  TGF-(3  Factor  known as GDF-8  which
                  Factor  is   designated   under  the  1999   Agreement   as  a
                  "MetaMorphix Factor".

         1.2.5    "GDF-8     DERIVATIVE      PRODUCT"     shall     mean     any
                  pharmaceuticalproduct which primarily acts as

CONFIDENTIAL                          -2-
<PAGE>

                  (i)      an  antagonist  or  agonist  of  GDF-8  or the  GDF-8
                           receptor,

                  (ii)     a vaccine against GDF-8,

                  (iii)    a modifier of GDF-8 synthesis, or

                  (iv)     a modulator of the GDF-8 signal transduction pathway,

                  only to the extent  that such  pharmaceutical  product is both
                  (a)  developed  or sold for the  purposes  of  modulating  the
                  effects  of GDF-8,  and (b) is  covered  by one or more  Valid
                  Claims  included  within the  applicable  GDF-8 Patent  Rights
                  licensed under Section 2.1 or Section 2.2 hereof.

         1.2.6    "GDF-8   KNOW-HOW"  shall  mean  any  unpatented   information
                  specifically   relating  to  GDF-8   produced   or   otherwise
                  Controlled  by  either  Party  which  is  reasonably   useful,
                  necessary or required  for the other Party and its  Affiliates
                  to  manufacture,  use and/or sell GDF-8 Licensed  Products for
                  use in the  MetaMorphix  Field or the GI Field, as applicable,
                  under this Agreement.

         1.2.7    "GDF-8 LICENSED PRODUCT" shall mean any GDF-8 Product or GDF-8
                  Derivative  Product, in each case, other than (i) with respect
                  to  the  rights  granted  to  GI  hereunder,  any  MetaMorphix
                  Excluded Product or (ii) with respect to the rights granted to
                  MetaMorphix hereunder, any GI Excluded Product.

         1.2.8    "GDF-8 PATENT RIGHTS" shall mean,  with respect to GDF-8,  any
                  GDF-8 Product, or any GDF-8 Derivative Product (a) all Patents
                  covering  inventions  (as such term is  defined  under  United
                  States  Patent  Law)  which (i) as of the  Effective  Date are
                  Controlled by or during the term of this  Agreement  come into
                  the  Control  of  either   Party,   either  alone  or  jointly
                  (including,  without limitation,  jointly with JHU pursuant to
                  the  1994  Agreement  or the  1999  Agreement)  and  (ii)  are
                  reasonably  useful,  necessary or required for the other Party
                  and its  Affiliates  to  manufacture,  use  and/or  sell GDF-8
                  Licensed  Products for use in the MetaMorphix  Field or the GI
                  Field,  as  applicable,  and (b) all  Patents  coming into the
                  Control of a Party during the term of this  Agreement,  which,
                  but for the  inclusion  of such  acquired  Patents  under this
                  clause (b),  would prevent the other Party and its  Affiliates
                  from  practicing  under  one or more of the  Patents  included
                  under clause (a) above.

CONFIDENTIAL                          -3-
<PAGE>

         1.2.9    "GDF-8 PRODUCT" shall mean GDF-8, including any and all

                  (i)      formulations, mixtures or compositions of GDF-8,

                  (ii)     antibodies targeted against GDF-8,

                  (iii)    receptors for which GDF-8 is a ligand,

                  (iv)     antisense molecules or ribozymes that modulate the IN
                           VIVO production of GDF-8, and

                  (v)      other   products   for   research,    diagnostic   or
                           therapeutic  use  containing  GDF-8  or  any  of  (i)
                           through (iv) above,

                  which,  or which  the  manufacture  use or sale of  which,  is
                  covered  by one or  more  Valid  Claims  included  within  the
                  applicable  GDF-8 Patent Rights  licensed under Section 2.1 or
                  Section 2.2 hereof.

         1.2.10   "GI  EXCLUDED  PRODUCT"  shall  mean any GDF-8  Product or any
                  GDF-8 Derivative  Product which GI selects pursuant to Section
                  3.3  hereof.  A list of those GI Excluded  Products  that have
                  been  selected  by GI as of the  Effective  Date  is  attached
                  hereto as Exhibit 1.2.10.

         1.2.11   "GI GDF-8 KNOW-HOW" shall mean that GDF-8 Know-How, other than
                  the Joint GDF-8  Know-How,  which is  Controlled  by GI or its
                  Affiliates as of the Effective  Date or comes into the Control
                  of GI or its Affiliates during the term of this Agreement,  in
                  each  case  other  than  through  the  grant  of  licenses  by
                  MetaMorphix under this Agreement or the 1999 Agreement.

         1.2.12   "GI GDF-8 PATENT RIGHTS" shall mean those GDF-8 Patent Rights,
                  other than the Joint GDF-8 Patent Rights, which are Controlled
                  by GI or its  Affiliates as of the Effective Date or come into
                  the  Control of GI or its  Affiliates  during the term of this
                  Agreement,  in each  case  other  than  through  the  grant of
                  licenses  by  MetaMorphix  under  this  Agreement  or the 1999
                  Agreement.  Without  limitation  of the  foregoing,  a list of
                  those GI GDF-8 Patent Rights believed to be existing as of the
                  Effective Date is attached hereto as Exhibit 1.2.12, PROVIDED,
                  HOWEVER,  that inclusion of any  particular  Patent on Exhibit
                  1.2.12  shall not  serve as an  admission  by either  Party or
                  evidence  that such  Patent  was not  included  in the  rights
                  licensed by GI to MetaMorphix under the 1999 Agreement.

CONFIDENTIAL                          -4-
<PAGE>

         1.2.13   "GI GDF-8 TECHNOLOGY" shall mean the GI GDF-8 Know-How, the GI
                  GDF-8  Patent  Rights and GI's  interest  in each of the Joint
                  GDF-8 Know-How and the Joint GDF-8 Patent Rights.

         1.2.14   "HSR  ACT"   shall   mean  the   Hart-Scott-Rodino   Antitrust
                  Improvements  Act of  1976,  as  amended,  and the  rules  and
                  regulations promulgated thereunder.

         1.2.15   "JOINT GDF-8 KNOW-HOW"  shall mean that GDF-8 Know-How,  which
                  (a) as of the  Effective  Date is Controlled by both (i) GI or
                  its Affiliates  and (ii)  MetaMorphix or its Affiliates or (b)
                  during the term of this  Agreement,  comes into the Control of
                  both  (i) GI or its  Affiliates  and (ii)  MetaMorphix  or its
                  Affiliates,  in each  case  other  than  through  the grant of
                  licenses by one Party to the other Party under this  Agreement
                  or the 1999 Agreement.

         1.2.15   "JOINT  GDF-8  PATENT  RIGHTS"  shall mean those GDF-8  Patent
                  Rights,  which (a) as of the  Effective  Date is Controlled by
                  both  (i) GI or its  Affiliates  and (ii)  MetaMorphix  or its
                  Affiliates or (b) during the term of this Agreement, come into
                  the  Control  of  both  (i)  GI or  its  Affiliates  and  (ii)
                  MetaMorphix or its Affiliates, in each case other than through
                  the grant of  licenses  by one Party to the other  Party under
                  this  Agreement or the 1999  Agreement.  A list of those Joint
                  GDF-8  Patent  Rights  existing  as of the  Effective  Date is
                  attached hereto as Exhibit 1.2.15.

         1.2.16   "METAMORPHIX  EXCLUDED.  PRODUCT" shall mean any GDF-8 Product
                  or any GDF-8  Derivative  Product  which  MetaMorphix  selects
                  pursuant to Section 3.3  hereof.  A list of those  MetaMorphix
                  Excluded Products that have been selected by MetaMorphix as of
                  the Effective Date is attached hereto as Exhibit 1.2.16

         1.2.17   "METAMORPHIX  GDF-8  KNOW-HOW" shall mean that GDF-8 Know-How,
                  other than the Joint GDF-8  Know-How,  which is  Controlled by
                  MetaMorphix  or its  Affiliates  as of the  Effective  Date or
                  comes into the Control of MetaMorphix or its Affiliates during
                  the term of this  Agreement,  in each case other than  through
                  the grant of licenses by GI under this  Agreement  or the 1999
                  Agreement.

         1.2.18   "METAMORPHIX  GDF-8  PATENT  RIGHTS"  shall mean  those  GDF-8
                  Patent Rights, other than the Joint GDF-8 Patent Rights, which
                  are  Controlled  by  MetaMorphix  or its  Affiliates as of the
                  Effective  - Date or come into the Control of  MetaMorphix  or
                  its Affiliates during the term of this Agreement, in each case
                  other than through

CONFIDENTIAL                          -5-
<PAGE>

                  the grant of licenses by GI under this  Agreement  or the 1999
                  Agreement.  Without  limitation  of the  foregoing,  a list of
                  those  MetaMorphix GDF-8 Patent Rights believed to be existing
                  as of the Effective Date is attached hereto as Exhibit 1.2.18,
                  PROVIDED,  HOWEVER, that inclusion of any particular Patent on
                  Exhibit 1.2.18 shall not serve as an admission by either Party
                  or evidence  that such  Patent was not  included in the rights
                  licensed by MetaMorphix to GI under the 1999 Agreement.

         1.2.19   "METAMORPHIX  GDF-8  TECHNOLOGY"  shall  mean the  MetaMorphix
                  GDF-8  Know-How,  the  MetaMorphix  GDF-8  Patent  Rights  and
                  MetaMorphix's interest in each of the Joint GDF-8 Know-How and
                  the Joint GDF-8 Patent Rights.

         1.2.20   "PRODUCT DEVELOPMENT" with respect to the activities conducted
                  by or on behalf of a Party,  shall mean any and all activities
                  performed,  by or on behalf of such Party,  in connection with
                  the  development  of any  GDF-8  Product  or GDF-8  Derivative
                  Product  from  the  date on  which  such  Party  has  formally
                  determined  (in  such  fashion  as  such   determinations  are
                  customarily  made  with  in  such  Party's   organization)  to
                  undertake those  preclinical  activities  necessary to support
                  the  filing  of an IND (in the  case of GI) or an INAD (in the
                  case of MetaMorphix)  until Regulatory  Approval of such GDF-8
                  Product  or  GDF-8  Derivative  Product  is  obtained  for the
                  indication under study, including, without limitation,  animal
                  toxicology  studies,  formulation  research  and  development,
                  manufacturing  research and development and clinical  studies.
                  When used as a verb in such context,  "Develop"  shall mean to
                  engage in Product Development.

2.        LICENSES AND OPTIONS.

         2.1      LICENSES  GRANTED TO GI. To the extent not granted to GI under
                  the  1999  Agreement,   and  subject  to  (i)  the  terms  and
                  conditions of this  Agreement,  (ii) the reservation of rights
                  set forth in Section 6.6 of the 1999  Agreement  and (iii) any
                  rights retained by the United States  government in accordance
                  with P.L.  96-517,  as  amended  by P.L.  98-620,  MetaMorphix
                  hereby grants to GI and its designated  Affiliates which agree
                  in writing  to comply  with the terms and  conditions  of this
                  -Agreement  (with  a copy  of  such  written  agreement  being
                  provided to MetaMorphix) an exclusive, royalty-bearing license
                  under the MetaMorphix GDF-8 Technology, including the right to
                  grant  sublicenses,  (i) to  make,  have  made,  use,  import,
                  market, offer for sale and sell GDF-8 Licensed Products in the
                  Territory,  in each case  only for use  solely in the GI Field
                  and (ii) to make,  have made and use GDF-8  Licensed  Products
                  and  MetaMorphix   Excluded   Products  for  GI's  and/or  its
                  designated

CONFIDENTIAL                          -6-
<PAGE>

                  Affiliates'   internal   research  and  development   purposes
                  (PROVIDED,  HOWEVER,  that no MetaMorphix Excluded Product may
                  be the  subject of a GI animal or clinical  study  without the
                  express prior  written  consent of  MetaMorphix,  which may be
                  withheld in its sole discretion). The license granted pursuant
                  to this  Section  2.1  shall  continue  in  effect  until  the
                  expiration of the last of the GDF-8 Patent Rights containing a
                  Valid Claim  licensed to GI under this Section 2.1,  PROVIDED,
                  HOWEVER, that thereafter, GI shall have a fully-paid,  royalty
                  free, perpetual,  irrevocable non-exclusive license to use the
                  MetaMorphix   GDF-8   Know-How  for  any  and  all   research,
                  development and commercialization purposes.

         2.2      LICENSES GRANTED TO METAMORPHIX.  To the extent not granted to
                  MetaMorphix  under the 1999 Agreement,  and subject to (i) the
                  terms and conditions of this  Agreement,  (ii) the reservation
                  of rights set forth in Section 6.6 of the 1999  Agreement  and
                  (iii) any rights  retained by the United States  government in
                  accordance with P.L.  96-517,  as amended by P.L.  98-620,  GI
                  hereby grants to  MetaMorphix  and its  designated  Affiliates
                  which agree in writing to comply with the terms and conditions
                  of this Agreement (with a copy of such written agreement being
                  provided  to GI) an  exclusive  (exclusive,  even  as to  GI),
                  royalty-bearing   license  under  the  GI  GDF-8   Technology,
                  including the right to grant  sublicenses,  (i) to make,  have
                  made,  use,  import,  market,  offer  for sale and sell  GDF-8
                  Licensed Products in the Territory,  in each case only for use
                  solely in the  MetaMorphix  Field and (ii) to make,  have made
                  and use GDF-8 Licensed  Products and GI Excluded  Products for
                  MetaMorphix's  and/or  its  designated   Affiliates'  internal
                  research and development purposes (PROVIDED,  HOWEVER, that no
                  GI Excluded Product may be the subject of a MetaMorphix animal
                  or clinical study without the express prior written consent of
                  GI, which may be withheld in its sole discretion). The license
                  granted  pursuant to this Section 2.2 shall continue in effect
                  until the  expiration  of the last of the GDF-8 Patent  Rights
                  containing a Valid Claim  licensed to  MetaMorphix  under this
                  Section 2.1, PROVIDED,  HOWEVER, that thereafter,  MetaMorphix
                  shall have a fully-paid, royalty free, perpetual,  irrevocable
                  non-exclusive  license to use the GI GDF8 Know-How for any and
                  all research, development and commercialization purposes.

         2.3      OPTION FOR CERTAIN EXCLUDED PRODUCTS. In the event that either
                  GI or MetaMorphix develops or otherwise acquires rights to any
                  Excluded  Product  and  such  Party  determines,  in its  sole
                  reasonable business judgment, that the inclusion by it of such
                  Excluded  Product within the license granted under Section 2.1
                  or Section 2.2, as the case may be, would not  interfere  with
                  its  product  development  and/or  commercialization  of  such
                  Excluded Product,  such Party (the "Offering Party") agrees to
                  extend to the other Party, by written notice,  the opportunity
                  to  negotiate  a  royalty-bearing  license  to  such  Excluded
                  Product, which license would (a) be restricted to the GI Field
                  or the

CONFIDENTIAL                          -7-
<PAGE>

                  MetaMorphix  Field,  as  applicable,   (b)  provide  for  such
                  royalties,  reports, and records as are set forth in Section 4
                  herein (and otherwise  incorporate  the provisions of Sections
                  9, 10, and 11), and (c) may provide for reasonable  parameters
                  for  clinical  testing,  regulatory  approaches,  and labeling
                  requirements.  Within  thirty  (30)  days  of  receiving  such
                  notice,  such  other  Party  may  elect to  negotiate  such an
                  agreement  (which shall become an amendment of this Agreement)
                  by  providing  the  Offering  Party  written  notice  of  such
                  election,  in which event the Parties would promptly  commence
                  good faith  negotiations  of the license terms (as provided in
                  this Section 2.3). If  MetaMorphix  and GI are unable to agree
                  on the terms and  conditions  of such a license  within ninety
                  (90) days after the Offering  Party  receives such notice from
                  the other Party,  the Offering  Party shall  thereafter not be
                  free to grant such  rights and  licenses  to any Third  Party.
                  This Section 2.3 is intended to amend and replace  Section 6.9
                  of  the  1999   Agreement  with  respect  to  the  rights  and
                  obligations conferred upon GI and MetaMorphix  thereunder and,
                  as such,  this  Section  2.3 shall  govern  and  control  with
                  respect to both this Agreement and the 1999 Agreement.

         2.4      RIGHTS  LICENSED  FROM  THIRD  PARTIES.  In the event that the
                  license  to  MetaMorphix  or GI  under  Sections  2.1  or  2.2
                  includes  rights  acquired by the licensor  Party from a Third
                  Party  (other than from JHU  pursuant  to the 1999  Agreement)
                  which involve the payment of royalties, fees or other payments
                  to such Third  Party,  the  licensor  Party  shall  notify the
                  licensee Party of the obligation to make such payment(s).  The
                  licensee  Party  promptly  shall  elect in writing  whether to
                  exclude such Third Party  rights from the licenses  granted to
                  it under this  Agreement,  and if the licensee  Party fails to
                  exclude such  rights,  it shall be fully  responsible  for the
                  payment of any such royalties, fees and other payments to such
                  Third  Party  as a  result  of its  practice  of the  licenses
                  granted to it hereunder.

         2.5      NONCOMPETE.

                  2.5.1    BY METAMORPHIX. MetaMorphix and GI agree that, for so
                           long as the  licenses  granted to GI,  under  Section
                           2.1,  with  respect to the  Product  Development  and
                           commercialization of GDF-8 Licensed Products,  remain
                           in  effect,  MetaMorphix  will not sell or  otherwise
                           distribute  any  GDF-8  Product  or GDF-8  Derivative
                           Product  for  use  in  the GI  Field.  The  preceding
                           sentence   shall  not  apply  to  any  products  that
                           MetaMorphix obtains,  other than through the grant of
                           rights under the 1999  Agreement,  from a Third Party
                           who has  developed  (or obtained  from another  Third
                           Party  who  has  developed)  such  products   without
                           infringing  issued patents of GI included  within the
                           GI GDF-8 Patent  Rights under this  Agreement,  which
                           products were fully developed by or on behalf of such
                           Third  Party  without  the use of any of the GI GDF-8
                           Know-How or any Confidential  Information of GI. GI's
                           right to enforce this Section 2.5.1 shall not

CONFIDENTIAL                          -8-
<PAGE>

                           be assignable, except to its Affiliates. This Section
                           2.5.1 is not  intended  as an  amendment  of  Section
                           6.8.1  of the 1999  Agreement  but,  rather,  confers
                           rights and obligations in addition to those set forth
                           in Section 6.8.1 of the 1999 Agreement.

                  2.5.2    BY GI. GI and MetaMorphix  agree that, for so long as
                           the licenses  granted to  MetaMorphix,  under Section
                           2.2,  with  respect to the  Product  Development  and
                           commercialization of GDF-8 Licensed Products,  remain
                           in effect,  GI will not sell or otherwise  distribute
                           any GDF-8 Product or GDF-8 Derivative Product for use
                           in the  MetaMorphix  Field.  The  preceding  sentence
                           shall  not  apply to any  products  that GI  obtains,
                           other than through the grant of rights under the 1999
                           Agreement,  from a Third Party who has  developed (or
                           obtained from another Third Party who has  developed)
                           such  products  without   infringing  issued  patents
                           included within the  MetaMorphix  GDF-8 Patent Rights
                           under  this  Agreement,  which  products  were  fully
                           developed by or on behalf of such Third Party without
                           the  use of any of the  MetaMorphix  Know-How  or any
                           Confidential      Information     of     MetaMorphix.
                           MetaMorphix's  right to enforce  this  Section  2.5.2
                           shall not be  assignable,  except to its  Affiliates.
                           This Section 2.5.2 is not intended as an amendment of
                           Section  6.8.2 of the  1999  Agreement  but,  rather,
                           confers  rights and  obligations in addition to those
                           set forth in Section 6.8.2 of the 1999 Agreement.

         2.6      HSR FILING AND APPROVALS.

                  2.6.1    HSR FILING.  As soon as practicable  (consistent with
                           each Party's  procedures  for doing so, each of Wyeth
                           and MetaMorphix  shall  determine,  in its respective
                           reasonable judgment, whether any filings are required
                           under the HSR Act and shall notify the other Party of
                           the  determination so made. In the event either Party
                           determines  that such filings should be made, each of
                           MetaMorphix and GI shall file, as soon as practicable
                           thereafter,  with the Federal Trade  Commission  (the
                           "FTC")  and  the  Antitrust  Division  of the  United
                           States   Department   of  Justice   (the   "Antitrust
                           Division")  the  notification  and  report  form (the
                           "Report")  required under the HSR Act with respect to
                           the  transactions  as  contemplated  hereby and shall
                           reasonably  cooperate  with  the  other  Party to the
                           extent  necessary  to assist  the other  Party in the
                           preparation  of its  Report  and to proceed to obtain
                           necessary  approvals under the HSR Act, including but
                           not limited to the expiration or earlier  termination
                           of any and all applicable waiting periods required by
                           the HSR Act. The Parties  shall share  equally in any
                           fees required to be paid to any  governmental  agency
                           in connection with making such filings and each Party
                           shall bear its own expenses, including, without

CONFIDENTIAL                          -9-
<PAGE>

                           limitation,  legal fees,  incurred in connection with
                           preparing such filings.

                  2.6.2    METAMORPHIX'S   AND   GI'S   OBLIGATIONS.   Each   of
                           MetaMorphix  and GI shall use its good faith  efforts
                           to eliminate  any concern on the part of any court or
                           government  authority  regarding  the legality of the
                           proposed  transaction,   including,  if  required  by
                           federal  or  state  antitrust  authorities,  promptly
                           taking  all  steps  to  secure  government  antitrust
                           clearance, including, without limitation, cooperating
                           in  good  faith  with  any  government  investigation
                           including  the prompt  production  of  documents  and
                           information   demanded   by  a  second   request  for
                           documents and of witnesses if requested.

                  2.6.3    ADDITIONAL   APPROVALS.   MetaMorphix   and  GI  will
                           cooperate and use respectively all reasonable efforts
                           to  make  all  other   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. Neither Party shall be required,
                           however,  to divest  products or assets or materially
                           change its  business  if doing so is a  condition  of
                           obtaining   approval  under  the  HSR  Act  or  other
                           governmental    approvals    of   the    transactions
                           contemplated by this Agreement.

3. INFORMATION DISCLOSURE; EXCLUDED PRODUCTS.

         3.1      RESEARCH MANAGEMENT COMMITTEE.  Within thirty (30) days of the
                  Effective  Date,  the  Parties  shall  reestablish  a Research
                  Management  Committee ("RMC") consisting of an equal number of
                  between  two (2) and four (4)  representatives  of each Party.
                  The  sole  functions  of the RMC  shall be to  facilitate  the
                  exchange of ideas and information by GI and MetaMorphix  under
                  this  Agreement.  The RMC  shall  have no right  to amend  any
                  provision of this Agreement.  The RMC shall meet at least once
                  during  each  calendar  half-year  (or more or less often as a
                  majority of the members of the RMC may agree)  during the term
                  of this Agreement. Meetings of the RMC shall alternate between
                  GI and MetaMorphix locations,  provided that such meetings may
                  also  be  held   telephonically  or  by   videoconference   as
                  determined by the members of the RMC.

         3.2      INFORMATION  DISCLOSURE.  Each of GI and MetaMorphix shall use
                  its Commercially  Reasonable Efforts to disclose, via exchange
                  of information at

CONFIDENTIAL                          -10-
<PAGE>

                  meetings  of the  RMC  and  provision  of  reports  (if and as
                  available),  to the  other  Party,  a summary  of those  GDF-8
                  Patent  Rights  and  GDF-8  Know-How  that has come  into such
                  Party's Control and has not been  previously  disclosed to the
                  other Party.  Upon  important  discoveries  or advances  being
                  made,   such  Party  shall   endeavor  to  disclose  such  new
                  information   prior   to  the   next   meeting   of  the  RMC.
                  Notwithstanding  the  foregoing,  it shall  not be a breach of
                  this   Agreement,   if  a  Party  has  used  its  good   faith
                  Commercially   Reasonable   Efforts  to  disclose  such  GDF-8
                  Know-How but has failed to disclose all such GDF-8 Know-How to
                  the other Party  (provided that, upon request by the receiving
                  Party or awareness of the disclosing  Party,  such undisclosed
                  information  is then promptly  disclosed).  From time to time,
                  upon request,  a disclosing  Party shall endeavor,  but not be
                  obligated   to  provide  the   receiving   Party  with  sample
                  quantities  of  proteins  and other  materials  to assist  the
                  receiving   Party   in  its   assessment   of  the   disclosed
                  Confidential  Information.  Any GDF-8  Know-How  disclosed  or
                  materials  provided by a Party pursuant to this Section 3.2 or
                  otherwise to the other Party shall be treated as  Confidential
                  Information of the disclosing Party in accordance with Article
                  7 hereof.

         3.3      EXCLUDED PRODUCTS.  From time to time, each Party may, in good
                  faith and by  written  notice to the  other  Party,  designate
                  certain GDF-8 Products and GDF-8  Derivative  Products  (other
                  than,  (i) in the  case  of GI  making  a  designation,  GDF-8
                  Products or GDF-8 Derivative  Products consisting of compounds
                  or  compositions  where such  compounds  or  compositions  are
                  Controlled by MetaMorphix and are initially  provided to GI by
                  MetaMorphix  under this  Agreement or the 1999  Agreement  and
                  (ii) in the case of MetaMorphix  making a  designation,  GDF-8
                  Products or GDF-8 Derivative  Products consisting of compounds
                  or  compositions  where such  compounds  or  compositions  are
                  Controlled by GI and are initially  provided to MetaMorphix by
                  GI under this Agreement or the 1999  Agreement),  as either GI
                  Excluded  Products  or  MetaMorphix   Excluded  Products,   as
                  applicable.  Such notice shall detail the  rationale  for such
                  designation.  A Party may designate a GDF-8 Product or a GDF-8
                  Derivative  Product  as  either  a GI  Excluded  Product  or a
                  MetaMorphix   Excluded   Product  only  if  such  Party  (upon
                  successful,  in vivo, proof of concept) has initiated  Product
                  Development of such GDF-8 Product or GDF-8 Derivative Product,
                  PROVIDED,  HOWEVER, that upon designating any GDF-8 Product or
                  GDF-8  Derivative   Product  as  an  Excluded   Product,   the
                  designating Party may also designate as Excluded  Products,  a
                  reasonable  number of other GDF-8 Products or GDF-8 Derivative
                  Products (as the case may be),  which GDF-8  Products or GDF-8
                  Derivative Products not only are in the same chemical class or
                  biological  class  as the  GDF-8  Product  or GDF-  Derivative
                  Product primarily  selected as an Excluded  Product,  but also
                  are intended be back-up candidates (to the extent customary in
                  the  pharmaceutical   industry)  for  the  primarily  selected
                  Excluded  Product.  For the sake of  clarity,  a Party may not
                  designate  a  broad   category  of  GDF-8  Products  or  GDF-8
                  Derivative

CONFIDENTIAL                          -11-
<PAGE>

                  Products  (e.g.,  all  antibodies,   or  all  compounds  of  a
                  particular  chemical class, or a biological class) as Excluded
                  Products,  merely  because  such Party has  initiated  Product
                  Development of a GDF-8 Product or a GDF-8  Derivative  Product
                  within such category.  A designated  Excluded Product shall be
                  only an active ingredient or a single molecule.  Except to the
                  extent  provided  otherwise  in Section 2.4 above,  during the
                  term of this  Agreement,  MetaMorphix  shall  not  develop  or
                  commercialize any GI Excluded Product in the MetaMorphix Field
                  and GI shall not  develop  or  commercialize  any  MetaMorphix
                  Excluded Product in the GI Field.

4.        ROYALTIES.

         4.1      PAYABLE  BY GI. GI shall pay to  MetaMorphix,  on a country by
                  country  basis, a royalty in the amount of two percent (2%) of
                  the Net  Sales of each  GDF-8  Licensed  Product  sold in such
                  country by or on behalf of GI, its Affiliates or  sublicensees
                  (other than  MetaMorphix)  pursuant to the licenses granted by
                  MetaMorphix to GI hereunder.  Such royalties shall be payable,
                  on a country by country basis, for so long as the manufacture,
                  use or sale of such GDF-8  Licensed  Product  in such  country
                  would,  but for the  licenses  granted  by  MetaMorphix  to GI
                  hereunder,  infringe a Valid Claim of a patent included within
                  the MetaMorphix  GDF-8 Patent Rights or the Joint GDF-8 Patent
                  Rights  licensed by  MetaMorphix  to GI hereunder and shall be
                  incremental to any royalty  payable under the 1999  Agreement,
                  PROVIDED,  HOWEVER,  that  the  grant  of  rights  under  this
                  Agreement  shall not serve to extend the period of time during
                  which royalties are payable under the 1999 Agreement.

         4.2      PAYABLE  BY  METAMORPHIX.  MetaMorphix  shall  pay to GI, on a
                  country  by  country  basis,  a royalty  in the  amount of two
                  percent (2%) of the Net Sales of each GDF-8  Licensed  Product
                  sold in such  country  by or on  behalf  of  MetaMorphix,  its
                  Affiliates  or  sublicensees  (other than GI)  pursuant to the
                  licenses  granted  by  GI  to  MetaMorphix   hereunder.   Such
                  royalties shall be payable, on a country by country basis, for
                  so long as the manufacture, use or sale of such GDF-8 Licensed
                  Product in such country would, but for the licenses granted by
                  GI to  MetaMorphix  hereunder,  infringe  a Valid  Claim  of a
                  patent included within the GI GDF-8 Patent Rights or the Joint
                  GDF-8 Patent Rights  licensed by GI to  MetaMorphix  hereunder
                  and shall be incremental to any royalty payable under the 1999
                  Agreement,  PROVIDED,  HOWEVER, that the grant of rights under
                  this  Agreement  shall not serve to extend  the period of time
                  during which royalties are payable under the 1999 Agreement.

CONFIDENTIAL                          -12-
<PAGE>

         4.3      ROYALTY CALCULATIONS.

                  4.3.1    COUNTRY-BY-COUNTRY  BASIS.  For each  GDF-8  Licensed
                           Product,  royalties  shall be payable by a Party on a
                           country-by-country  basis  solely with respect to Net
                           Sales  for any  country  where  such  GDF-8  Licensed
                           Product is  manufactured  or sold in which there is a
                           Valid Claim under the applicable GDF-8 Patent Rights.
                           However,  for sales of a GDF-8 Licensed Product which
                           is  manufactured  in a  country  in which  there is a
                           Valid Claim under the applicable GDF-8 Patent Rights,
                           but sold in a  country  where  there  is no  existing
                           Valid Claim under the applicable GDF-8 Patent Rights,
                           the  royalties  payable  hereunder by the Parties for
                           sales  in that  country  shall  be  reduced  by fifty
                           percent  (50%) if  products  are  being  sold in that
                           country  which  directly   compete  with  such  GDF-8
                           Licensed Product.

                  4.3.2    ADVANCED PRODUCTS.  For GDF-8 Licensed Products which
                           are   not   finished   formulations,    mixtures   or
                           compositions  of GDF-8  (that is, for GDF-8  Licensed
                           Products  which  could not have been  developed  by a
                           Party but for the application of substantial advanced
                           technologies  developed  by  that  Party  (including,
                           without limitation, GDF-8 Licensed Products which are
                           antibodies,  antisense  molecules  or  ribozymes  to,
                           GDF-8),   the  royalty  payable   hereunder  by  that
                           developing  Party on Net Sales of that GDF-8 Licensed
                           Product  shall be reduced to reflect  the fair market
                           value contribution of that advanced technology to the
                           GDF-8  Licensed  Product,  as  determined  by  mutual
                           agreement  of the  Parties.  In the  event  that  the
                           Parties  are  unable to  calculate  or agree upon the
                           fair  market  value   contribution  of  the  advanced
                           technology to the GDF-8  Licensed  Product,  then the
                           royalty payable by the developing  Party on Net Sales
                           of that GDF-8  Licensed  Product  shall be reduced by
                           fifty percent (50%).

                  4.3.3    THIRD PARTY ROYALTIES.  If it becomes  necessary,  in
                           order for a Party or its  Affiliates or  sublicensees
                           to make, use or sell any GDF-8 Licensed  Product,  to
                           pay  royalties  under a Third  Party's  patent rights
                           (including  amounts, if any, payable to Third Parties
                           under  Section  2.4,  above;   and  with  respect  to
                           MetaMorphix,  excluding amount payable by MetaMorphix
                           to GI under this  Agreement or to JHU and/or GI under
                           the 1999 Agreement; and with respect to GI, excluding
                           amount  payable  by  GI  to  MetaMorphix  under  this
                           Agreement or to MetaMorphix and/or JHU under the 1999
                           Agreement),  then the  licensee  Party shall have the
                           right to deduct fifty percent (50%) of the amounts so
                           paid to Third  Parties up to a total of fifty percent
                           (50%) of the amount  due  hereunder  to the  licensor
                           Party on account of such  particular  GDF-8  Licensed
                           Product.

CONFIDENTIAL                          -13-
<PAGE>

                  4.3.4    LIMITATION  ON  ROYALTY  DEDUCTIONS.   Total  royalty
                           deductions  under this  Section  4.3 shall not exceed
                           fifty  percent  (50%) of the amount due the  licensor
                           Party on account  of Net Sales of the GDF-8  Licensed
                           Product, for which royalty payments are owed.

         4.4      REPORTS AND PAYMENT.  Each Party shall deliver to the Party to
                  which  royalties  are owed  hereunder,  within sixty (60) days
                  after  the end of each  calendar  quarter,  a  written  report
                  showing its  computation of royalties due under this Agreement
                  upon Net Sales by such Party,  its Affiliates and sublicensees
                  during such calendar quarter. All Net Sales shall be segmented
                  in each such report  according  to sales by such  Party,  each
                  Affiliate   and   each   sublicensee,   as   well   as   on  a
                  country-by-country basis, including the rates of exchange used
                  to convert such  royalties to United  States  Dollars from the
                  currency  in  which  such  sales  were  made.  Subject  to the
                  provisions  of  Sections  4.5  and  4.6  of  this   Agreement,
                  simultaneously  with the  delivery  of each such  report,  the
                  paying Party shall tender  payment in United States Dollars of
                  all  royalties  shown to be due  therein.  Such reports may be
                  combined  with any report to be submitted by such Party to the
                  other Party  pursuant to the 1999  Agreement,  provided,  that
                  such combined  report  separately  states the amounts  payable
                  under the 1999  Agreement  and the amounts  payable under this
                  Agreement.  For purposes  hereof,  the rates of exchange to be
                  used for  converting  royalties  hereunder  to  United  States
                  Dollars shall be the closing price  published for the purchase
                  of United States Dollars in the East Coast Edition of the Wall
                  Street  Journal  for the  last  business  day of the  calendar
                  quarter for which payment is due.

         4.5      FOREIGN ROYALTIES. Where royalties are due hereunder for sales
                  of GDF-8 Licensed  Products in a country  where,  by reason of
                  currency regulations or taxes of any kind, it is impossible or
                  illegal  for such  Party,  any  Affiliate  or  sublicensee  to
                  transfer  royalty payments to the licensor Party for Net Sales
                  in that country, such royalties shall be deposited in whatever
                  currency is allowable by the person or entity not able to make
                  the transfer  for the benefit or credit of the licensor  Party
                  in an  accredited  bank in  that  country  that is  reasonably
                  acceptable to the licensor Party.

         4.6      TAXES.  Any and all income or similar  taxes imposed or levied
                  on account  of the  receipt of  royalties  payable  under this
                  Agreement  which are  required to be withheld by a Party shall
                  be paid by such  Party,  its  Affiliates  or  sublicensees  on
                  behalf of the  licensor  Party and shall be paid to the proper
                  taxing  authority.  Proof of payment shall be secured and sent
                  to the  licensor  Party  by  such  Party,  its  Affiliates  or
                  sublicensees  as  evidence  of such  payment  in such  form as
                  required by the tax authorities having  jurisdiction over such
                  Party,  its  Affiliates or  sublicensees.  Such taxes shall be
                  deducted  from the royalty that would  otherwise be remittable
                  hereunder by the Party, its Affiliates or sublicensees.

CONFIDENTIAL                          -14-
<PAGE>

          4.7     RECORDS.   Each  Party  shall  keep,  and  shall  require  all
                  Affiliates and  sublicensees to keep, for a period of at least
                  two (2) years,  full,  true and accurate books of accounts and
                  other records containing all information and data which may be
                  necessary to  ascertain  and verify the  royalties  payable by
                  such Party  hereunder.  During the term of this  Agreement and
                  for a period of two (2) years following its termination,  each
                  Party  shall  have the right  from time to time (not to exceed
                  once during each calendar year) to inspect in  confidence,  or
                  have an agent,  accountant or other representative  inspect in
                  confidence, such books, records and supporting data.

5.       PRODUCT DEVELOPMENT AND COMMERCIALIZATION.

          5.1     DILIGENCE  OBLIGATIONS.  GI and MetaMorphix each shall have no
                  diligence  obligations with respect to the Product Development
                  or  commercialization  of any GDF-8 Licensed  Product over and
                  above those set forth in the 1999 Agreement.

6.       PATENT PROSECUTION AND INFRINGEMENT.

         6.1      RESPONSIBILITY FOR PATENTING GDF-8 PATENT RIGHTS.

                  6.1.1    GI GDF-8 PATENT RIGHTS AND CERTAIN JOINT GDF-8 PATENT
                           RIGHTS. Subject to the rights and obligations of each
                           of the Parties and JHU under the 1999  Agreement,  GI
                           shall have the first right,  but not the  obligation,
                           to  seek or  continue  to  seek  or  maintain  Patent
                           protection  on any GI  GDF-8  Patent  Rights  and any
                           Joint GDF-8  Patent  Rights,  in any  country.  If GI
                           elects,  in any  country  not to seek or  continue to
                           seek or maintain Patent  protection on any such GDF-8
                           Patent Rights,  to the extent the  manufacture use or
                           sale, by  MetaMorphix,  of a GDF-8  Licensed  Product
                           would  infringe  such  GDF-8  Patent  Rights  in such
                           country,  MetaMorphix  shall have the right,  but not
                           the obligation,  at its expense, to file, procure and
                           maintain  in  such  country(ies)  such  GDF-8  Patent
                           Rights.

                  6.1.2    METAMORPHIX  GDF-8  PATENT  RIGHTS.  Subject  to  the
                           rights and  obligations  of the Parties and JHU under
                           the 1999 Agreement,  MetaMorphix shall have the first
                           right, but not the obligation, to seek or continue to
                           seek  -  or  maintain   Patent   protection   on  any
                           MetaMorphix  GDF-8 Patent  Rights in any country.  If
                           MetaMorphix elects not to seek or continue to seek or
                           maintain Patent  protection on any MetaMorphix  GDF-8
                           Patent  Rights  in any  country,  GI  shall  have the
                           right,  but not the  obligation,  at its expense,  to
                           file,  procure and maintain in such country(ies) such
                           MetaMorphix GDF-8 Patent Rights.

CONFIDENTIAL                          -15-
<PAGE>

                  6.1.3    PATENT COOPERATION. Each Party shall advise the other
                           Party of all  decisions  taken under this Section 6.1
                           in a timely  manner in order to allow the other Party
                           to protect its rights under this  Section  6.1.  Each
                           Party  shall  provide  the other Party with copies of
                           all  substantive   communications   from  all  patent
                           offices  regarding any GDF-8 Patent Rights,  promptly
                           after the receipt  thereof.  Each Party shall provide
                           the  other   Party  with   copies  of  all   proposed
                           substantive  communications  to such  patent  offices
                           regarding the GDF-8 Patent Rights in sufficient  time
                           before  the due  date in order to  enable  the  other
                           applicable  Party an  opportunity  to  comment on the
                           content  thereof.  Each Party shall make available to
                           the other Party, or its authorized attorneys,  agents
                           or  representatives,  such of its employees  whom the
                           other applicable  Party, in its reasonable  judgment,
                           deems  necessary  in order to assist it in  obtaining
                           Patent  protection  for the  applicable  GDF-8 Patent
                           Rights,  in the event the Party with first  rights to
                           seek  or  continue   to  seek  or   maintain   Patent
                           protection on any such GDF-8Patent Rights chooses not
                           to do so.  Each  Party  shall  sign or use  its  best
                           efforts to have signed all legal documents  necessary
                           to  file  and  prosecute  Patents  or  to  obtain  or
                           maintain Patents at no cost to the other Party.  Each
                           Party  shall  bear  all  costs   incurred  by  it  in
                           exercising the foregoing rights.

                  6.1.4    INTERFERENCES. The Parties shall each, in good faith,
                           use its respective Commercially Reasonable Efforts to
                           resolve any patent  interferences  between any of the
                           Parties  relating to Patents directed to GDF-8 or any
                           GDF-8 Licensed Product.

         6.2      INFRINGEMENT.

                  6.2.1    NOTICE.  Each Party shall promptly  report in writing
                           to the other Party during the term of this  Agreement
                           any (i) known infringement or suspected  infringement
                           of  any  of  the   GDF-8   Patent   Rights   or  (ii)
                           unauthorized  use or  misappropriation  of the  other
                           Party's Confidential  Information by a Third Party of
                           which it becomes  aware,  and shall provide the other
                           Parties with all available  evidence  supporting said
                           infringement,  suspected infringement or unauthorized
                           use or misappropriation.

                  6.2.2    FIRST RIGHT TO INITIATE SUITS.  Subject to the rights
                           and   obligations  of  the  Parties  under  the  1999
                           Agreement,  MetaMorphix shall have the first right to
                           initiate an  infringement or other  appropriate  suit
                           against   any  Third   Party  who  at  any  time  has
                           infringed, or is suspected of infringing,  any of the
                           MetaMorphix   GDF-8  Patent  Rights  licensed  to  GI
                           hereunder or of using  without  proper  authorization
                           all or any of MetaMorphix's Confidential Information,
                           where such infringement,

CONFIDENTIAL                          -16-
<PAGE>

                           suspected   infringement  or   unauthorized   use  is
                           determined by  MetaMorphix  to have an adverse affect
                           on its  ability to make,  have made,  use and/or sell
                           GDF-8 Licensed Products,  PROVIDED,  HOWEVER, that GI
                           shall  have  the  first   right  to   initiate   such
                           infringement  or other  appropriate  suit against any
                           such  Third  Party,  where the  actual  or  suspected
                           infringement  is occurring  only in the GI Field.  GI
                           shall   have  the   first   right  to   initiate   an
                           infringement  or other  appropriate  suit against any
                           Third  Party  who at any  time has  infringed,  or is
                           suspected of  infringing,  any of the GI GDF-8 Patent
                           Rights licensed to MetaMorphix hereunder or the Joint
                           GDF-8  Patent  Rights,  or of  using  without  proper
                           authorization   all  or  any  of  GI's   Confidential
                           Information,   where  such  infringement,   suspected
                           infringement or unauthorized  use is determined by GI
                           to have an  adverse  affect on its  ability  to make,
                           have made, use and/or sell GDF-8  Licensed  Products.
                           GI and  MetaMorphix  agree to consult with each other
                           prior to instituting any such suit and to provide the
                           other Party a reasonable  opportunity to participate,
                           at its own  expense,  in any such suit to protect its
                           respective interests.

                  6.2.3    RIGHT TO PARTICIPATE IN SUIT. The Party  initiating a
                           suit  pursuant  to Section  6.2.2  above (the  "first
                           Party")  shall  give the  other  Party  (the  "second
                           Party")  sufficient  advance  notice of its intent to
                           file said suit and the  reasons  therefor,  and shall
                           provide the second Party with an  opportunity to make
                           suggestions   and  comments   regarding   such  suit,
                           including, without limitation, the initiation thereof
                           and the  selection  of  counsel  therefor.  The first
                           Party shall keep the second Party promptly  informed,
                           and shall from time to time  consult  with the second
                           Party regarding the status of any such suit and shall
                           provide the second Party with copies of all documents
                           filed in, and all written communications relating to,
                           such suit. Except as provided herein, the first Party
                           shall  have the sole and  exclusive  right to  select
                           counsel  for any suit and shall pay all  expenses  of
                           the suit,  including  without  limitation  attorneys'
                           fees and court costs.  The second Party,  in its sole
                           discretion,  may elect,  within sixty (60) days after
                           the commencement of such litigation,  to contribute a
                           fixed  percentage of up to fifty percent (50%) of the
                           costs incurred by the first Party in connection  with
                           such  litigation,   including,   without  limitation,
                           reimbursement   of   the   first   Party's   expenses
                           hereunder.  If it so elects, any damages,  royalties,
                           settlement  fees or other  consideration  received by
                           the  first  Party or any of its  Affiliates  for past
                           infringement or  misappropriation as a result of such
                           litigation  shall be shared  by the first and  second
                           Parties pro-rata based on their respective sharing of
                           the  costs of such  litigation,  subject  to  Section
                           6.2.5,  below.  In the event  that the  second  Party
                           elects  not  to  contribute  to  the  costs  of  such
                           litigation,  the first  Party  and/or its  Affiliates
                           shall be entitled to retain any  damages,  royalties,
                           settlement

CONFIDENTIAL                          -17-
<PAGE>

                           fees or other  consideration for past infringement or
                           misappropriation  resulting  therefrom,   subject  to
                           Section 6.2.5, below. If necessary or desirable,  the
                           second  Party  shall  join as a party to the suit but
                           shall be under no obligation to participate except to
                           the extent that such participation is required as the
                           result of being a named party to the suit. The second
                           Party shall offer reasonable  assistance to the first
                           Party in  connection  therewith  at no  charge to the
                           first Party except for  reimbursement  of  reasonable
                           out-of-pocket  expenses.  The second Party shall have
                           the right to  participate  and be  represented in any
                           such suit by its own counsel at its own expense.  The
                           first Party shall not settle any such suit  involving
                           rights of the  second  Party  without  obtaining  the
                           prior  written  consent  of the second  Party,  which
                           consent  shall  not  be   unreasonably   withheld  or
                           delayed.

                  6.2.4    SECOND RIGHT TO INITIATE  SUIT. In the event that the
                           first Party elects not to initiate an infringement or
                           other  appropriate  suit pursuant to Sections  6.2.2,
                           above, as applicable,  the first Party shall promptly
                           advise the second Party of its intent not to initiate
                           such suit, and the second Party shall have the right,
                           at its expense,  of  initiating  an  infringement  or
                           other appropriate suit against any Third Party who at
                           any  time  has   infringed,   or  is   suspected   of
                           infringing, any of the GDF8 Patent Rights or of using
                           without  proper  authorization  all or any portion of
                           such Party's Confidential Information.  In exercising
                           its  rights  pursuant  to this  Section  6. 2. 4, the
                           second Party shall have the sole and exclusive  right
                           to select  counsel  and  shall,  except  as  provided
                           below, pay all expenses of the suit including without
                           limitation attorneys' fees and court costs. The first
                           Party,  in its sole  discretion,  may  elect,  within
                           sixty  (60)  days  after  the  commencement  of  such
                           litigation, to contribute a fixed percentage of up to
                           fifty  percent  (50%) of the  costs  incurred  by the
                           second  Party in  connection  with  such  litigation,
                           including,  without limitation,  reimbursement of the
                           second Party's expenses  hereunder.  If it so elects,
                           any  damages,  royalties,  settlement  fees or  other
                           consideration  received by the second Party or any of
                           its    Affiliates    for   past    infringement    or
                           misappropriation as a result of such litigation shall
                           be shared by the  second and first  Parties  pro-rata
                           based on their  respective  sharing  of the  costs of
                           such  litigation,  subject to Section 6. 2. 5, below.
                           In the  event  that the  first  Party  elects  not to
                           contribute  to the  costs  of  such  litigation,  the
                           second Party and/or its Affiliates  shall be entitled
                           to retain any damages, royalties,  settlement fees or
                           other   consideration   for  past   infringement   or
                           misappropriation  resulting  therefrom,   subject  to
                           Section 6.2.5, below. If necessary or desirable,  the
                           first  Party  shall  join as a party  to the suit but
                           shall be under no obligation to participate except to
                           the extent that such  participation  is required as a
                           result  of being a named  party to the  suit.  At the
                           second Party's  request,  the first Party shall offer
                           reasonable assistance to the second

CONFIDENTIAL                          -18-
<PAGE>

                           Party in  connection  therewith  at no  charge to the
                           second Party except for  reimbursement  of reasonable
                           out-of-pocket  expenses.  The first  Party shall have
                           the right to  participate  and be  represented in any
                           such suit by its own counsel at its own expense.

                  6.2.5    ROYALTY DEDUCTION. Any damages, royalties, settlement
                           fees or other  consideration for past infringement or
                           misappropriation  awarded  to and/or  collected  by a
                           Party (or Parties)  resulting from an infringement or
                           other  appropriate  suit  against a Third  Party or a
                           settlement  thereof  shall,  after  deduction  of all
                           costs  and  expenses  associated  with  such  suit or
                           settlement, be deemed to reflect a loss of commercial
                           sales,  and royalties shall be payable thereon to the
                           Party (or Parties) to which royalties would have been
                           owed under  Section 4.1 of this  Agreement,  provided
                           that such Party is not otherwise  entitled to receive
                           a portion of any recovery other than reimbursement of
                           its litigation  expenses)  obtained from such suit or
                           settlement pursuant to this Section 6.2.

         6.3      CLAIMED INFRINGEMENT.

                  6.3.1    NOTICE;  COOPERATION. In the event that a Third Party
                           at any time provides written notice of a claim to, or
                           brings an action,  suit or  proceeding  against,  any
                           Party or any of their  respective  Affiliates  or sub
                           licensees, claiming infringement of its patent rights
                           or copyrights or unauthorized use or misappropriation
                           of  its  Confidential  Information,   based  upon  an
                           assertion  or claim  arising out of the  manufacture,
                           use and/or sale of any GDF-8 Product  pursuant to the
                           licenses  granted  under this  Agreement,  such Party
                           shall promptly  notify the other Parties of the claim
                           or  the   commencement   of  such  action,   suit  or
                           proceeding,  enclosing a copy of the claim and/or all
                           papers served. Each Party agrees to make available to
                           the other Party its advice and counsel  regarding the
                           technical  merits of any such claim at no cost to the
                           other Party.

                  6.3.2    LIMITATION  OF  LIABILITY.  EXCEPT  FOR  BREACHES  OF
                           SECTIONS  8.1,  8.2 AND 8.3 OF  THIS  AGREEMENT,  THE
                           FOREGOING  STATES  THE ENTIRE  RESPONSIBILITY  OF THE
                           PARTIES IN THE CASE OF ANY  CLAIMED  INFRINGEMENT  OR
                           VIOLATION  OF ANY  THIRD  PARTY'S  PATENT  RIGHTS  OR
                           COPYRIGHTS OR UNAUTHORIZED USE OR MISAPPROPRIATION OF
                           ANY THIRD PARTY'S KNOW-HOW.

CONFIDENTIAL                          -19-
<PAGE>

7. CONFIDENTIAL INFORMATION.

          7.1     NONDISCLOSURE OF CONFIDENTIAL  INFORMATION.  Neither Party may
                  directly  or  indirectly  publish,  disseminate  or  otherwise
                  disclose,  deliver or make available to any person outside its
                  organization any of the other Party's Confidential Information
                  received hereunder.  Each Party may disclose the other Party's
                  Confidential  Information to persons  within its  organization
                  and to its Affiliates and  sublicensees  who/which have a need
                  to receive such  Confidential  Information in order to further
                  the  purposes of this  Agreement  and  who/which  are bound to
                  protect the confidentiality of such Confidential  Information,
                  as set forth in Section 7.3 below. Each Party may disclose the
                  other  Party's  Confidential  Information  to  a  governmental
                  authority  or by order of a court of  competent  jurisdiction,
                  provided  that such  disclosure  is subject to all  applicable
                  governmental  or  judicial   protection   available  for  like
                  material and  reasonable  advance notice is given to the other
                  Party.

          7.2     USE OF  CONFIDENTIAL  INFORMATION.  Each  Party  shall use the
                  other Party's Confidential Information solely for the purposes
                  contemplated  in this  Agreement or for such other purposes as
                  may be agreed upon by the Parties in writing.

          7.3     AGREEMENTS WITH PERSONNEL AND THIRD PARTIES.  The Parties have
                  or shall  obtain  agreements  with  all  personnel  and  Third
                  Parties who will have access to the other Party's Confidential
                  Information  which impose on such  personnel and Third Parties
                  confidentiality  and  non-use  obligations  which  are no less
                  restrictive than those that are set forth in this Agreement.

           7.4    PUBLICATIONS.

                  7.4.1     RIGHT  TO   PUBLISH.   Any  Party  may  publish  any
                            manuscripts  or  other  scientific  papers  on  work
                            conducted  exclusively  by that  Party  without  the
                            written  consent of the other  Parties.  However,  a
                            Party may not  publish  (or permit a Third  Party to
                            publish) any  manuscript or other  scientific  paper
                            that discloses or uses any Confidential  Information
                            of another Party without first  obtaining that other
                            Party's written consent; and a Party may not publish
                            any manuscript or other  scientific paper that would
                            prejudice   any  Patent   rights  of  another  Party
                            (including,  without limitation,  prospective Patent
                            rights)  without first complying with the provisions
                            of this Section 7.4 and Section 6.1, above.

                   7.4.2    NOTICE AND REVIEW.  In order to balance the Parties'
                            interests  in securing  Patents  covering  the GDF-8
                            Patent Rights with each Party's right to publish any
                            manuscripts  or  other  scientific  papers  on  work
                            relating  directly and exclusively to GDF-8 or GDF-8
                            Products  which  work is  conducted  solely by or on
                            behalf of that Party, prior to the

CONFIDENTIAL                          -20-
<PAGE>

                           publication   or  other  public   disclosure  of  any
                           manuscripts  or other form of  disclosure  describing
                           the  results of its work  hereunder,  the  publishing
                           Party shall  provide (a) the data to be  disclosed in
                           that manuscript or other form of public disclosure to
                           the other Party as soon as practicable,  but at least
                           four (4)  weeks  prior  to  intended  submission  for
                           publication or other method of public disclosure, (b)
                           a copy of the draft manuscript to be published,  or a
                           detailed  summary of any other public  disclosure  to
                           the  other  Parties  as soon as  practicable,  but at
                           least two (2) weeks prior to intended  submission for
                           publication or other method of public disclosure, (c)
                           a copy of the  completed  manuscript or other form of
                           public disclosure at the time of submission and (d) a
                           copy of any reviewer's  comments on the manuscript or
                           other form of public  disclosure  with a revised copy
                           thereof at least two (2) weeks prior to publication.

                  7.4.3    DELETION   OF   CONFIDENTIAL   INFORMATION;    PATENT
                           PROTECTION.  A Party may request that the  publishing
                           Party delete from its manuscripts or other scientific
                           papers or other forms of public disclosure  reference
                           to  that   Party's   Confidential   Information.   In
                           addition,  if a Party notifies  another Party that it
                           desires  patent  applications  to be  filed  claiming
                           inventions  that would be  included  within the GDF-8
                           Patent  Rights once filed,  which patent  application
                           contains  information  to be  disclosed by that other
                           Party in a public forum other than in  manuscripts or
                           other  scientific  papers,  the presenting Party will
                           defer such  presentation for a period,  not to exceed
                           thirty (30) additional days, sufficient to permit the
                           Party  with  rights  to  file  any   desired   patent
                           applications to do so.

8. REPRESENTATION AND WARRANTIES.

         8.1    REPRESENTATIONS AND WARRANTIES OF GI AND METAMORPHIX.  As of the
                Effective Date, each of GI and  MetaMorphix  hereby  represents,
                warrants and covenants to the other Party hereto as follows:

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

CONFIDENTIAL                          -21-
<PAGE>

                  (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  shall 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 GI.

                 8.2.1    PATENT  RIGHTS  AND  KNOW-HOW.  To the  best  of  GI's
                          knowledge,  information and belief,  GI represents and
                          warrants that it owns or has exclusive  (except to the
                          extent  otherwise  provided  in  the  1999  Agreement)
                          rights  to the GI  GDF-8  Patent  Rights  and GI GDF-8
                          Know-How in existence on the Effective Date and/or has
                          the  right to grant  the  licenses  under the GI GDF-8
                          Patent  Rights  and  to  the  GI  GDF-8   Know-How  in
                          existence on the  Effective  Date subject to the terms
                          of this Agreement.  The foregoing  representation  and
                          warranty  shall not be  construed  as a warranty as to
                          the  scope  and/or  validity  of any  claims in the GI
                          GDF-8 Patent Rights.

                  8.2.2   NO CONFLICTING AGREEMENTS.  GI represents and warrants
                          that  the  execution  of,  and   performance   of  the
                          transactions  contemplated by, this Agreement will not
                          conflict  with or result  in any  breach of any of the
                          teens,  conditions or  provisions  of, or constitute a
                          default under, any agreement to which GI is a party or
                          by which GI is bound.

          8.3     ADDITIONAL REPRESENTATIONS AND WARRANTIES OF METAMORPHIX.

                 8.3.1    PATENT   RIGHTS   AND   KNOW-HOW.   To  the   best  of
                          MetaMorphix'   knowledge,   information   and  belief,
                          MetaMorphix  represents  and warrants  that it owns or
                          has exclusive (except to the extent otherwise provided
                          in the 1999 Agreement) rights to the MetaMorphix GDF-8
                          Patent  Rights  and  MetaMorphix   GDF-8  Know-How  in
                          existence on the  Effective  Date and/or has the right
                          to grant  the  licenses  under the  MetaMorphix  GDF-8
                          Patent Rights and to the MetaMorphix GDF-8 Know-How in
                          existence on the  Effective  Date subject to the terms
                          of this Agreement.  The foregoing  representation  and
                          warranty  shall not be  construed  as a warranty as to
                          the  scope  and/or  validity  of  any  claims  in  the
                          MetaMorphix GDF-8 Patent Rights.

CONFIDENTIAL                          -22-
<PAGE>

                  8.3.2    NO CONFLICTING AGREEMENTS. MetaMorphix represents and
                           warrants that the execution  of, and  performance  of
                           the transactions contemplated by, this Agreement will
                           not  conflict  with or result in any breach of any of
                           the terms, conditions or provisions of, or constitute
                           a default under,  any agreement to which  MetaMorphix
                           is a party or by which MetaMorphix is bound.

          8.4     REPRESENTATION BY LEGAL COUNSEL.  Each Party hereto represents
                  that it has been  represented  by legal  counsel in connection
                  with this Agreement and acknowledges  that it has participated
                  in the drafting hereof. In interpreting and applying the terms
                  and  provisions of this  Agreement,  the Parties agree that no
                  presumption  shall exist or be implied against the Party which
                  drafted such teens and provisions.

         8.5      MATERIALITY.  EACH PARTY  EXPRESSLY  WAIVES ANY RIGHTS TO SEEK
                  DAMAGES OR OTHER RELIEF FOR BREACH OF THE  REPRESENTATIONS AND
                  WARRANTIES IN SECTIONS 8.1, 8.2 AND 8.3 UNLESS SUCH BREACH HAS
                  A MATERIAL AND ADVERSE EFFECT ON SUCH PARTY.

         8.6     DISCLAIMER. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NO
                 PARTY MAKES ANY WARRANTIES,  EXPRESS OR IMPLIED,  INCLUDING BUT
                 NOT LIMITED TO IMPLIED WARRANTIES OR  MERCHANTABILITY,  FITNESS
                 FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT.

9. PRODUCT LIABILITY INDEMNIFICATION.

          9.1     METAMORPHIX  INDEMNIFICATION.  MetaMorphix agrees to defend GI
                  and   ITS   respective   Affiliates,   sublicensees,   agents,
                  directors,  officers,  employees,  students  and  licensees of
                  rights  to  a  GDF-8  Licensed  Product,  as  applicable  (the
                  "indemnitees")  (other  than  in  settlement  of  a  claim  of
                  infringement),  at  MetaMorphix'  cost and  expense,  and will
                  indemnify and hold harmless such  indemnitees from and against
                  any and all  liabilities,  losses,  costs,  damages,  fees, or
                  expenses  claimed by or paid to a Third Party  attributable to
                  injury  to  persons  or  damage  to  property   (collectively,
                  "Losses")   arising   out  of  or  in   connection   with  the
                  manufacture,  use and/or sale of any GDF-8 Licensed Product by
                  MetaMorphix, its -Affiliates, or sublicensees (other than GI);
                  provided  that  such  Losses  do not  arise  out of the  gross
                  negligence or willful  misconduct of GI or any GI  indemnitee.
                  MetaMorphix's  indemnification  obligations under this Section
                  9.1 shall be  applicable  only to the  extent  not  covered by
                  MetaMorphix's   indemnification  obligations  under  the  1999
                  Agreement.

CONFIDENTIAL                          -23-
<PAGE>

         9.2      GI  INDEMNIFICATION.  GI agrees to defend  MetaMorphix and its
                  respective   Affiliates,   permitted   sublicensees,   agents,
                  directors,  officers,  employees,  students  and  licensees of
                  rights  to  a  GDF-8  Licensed  Product,  as  applicable  (the
                  "indemnitees")  (other  than  in  settlement  of  a  claim  of
                  infringement),  at GI's cost and expense,  and will  indemnify
                  and hold  harmless such  indemnitees  from and against any and
                  all  Losses   arising  out  of  or  in  connection   with  the
                  manufacture,  use and/or sale of any GDF-8 Licensed Product by
                  GI, its Affiliates,  or sublicensees (other than MetaMorphix);
                  provided  that  such  Losses  do not  arise  out of the  gross
                  negligence  or  willful   misconduct  of  MetaMorphix  or  any
                  MetaMorphix indemnitee. GI's indemnification obligations under
                  this  Section 9.2 shall be  applicable  only to the extent not
                  covered  by GI's  indemnification  obligations  under the 1999
                  Agreement.

         9.3      NOTICE;  COOPERATION.  In the event of any such  indemnifiable
                  claim,  the  indemnified   Party  shall  promptly  notify  the
                  indemnifying   Party  in   writing   of  the   claim  and  the
                  indemnifying  Party  shall  manage  and  control,  at its sole
                  expense,  the  defense  of the claim and its  settlement.  The
                  indemnified Party shall cooperate with the indemnifying  Party
                  and may, at its option and expense, be represented in any such
                  action or  proceeding.  The  indemnifying  Party  shall not be
                  liable for any  settlements,  litigation  costs,  or  expenses
                  incurred by the  indemnified  Party  without the  indemnifying
                  Party's written consent, such consent to be promptly given and
                  not unreasonably withheld.

         9.4      LIABILITY  LIMITATION.  Neither  GI nor  MetaMorphix  shall be
                  liable for special, incidental or consequential damages or for
                  loss of profit or lost  revenue,  even another  Party had been
                  advised of the possibility of such damages.

         9.5      INSURANCE.  Prior to initial human testing or first commercial
                  sale of any  GDF-8  Product  in any  particular  country  by a
                  Party, such Party shall secure and maintain at its own expense
                  during the term of this Agreement  either self insurance or an
                  insurance  policy or  policies  with an  insurer  or  insurers
                  acceptable to the other  Parties,  in either case,  protecting
                  the  Parties  against  any and  all  risks  typically  insured
                  against  by  businesses  comparable  to the  Party,  including
                  without limitation general and products liability,  arising or
                  occurring  upon or in connection  with each Party's  business.
                  Such policy or policies  shall  include  general and  products
                  liability   coverage  in  an  amount   typically   secured  by
                  businesses  comparable to the Party.  Each Party shall furnish
                  the  other  Party  with   certificates   evidencing  all  such
                  insurance.  Each Party  shall name the other  Party and JHU as
                  additional insured in such policy or policies.

CONFIDENTIAL                          -24-
<PAGE>

10.      TERM AND TERMINATION.

         10.1     TERM. This Agreement  shall remain in effect until  terminated
                  in accordance  with the provisions of this Section 10 or until
                  the last to expire of any of the  exclusive  licenses  granted
                  pursuant to this Agreement.

         10.2     TERMINATION FOR BREACH.  In the event that a Party shall be in
                  default of any of its material  obligations  to another  Party
                  hereunder,  and shall fail to remedy any such  default  within
                  sixty (60) days  after  notice  thereof  by the  non-breaching
                  Party to whom such  obligations are owed,  such  non-breaching
                  Party shall, by written notice to the other Party, be entitled
                  to  terminate  the rights it granted  to the  breaching  Party
                  under this  Agreement  and its  obligations  to the  breaching
                  Party under this Agreement. Any such notice shall specifically
                  describe  the  alleged  default and  expressly  state that the
                  non-breaching  Party  intends to  terminate  the rights it has
                  granted to the  breaching  Party under this  Agreement  in the
                  event  that the  breaching  Party  shall  fail to  remedy  the
                  default.  Upon any  termination of this Agreement  pursuant to
                  this Section  10.2,  the Parties  shall not be relieved of any
                  obligations    incurred    prior    to    such    termination.
                  Notwithstanding the foregoing, a termination of this Agreement
                  under  this  Section  10.2  shall  have no  effect on the 1999
                  Agreement  and any  termination  of the 1999  Agreement  under
                  Section 14.2 thereof shall have no effect on this Agreement.

         10.3     SURVIVAL OF OBLIGATIONS;  RETURN OF CONFIDENTIAL  INFORMATION.
                  Notwithstanding   any  termination  of  this  Agreement,   the
                  obligations  of the Parties under  Sections 7, 9, 10.3,  11.1,
                  11.6 and 11.15 as well as under any other  provisions which by
                  their  nature are  intended to survive  any such  termination,
                  shall  survive  and  continue  to  be  enforceable.  Upon  any
                  termination of this Agreement pursuant to Section 10.2 hereof,
                  the breaching Party shall promptly return to the non-breaching
                  Party all  written  Confidential  Information,  and all copies
                  thereof, of the non-breaching Party, which is not covered by a
                  license surviving such termination.

11.      MISCELLANEOUS.

         11.1     PUBLICITY.  No  Party,  nor  any  of  its  Affiliates,   shall
                  originate  any   publicity,   news  release  or  other  public
                  announcement,  written  or oral,  relating  to this  Agreement
                  without the prior written approval of the other Parties, which
                  approval  shall  not  be  unreasonably  withheld,   except  as
                  otherwise  required by law. It is  expressly  understood  that
                  nothing in this Section 11.1 shall prevent a Party from making
                  a disclosure in connection with any required  filings with the
                  Securities and Exchange  Commission or in connection  with the
                  offering of securities or any financing. In addition,  neither
                  GI nor  MetaMorphix  shall use the name of the other  Party in
                  any advertising,

CONFIDENTIAL                          -25-
<PAGE>

                  promotional, sales literature or fundraising documents without
                  the prior written consent of such other Party.

         11.2     EXPORT  CONTROL.  The Parties  acknowledge  that the export of
                  technical  data,  materials,  or  products  is  subject to the
                  exporting  Party  receiving the necessary  export licenses and
                  that  the  Parties  cannot  be  responsible   for  any  delays
                  attributable to export controls that are beyond the reasonable
                  control of either Party.  The Parties agree that regardless of
                  any  disclosure  made by the Party  receiving  an export of an
                  ultimate  destination  of any technical  data,  materials,  or
                  products,   the  receiving  Party  will  not  reexport  either
                  directly or  indirectly,  any  technical  data,  material,  or
                  products  without first obtaining the applicable  validated or
                  general license from the United States Department of Commerce,
                  United States Food and Drug  Administration,  and/or any other
                  agency or  department  of the  United  States  Government,  as
                  required.  The  receiving  Party shall  provide the  exporting
                  Party  with any  information,  materials,  certifications,  or
                  other documents which may be reasonably required in connection
                  with such exports under the Export Administration Act of 1979,
                  as amended, its rules and regulations,  the Federal Food, Drug
                  and Cosmetic Act, and other applicable export laws.

         11.3     CONDUCT OF STUDIES. All studies,  research and testing done by
                  or on behalf  of each  Party  under  this  Agreement  shall be
                  performed in strict  compliance  with any applicable  federal,
                  state, or local laws,  rules,  and  regulations  governing the
                  conduct of  studies,  research,  and testing at the site where
                  such studies, research, and testing are being conducted.

         11.4     NO IMPLIED LICENSES. Only the licenses granted pursuant to the
                  express  terms of this  Agreement  shall be of any legal force
                  and effect.  No license rights shall be created by implication
                  or estoppel.

         11.5     NO AGENCY.  Nothing  herein shall be deemed to constitute  any
                  Party as the agent or representative of the other Parties,  or
                  the Parties as joint  venturers  or partners  for any purpose.
                  Each Party shall be an independent contractor, not an employee
                  or partner of the other Parties,  and the manner in which each
                  Party  renders  its  services  under this  Agreement  shall be
                  within its sole discretion.  No Party shall be responsible for
                  the acts or omissions of the other Parties,  and no Party will
                  have  authority to speak for,  represent or obligate the other
                  Parties in any way without  prior written  authority  from the
                  other Party or Parties.

         11.6     NOTICE.  All notices required under this Agreement to be given
                  by one Party to another shall be in writing and shall be given
                  by  addressing  the  same  to  the  other  at the  address  or
                  facsimile  number set forth below,  or at such other addresses
                  or  facsimile  numbers as the  Parties may specify in writing.
                  All notices  shall  become  effective  when  deposited  in the
                  United  States  Mail  with  proper  postage  for  first  class
                  registered or certified mail prepaid, return

CONFIDENTIAL                          -26-
<PAGE>

                  receipt  requested,  or  when  delivered  personally,  or,  if
                  promptly  confirmed by mail as provided above, when dispatched
                  by facsimile.

                 If to GI:
                                   Genetics Institute, Inc. 87
                                   CambridgePark Drive Cambridge,
                                   Massachusetts 02140
                                   Telecopier: (617) 876-5851
                                   Attn: Legal Department

                 If to MetaMorphix:
                                   MetaMorphix, Inc.
                                   8510A Corridor Road
                                   Savage, Maryland 20763
                                   Telecopier: (301) 617-9075
                                   Attn: President

                 with copies to:
                                    Wyeth
                                    5 Giralda Farms
                                    Madison, New Jersey 07940.
                                    Telecopier: (973) 660-7156
                                    Attn: General Counsel

                                    and

                                    Shapiro Sher Guinot & Sandler
                                    36 South Charles Street - Suite 2000
                                    Baltimore,  MD 21201-3147
                                    Telecopier: (410) 539-7611
                                    Attn: William E. Carlson, Esq.

         11.7     ASSIGNMENT.  This  Agreement,  and the rights and  obligations
                  hereunder, may not be assigned or transferred,  in whole or in
                  part, by any Party  without the prior  written  consent of the
                  other Parties, except that (a) upon notice to the other Party,
                  GI may assign this Agreement to an Affiliate controlled by GI,
                  and  MetaMorphix  may assign this  Agreement  to an  Affiliate
                  which is majority  controlled  by  MetaMorphix,  provided that
                  each such Party remains  primarily  liable and/or  responsible
                  for the  performance of such  obligations  and such controlled
                  Affiliate, and provided further that such controlled Affiliate
                  agrees  to be  bound  to the  terms  and  conditions  of  this
                  Agreement  and (b) upon  notice  to the  other  Party,  GI may
                  assign  this   Agreement  in   connection   with  the  merger,
                  consolidation  or  sale  of all or  substantially  all of GI's
                  assets and MetaMorphix may assign this Agreement in connection
                  with the merger, consolidation or sale of all or substantially
                  all of MetaMorphix' assets.

CONFIDENTIAL                          -27-
<PAGE>

         11.8     ENTIRE   AGREEMENT.   This  Agreement  and  the  exhibits  and
                  schedules  attached  hereto,  together,  constitute the entire
                  agreement  of the Parties  with regard to its subject  matter,
                  and supersedes all previous  written or oral  representations,
                  agreements   and    understandings    between   the   Parties.
                  Notwithstanding the foregoing,  the Parties hereby acknowledge
                  and agree that the 1999  Agreement  shall remain in full force
                  and effect in  accordance  with the terms and  conditions  set
                  forth therein  except to the extent  expressly  amended hereby
                  and that  this  Agreement  is in  addition  to and  should  be
                  interpreted in light of the rights and  obligations of each of
                  the Parties under the 1999 Agreement.

         11.9     NO  MODIFICATION.  This  Agreement  may be  changed  only by a
                  writing signed by the Parties.

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

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

         11.12    SEVERABILITY.  In  the  event  that  any  one or  more  of the
                  provisions  contained in this Agreement shall, for any reason,
                  be  held  to be  invalid,  illegal  or  unenforceable  in  any
                  respect, such invalidity, illegality or unenforceability shall
                  not affect any other  provisions  of this  Agreement,  and all
                  other provisions shall remain in full force and effect. If any
                  of the  provisions of this Agreement is held to be excessively
                  broad   or   invalid,   illegal   or   unenforceable   in  any
                  jurisdiction,  it shall be reformed and  construed by limiting
                  and reducing it so as to be  enforceable to the maximum extent
                  permitted by law in conformance with its original intent.

         11.13    SUCCESSORS AND ASSIGNS.  This Agreement  shall be binding upon
                  and  inure to the  benefit  of the  Parties  hereto  and their
                  successors and permitted assigns.

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

CONFIDENTIAL                          -28-
<PAGE>

         11.15    APPLICABLE LAW. This Agreement shall in all events and for all
                  purposes be governed by, and construed in accordance with, the
                  law of the State of Maryland  without  regard to any choice of
                  law principle that would dictate the application of the law of
                  another jurisdiction.

                  IN WITNESS  WHEREOF,  duly-authorized  representatives  of the
parties have signed this  Agreement as a document under seal as of the Effective
Date.

GENETICS INSTITUTE, LLC           METAMORPHIX,INC.

By: /s/ Ronald W. Alice           By:      /s/ Edwin C. Quattlebaum
         Ronald W. Alice                   Edwin C. Quattlebaum, Ph.D.
         Vice President                    President and Chief Executive Officer

CONFIDENTIAL                          -29-
<PAGE>
                                                EXHIBIT 1.2.10

                                             GI EXCLUDED PRODUCTS
                                             --------------------

                                          None as of Effective Date.

CONFIDENTIAL
<PAGE>

                                 EXHIBIT 1.2.12

                             GI GDF-8 PATENT RIGHTS
                             ----------------------

--------------------------------------------------------------------------------
   WYETH         PATENT/APP #      TITLE        COUNTRY       STATUS      FILED
  DOCKET #
--------------------------------------------------------------------------------
    ***               ***          ***             US         Filed     02/08/02

--------------------------------------------------------------------------------
    ***               ***          ***            PCT         Filed     02/08/02

--------------------------------------------------------------------------------
    ***               ***          ***         Argentina      Filed     02/08/02
--------------------------------------------------------------------------------
    ***               ***          ***           Chile        Filed     02/07/02
--------------------------------------------------------------------------------
    ***               ***          ***           Taiwan       Filed     02/07/02
--------------------------------------------------------------------------------
    ***               ***          ***         Venezuela      Filed     02/08/02
                                                   I
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
    ***                            ***             US         Filed     09/26/02
--------------------------------------------------------------------------------
    ***                            ***            PCT         Filed     09/26/02
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
    ***               ***          ***             US         Filed     02/21/02
--------------------------------------------------------------------------------
    ***               ***          ***             US         Filed     02/21/02
--------------------------------------------------------------------------------

CONFIDENTIAL
<PAGE>

                                 EXHIBIT 1.2.15

                            JOINT GDF-8 PATENT RIGHTS

                           None as of Effective Date.

CONFIDENTIAL
<PAGE>
                                 EXHIBIT 1.2.16

                          METAMORPHIX EXCLUDED PRODUCTS

                            None as of Effective Date

CONFIDENTIAL
<PAGE>
                                 EXHIBIT 1.2.18

                         METAMORPHIX GDF-8 PATENT RIGHTS
                         -------------------------------

-------------------------------------------------------------------------------
 PATENT / APP #              TITLE                COUNTRY            STATUS
-------------------------------------------------------------------------------
      ***             ***                           US               Issued
-------------------------------------------------------------------------------
      ***             ***                        Argentina          Pending
-------------------------------------------------------------------------------
      ***             ***                         Brazil            Pending
-------------------------------------------------------------------------------
      ***             ***                         Canada            Pending
-------------------------------------------------------------------------------
      ***             ***                         Europe            Pending
-------------------------------------------------------------------------------
      ***             ***                          Japan            Pending
-------------------------------------------------------------------------------
      ***             ***                         Mexico            Pending
-------------------------------------------------------------------------------
      ***             ***                       New Zealand         Pending
-------------------------------------------------------------------------------
      ***             ***                      South Africa          Issued
-------------------------------------------------------------------------------
      ***             ***                           US              Pending
-------------------------------------------------------------------------------
      ***             ***                          World           Published
-------------------------------------------------------------------------------
      ***             ***                          World           Published
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
      ***             ***                           US              Pending
-------------------------------------------------------------------------------
      ***             ***                         Canada            Pending
-------------------------------------------------------------------------------
      ***             ***                         Europe            Pending
-------------------------------------------------------------------------------
      ***             ***                          Japan            Pending
-------------------------------------------------------------------------------
      ***             ***                           US              Pending
-------------------------------------------------------------------------------
      ***             ***                          World            Pending
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
      ***             ***                           US              Pending
-------------------------------------------------------------------------------
      ***             ***                        Australia          National
-------------------------------------------------------------------------------
      ***             ***                         Brazil            Pending
-------------------------------------------------------------------------------
      ***             ***                         Canada            Pending
-------------------------------------------------------------------------------
      ***             ***                          China           Published
-------------------------------------------------------------------------------
      ***             ***                         Europe           Published
-------------------------------------------------------------------------------
      ***             ***                          Japan            National
                                                                     Phase
-------------------------------------------------------------------------------

CONFIDENTIAL
<PAGE>

                                 EXHIBIT 1.2.18

                         METAMORPHIX GDF-8 PATENT RIGHTS
                         -------------------------------

-------------------------------------------------------------------------------
 PATENT / APP #              TITLE                COUNTRY            STATUS
-------------------------------------------------------------------------------
      ***              ***                        Mexico            Pending
-------------------------------------------------------------------------------
      ***              ***                      New Zealand         National
                                                                     Phase
-------------------------------------------------------------------------------
      ***              ***                         World            Pending
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
      ***              ***                          US               Issued
-------------------------------------------------------------------------------
      ***              ***                       Australia          Pending
-------------------------------------------------------------------------------
      ***              ***                        Canada            Pending
-------------------------------------------------------------------------------
      ***              ***                        Europe            Pending
--------------------------------------------------------------------------------
      ***              ***                         US               Pending
--------------------------------------------------------------------------------
      ***              ***                        World             National
                                                                     Phase
--------------------------------------------------------------------------------

CONFIDENTIALEX-10.23

                              AMENDED AND RESTATED
                             COLLABORATION AGREEMENT

                                  BY AND AMONG

                            GENETICS INSTITUTE, INC.

                                       AND

                          THE JOHNS HOPKINS UNIVERSITY

                                       AND

                                METAMORPHIX, INC.

                                JANUARY 26, 1999

<PAGE>

                                TABLE OF CONTENTS

1.       DEFINITION
1.1      "ADDITIONAL BMPS"
1.2      "ADDITIONAL COLLABORATIVE FACTORS"
1.3      "ADDITIONAL FACTORS"
1.4      "ADDITIONAL FACTOR JOINT KNOW-HOW"
1.5      "ADDITIONAL FACTOR JOINT PATENT RIGHTS"
1.6      "ADDITIONAL FACTOR JOINT RIGHTS
1.7      "ADDITIONAL FACTOR KNOW-HOW"
1.8      "ADDITIONAL FACTOR PATENT RIGHTS"
1.9      "ADDITIONAL FACTOR RIGHTS"
1.10     "ADDITIONAL GDFS"
1.11     "AFFILIATE"
1.12     "AVAILABLE FACTORS"
1.13     "BAYLOR"
1.14     "BAYLOR AGREEMENT"
1.15     "BONE MORPHOGENETIC PROTEINS" OR "BMPS"
1.16     "COLLABORATIVE FACTORS"
1.17     "COLLABORATIVE RESEARCH"
1.18     "COMMERCIALLY REASONABLE EFFORTS"
1.19     "COLLABORATIVE RESEARCH TERM"
1.20     "CONFIDENTIAL INFORMATION"
1.21     "CONTROL" OR "CONTROLLED"
1.22     "DATA"
1.23     "DISCOVER", "DISCOVERED" AND "DISCOVERY"
1.24     "EFFECTIVE DATE"
1.25     "EVALUATION PERIOD"
1.26     "FACTOR"
1.27     "FACTOR KNOW-HOW"
1.28     "FACTOR PATENT RIGHTS"
1.29     "FACTOR RIGHTS"
1.30     "FDA"
1.31     "GDF-8 DERIVATIVE PRODUCT"
1.32     "GDF-16"
1.33     "GDF-16 PRODUCT(S)"
1.34     "GDF-17"
1.35     "GDF-17 PRODUCT(S)"
1.36     "GI ADDITIONAL FACTOR(S)"
1.37     "GI ADDITIONAL FACTOR KNOW-HOW"
1.38     "GI ADDITIONAL FACTOR PATENT RIGHTS"
1.39     "GI FACTORS"
1.40     "GI FIELD"
1.41     "GI KNOW-HOW"
1.42     "GI PATENT RIGHTS"
1.43     "GI PRODUCTS"
1.44     "GI TYPE A PRODUCT"
1.45     "GI TYPE B PRODUCT"
1.46     "GI TYPE C PRODUCT"
1.47     "GI RIGHTS"
1.48     "GPDC FACTORS"
1.49     "GROWTH AND DIFFERENTIATION FACTORS" OR "GDFS"
1.50     "INAD"
1.51     "IND"
1.52     "INVENTION AND DISCLOSURE AGREEMENT"

<PAGE>

1.53     "JHU ADDITIONAL FACTOR KNOW-HOW"
1.54     "JHU ADDITIONAL FACTOR PATENT RIGHTS"
1.55     "JHU KNOW-HOW"
1.56     "JHU PATENT RIGHTS"
1.57     "JHU RIGHTS"
1.58     "JOINT KNOW-HOW"
1.59     "JOINT PATENT RIGHTS"
1.60     "JOINT RIGHTS"
1.61     "LETTER OF INTENT"
1.62     "METAMORPHIX FACTORS"
1.63     "METAMORPHIX FIELD"
1.64     "METAMORPHIX KNOW-HOW"
1.65     "METAMORPHIX PATENT RIGHTS"
1.66     "METAMORPHIX PRODUCT"
1.67     "METAMORPHIX RIGHTS"
1.68     "NET SALES"
1.69     "ORIGINAL RESEARCH"
1.70     "OTHER TGF-(BETA) FACTORS"
1.71     "OTHER TGF-(BETA) PRODUCTS"
1.72     "PATENTS"
1.73     "PLA"
1.74     "PRODUCT(S)"
1.75     "PROMISSORY NOTE"
1.76     "RESEARCH MANAGEMENT COMMITTEE" OR "RMC"
1.77     "SPONSORED RESEARCH"
1.78     "SPONSORED RESEARCH TERM"
1.79     "TGF-(BETA) ADDITIONAL FACTOR CLASS"
1.80     "TGF-(BETA) CLASS"
1.81     "TGF-(BETA) FACTOR CLASS"
1.82     "TGF-(BETA) FACTORS"
1.83     "TGF-(BETA) SUPERFAMILY"
1.84     "THIRD PARTY(IES)"
1.85     "USE PATENT"
1.86     "VALID CLAIM"

2.       CONDITIONS PRECEDENT; THE CLOSING
  2.1      GOVERNMENT APPROVALS
    2.1.1    THE PARTIES' OBLIGATIONS
    2.1.2    ADDITIONAL APPROVALS
  2.2      CORPORATE APPROVALS
    2.2.1    METAMORPHIX DIRECTOR AND SHAREHOLDER APPROVAL
    2.2.2    GENETICS INSTITUTE APPROVAL
  2.3      THE CLOSING
    2.3.1    TIME AND PLACE
    2.3.2    GI DELIVERABLES
    2.3.3    METAMORPHIX DELIVERABLES
    2.3.4    JHU DELIVERABLES
    2.3.5    DR. LEE DELIVERABLES

3. THE RESEARCH
  3.1      BACKGROUND AND GOALS
  3.2      THE ORIGINAL RESEARCH
    3.2.1    FUNDING
    3.2.2    DISCLOSURE OF INFORMATION
      3.2.2.1    DISCLOSURE OF SEQUENCES

<PAGE>

      3.2.2.2    DISCLOSURE OF OTHER INFORMATION
  3.3      THE SPONSORED RESEARCH
    3.3.1    SPONSORED RESEARCH TERM
    3.3.2    FUNDING
    3.3.3    USE OF FUNDS; BUDGETS
    3.3.4    SPONSORED RESEARCH PLAN
    3.3.5    SPONSORED RESEARCH ACTIVITIES
    3.3.6    INVENTION AND DISCLOSURE AGREEMENT
    3.3.7    DISCLOSURE OF INFORMATION
      3.3.7.1    DISCLOSURE OF SEQUENCES
      3.3.7.2    DISCLOSURE OF OTHER INFORMATION
      3.3.7.3    MANDATORY DISCLOSURE OF OTHER INFORMATION
    3.3.8    ANNUAL REPORTS
    3.3.9    EQUIPMENT
    3.3.10   EXCLUSIVITY OF RESEARCH
  3.4      THE COLLABORATIVE RESEARCH
     3.4.1   THE COLLABORATIVE RESEARCH TERM
     3.4.2   COLLABORATIVE RESEARCH PLAN
     3.4.3   RESEARCH MANAGEMENT COMMITTEE
     3.4.4   COLLABORATIVE RESEARCH ACTIVITIES
     3.4.5   DISPUTE RESOLUTION
     3.4.6   DISCLOSURE OF INFORMATION
      3.4.6.1    DISCLOSURE OF SEQUENCES
      3.4.6.2    DISCRETIONARY DISCLOSURE OF OTHER INFORMATION
      3.4.6.3    MANDATORY DISCLOSURE OF OTHER INFORMATION
     3.4.7   ANNUAL REPORTS
  3.5      DISCLOSURE OF INFORMATION BY AND TO JHU
    3.5.1    JHU DISCLOSURES
    3.5.2    GI AND METAMORPHIX DISCLOSURES
  3.6      OWNERSHIP OF RESULTS
  3.7      RESEARCH LICENSE
  3.8      ACKNOWLEDGEMENT
  3.9      METAMORPHIX SPONSORED RESEARCH
  3.10     DR. LEE AS CONSULTANT TO METAMORPHIX

4.  SUPPLY OF MATERIALS
  4.1      SUPPLY OF MATERIALS IN CONNECTION WITH THE SPONSORED RESEARCH
  4.2      SUPPLY OF MATERIALS TO METAMORPHIX
    4.2.1    UNASSIGNED BMPS, GDFS AND COLLABORATIVE FACTORS
    4.2.2    METAMORPHIX FACTORS
    4.2.3    SUPPLY OF REAGENTS AND ANTIBODIES
    4.2.4    SUPPLY OF FACTORS, REAGENTS AND ANTIBODIES AFTER
             COLLABORATIVE RESEARCH TERM
  4.3      SUPPLY OF MATERIALS BY METAMORPHIX
  4.4      SUPPLY OF CERTAIN MATERIALS TO DR. LEE
  4.5      LIMITATIONS ON USE OF FACTORS

5.  EVALUATION AND SELECTION OF FACTORS
  5.1      EVALUATION
  5.2      AVAILABLE FACTORS
  5.3      SELECTION OF AVAILABLE FACTORS
    5.3.1    ORDER OF SELECTION
      5.3.1.1    METAMORPHIX HAS FIRST SELECTION
      5.3.1.2    GI HAS NEXT SELECTION
      5.3.1.3    ALTERNATING SELECTIONS
    5.3.2    TRIGGERING A SELECTION
      5.3.2.1    GI'S RIGHT TO TRIGGER A SELECTION

<PAGE>

      5.3.2.2    METAMORPHIX' RIGHT TO TRIGGER A SELECTION
      5.3.2.3    LIMITATION ON RIGHT TO TRIGGER A SELECTION
    5.3.3    COMPLETION OF SELECTION PROCESS

6.   LICENSES
  6.1      RESTATEMENT OF RIGHTS
  6.2      LICENSES FROM JHU TO METAMORPHIX
  6.3      LICENSES FROM JHU TO GI
    6.3.1    GI TYPE A PRODUCTS
    6.3.2    GI TYPE B PRODUCTS
    6.3.3    GI TYPE C PRODUCTS
  6.4      LICENSES FROM METAMORPHIX TO GI
    6.4.1    GI TYPE A PRODUCTS
    6.4.2    GI TYPE B PRODUCTS
  6.5      LICENSES FROM GI TO METAMORPHIX
  6.6      RESERVATION OF RIGHTS
  6.7      FACTOR RIGHTS LICENSED FROM THIRD PARTIES
  6.8      NON COMPETE
    6.8.1    BY METAMORPHIX
    6.8.2    BY GI
  6.9      OPTION TO CERTAIN GDF-8 DERIVATIVE PRODUCTS

7.   CONSIDERATION
  7.1      LICENSE FEES
    7.1.1    INITIAL LICENSE PROCESSING FEE
    7.1.2    ADDITIONAL LICENSE PROCESSING FEES
    7.1.3    LICENSE MAINTENANCE FEES
  7.2      ADDITIONAL LICENSE FEES
  7.3      ROYALTIES
    7.3.1    METAMORPHIX PRODUCTS
      7.3.1.1    PAYABLE BY METAMORPHIZ TO JHL
      7.3.1.2    PAYABLE BY METAMORPHIX TO GI
    7.3.2    GI TYPE A PRODUCTS
      7.3.2.1    PAYABLE BY GI TO METAMORPHIX
      7.3.2.2    PAYABLE BY GI TO JHU
    7.3.3    GI TYPE B PRODUCTS
      7.3.3.1    PAYABLE BY GI TO METAMORPHIX
      7.3.3.2    PAYABLE BY GI TO JHU
    7.3.4    GI TYPE C PRODUCTS
    7.3.5    OTHER TGF(BETA) beta FACTORS
      7.3.5.1    PAYABLE BY METAMORPHIX TO JHU
      7.3.5.2    PAYABLE BY METAMORPHIX TO GI
      7.3.5.3    PAYABLE BY GI TO JHU
      7.3.5.3    PAYABLE BY CI TO METAMORPHIX
      7.3.5.4    PATENT INTERFERENCE

  7.4     ROYALTY CALCULATIONS
    7.4.1    COUNTRY-BY-COUNTRY BASIS
    7.4.2    ADVANCED PRODUCTS
    7.4.3    THIRD PARTY ROYALTIES
    7.4.4    LIMITATIONS ON ROYALTY DEDUCTIONS
  7.5      REPORT AND PAYMENT
  7.6      FOREIGN ROYALTIES
  7.7      TAXES
  7.8      RECORDS

<PAGE>

8.    ADDITIONAL CONSIDERATION
  8.1      ASSIGNMENT OF METAMORPHIX STOCK
  8.2      AMENDMENT OF PROMISSORY NOTE
  8.3      PUT OPTION
  8.4      PURCHASE OF EQUIPMENT
  8.5      BAYLOR AGREEMENT
  8.6      SHAREHOLDER AGREEMENTS

9.   PRODUCT DEVELOPMENT AND COMMERCIALIZATION
  9.1  METAMORPHIX'S OBLIGATIONS
    9.1.1    GENERAL DILIGENCE OBLIGATION
    9.1.2    DEVELOPMENT MILESTONES
    9.1.3    SATISFACTION OF DILIGENCE AND DEVELOPMENT MILESTONE OBLIGATIONS
    9.1.4    FAILURE TO ACHIEVE DEVELOPMENT MILESTONES
  9.2      GI'S DILIGENCE OBLIGATIONS
    9.2.1    GENERAL DILIGENCE OBLIGATION
    9.2.2    MILESTONES
    9.2.3    SATISFACTION OF DILIGENCE AND DEVELOPMENT MILESTONE OBLIGATIONS
    9.2.4    FAILURE TO ACHIEVE DEVELOPMENT MILESTONES
  9.3      RIGHT OF FIRST REFUSAL

10.   PATENT PROSECUTION AND INFRINGEMENT
  10.1     RESPONSIBILITY FOR PATENTING FACTOR RIGHTS
    10.1.1   GI PATENT RIGHTS AND CERTAIN JOINT PATENT RIGHTS
    10.1.2   METAMORPHIX PATENT RIGHTS
    10.1.3   JHU PATENT RIGHTS AND CERTAIN JOINT PATENT RIGHTS
    10.1.4   PATENT COOPERATION
    10.1.5   USE OF INFORMATION
    10.1.6   DIVISION OF CLAIMS
    10.1.7   INTERFERENCES
  10.2     EXPENSES
    10.2.1   PREVIOUSLY INCURRED EXPENSES - GI FACTORS
    10.2.2   PREVIOUSLY INCURRED EXPENSED - METAMORPHIX FACTORS AND
             UNASSIGNED FACTORS
    10.2.3   CONTINUING EXPENSES - GI FACTORS AND ADDITIONAL FACTORS
    10.2.4   CONTINUING EXPENSES - METAMORPHIX FACTORS
    10.2.5   CONTINUING EXPENSES - UNASSIGNED FACTORS
    10.2.5   CONTINUING EXPENSES - GDF-16 AND GDF-17
  10.3     INFRINGEMENT
    10.3.1   NOTICE
    10.3.2   FIRST RIGHT TO INITIATE SUITS - GI FACTORS AND ADDITIONAL FACTORS
    10.3.3   FIRST RIGHT TO INITIATE SUITS - METAMORPHIX FACTORS, GDF-16 AND
             GDF-17
    10.3.4   FIRST RIGHT TO INITIATE SUITS - UNASSIGNED FACTORS
    10.3.5   DETERMINATION OF RIGHT TO PARTICIPATE IN, AND SECOND RIGHT TO
             INITIATE, SUITS
    10.3.6   RIGHT TO PARTICIPATE IN SUIT
    10.3.7   SECOND RIGHT TO INITIATE SUIT
    10.3.8   ROYALTY DEDUCTION
  10.4     CLAIMED INFRINGEMENT
    10.4.1   NOTICE; COOPERATION
    10.4.2   LIMITATION OF LIABILITY

11    CONFIDENTIAL INFORMATION
  11.1     NONDISCLOSURE OF CONFIDENTIAL INFORMATION
  11.2     USE OF CONFIDENTIAL INFORMATION
  11.3     AGREEMENTS WITH PERSONNEL AND THIRD PARTIES
  11.4     PUBLICATION
    11.4.1   RIGHT TO PUBLISH

<PAGE>

11.4.2   NOTICE AND REVIEW
11.4.3   DELETION OF CONFIDENTIAL INFORMATION; PATENT PROTECTION
11.4.4   GDFS DISCOVERED BY JHU
    11.5 NON-USE OF CERTAIN CONFIDENTIAL INFORMATION

12    REPRESENTATION AND WARRANTIES
  12.1     REPRESENTATIONS AND WARRANTIES OF GI AND METAMORPHIX
  12.2     ADDITIONAL REPRESENTATIONS AND WARRANTIES OF GI
    12.2.1   PATENT RIGHTS AND KNOW-HOW
    12.2.2   NO CONFLICTING AGREEMENTS
  12.3     ADDITIONAL REPRESENTATIONS AND WARRANTIES OF METAMORPHIX
    12.3.1   PATENT RIGHTS AND KNOW-HOW.
    12.3.2   NO CONFLICTING AGREEMENTS
    12.3.3   EQUIPMENT
  12.4     REPRESENTATIONS AND WARRANTIES OF JHU
    12.4.1   AUTHORITY
    12.4.2   COMPLIANCE WITH LAWS AND ORGANIZATIONAL DOCUMENTS
    12.4.3   PATENT RIGHTS AND KNOW-HOW
    12.4.4   NO CONFLICTING AGREEMENTS
  12.5     REPRESENTATION BY LEGAL COUNSEL
  12.6     MATERIALITY
  12.7     DISCLAIMER

13    PRODUCT LIABILITY INDEMNIFICATION
  13.1     METAMORPHIX INDEMNIFICATION
  13.2     GI INDEMNIFICATION
  13.3     NOTICE; COOPERATION
  13.4     LIABILITY LIMITATION
  13.5     INSURANCE

14.   TERM AND TERMINATION
  14.1     TERM
  14.2     TERMINATION FOR BREACH
  14.3     BREACH OF OR WITHDRAWAL FROM  AGREEMENT
    14.3.1   BY METAMORPHIX
    14.3.2   BY GI
  14.4     SURVIVAL OF OBLIGATIONS; RETURN OF CONFIDENTIAL INFORMATION

15    MISCELLANEOUS
  15.1     NO ASSUMPTION OF OBLIGATIONS
  15.2     PUBLICITY
  15.3     EXPORT CONTROL
  15.4     CONDUCT OF' STUDIES
  15.5     NO IMPLIED LICENSES
  15.6     NO AGENCY
  15.7     NOTICE
  15.8     ASSIGNMENT
  15.9     ENTIRE AGREEMENT
  15.10    NO MODIFICATION
  15.11    HEADINGS
  15.12    WAIVER
  15.13    SEVERABILITY
  15.14    SUCCESSORS AND ASSIGNS
  15.15    COUNTERPARTS
  15.16    APPLICABLE LAW

<PAGE>

                  AMENDED AND RESTATED COLLABORATION AGREEMENT

         THIS AMENDED AND RESTATED COLLABORATION AGREEMENT (together with the
attached Schedules, the "Agreement") is entered into as of January 26. 1999 by
and among Genetics Institute, Inc., a Delaware corporation with a business
address at 87 CambridgePark Drive, Cambridge, Massachusetts 02140 ("GI"), The
Johns Hopkins University, a non-profit educational institution with a business
address at 720 Rutland Avenue, Baltimore, Maryland 21205 ("JHU") and
MetaMorphix, Inc., a Delaware corporation with a business address at 1450 South
Rolling Road, Baltimore, Maryland 21227 ("MetaMorphix"). GI, JHU and MetaMorphix
may each be referred to herein individually as a "Party" and collectively as the
"Parties".

         WHEREAS, JHU, as a center for research and education, is interested in
licensing discoveries made by JHU researchers in a manner that will benefit the
public by facilitating the commercialization of useful products, but is without
capacity to commercially develop, manufacture and sell any such products;

         WHEREAS, MetaMorphix was formed in 1994 for the purposes, INTER ALIA,
OF funding research at JHU under the direction OF Se-Jin Lee, M.D., Ph.D. ("Dr.
Lee") to characterize certain previously-discovered factors, and discover and
characterize new factors, in the TGF-(beta) Superfamily (referred to by JHU as
"GDFs", as more fully defined below) and commercializing such GDFs, either on
its own, or by sublicense to GI and other Third Parties;

         WHEREAS, GI also has ongoing research to discover, characterize and
develop factors in the TGF- Superfamily (referred to by GI as "BMPs", as more
fully defined below);

         WHEREAS, on December 1, 1994, the Parties entered into a Collaboration
Agreement (the" 1994 Collaboration Agreement") pursuant to which, during the
Research Term (as such term is defined in the 1994 Collaboration Agreement)
thereof, which Research Term is now expired, they collaborated on the
characterization of theretofore previously discovered GDFs and BMPs. and the
discovery and characterization OF new GDFs and BMPs;

         WHEREAS, pursuant to the 1994 Collaboration Agreement, JHU agreed to
license to MetaMorphix certain GDFs discovered by JHU; GI agreed to license to
MetaMorphix certain BMPs discovered by GI; and MetaMorphix agreed to license
and/or sublicense to GI certain GDFs discovered by MetaMorphix:

         WHEREAS, MetaMorphix desires to restructure its business to focus on
the development and commercialization of products for agricultural and
veterinary uses;

         WHEREAS, in order to facilitate MetaMorphix' desire to so restructure
its business, and to further development and commercialization of those BMPs,
GDFs and Collaborative Factors that were discovered pursuant to or which are
otherwise subject to the 1994

<PAGE>

Collaboration Agreement, the Parties have agreed to amend. restate and replace
the 1994 Collaboration Agreement as set forth herein:

         NOW THEREFORE. in consideration of the foregoing premises and the
mutual promises, covenants and conditions set forth below, the Parties,
intending to be legally bound, hereby agree as follows:

1.       DEFINITIONS.

         1.1      "ADDITIONAL BMPS" shall mean the Factors in the TGF-(beta)
                  Superfamily Discovered solely by GI after May 31, 1998, which
                  Factors include, without limitation, those Factors identified
                  in Schedule 1.1, attached hereto. Notwithstanding the
                  foregoing, Additional BMPs shall exclude (i) the BMPs and (ii)
                  the GPDC Factors.

         1.2      "ADDITIONAL COLLABORATIVE FACTORS" shall mean the Factors in
                  the TGF-(beta) Superfamily Discovered by JHU jointly with GI
                  after May 31, 1998 and on or before the end of the six (6)
                  month period which begins on the day after the end of the
                  Sponsored Research Term. The Additional Collaborative Factors
                  shall not include BMPs. GDFs, Collaborative Factors,
                  Additional BMPs, Additional GDFs or Other TGF-beta Factors.
                  For JHU, Additional Collaborative Factors shall be restricted
                  to those Factors Discovered after May 31, 1998 in Dr. Lee's
                  JHU laboratory jointly by (i) Dr. Lee and/or other JHU
                  faculty. students, fellows and/or employees who have signed an
                  Invention and Disclosure Agreement and (ii) employees of GI.

         13       "ADDITIONAL Factors" shall mean the Additional BMPs, the
                  Additional GDFs and the Additional Collaborative Factors.

         1.4      "ADDITIONAL FACTOR JOINT Know-How" shall mean any tmpatented
                  information specifically relating to any Additional BMP,
                  Additional GDF or Additional Collaborative Factor produced by
                  GI and JHU after May 31, 1998 and on or before the end of the
                  six (6) month period which begins on the day after the end of
                  the Sponsored Research Term, and for which each named Party
                  has a licensable interest, which information is reasonably
                  useful, necessary, or required for GI and/or its Affiliates,
                  to manufacture, use and/or sell GI Products. For JHU, the
                  Joint Know-How shall be restricted to the information produced
                  by Dr. Lee and other JHU faculty, students, fellows, and
                  employees who have signed an Invention and Disclosure
                  Agreement.

         1.5      "ADDITIONAL FACTOR JOINT PATENT RIGHTS" shall mean with
                  respect to each Additional BMP. Additional GDF or Additional
                  Collaborative Factor, (a) all Patents covering inventions (as
                  such term is defined under United States Patent Law) made by
                  GI and JHU jointly, after May 31, 1998 and on or before the
                  end of the six (6) month period which begins on the day after
                  the

<PAGE>

                  end of the Sponsored Research Term, which inventions or
                  Patents are reasonably useful, necessary or required for GI
                  and/or its Affiliates, to manufacture, use and/or sell GI
                  Products for any use and (b) all Patents Controlled by or
                  coming into the Control of GI and JHU jointly during the term
                  of this Agreement. and for which each named Party has a
                  licensable interest, which, but for the inclusion of such
                  acquired Patents under this clause (b), would prevent GI
                  and/or its Affiliates, from practicing under one or more of
                  the Patents under clause (a), above. The Additional Factor
                  Joint Patent Rights believed by the Parties to be existing as
                  of the Effective Date are listed in Schedule 1.5 attached
                  hereto. For JHU, the Joint Patent Rights shall be restricted
                  to the Patents covering inventions made by Dr. Lee and other
                  JHU faculty, students, fellows. and employees who have signed
                  an Invention and Disclosure Agreement.

         1.6      "ADDITIONAL FACTOR JOINT RIGHTS"-shall mean the Additional
                  Factor Joint Know-How and the Additional Factor Joint Patent
                  Rights.

         1.7      "ADDITIONAL FACTOR KNOW-HOW" shall mean the GI Additional
                  Factor Know-How, the JHU Additional Factor Know-How and the
                  Additional Factor Joint Know-How.

         1.8      "Additional Factor Patent RIGHTS" shall mean the GI Additional
                  Factor Patent Rights. the JHU Additional Factor Patent Rights
                  and the Additional Factor Joint Patent Rights.

         1.9      "ADDITIONAL FACTOR RIGHTS" shall mean the Additional Factor
                  Know-How and the Additional Factor Patent Rights.

         1.10     "ADDITIONAL GDFS" shall mean the Factors in the TGF-(beta)
                  Superfamily Discovered by JHU solely after May 31, 1998 and on
                  or before the end of the six (6) month period which begins on
                  the day after the end of the Sponsored Research Term. The
                  Additional GDFs shall not include BMPs, GDFs, Collaborative
                  Factors, Additional BMPs, Additional Collaborative Factors or
                  Other TGF-(beta) Factors. For JHU, Additional GDFs shall be
                  restricted to those Factors listed on Schedule 1.10, together
                  with any additional Factors Discovered after May 31, 1998, in
                  (or in collaboration with) Dr. Lees JHU laboratory by Dr. Lee
                  and other JHU faculty, students, fellows, and employees who
                  have signed an Invention and Disclosure Agreement.

         1.11     "AFFILIATE" shall mean any corporation, company, partnership,
                  joint venture and/or firm which controls. is controlled by or
                  is under common control with a Party. For purposes of this
                  Section 1.11, "control" means (a) in the case of corporate
                  entities, direct or indirect ownership of at least fifty
                  percent (50%) of the stock or shares entitled to vote for the
                  election of directors; and (b) in the case of non-corporate
                  entities, direct or indirect ownership of at least fifty

<PAGE>

                  percent (50%) of the equity interest with the power to direct
                  the management and policies of such noncorporate entities.
                  Notwithstanding the foregoing. (a) the term "Affiliate" shall
                  not include subsidiaries in which a Party or its Affiliates
                  owns a majority of the ordinary voting power to elect a
                  majority of the board of directors but is restricted from
                  electing such majority by contract or otherwise, until such
                  time as such restrictions are no longer in effect; (b) only
                  upon designation by GI and written notice to the other Parties
                  shall American Home Products Corporation and/or any of its
                  affiliates be Affiliates of GI for purposes of this Agreement;
                  and (c) unless the context expressly provides otherwise, a
                  Party shall not be treated as an Affiliate of the another
                  Party or another Party's Affiliates for purposes of this
                  Agreement.

         1.12     "AVAILABLE FACTORS" shall mean those BMPs, GDFs and
                  Collaborative Factors that have been determined to be
                  available for selection by GI or MetaMorphix pursuant to the
                  Factor selection process described Article 5 of this
                  Agreement.

         1.13     "BAYLOR" shall mean the Baylor College of Medicine.

         1.14     "BAYLOR AGREEMENT" shall mean that certain Research
                  Collaboration Agreement entered into on February 1, 1998, by
                  and between MetaMorphix and Baylor, pursuant to which
                  MetaMorphix sponsored research relating to GDF-9 in the
                  laboratory of Dr. Martin Matzuk for a term of three (3) years.

         1.15     "BONE MORPHOGENETIC PROTEINS" or "BMPS" shall mean the Factors
                  in the TGF-(beta) Superfamily Discovered solely by GI on or
                  before May 31, 1998, which Factors include, without
                  limitation, those Factors identified in Schedule 1.15 which is
                  attached hereto. Notwithstanding the foregoing, BMPs shall
                  exclude (a) the GPDC Factors and (b) any Factors in the
                  TGF-beta Superfamily, the sequences for which are identified
                  solely by GI using research strategies that do not use
                  sequence homology with previously sequenced TGF-P Factors. The
                  BMPs may be assigned to or selected by either GI (as a GI
                  Factor) or MetaMorphix (as a MetaMorphix Factor) under this
                  Agreement. BMPs shall not include Additional BMPs, GDFs,
                  Additional GDFs, Collaborative Factors, Additional
                  Collaborative Factors or Other TGF-beta Factors.

         1.16     "COLLABORATIVE FACTORS" shall mean the Factors in the
                  TGF-(beta) Superfamily Discovered by (a) GI and MetaMorphix
                  jointly or (b) GI and JHU jointly or (c) JHU and MetaMorphix
                  jointly, as the case may be, on or before May 31, 1998,
                  including, without limitation, those Factors identified on
                  Schedule1.16 attached hereto. The Collaborative Factors may be
                  assigned to or selected by either GI (as a GI Factor) or
                  MetaMorphix (as a MetaMorphix Factor) under this Agreement.
                  Collaborative Factors shall not include

<PAGE>

                  BMPs, GDFs. Additional BMPs. Additional GDFs, Additional
                  Collaborative Factors or Other TGF-beta Factors. For JHL,
                  Collaborative Factors shall be restricted to those Factors
                  Discovered on or before May 31, 1998 in Dr. Lee's JHU
                  laboratory jointly by (i) Dr. Lee and/or other JHU faculty,
                  students, fellows and/or employees who have signed an
                  Invention and Disclosure Agreement and (ii) employees of GI
                  and/or MetaMorphix.

         1.17     "COLLABORATIVE RESEARCH" shall mean the collaborative research
                  activities conducted by the GI and MetaMorphix, from June 1,
                  1998 through the end of the Collaborative Research Term, to
                  rapidly characterize and evaluate, for commercial development,
                  those BMPs, GDFs and Collaborative Factors that have not yet
                  been selected or designated as either GI Factors or
                  MetaMorphix Factors. Collaborative Research shall not include
                  the Sponsored Research or internal or collaborative research
                  conducted by GI or MetaMorphix on matters other than BMPs,
                  GDFs or Collaborative Factors that have not yet been selected
                  or designated as GI Factors or MetaMorphix Factors.

         1.18     "COMMERCIALLY REASONABLE EFFORTS" shall mean efforts and
                  resources normally used by a Party for a product owned by it
                  or to which it has rights, which is of similar market
                  potential at a similar stage in its development or product
                  life, taking into account issues of safety and efficacy,
                  product profile, the competitiveness of the marketplace, the
                  proprietary position of the compound or product, the
                  regulatory structure involved, the profitability of the
                  applicable products, and other relevant factors.

         1.19     "COLLABORATIVE RESEARCH TERM" shall have the meaning set forth
                  in Section 3.4.1 hereof.

         1.20     "CONFIDENTIAL Information" includes, without limitation, any
                  scientific, technical, trade or business information disclosed
                  by one Party to one or more of the other Parties which is (a)
                  disclosed in writing or other tangible form and labeled or
                  otherwise identified in writing as "CONFIDENTIAL" at the time
                  of disclosure or (h) disclosed verbally and identified as
                  "CONFIDENTIAL" at the time of disclosure and subsequently
                  reduced to writing or other tangible form. labeled or
                  otherwise identified in writing as "CONFIDENTIAL" and
                  delivered to the receiving Party within thirty (30) days of
                  verbal disclosure. Notwithstanding the foregoing,
                  "Confidential Information" does not include information which
                  (a) was known to the receiving Pam' at the time it was
                  disclosed. other than by previous disclosure by the disclosing
                  Party, as evidenced by written records at the time of
                  disclosure; (b) is at the time of disclosure or later becomes
                  publicly known under circumstances involving no breach of this
                  Agreement; (c) is lawfully and in good faith made available to
                  the receiving Party by a Third Party who did not derive it
                  from the disclosing Party and who imposes no obligation of

<PAGE>

                  confidence on the receiving Party: or (d) is developed by the
                  receiving Party independent of any disclosure by the
                  disclosing Party, as evidenced by written records.

         1.21     "CONTROL" OR "CONTROLLED" shall mean with respect to any (i)
                  item of information, including, without limitation, any Factor
                  Know-How or Additional Factor-Know-How, or (ii) intellectual
                  property right, the possession (whether by purchase.
                  assignment or license) by a Party of the ability to grant to
                  one or both of the other Parties access and/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.

         1.22     "DATA" with respect to any Party, shall mean any and all
                  laboratory, animal and other scientific data (including,
                  without limitation, cloning, expression, purification,
                  refolding, analysis of bioactivity IN VITRO and IN VIVO,
                  physical characterization and formulation, IN SITU
                  hybridization and genetic mapping) in that Party's Control
                  arising either (a) from the Original Research on or before May
                  31, 1998, (b) from the Collaborative Research during the
                  Collaborative Research Term and/or (c) from the Sponsored
                  Research during the Sponsored Research Term, as applicable.

         1.23     "DISCOVER", "DISCOVERED" AND "DISCOVERY" (and any other
                  variations thereof) shall mean, with respect to a BMP, a GDF,
                  a Collaborative Factor, an Additional BMP, an Additional GDF
                  or an Additional Collaborative Factor, the first sequencing by
                  a Party's employees or agents of the mature protein coding
                  region of that BMP, GDF. Collaborative Factor, Additional BMP,
                  Additional GDF or Additional Collaborative Factor. A Party
                  shall be deemed to have Discovered a Factor hereunder
                  regardless of whether such Party's employees or agents
                  Discovered such Factor solely or jointly with a Third Party.
                  In the event that, prior to the end of (i) the term of the
                  Original Research, with respect to BMPs, GDFs or Collaborative
                  Factors, or (ii) the Sponsored Research Term, with respect to
                  Additional BMPs, Additional GDFs or Additional Collaborative
                  Factors, one Party Discovers a Factor within twenty (20) days
                  following Discovery of the same Factor by another Party, such
                  Factor shall be deemed to be a Collaborative Factor or an
                  Additional Collaborative Factor, as the case may be, jointly
                  Discovered by the first and second Discovering Parties for
                  purposes of this Agreement. Determination of the utility or
                  activity of a Factor is not relevant in identifying the Party
                  which Discovered that Factor under this Agreement. Similarly,
                  inventorship on a Patent claiming a Factor may include a Party
                  which provided utility or other data, without changing the
                  identity of the Party which Discovered that Factor for
                  purposes of this Agreement. Under this Agreement, the identity
                  of the Party (or Parties) which Discovered a Factor determines
                  (a) whether that Factor will be classified as a BMP (under
                  Section 1.15), a GDF (under Section 1.49) or a Collaborative
                  Factor (under Section 1.16). an Additional BMP (under Section
                  1.1), an Additional GDF

<PAGE>

                  (under Section 1.10) or an Additional Collaborative Factor
                  (under Section 1.2); (b) the Party (or Parties) to which
                  additional license fees will be made under Section 7.2; (c)
                  the Party (or Parties) to which license maintenance fees would
                  be owed in the event a Party fails to meet a Milestone under
                  Article 9; and (d) royalties payable among the Parties under
                  Section 7.3 of this Agreement.

         1.24     "EFFECTIVE DATE" shall mean the next business day after the
                  Closing occurs in accordance with Section 2.3 hereof.

         1.25     "EVALUATION PERIOD" shall have the meaning set forth in
                  Section 5.1 of this Agreement.

         1.26     "FACTOR" shall mean (a) the proteins, peptides or polypeptides
                  corresponding to a molecule within the TGF-(beta) Superfamily;
                  (b) the polynucleotides which encode those proteins, peptides
                  or polypeptides, and any sub-sequences thereof; (c) any
                  modified form of those proteins, peptides or polypeptides: or
                  (d) variant or mutant forms of those proteins, peptides or
                  polypeptides, or of the polynucleotides encoding such variant
                  or mutant forms.

         1.27     "FACTOR KNOW-HOW" shall mean the GI Know-How, the JHU
                  Know-How, the MetaMorphix Know-How and the Joint Know-How.

         1.28     "FACTOR Patent Rights" shall mean the GI Patent Rights, the
                  JHU Patent Rights, the Metamorphix Patent Rights and the Joint
                  Patent Rights.

         1.29     "FACTOR Rights" shall mean the Factor Patent Rights and the
                  Factor Know-How.

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

         1.31     "GDF-8 DERIVATIVE Product" shall mean any pharmaceutical
                  product which primarily acts as

                  (i)      an antagonist or agonist of GDF-8 or the GDF-8
                           receptor,

                  (ii)     a vaccine against GDF-8,

                  (iii)    a modifier of GDF-8 synthesis, or

                  (iv)     a modulator of the GDF-8 signal transduction pathway,
                           only to the extent that such pharmaceutical product
                           is developed or sold for the purposes of modulating
                           the effects of GDF-8.

<PAGE>

         1.32     "GDF-16" shall mean the TGF-(beta) Factor known to MetaMorphix
                  and JHU as GDF-16, PROVIDED, HOWEVER, that GDF-16 shall not
                  include any TGF-(beta) Factor which is owned or Controlled by
                  GI.

         1.33     "GDF-16 PRODUCT(S)" shall mean GDF-16, including any and all

                  (i)      formulations, mixtures or compositions of GDF-16,

                  (ii)     antibodies targeted against GDF-16,

                  (iii)    receptors for which GDF-16 is a ligand,

                  (iv)     antisense molecules or ribozymes that modulate the IN
                           VIVO production of GDF-16, and

                  (v)      other products for research, diagnostic or
                           therapeutic use containing GDF- 16 or any of (i)
                           through (iv) above,

                  which, or which the manufacture use-Or sale of which, is
                  covered by a Valid Claim included within JHU's or MetaMorphix'
                  interest in the Factor Patent Rights.

         1.34.    "GDF-17" shall mean the TGF-(beta) Factor known to MetaMorphix
                  and JHU as GDF-17, PROVIDED HOWEVER, that GDF-17 shall not
                  include any TGF-(beta) Factor which is owned or Controlled by
                  GI.

         1.35     "GDF-17 PRODUCT(S)" shall mean GDF-17, including any and all

                  (i)      formulations, mixtures or compositions of GDF-17,

                  (ii)     antibodies targeted against GDF-17,

                  (iii)    receptors for which GDF-17 is a ligand,

                  (iv)     antisense molecules or ribozymes that modulate the IN
                           VIVO production of GDF-17. and

                  (v)      other products for research, diagnostic or
                           therapeutic use containing GDF-17 or any of (i)
                           through (iv) above, which, or which the manufacture
                           use or sale of which, is covered by a Valid Claim
                           included within JHU's or MetaMorphix' interest in the
                           Factor Patent Rights.

<PAGE>

         1.36     "GI ADDITIONAL FACTOR(S)" shall mean each Additional BMP.
                  Additional GDF or Additional Collaborative Factor, PROVIDED
                  HOWEVER, that GI Additional Factors shall not include any GPDC
                  Factors or any GI Factors.

         1.37     "GI ADDITIONAL FACTOR KNOW-HOW" shall mean any unpatented
                  information specifically relating to any GI Additional Factor
                  produced by or on behalf of GI.

         1.38     "GI ADDITIONAL FACTOR PATENT RIGHTS" shall mean with respect
                  to each GI Additional Factor, all Patents covering inventions
                  (as such term is defined under United States Patent Law) made
                  solely by GI which are reasonably useful, necessary or
                  required for GI and its Affiliates to manufacture, use and/or
                  sell GI Type C Products.

         1.39     "GI FACTORS" shall mean (a) each GDF listed on Schedule 1.39
                  as of the Effective Date; (b) each BMP, GDF or Collaborative
                  Factor subsequently selected by GI and added to Schedule 1.39;
                  (c) each BMP, GDF or Collaborative Factor belonging to a
                  TGF-13 Class which includes one or more of the BMPs, GDFs or
                  Collaborative Factors identified in clauses (a) or (b) of this
                  Section; and (d) each BMP, GDF or Collaborative Factor
                  belonging to a TGF-(beta) Class which includes the Factors
                  known to GI as BMPs 2 and 4, BMPs 5.6. and 7, BMP 9, or BMP
                  12; PROVIDED, HOWEVE, the specific Factors themselves which
                  are listed in this clause (d) shall not be considered GI
                  Factors for purposes of this Agreement. BMPs, GDFs and
                  Collaborative Factors which would belong to both (x) a
                  TGF-(beta) Factor Class which includes a GI Factor and (y) a
                  TGF-(beta) Factor Class which includes a MetaMorphix Factor,
                  based on the definition of TGF-(beta) Factor Class set FORTH
                  in this Agreement, are classified pursuant to Section 1.80,
                  below.

         1.40     "GI FIELD" shall mean all potential uses in humans, including,
                  without limitation, the diagnosis and/or the prophylactic or
                  therapeutic treatment of diseases or disorders in humans.

         1.4I     "GI KNOW-HOW" shall mean any unpatented information
                  specifically relating to a BMP. GDF or Collaborative Factor
                  produced by GI (i) on or before May 31. 1998 in performing the
                  Original Research or (ii) during the Collaborative Research
                  Term with respect only to those BMPs, GDFs and Collaborative
                  Factors that have not yet been selected or designated as
                  either a GI Factor or a MetaMorphix Factor, and for which GI
                  has a licensable interest, which is reasonably useful,
                  necessary or required for MetaMorphix and its Affiliates to
                  manufacture, use and/or sell MetaMorphix Products for use in
                  the MetaMorphix Field under this Agreement.

         1.42     "GI PATENT Rights" shall mean, with respect to each BMP, GDF
                  or Collaborative Factor, (a) all Patents covering inventions
                  (as such term is defined under United States Patent Law) made
                  solely by GI

<PAGE>

                  (i)      on or before May 31. 1998 in performing the Original
                           Research or

                  (ii)     during the Collaborative Research Term with respect
                           only to those BMPs. GDFs and Collaborative Factors
                           which have not yet been selected or designated as GI
                           Factors or MetaMorphix Factors.

                  which inventions or Patents are reasonably useful, necessary
                  or required for MetaMorphix and its Affiliates to manufacture,
                  use and/or sell MetaMorphix Products for use in the
                  MetaMorphix Field and (b) all Patents coming into the Control
                  of GI during the term of this Agreement, which, but for the
                  inclusion of such acquired Patents under this clause (b),
                  would prevent MetaMorphix and its Affiliates from practicing
                  under one or more of the Patents included under clause (a),
                  above. The GI Patent Rights believed to be existing by the
                  Parties as of the Effective Date are listed on Schedule 1.42
                  to this Agreement.

         1.43     "GI PRODUCTS" shall mean GI Type A Products, GI Type B
                  Products and GI Type C Products.

         1.44     "GI TYPE A PRODUCT" shall mean each GI Factor, including any
                  and all

                  (i)      formulations, mixtures or compositions of such GI
                           Factor,

                  (ii)     antibodies targeted against such GI Factor,

                  (iii)    receptors for which such GI Factor is a ligand,

                  (iv)     antisense molecules or ribozymes that modulate the IN
                           VIVO production of such GI Factor, and

                  (v)      other products for research diagnostic or therapeutic
                           use containing such GI Factor or any of (i) through
                           (iv) above,

                  which, or which the manufacture use or sale of which, is
                  covered by a Valid Claim included within the Factor Patent
                  Rights.

         1.45     "GI TYPE B PRODUCT" shall mean each MetaMorphix Factor,
                  including any and all

                  (i)      formulations, mixtures or compositions of such .
                           MetaMorphix Factor,

                  (ii)     antibodies targeted against such MetaMorphix Factor,

<PAGE>

                  (iii)    receptors for such MetaMorphix Factor is a ligand.

                  (iv)     antisense molecules or ribozymes that modulate the IN
                           VIVO production of such MetaMorphix Factor. and

                  (v)      other products for research, diagnostic or
                           therapeutic use containing such MetaMorphix Factor or
                           any of (i) through (iv) above,

                  which, or which the manufacture use or sale of which, is
                  covered by a Valid Claim included within the Factor Patent
                  Rights.

         1.46     "GI TYPE C PRODUCT" shall mean each Additional GDF or each
                  Additional Collaborative Factor, including any and all

                  (i)      formulations, mixtures or compositions of such
                           Additional GDF Factor or Additional Collaborative
                           Factor.

                  (ii)     antibodies targeted against such Additional GDF
                           Factor or Additional Collaborative Factor,

                  (iii)    receptors for which such Additional GDF or Additional
                           Collaborative Factor is a ligand,

                  (iv)     antisense molecules or ribozymes that modulate the IN
                           VIVO production of such Additional GDF or Additional
                           Collaborative Factor, and

                  (v)      other products for research, diagnostic or
                           therapeutic use containing such Additional GDF or
                           Additional Collaborative Factor or any of (i) through
                           (iv) above,

                  which, or which the manufacture use or sale of which, is
                  covered by a Valid Claim included within the Factor Patent
                  Rights.

         1.47     "GI RIGHTS" shall mean the GI Know-How, the GI Patent Rights,
                  the GI Additional Factor Know-How, and the GI Additional
                  Factor Patent Rights.

         1.48     "GPDC FACTORS" shall mean the Factors identified on Schedule
                  1.48 attached hereto.

         1.49     "GROWTH AND DIFFERENTIATION FACTORS" or "GDFs" shall mean the
                  Factors in the TGF-(beta) Superfamily Discovered by (a) JHU
                  solely or (b) MetaMorphix solely on or before May 31, 1998 in
                  performing the Original Research, including, without
                  limitation, those Factors listed on Schedule1.49 attached
                  hereto. The GDFs shall not include GDF-16, GDF-17, BMPs,

<PAGE>

                  Collaborative Factors, Additional BMPs, Additional GDFs,
                  Additional Collaborative Factors or Other TGF-beta Factors.
                  The GDFs may be assigned to or selected by either GI (as a GI
                  Factor) or MetaMorphix (as a MetaMorphix Factor) under this
                  Agreement. For JHU, GDFs shall be restricted to those Factors
                  listed on Schedule 1.49, together with any additional Factors
                  Discovered, on or before May 31, 1998, in (or in collaboration
                  with) Dr. Lee's JHU laboratory by Dr. Lee and/or other JHU
                  faculty, students, fellows, and/or employees who have signed
                  an Invention and Disclosure Agreement.

         1.50     "INAD" shall mean an Investigational New Animal Drug
                  application or its equivalent for initiating clinical trials
                  of a product in non-human animals in the United States or any
                  corresponding or equivalent foreign application, registration
                  or certification.

         1.51     "IND" shall mean a Investigational New Drug application or its
                  equivalent for initiating clinical trials of a product in
                  humans in the United States or any corresponding or equivalent
                  foreign application, registration or certification.

         1.52     "INVENTION AND DISCLOSURE AGREEMENT" shall mean the form
                  agreement attached hereto as Schedule 1.52.

         1.53     "JHU ADDITIONAL FACTOR KNOW-HOW" shall mean any unpatented
                  information specifically relating to any Additional BMP,
                  Additional GDF or Additional Collaborative Factor produced in
                  Dr. Lee's JHU laboratory after May 31, 1998, and on or before
                  the end of the six (6) month period which begins on the day
                  after the end of the Sponsored Research Term, and for which
                  JHU has a licensable interest, which is reasonably useful,
                  necessary or required for GI, and its Affiliates, to
                  manufacture, use and/or sell GI Products as permitted under
                  this Agreement. For JHU, the JHU Know-How shall be restricted
                  to the information produced by Dr. Lee and other JHU faculty,
                  students, fellows, and employees who have signed an Invention
                  and Disclosure Agreement.

         1.54     "JHU Additional Factor PATENT RIGHTS" shall mean, with respect
                  to each Additional BMP. Additional GDF or Additional
                  Collaborative Factor, (a) all Patents covering inventions (as
                  such term is defined under United States Patent Law) made
                  solely by JHU after May 31, 1998 and on or before the end of
                  the six (6) month period which begins on the day after the end
                  of the Sponsored Research Term, which inventions or Patents
                  are reasonably useful, necessary or required for GI and its
                  Affiliates, to manufacture, use and/or sell GI Products as
                  permitted hereunder and (b) all Patents Controlled by or
                  coming into the Control of JHU (other than those Patents
                  assigned to JHU by faculty, students. fellows or employees who
                  are not working in (or in support of) Dr. Lee's JHU
                  laboratory) during the term of this Agreement, which, but for
                  the inclusion of such acquired Patents under this clause (b),

<PAGE>

                  would prevent GI and/or any of its Affiliates, from practicing
                  under one or more of the Patents under clause (a) above. The
                  JHU Additional Factor Patent Rights believed by the Parties to
                  be existing as of the Effective Date are listed on Schedule
                  1.54 to this Agreement. The JHU Additional Factor Patent
                  Rights shall be restricted to the Patents covering inventions
                  made by Dr. Lee and/or other JHU faculty, students, fellows,
                  and/or employees who have signed an Invention and Disclosure
                  Agreement.

         1.55     "JHU KNOW-HOW" shall mean any unpatented information
                  specifically relating to a BMP, GDF, Collaborative Factor,
                  GDF-16 or GDF-17, which information is produced in Dr. Lee's
                  JHU laboratory

                  (i)      on or before May 31, 1998 in performing the Original
                           Research, or

                  (ii)     with respect to the license granted by JHU to

                           (x)      GI hereunder, during the Sponsored Research
                                    Term in performing.the Sponsored Research
                                    (except to the extent that such information
                                    relates specifically to GDF-16 or GDF-17),
                                    or

                           (y)      MetaMorphix hereunder, during the
                                    Collaborative Research Term in performing
                                    the Sponsored Research, only to the extent
                                    that such information relates directly to
                                    those BMPs, GDFs or Collaborative Factors
                                    that have not been selected or designated as
                                    either GI Factors or MetaMorphix Factors.

                  and for which JHU has a licensable interest, which is
                  reasonably useful, necessary or required for MetaMorphix or
                  GI, and their respective Affiliates, to manufacture, use
                  and/or sell their respective Products under this Agreement.
                  For JHU, the JHU Know-How shall be restricted to the
                  information produced by Dr. Lee and/or other JHU faculty,
                  students, fellows, and/or employees who have signed an
                  Invention and Disclosure. Notwithstanding the forgoing, the
                  JHU Know-How shall also include any data and information
                  deemed to be included within this definition pursuant to
                  Sections 3.9 and/or 3.10 hereof.

         1.56     "JHU PATENT Rights" shall mean, with respect to each BMP, GDF,
                  Collaborative Factor. GDF-16 or GDF-17, (a) all Patents
                  covering inventions (as such term is defined under United
                  States Patent Law) made solely by JHU

<PAGE>

                  (i)      on or before May 31, 1998 in performing the Original
                           Research or

                  (ii)     with respect to the licensed granted by JHU to

                           (x)      GI hereunder, during the Sponsored Research
                                    Term in performing the Sponsored Research
                                    (except to the extent that such inventions
                                    relate specifically to GDF16 or GDF-17) or

                           (y)      MetaMorphix hereunder, during the
                                    Collaborative Research Term in performing
                                    the Sponsored Research, only to the extent
                                    that such information relates directly to
                                    those BMPs, GDFs or Collaborative Factors
                                    that have not been selected or designated as
                                    either GI Factors or MetaMorphix Factors,

                  which inventions or Patents are reasonably useful, necessary
                  or required for GI or MetaMorphix and their respective
                  Affiliates, to manufacture, use and/or sell their Products as
                  permitted hereunder and (b) all Patents coming into the
                  Control of JHU (other than those Patents assigned to JHU by
                  faculty, students, fellows or employees who are not working in
                  (or in support of) Dr. Lee's JHU laboratory) during the term
                  of this Agreement, which, but for the inclusion of such
                  acquired Patents under this clause (b), would prevent GI or
                  MetaMorphix, and their respective Affiliates, from practicing
                  under one or more of the Patents under clause (a) above. The
                  JHU Patent Rights believed by the Parties to be existing as of
                  the Effective Date are listed on Schedule 1.56 to this
                  Agreement. The JHU Patent Rights shall be restricted to the
                  Patents covering inventions made by Dr. Lee and/or other JHU
                  faculty, students, fellows, and/or employees who have signed
                  an Invention and Disclosure Agreement.

         1.57     "JHU RIGHTS" shall mean the JHU Know-How and JHU Patent
                  Rights.

         1.58     "JOINT KNOW-HOW" shall mean any unpatented information
                  specifically relating to a BMP. GDF or Collaborative Factor
                  (and in the case where such unpatented information was
                  produced by JHU and MetaMorphix, GDF-16 or GDF-17) which
                  information is produced by

                  (i)      GI and MetaMorphix, or GI and JHU, or JHU and
                           MetaMorphix, as the case may be, on or before May 31,
                           1998 in performing the Original Research,

                  (ii)     GI and MetaMorphix, during the Collaborative Research
                           Term. in performing the Collaborative Research, only
                           to the

<PAGE>

                           extent that such information relates to those BMPs.
                           GDFs or Collaborative Factors that have not yet been
                           selected or designated as either a GI Factor or a
                           MetaMorphix Factor.

                  (iii)    GI and JHU., during the Sponsored Research Term. in
                           performing the Sponsored Research, only to the extent
                           that, with respect to the licenses granted by

                           (x)      JHU or GI to MetaMorphix hereunder, such
                                    information relates to those BMPs, GDFs or
                                    Collaborative Factors that have not yet been
                                    selected or designated as either a GI Factor
                                    or a MetaMorphix Factor, or

                           (y)      JHU to GI hereunder, such information
                                    relates to any. BMP, GDF or Collaborative
                                    Factor, or

                  (iv)     JHU and MetaMorphix, during the Sponsored Research
                           Term, in performing any collaborative or sponsored
                           research (as permitted in accordance with Section 3.9
                           hereof),

                  and for which each named Party has a licensable interest,
                  which is reasonably useful, necessary or required for GI or
                  MetaMorphix, and their respective Affiliates, to manufacture,
                  use and/or sell their Products under this Agreement. For JHU,
                  the Joint Know-How shall be restricted to the information
                  produced by Dr. Lee and/or other JHU faculty, students,
                  fellows, and/or employees who have signed an Invention and
                  Disclosure Agreement.

         1.59     "JOINT PATENT RIGHTS" shall mean, with respect to each BMP,
                  GDF or Collaborative Factor (arid in the case of inventions
                  made jointly by JHU and MetaMorphix. GDF-16 or GDF-17), (a)
                  all Patents covering inventions (as such term is defined under
                  United States Patent Law) made by

                  (i)      GI and MetaMorphix jointly, or GI and JHU jointly, or
                           JHU and MetaMorphix jointly, as the case may be, on
                           or before May 31, 1998 in performing the Original
                           Research,

                  (ii)     GI and MetaMorphix, during the Collaborative Research
                           Term, in performing the Collaborative Research, only
                           to the(.) extent that such inventions relate to those
                           BMPs, GDFs or Collaborative Factors that have not yet
                           been selected or designated as either a GI Factor or
                           a MetaMorphix Factor,

                  (iii)    GI and JHU, during the Sponsored Research Term, in
                           performing the Sponsored Research, only to the extent
                           that, with respect to the licenses granted by

<PAGE>

                           (x)      JHU or GI to MetaMorphix hereunder, such
                                    inventions relate to those BMPs, GDFs or
                                    Collaborative Factors that have not yet been
                                    selected or designated as either a GI Factor
                                    or a MetaMorphix Factor, or

                           (y)      JHU to GI hereunder, such inventions relate
                                    to any BMP, GDF or Collaborative Factor, or

                  (iv)     JHU and MetaMorphix, during the Sponsored Research
                           Term, in performing any collaborative or sponsored
                           research (as permitted in accordance with Section 3.9
                           hereof),

                  which inventions or Patents are reasonably useful, necessary
                  or required for GI or MetaMorphix, and their respective
                  Affiliates, to manufacture, use and/or sell their Products for
                  any use and (b) all Patents coming into the Control of GI and
                  MetaMorphix jointly, or GI and JHU jointly, or JHU and
                  MetaMorphix jointly, as the case may-be, during the term of
                  this Agreement, and for which each named Party has a
                  licensable interest, which, but for the inclusion of such
                  acquired Patents under this clause (b), would prevent GI or
                  MetaMorphix. and their respective Affiliates, from practicing
                  under one or more of the Patents under clause (a) above. The
                  Joint Patent Rights believed by the Parties to be existing as
                  of the Effective Date are listed on Schedule 1.59 to this
                  Agreement. For JHU, the Joint Patent Rights shall be
                  restricted to the Patents covering inventions made by Dr. Lee
                  and/or other JHU faculty, students, fellows, and/or employees
                  who have signed an Invention and Disclosure Agreement.

         1.60     "JOINT RIGHTS" shall mean the Joint Know-How and Joint Patent
                  Rights.

         1.61     "LETTER OF INTENT" shall mean that certain Letter of Intent
                  entered into by GI, MetaMorphix and JHU as of January 4, 1999,
                  which Letter of Intent sets forth, INTER ALIA, the Parties
                  intention to enter into this Agreement and the obligation of
                  GI to make a certain payment to JHU.

         1.62     "METAMORPHIX FACTORS" shall mean (a) each GDF listed on
                  Schedule 1.62 as of the Effective Date: (b) each BMP, GDF or
                  Collaborative Factor subsequently selected by MetaMorphix,
                  which upon such selection shall be listed on Schedule 1.62 and
                  (c) each BMP, GDF or Collaborative Factor belonging to a TGF-R
                  Class which includes one or more of the BMPs, GDFs or
                  Collaborative Factors identified in clauses (a) or (b). BMPs,
                  GDFs and Collaborative Factors which would belong to both (x)
                  a TGF-(beta) Factor Class which includes a MetaMorphix Factor
                  and (y) a TGF-(beta) Factor Class which includes a GI Factor,
                  based on the definition of TGF-(beta) Factor Class set forth
                  in this Agreement. are classified pursuant to Section 1.81,
                  below. For the

<PAGE>

                  sake of clarity. MetaMorphix Factors shall not include GDF-I6
                  or GDF-1 7 notwithstanding the fact that JHU is granting to
                  MetaMorphix a license hereunder with respect to GDF-16 and
                  GDF-17.

         1.63     "METAMORPHIX FIELD" shall mean all potential uses in non-human
                  animals, including, without limitation, (i) non-human animal
                  health. (ii) livestock . products, (iii) the diagnosis and/or
                  the prophylactic or therapeutic treatment of diseases or
                  disorders in non-human animals, and/or (iv) the development
                  and production of transgenic non-human animals for use as
                  agricultural products.

         1.64     "METAMORPHIX KNOW-HOW" shall mean any unpatented information
                  specifically relating to a BMP, GDF or Collaborative Factor
                  which information is (a) produced by MetaMorphix

                  (i)      on or before May 31, 1998 in performing the Original
                           Research, or

                  (ii)     during the Collaborative Research Term in performing
                           the Collaborative Research only to the extent that
                           such information relates to those BMPs, GDFs or
                           Collaborative Factors which have not yet been
                           selected or designated as either GI Factors or
                           MetaMorphix Factors,

                  and for which MetaMorphix has a licensable interest and (b) is
                  reasonably useful, necessary or required for GI and its
                  Affiliates to manufacture, use and/or sell its Products under
                  this Agreement. Notwithstanding the foregoing. the MetaMorphix
                  Know-How shall also include any data and information deemed to
                  be included within this definition pursuant to Sections 3.9
                  and/or 3.1 0 hereof.

         1.65     "METAMORPHIX PATENT RIGHTS" shall mean, with respect to each
                  BMP, GDF or Collaborative Factor, (a). all Patents covering
                  inventions (as such term is defined under United States Patent
                  Law) made solely by MetaMorphix

                  (i)      on or before May 31 , 1998 in performing the Original
                           Research or

                  (ii)     during the Collaborative Research Term in performing
                           the Collaborative Research, to the extent such
                           inventions relate to those BMPs, GDFs or
                           Collaborative Factors that have not yet been selected
                           or designated as either GI Factors or MetaMorphix
                           Factors,

<PAGE>

                  which inventions are reasonably useful, necessary or required
                  for GI and its Affiliates to manufacture, use and/or sell GI
                  Products for any use and (b) all Patents coming into the
                  Control of MetaMorphix during the term of this Agreement,
                  which. but for the inclusion of such Patents under this clause
                  (h) would prevent GI and its Affiliates from practicing under
                  one or more of the Patents under clause (a) above. The
                  MetaMorphix Patent Rights believed by the Parties to be
                  existing as of the Effective Date are listed in Schedule 1.65
                  attached hereto. -

         1.66     "METAMORPHIX PRODUCT" shall mean each MetaMorphix Factor,
                  including any and all

                  (i)      formulations, mixtures or compositions of such
                           MetaMorphix Factor,

                  (ii)     antibodies targeted against such MetaMorphix Factor,

                  (iii)    receptors for which such MetaMorphix Factor is a
                           ligand,

                  (iv)     antisense molecules or ribozymes that modulate the in
                           vivo production of such MetaMorphix Factor, and

                  (v)      other products for research, diagnostic or
                           therapeutic use containing such MetaMorphix Factor or
                           any of (i) through (iv) above.

                  Which, or which the manufacture use or sale of which, is
                  covered by a Valid Claim included within the Factor Patent
                  Rights.

         1.67     "METAMORPHIX Rights" shall mean the MetaMorphix Know-How and
                  MetaMorphix Patent Rights.

         1.68     "NET SALES" shall mean, with respect to any Product or Other
                  TGF-(beta) Product, the aggregate United States dollar
                  equivalent of gross revenues derived by or payable to a
                  selling Party, its Affiliates and sublicensees from or on
                  account of the sale or distribution of such Product or Other
                  TGF-(beta) Product, as applicable, to Third Parties, less (a)
                  reasonable credits or allowances, if any, actually granted on
                  account of price adjustments, recalls, rejection or return of
                  items previously sold, (b) excises, sales taxes, value added
                  taxes, consumption taxes, duties or other taxes imposed upon
                  and paid with respect to such sales (excluding income or
                  franchise taxes of any kind) and (c) separately itemized
                  insurance and transportation costs incurred in shipping such
                  Products or Other TGF-(beta) Products, as applicable, to such
                  Third Parties. No deduction shall be made for any item of cost
                  incurred by a selling Parry, its Affiliates or sublicensees in
                  preparing, manufacturing, shipping or selling Products or
                  Other TGF-beta Products, as applicable, except

<PAGE>

                  as permitted pursuant to clauses (a). (b) and (c) of the
                  foregoing sentence. Net sales shall not include any transfer
                  between a selling Party and any of its Affiliates or
                  sublicensees for resale, but shall include the resale price to
                  a Third Party payable to such Affiliates or sublicensees.

                  Notwithstanding the provisions of the first paragraph of this
                  Section 1.68. (a) if a selling Party or an Affiliate or
                  sublicensee sells Products or Other TGF-(beta) Products, as
                  applicable, to a distributor which is not an Affiliate, the
                  gross revenues derived by or payable to that selling Party or
                  the applicable Affiliate or sublicensee on account of such
                  sale shall be the gross revenues received by the selling Party
                  and/or the applicable Affiliate or sublicensee from the sale
                  of such Products or Other TGF-(beta) Products, as applicable,
                  to the distributor, and (b) if the distributor is an
                  Affiliate, then gross revenues derived by or payable to that
                  selling Party or the applicable Affiliate or sublicensee shall
                  be those received from the sale to the first Third Party which
                  is not an Affiliate.

                  In addition, in order to ensure the full royalty payments
                  contemplated under this Agreement, in the event any Product or
                  Other TGF-(beta) Product, as applicable, is sold to any
                  corporation, firm or association with which GI or MetaMorphix,
                  as the case may be, has an agreement, understanding or other
                  arrangement with respect to other forms of consideration (for
                  example, an option to purchase stock or actual stock
                  ownership; an arrangement involving division of profits or
                  special rebates or allowances) royalties shall be calculated
                  for sales of such Products or Other TGF-(beta) Products, as
                  applicable, based upon the greatest of (a) the price at which
                  the purchaser of such Products or Other TGF-(beta) Products,
                  as applicable, resells such Products or Other TGF-(beta)
                  Products to the end user or (b) the fair market value of such
                  Products or Other TGF-(beta) Products, as applicable, or (c)
                  the price of such Products or Other TGF-(beta) Products, as
                  applicable, paid by the purchaser.

                  In the event that a selling Party or any of its Affiliates or
                  sublicensees shall make any transfer of Products or Other
                  TGF-(beta) Products to Third Parties for other than monetary
                  value, such transfer shall be considered a sale hereunder for
                  accounting and royalty purposes. Net sales for any such
                  transfers shall be determined on a country-by-country basis
                  and shall be the average price of "arms length" sales by that
                  selling Party, its Affiliates or sublicensees in such country
                  during the royalty reporting period in which such transfer
                  occurs or, if no such "arms length" sales occurred in such
                  country during such period, during the last period in which
                  such "arms length" sales occurred. If no "arms length" sales
                  have occurred in a particular country, Net Sales for any such
                  transfer in such country shall be the average price of "arms
                  length" sales in all countries by that selling Party.

                  Notwithstanding the foregoing, no transfer of Products or
                  Other TGF-(beta) Products for testing, pre-clinical, clinical
                  or developmental purposes or as

<PAGE>

                  samples shall be considered a sale hereunder for accounting
                  and royalty purposes.

         1.69     "ORIGINAL RESEARCH" shall mean the research activities
                  conducted, pursuant to the 1994 Collaboration Agreement. by
                  the Parties prior to June 1. 1998, to rapidly Discover,
                  characterize and evaluate the BMPs, GDFs and Collaborative
                  Factors for commercial development. For JHU, the Original
                  Research was restricted -to the research sponsored by
                  MetaMorphix under Section 6.1 of the 1994 Collaboration
                  Agreement and conducted in (or in collaboration with) Dr.
                  Lee's JHU laboratory by Dr. Lee and other JHU faculty,
                  students, fellows, and employees who had signed an Invention
                  and Disclosure Agreement.

         1.70     "OTHER TGF-(BETA) FACTORS" shall mean the Factors in the
                  TGF-(beta) Superfamily which are not BMPs, GDFs, Collaborative
                  Factors, Additional BMPs, Additional GDFs or Additional
                  Collaborative Factors. Other TGF-(beta) Factors shall include,
                  without limitation, (a) Factors acquired by a Party from a
                  Third Party; (b) Factors first sequenced by a Party (either
                  solely or jointly) pursuant to a preexisting collaboration
                  with a Third Party (for example, without limitation, the GPDC
                  Factors, which were FIRST sequenced by GI pursuant to a
                  preexisting collaboration with its Japanese partner,
                  Yamanouchi Pharmaceutical Company Ltd., and any Factors first
                  identified by GI using "gene chip" technology developed
                  pursuant to an agreement with Affymetrix. Inc.): (c) with
                  respect to MetaMorphix, only for determining royalties that
                  may be payable by MetaMorphix to GI, the TGF(beta) Factors
                  known to JHU and MetaMorphix as GDF-16 or GDF-17; and (d)
                  Factors first sequenced by a Party (either solely or jointly)
                  pursuant to any future collaborations with Third Parties.

         1.71     "OTHER TGF-(BETA) PRODUCTS" shall mean each Other TGF-(beta)
                  Factor, including any and all

                  (i)      formulations, mixtures or compositions of such Other
                           TGF-(beta) Factor,

                  (ii)     antibodies targeted against such Other TGF-(beta)
                           Factor,

                  (iii)    antisense molecules or ribozymes that modulate the IN
                           VIVO production of such Other TGF-(beta) Factor, and

                  (iv)     other products for research, diagnostic or
                           therapeutic use containing such Other TGF-(beta)
                           Factor or any of (i) through (iii) above.

         1.72     "PATENTS" shall mean all patents and patent applications and
                  foreign counterparts thereof (which for all purposes of this
                  Agreement shall be

<PAGE>

                  deemed to include certificates of invention and applications
                  for certificates of invention and priority rights), together
                  with any reissues, extensions or other governmental acts which
                  effectively extend the period of exclusivity by the patent
                  holder. substitutions, confirmations, registrations,
                  revalidations, additions, continuations,
                  continuations-in-part, or divisions of or to any of the
                  foregoing.

         1.73     "PLA" shall mean a Product License Application or its
                  equivalent in the United States or any corresponding foreign
                  application, registration, or certification.

         1.74     "PRODUCT(S)" shall mean the MetaMorphix Products, the GI Type
                  A Products, the GI Type B Products, and/or the GI Type C
                  Products, as applicable.

         1.75     "PROMISSORY NOTE" shall mean that certain promissory note
                  dated February 9, 1998, executed by MetaMorphix as the maker,
                  where GI is the lender, together with the First Allonge (dated
                  August 18, 1998) and the Second Allonge (dated October 30,
                  1998) thereto.

         1.76     "RESEARCH MANAGEMENT COMMITTEE" or "RMC" is defined in Section
                  3.4.3 of this Agreement.

         1.77     "SPONSORED RESEARCH" shall mean the research activities
                  conducted, pursuant to this Agreement, (i) by JHU, to rapidly
                  characterize and evaluate the BMPs. GDFs and Collaborative
                  Factors for commercial development by GI and/or MetaMorphix
                  and (ii) by JHU and GI to rapidly Discover characterize and
                  evaluate the Additional BMPs, Additional GDFs and Additional
                  Collaborative Factors for commercial development by GI. For
                  JHU, the Sponsored Research to be conducted hereunder shall be
                  limited to the research sponsored by GI under Section 3.3
                  hereof and conducted in (or in collaboration with) Dr. Lee's
                  JHU laboratory by Dr. Lee and/or other JHU faculty, students,
                  fellows, and/or employees who have signed an Invention and
                  Disclosure Agreement.

         1.78     "SPONSORED RESEARCH TERM" shall have the meaning set forth in
                  Section 3.3.1 hereof.

         1.79     "TGF-(BETA) ADDITIONAL FACTOR CLASS" shall mean all Additional
                  Factors and Other TGF-(beta) Factors which share eighty
                  percent (80%) amino acid sequence identity within their mature
                  protein coding regions. The first Additional BMP, Additional
                  GDF or Additional Collaborative Factor in a TGF-(beta) Class
                  Discovered by a GI and/or JHU is the "First Member"; any other
                  Factors Discovered by GI and/or JHU in that TGF-(beta) Class
                  are "Subsequent Members."

<PAGE>

         1.80     "TGF-(BETA) CLASS" shall mean a TGF-(beta) Factor Class or a
                  TGF-(beta) Additional Factor Class, as applicable.

         1.81     "TGF-(BETA) FACTOR CLASS" shall mean all BMPs, GDFs,
                  Collaborative Factors, Other TGF-(beta) Factors and, as
                  between JHU and MetaMorphix only. GDF-I6 and GDF-17, which
                  share eighty percent (80%) amino acid sequence identity within
                  their mature protein coding regions. The first BMP, GDF or
                  Collaborative Factor in a TGF-(beta) Class Discovered by a
                  Party (or Parties) is the "First Member"; any other Factors
                  Discovered by a Party (or Parties) in that TGF-(beta) Class
                  are "Subsequent Members." However, any BMP. GDF or
                  Collaborative Factor which shares eighty percent (80%) amino
                  acid sequence identity within its mature protein coding region
                  with both (a) a previously classified GI Factor and (b) a
                  previously classified MetaMorphix Factor shall be classified,
                  at the RMC's discretion after consultation with JHU, as (x) a
                  Subsequent Member of the TGF-(beta) Class containing the GI
                  Factor referred to in Subsection (a) of this Section or (y) a
                  Subsequent Member of the TGF-(beta) Class containing the
                  MetaMorphix Factor referred to in Subsection (b) of this
                  Section or (z) the First Member of a new TGF-(beta) Class for
                  purposes of this Agreement.

         1.82     "TGF-(BETA) FACTORS" shall mean the BMPs, the GDFs, the
                  Collaborative Factors, the Additional BMPs. the Additional
                  GDFs, the Additional Collaborative Factors. GDF-16. GDF-17 and
                  the Other TGF-(beta) Factors, being all of the Factors in the
                  TGF-(beta) Superfamily.

         1.83     "TGF-(BETA) SUPERFAMILY" shall mean (a) all of the molecules
                  containing the amino acid pattern which reflects the conserved
                  cysteine structure CX{24,29}CX{3}CX{25.38}CX{30.35}CXC and (b)
                  any other molecules which the RMC, after consultation with
                  JHU, reasonably determines are properly considered members of
                  the TGF-(beta) Superfamily.

         1.84     "THIRD PARTY(IES)" shall mean any person(s) or entity(ies)
                  other than JHU, MetaMorphix. GI and their respective
                  Affiliates.

         1.85     "USE PATENT" shall mean, with respect to GI. a Patent within
                  the GI Patent Rights or the Joint Patent Rights, and with
                  respect to MetaMorphix, a Patent within the MetaMorphix Patent
                  Rights or Joint Patent Rights, and with respect to JHU, a
                  Patent within the JHU Patent Rights or the Joint Patent
                  Rights, which Patent contains claims directed to a use of, or
                  method of treatment using, a Product, and which does not
                  contain composition claims directed to such Product.

         1.86     "VALID CLAIM" shall mean, with respect to the manufacture, use
                  or sale of a Product, (a) a claim of an unexpired patent which
                  shall not have been withdrawn, canceled or disclaimed, nor
                  held invalid or unenforceable by a court of competent
                  jurisdiction in an unappealed or unappealable decision or

<PAGE>

                  (b) a claim of a patent application which is either (i) the
                  subject of a pending patent interference proceeding or (ii)
                  supported by the disclosure of such application or any prior
                  filed patent application for a cumulative period not exceeding
                  seven (7) years from the earliest date of such supporting
                  disclosure for such claim in any such patent application.

2.       CONDITIONS PRECEDENT; THE CLOSING.

         2.1      GOVERNMENT APPROVALS.

                  2.1.1    THE PARTIES' OBLIGATIONS. Each Party shall use its
                           good faith efforts to eliminate any concern on the
                           part of any court or government authority regarding
                           the legality of the proposed transaction, including,
                           if required by federal or state antitrust
                           authorities, promptly taking all steps to secure
                           government antitrust clearance, including, without
                           limitation, cooperating in good faith with any
                           government investigation including the prompt
                           production of documents and information demanded by a
                           second request for documents and of witnesses if
                           requested.

                  2.1.2    ADDITIONAL APPROVALS. Each Party will cooperate and
                           use respectively all reasonable efforts to make all
                           other 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. Neither
                           Party shall be required, however, to divest products
                           or assets or materially change its business if doing
                           so is a condition of obtaining any governmental
                           approvals of the transactions contemplated by this
                           Agreement.

         2.2      CORPORATE APPROVALS.

                  2.2.1    METAMORPHIX DIRECTOR AND SHAREHOLDER APPROVAL.
                           MetaMorphix represents and warrants to GI that each
                           member of its board of directors (excluding those
                           Directors who are employed by GI and, for such reason
                           recuse themselves from voting on this transaction)
                           and each of its shareholders that hold twenty-five
                           thousand (25.000) or more shares of MetaMorphix
                           common or preferred stock of any series or class has
                           approved MetaMorphix entering into this Agreement,
                           performing its obligations hereunder and consummating
                           the transactions contemplated hereby.

                  2.2.2    GENETICS INSTITUTE APPROVAL. GI represents and
                           warrants that it has obtained all necessary
                           management approvals to enter into this

<PAGE>

                           Agreement, including, without limitation, any
                           approvals from GI's parent company. American Home
                           Products Corporation.

         2.3      THE CLOSING.

                  2.3.1    TIME AND PLACE. The Closing of the transactions
                           contemplated hereby shall take place at the offices
                           of the Wyeth-Ayerst Laboratories Division of American
                           Home Products Corporation. St. Davids, Pennsylvania,
                           at 10:00 A.M. (local time) on a date to be mutually
                           agreed upon by the Parties, which date shall be
                           within three (3) business days after the execution of
                           this Agreement by each of the Parties and the
                           delivery of such fully executed Agreement to each of
                           the Parties.

                  2.3.2    GI DELIVERABLES. At the Closing, GI shall

                           (i)      pay to MetaMorphix the amounts set forth in
                                    Sections 8.4, 10.2.1 and 10.2.2 hereof. to
                                    the extent such amounts have-not been paid
                                    by GI prior to the Closing;

                           (ii)     in accordance with Section 8.1 hereof,
                                    deliver to MetaMorphix an executed
                                    Assignment Agreement (substantially in the
                                    form of Schedule 8.IA hereof) and an
                                    executed Stock Power (substantially in the
                                    form of Schedule 8.IB attached hereto) for
                                    each MetaMorphix stock certificate, along
                                    with the original stock certificate, held by
                                    GI, for the assignment to MetaMorphix of two
                                    million seven hundred thousand (2,700,000)
                                    shares of its MetaMorphix Series A
                                    Convertible Preferred Stock and nine hundred
                                    thousand shares (900,000) shares (i.e.. all)
                                    of its MetaMorphix Series B Convertible
                                    Preferred Stock, each of which are owned by
                                    GI as of the date this Agreement was signed
                                    by the Parties;

                           (iii)    in accordance with Section 8.2 hereof, sign
                                    the Third Allonge to the Promissory Note
                                    (substantially in the form of Schedule 8.2
                                    hereof); and

                           (iv)     in accordance with Section 8.6 hereof, sign
                                    and deliver to MetaMorphix, JHU and Dr. Lee,
                                    the Termination Agreement (substantially in
                                    the form of Schedule 8.6 hereof)

                  2.3.3    METAMORPHIX DELIVERABLES. At the Closing, MetaMorphix
                           shall

<PAGE>

                           (i)      in accordance with Section 8.2 hereof, sign
                                    and deliver to GI the Third Allonge to the
                                    Promissory Note (substantially in the form
                                    of Schedule 8.2 hereof:

                           (ii)     in accordance with Section 8.1 hereof and
                                    the Assignment Agreement to be signed at the
                                    Closing, after receipt of the Assignment
                                    Agreement, the Stock Power and the original
                                    MetaMorphix stock certificates, a new
                                    original stock certificate in GI's name
                                    representing the two hundred thousand
                                    (200,000) shares of the MetaMorphix Series A
                                    Convertible Preferred Stock to be retained
                                    by GI:

                           (iii)    in accordance with Section 8.6 hereof, sign
                                    and deliver to GI, JHU and Dr. Lee, the
                                    Termination Agreement (substantially in the
                                    form of Schedule 8.6 hereof); deliver to GI
                                    a written opinion of MetaMorphix' legal
                                    counsel that (a) this Agreement and the
                                    transactions contemplated hereby have been
                                    unanimously approved by (x) MetaMorphix'
                                    Board of Directors and (y) those MetaMorphix
                                    shareholders that own twenty-five thousand
                                    (25,000) or more shares of MetaMorphix stock
                                    of any class or series. and (b) MetaMorphix
                                    has the requisite authority and right to
                                    enter into this Agreement and perform all of
                                    its obligations hereunder, which opinion
                                    shall be in a form customary in like
                                    transactions.

                  2.3.4    JHU DELIVERABLES. At the Closing, JHU shall in
                           accordance with Section 8.6 hereof, sign and deliver
                           to GI, MetaMorphix and Dr. Lee, the Termination
                           Agreement (substantially in the form of Schedule 8.6
                           hereof).

                  2.3.5    DR. LEE DELIVERABLES. At the Closing, Dr. Lee shall
                           in accordance with Section 8.6 hereof, sign and
                           deliver to GI, MetaMorphix and JHU, the Termination
                           Agreement (substantially in the form of Schedule 8.6
                           hereof).

3.       THE RESEARCH.

         3.1      BACKGROUND and Goals. In conducting the Original Research in
                  accordance with the 1994 Collaboration Agreement, a number of
                  GDFs, BMPs and/or Collaborative Factors were Discovered by the
                  Parties. The Parties desire to continue their efforts to
                  evaluate and characterize such Factors and any other

<PAGE>

                  Factors that were otherwise subject to the terms and
                  conditions of the 1994 Collaboration Agreement. but wish to
                  conduct such activities under a restructured relationship.
                  Under such restructured relationship. GI-and JHU hereby form a
                  sponsored research relationship whereby GI will provided
                  certain sponsored research funding to JHU for use by JHU in
                  evaluating and characterizing the GDFs, BMPs and Collaborative
                  Factors and in Discovering, evaluating and characterizing
                  Additional Factors. Additionally. until the expiration of the
                  Collaborative Research Term, GI and MetaMorphix will continue
                  to collaborate with respect to the evaluation and
                  characterization of the GDFs, BMPs and Collaborative Factors
                  which have not yet been selected or designated as either GI
                  Factors or MetaMorphix Factors so that GI and MetaMorphix may
                  utilize such information in selecting such Factors as either
                  GI Factors or MetaMorphix Factors. As part of such
                  collaboration GI will make available to MetaMorphix relevant
                  information it receives from JHU under the Sponsored Research
                  regarding such GDFs, BMPs and Collaborative Factors.

         3.2      THE ORIGINAL RESEARCH.

                  3.2.1    FUNDING. JHU acknowledges and agrees that it has
                           received all payments due to it from MetaMorphix
                           and/or GI with respect to its conduct of the Original
                           Research.

                  3.2.2    DISCLOSURE OF INFORMATION.

                           3.2.2.1  DISCLOSURE OF SEQUENCES. Each Party
                                    represents and warrants to the other Parties
                                    that, prior to the Effective Date, it has
                                    reported and disclosed to the other Parties
                                    the cDNA sequence(s) encoding the
                                    mature/processed protein region of any BMPs,
                                    GDFs or Collaborative Factors Discovered by
                                    that Party in conducting the Original
                                    Research on or before May 31, 1998.

                           3.2.2.2  DISCLOSURE OF OTHER INFORMATION. Each Party
                                    shall promptly report and disclose to the
                                    other Parties, in writing, the applicable
                                    (x) Factor Rights developed in conducting
                                    the Original Research and (y) Data developed
                                    in conducting the Original Research as
                                    follows:

                                    (i)      in connection with the preparation,
                                             filing and maintenance by a Party
                                             of a Patent covering such Factor
                                             Rights, or a review of information
                                             by the Parties prior to public
                                             disclosure, the disclosure of such
                                             Factor Rights and Data may be
                                             limited to that Factor (or those
                                             Factors) which is (are) the

<PAGE>

                                             subject of the Patent action or
                                             public disclosure: and

                                    (ii)     in connection with notice by GI or
                                             MetaMorphix of its intention to
                                             select, or trigger the selection
                                             of, any Available Factor under
                                             Article 5, below, the disclosure of
                                             such Factor Rights and Data shall
                                             not be limited to a particular
                                             Factor, but shall include
                                             information on ALL then-Available
                                             Factors which the disclosing Party,
                                             acting in good faith, determines is
                                             likely to be material to the
                                             selecting Party in making its
                                             selection decision, all according
                                             to the procedures set forth in
                                             Article 5 of this Agreement.

         3.3      THE SPONSORED RESEARCH.

                  3.3.1    SPONSORED RESEARCH TERM. The Sponsored Research shall
                           be conducted by JHU as set forth herein beginning on
                           June 1, 1998 and shall continue through November 30,
                           1999 or until such later date as JHU and GI may
                           mutually agree in writing (the "Sponsored Research
                           Term"). Any such extension of the Sponsored Research
                           Term shall have no effect upon the length of the
                           Collaborative Research Term, and shall not be
                           considered to be an extension of the Original
                           Research Term.

                  3.3.2    FUNDING. GI shall provide to JHU a total of one
                           million one hundred eighty-two thousand four hundred
                           sixty two dollars ($1,182,462) in sponsored research
                           funding, four hundred fifty six thousand one hundred
                           thirty eight dollars ($456.138) of which was paid to
                           JHU on or about January 7. 1999 pursuant to the
                           Letter of Intent. The remaining seven hundred twenty
                           six thousand three hundred twenty four dollars
                           ($726.324) will be provided to JHU in installments as
                           follows:

                               Amount of Payment      Date Payment Is Due
                               -----------------      -------------------

                                        $181.581      within ten (10) days after
                                                      the Effective Date

                                        $181,581      March 1, 1999

                                        $181.581      June 1, 1999

                                        $181.581      September 1, 1999

<PAGE>

                           Additionally. MetaMorphix had agreed to purchase and
                           donate to JHU for use by Dr. Lee's laboratory in
                           carrying out research activities that MetaMorphix had
                           agreed to sponsor at JHU during the period commencing
                           on December 1. 1997 and ending on November 30. 1998.
                           up to two hundred fifty thousand dollars ($250.000)
                           worth of equipment and supplies. GI agrees to
                           partially reimburse MetaMorphix for such supply
                           purchased by paying to MetaMorphix thirty seven
                           thousand four hundred ninety dollars ($37.490) which
                           amount will be paid on the Effective Date. Each of
                           GI. JHU and MetaMorphix acknowledge and agree that
                           the payment (in the amount of $456,138) made to JHU
                           pursuant to the Letter of Intent and the thirty seven
                           thousand four hundred ninety dollars ($37.490)
                           payment to be made to MetaMorphix are being made by
                           GI to assume previously unpaid sponsored research
                           funding obligations of MetaMorphix to JHU and that,
                           inconsideration of GI's assuming such obligations.
                           MetaMorphix relinquishes all rights and licenses to
                           any inventions, discoveries, Patents and know-how
                           relating to any Additional GDFs or Additional
                           Collaborative Factors Discovered by JHU on or after
                           June 1. 1998. 'MetaMorphix further acknowledges that,
                           as provided in Section 6.3.3 below, JHU has the right
                           to grant and is granting to GI an exclusive license
                           with respect to any such Additional Factors.

                  3.3.3    USE OF FUNDS; BUDGETS. JHU shall use the funds
                           provided under Section 3.3.2 solely in support of
                           activities in Dr. Lee's JHU laboratory, or in such
                           other JHU laboratories or core facilities which are
                           supporting Dr. Lee's laboratory, under the Sponsored
                           Research to (i) characterize GDFs and Collaborative
                           Factors for commercialization by GI and/or
                           MetaMorphix and their respective sublicensees, and
                           (ii) to Discover and characterize Additional GDFs and
                           Additional Collaborative Factors for
                           commercialization by GI and its sublicensees, as
                           provided herein. During the Sponsored Research Term.
                           JHU. except as expressly permitted under Section 3.9
                           hereof. shall not use funds provided by a commercial
                           entity, other than GI to support Dr. Lee's activities
                           under the Sponsored Research. JHU, acting through Dr.
                           Lee, has prepared an initial budget to guide JHU's
                           expenditures for its Sponsored Research activities
                           during the Sponsored Research Term, a copy of which
                           is attached hereto as Schedule 3.3.3. The Sponsored
                           Research funding may be increased only by written
                           agreement of GI and JHU. In the event that GI and JHU
                           agree to extend the Sponsored Research Term, any
                           unexpended funds will be carried over for use in the
                           following year.

                  3.3.4    SPONSORED RESEARCH PLAN. A' Sponsored Research Plan,
                           which sets forth JHU's specific activities under the
                           Sponsored Research and

<PAGE>

                           coordinates JHU's and GI's respective activities
                           under the Sponsored Research. is attached hereto as
                           Schedule 3.3.4. With respect to JHU's activities
                           under the Sponsored Research. the Sponsored Research
                           Plan sets forth Dr. Lee's research activities for the
                           full Sponsored Research Term: this portion of the
                           Sponsored Research Plan has been reviewed and
                           approved by GI. and shall be updated on an as needed
                           basis as agreed in writing by Dr. Lee and GI. With
                           respect to coordination of the Parties' activities
                           under the Sponsored Research, the Sponsored Plan
                           shall be reviewed each calendar quarter by the Dr.
                           Lee and GI. JHU and GI each shall endeavor to carry
                           out their portion of the Sponsored Research Plan
                           consistent with the descriptions of Schedule 3.3.4.

                  33.5     SPONSORED RESEARCH ACTIVITIES. For JHU, the Sponsored
                           Research shall be conducted in Dr. Lee's JHU
                           laboratory, only by Dr. Lee and other JHU faculty,
                           students, fellows and employees who have signed an
                           Invention and Disclosure Agreement, using Sponsored
                           Research funding provided by GI under this Section
                           3.3; PROVIDED, HOWEVER, that (i) JHU may utilize its
                           genetics core sequencing facility and other core
                           facilities in support of its Sponsored Research
                           activities under this Agreement and (ii) Dr. Lee may
                           collaborate with other JHU laboratories in performing
                           the Sponsored Research, PROVIDED THAT (x) such
                           collaboration is consistent with both the Sponsored
                           Research Plan and JHU's representations and
                           warranties set forth in Section 12.4 of this
                           Agreement and (y) prior to commencement of such
                           collaboration, JHU, acting through Dr. Lee, gives GI
                           written notice of such proposed collaboration and (z)
                           the JHU faculty, students, fellows and employees
                           working in such other JHU laboratory have signed an
                           Invention and Disclosure Agreement. GI shall review
                           JHU's activities under the Sponsored Research. During
                           the Sponsored Research Term and any extension of the
                           Sponsored Research Term that JHU and GI may agree
                           upon and for a period of six (6) months thereafter.
                           JHU shall not collaborate or otherwise, directly or
                           indirectly, work with MetaMorphix or any Third Party
                           with respect to the Discovery of any Factor or
                           characterization of any Additional Factor.

                  3.3.6    INVENTION and Disclosure Agreement. JHU, acting
                           through Dr. Lee, shall require all JHU faculty,
                           students, fellows and employees working in Dr. Lee's
                           JHU laboratory or in any other JHU laboratory with
                           which Dr. Lee collaborates, as provided in Section
                           3.3.4. above, who are engaged in the Discovery,
                           evaluation and/or characterization of TGF-R Factors
                           to sign an Invention and Disclosure Agreement. In the
                           event Dr. Lee desires to disclose

<PAGE>

                           specific GI and/or MetaMorphix Confidential
                           Information to any such JHU faculty, students.
                           fellows or employees, prior to such disclosure JHU,
                           acting through Dr. Lee shall require such JHU
                           faculty, students, fellows and employees to sign a
                           Confidentiality Agreement in the form appearing as
                           Schedule 3.3.6 to this Agreement covering such
                           specific Confidential Information. JHU agrees to
                           promptly provide to GI a copy of each such Invention
                           and Disclosure Agreement and Confidentiality
                           Agreement that is entered into in accordance with
                           this Section 3.3.5 or any other provision of this
                           Agreement. Additionally, within thirty (30) days
                           after the Closing; JHU shall provide to GI a copy of
                           each Invention and Disclosure Agreement and
                           Confidentiality Agreement that had been entered into
                           prior to the Closing.

                  3.3.7    DISCLOSURE OF INFORMATION.

                           3.3.7.1  DISCLOSURE OF SEQUENCES. JHU agrees to
                                    promptly (within twenty-five (25) days after
                                    Discovery) report and disclose to GI the
                                    cDNA sequence(s) encoding the
                                    mature/processed protein region of any
                                    Additional GDFs or Additional Collaborative
                                    Factors Discovered by JHU during the
                                    Sponsored Research Term or the six (6) month
                                    period following the end of the Sponsored
                                    Research Term.

                           3.3.7.2  DISCLOSURE OF OTHER INFORMATION. Subject to
                                    Section 3.3.7.3, below, JHU, from time to
                                    time, but no less often than once each
                                    Calendar Quarter, during the Sponsored
                                    Research Term (including any extensions
                                    thereof), shall disclose to GI (x) any
                                    Factor Rights (other than the cDNA sequences
                                    promptly disclosed under Section 3.3.7.1,
                                    above) and (y) any Data which relates to the
                                    Sponsored Research. GI may, at its sole
                                    option, either (i) disclose toMetaMorphix or
                                    (ii) require JHU to disclose toMetaMorphix.
                                    any such Factor Rights and Data which
                                    relates to one or more of the BMPs, GDFs or
                                    Collaborative Factors that have not yet
                                    become either a GI Factor or a MetaMorphix
                                    Factor in accordance with the selection
                                    process set forth in Article 5 below,
                                    PROVIDED, HOWEVER, that JHU shall not
                                    disclose any such Factor Rights or Data to
                                    MetaMorphix without GI's prior consent,
                                    which consent shall not be unreasonably
                                    withheld. Notwithstanding the foregoing,
                                    upon GI's request, which request may be made
                                    from time to time, JHU shall promptly
                                    (within fourteen (14) days of such request)
                                    disclose to GI all such Factor Rights and
                                    Data which JHU has not previously disclosed
                                    to GI.

<PAGE>

                                    Notwithstanding the foregoing. JHU agrees
                                    that it will not disclose to MetaMorphix any
                                    Factor Rights or Data pertaining to any GI
                                    Factor (after such Factor has been selected
                                    by GI in accordance with Article 5 hereof)
                                    or to any Additional Factor without GI's
                                    prior written consent. which consent may be
                                    provided or withheld in GI's sole
                                    discretion.

                           3.3.7.3  MANDATORY DISCLOSURE OF OTHER INFORMATION.
                                    Notwithstanding Section 3.3.7.2, above, JHU
                                    shall promptly report and disclose to GI
                                    and, if GI requests JHU to do so, to
                                    MetaMorphix, in writing, the applicable (x)
                                    Factor Rights and (y) Data, as follows:

                                    i.       in connection with the preparation,
                                             filing and maintenance by JHU of a
                                             Patent covering the Factor Patent
                                             Rights, or a review of information
                                             by the Parties prior to public
                                             disclosure, the disclosure of such
                                             Factor Rights and Data may be
                                             limited to that Factor (or those
                                             Factors) which is (are) the subject
                                             of the Patent action or public
                                             disclosure;

                                    ii.      in connection with notice by GI or
                                             MetaMorphix of its intention to
                                             select, or trigger the selection
                                             of, any Available Factor under
                                             Section 5, below, the disclosure of
                                             such Factor Rights and Data shall
                                             not be limited to a particular
                                             Factor, but shall include
                                             information on all then-Available
                                             Factors which the disclosing Party,
                                             acting in good faith, determines is
                                             likely to be material to the
                                             selecting Party in making its
                                             selection decision, all according
                                             to the procedures set forth in
                                             Section 5 of this Agreement; and

                                    iii.     in connection with submission of
                                             JHU's annual report, as provided in
                                             Subsection 3.3.8, below.

                  3.3.8    ANNUAL REPORTS. Each of GI and JHU shall prepare and
                           submit to the other, within thirty (30) days of the
                           end of the Sponsored Research Term and within thirty
                           (30) days of the end of each year of any extension of
                           the Sponsored Research Term, a report summarizing
                           that Party's activities under the Sponsored Research
                           during the preceding year.

                  3.3.9    EQUIPMENT. Pursuant to the 1994 Collaboration
                           Agreement, JHU, utilizing a portion of the funds it
                           received from MetaMorphix,

<PAGE>

                           purchased tissue culture equipment, molecular biology
                           equipment and protein test equipment identified in
                           Schedule 3.3.9 attached hereto. In accordance with
                           the terms of the 1994 Collaboration Agreement. JHU
                           owns such equipment and shall continue to own such
                           equipment. JHU agrees that during the Sponsored
                           Research Term, such equipment will be located in Dr.
                           Lee's JHU laboratory and will be used primarily by
                           JHU personnel engaged in the . Sponsored Research
                           under this Agreement.

                  3.3.10   EXCLUSIVITY OF RESEARCH. During the Sponsored
                           Research Term and for a period of six (6) months
                           following the expiration of the Sponsored Research
                           Term, Dr. Lee, except as expressly permitted under
                           Sections 3.9 and/or 3.10 hereof, will not participate
                           (as a researcher, consultant or advisor) in any
                           research sponsored or otherwise funded by a
                           commercial entity (except a Party) which is intended
                           to characterize previously-Discovered TGF-(beta)
                           Factors (except for GDF 1), and Discover and
                           characterize new Factors, in the TGF-(beta)
                           Superfamily. During the Sponsored Research Term and
                           for such time as they are engaged in the Discovery
                           and characterization of TGF-(beta) Factors in (or in
                           collaboration with) Dr. Lee's JHU laboratory, the JHU
                           faculty, students, fellows and employees who have
                           signed an Invention and Disclosure Agreement shall
                           give JHU immediate notice of any formal affiliations
                           they are negotiating or may have (as researchers,
                           consultants or advisors) with a commercial entity
                           (except GI) which is intended to discover, identify
                           and/or characterize Factors in the TGF-(beta)
                           Superfamily. JHU, acting through Dr. Lee, shall
                           describe to GI any such notice its receives under an
                           Invention and Disclosure Agreement, and thereafter,
                           JHU shall have no further obligation, PROVIDED that
                           such Invention and Disclosure Agreement remains in
                           effect, and FURTHER PROVIDED, that JHU, acting
                           through Dr. Lee, notifies such commercial entity of
                           the existence of such Invention and Disclosure
                           Agreement between JHU and such JHU faculty, student,
                           fellow or employee.

         3.4      THE COLLABORATIVE RESEARCH.

                  3.4.1    THE COLLABORATIVE RESEARCH TERM. The Collaborative
                           Research began as of June 1. 1998 and shall be
                           conducted by GI and MetaMorphix through November 30,
                           1999 or such later date as may be mutually agreed
                           upon in writing by the Parties (the "Collaborative
                           Research Term"). Any such extension of the
                           Collaborative Research Term shall have no effect on
                           the length of the Sponsored Research Term.

<PAGE>

                  3.4.2    COLLABORATIVE RESEARCH PLAN. A Collaborative Research
                           Plan. which sets forth GI's and MetaMorphix's
                           specific activities under the Collaborative Research
                           and coordinates the GI's and MetaMorphix's respective
                           activities under the Collaborative Research, is
                           attached hereto as Schedule 3.4.2. With respect to
                           coordination of the GI's and MetaMorphix's activities
                           under the Collaborative Research, the Collaborative
                           Research Plan shall be reviewed each calendar quarter
                           by the RMC. The Parties shall endeavor to carry out
                           their portion of the Collaborative Research Plan
                           consistent with the descriptions of Schedule 3.4.2.

                  3.4.3    RESEARCH MANAGEMENT COMMITTEE. Pursuant to the 1994
                           Collaboration Agreement, GI and MetaMorphix formed a
                           Research Management Committee (the "RMC") which
                           committee shall continue to exist during the
                           Collaborative Research Term of this Agreement. The
                           function of the RMC shall be to (i) advise GI and
                           MetaMorphix on the direction of the Collaborative
                           Research, (ii) coordinate GI's and MetaMorphix's
                           activities under the Collaborative Research, (iii)
                           facilitate the exchange of ideas and information by
                           GI and MetaMorphix under this Agreement and (iv)
                           mediate any disputes between GI and MetaMorphix, as
                           provided in Sections 1.81 and Article S. The RMC
                           shall consist of four (4) members, two (2) of whom
                           shall be designated by GI and two (2) of whom shall
                           be designated by MetaMorphix (with only the non-GI
                           representatives on the MetaMorphix board of directors
                           voting in the selection of such. representatives).
                           Communications between GI and MetaMorphix with
                           respect to the Discovery, characterization,
                           evaluation and selection of BMPs, GDFs and
                           Collaborative Factors shall be directed to each of
                           GI's and MetaMorphix's respective RMC members and
                           confirmed with copies to each of GI's and
                           MetaMorphix's respective RMC members, subject to
                           Section 3.4.6, below, GI and MetaMorphix may assign
                           its members to the RMC as it deems appropriate, and
                           designated substitutes may represent RMC members at
                           regularly scheduled meetings at the discretion of the
                           substituting Party. The RMC will meet at least once
                           per calendar quarter during the Collaborative
                           Research Term, alternating between GI and MetaMorphix
                           locations, to review their progress under the
                           Collaborative Research and other activities under
                           this Agreement subject to Section 3.4.6, below.
                           Actions by and decisions of the RMC shall require the
                           affirmative vote of at least three (3) RMC members.
                           GI and MetaMorphix shall each designate an overall
                           project manager to coordinate preparation of short
                           written reports summarizing each of GI's and
                           MetaMorphix's Collaborative Research efforts, to be
                           provided to each of the RMC members in advance of
                           each quarterly RMC meeting, subject to

<PAGE>

                           Section 3.4.6, below. It is contemplated that, in
                           addition to reports to, and meetings of the RMC there
                           will be frequent communications among the scientists
                           and project managers to keep GI and MetaMorphix
                           advised of current Collaborative Research activities,
                           subject to Section 3.4.6, below.

                  3.4.4    COLLABORATIVE RESEARCH ACTIVITIES. In conducting its
                           activities under the Collaborative Research, GI, at
                           its own expense, shall allocate at least one (1) full
                           time equivalent scientist to the Collaborative
                           Research, together with such technical staff,
                           equipment and supplies as are reasonably necessary to
                           support those GI scientists. In conducting its
                           activities under the Collaborative Research,
                           MetaMorphix, at its own expense, shall allocate at
                           least one (1) full time equivalent scientist to the
                           Collaborative Research, together with such technical
                           staff, equipment and supplies as are reasonably
                           necessary to support such MetaMorphix scientist.
                           During the Collaborative Research Term and any
                           extension of the Sponsored Research Term that JHU and
                           GI may agree upon and for a period of six (6) months
                           thereafter. MetaMorphix shall not collaborate or
                           otherwise, directly or indirectly, except through the
                           Collaborative Research or as otherwise expressly
                           permitted under Sections 3.9 and/or 3.10 hereof work
                           with JHU with respect to the Discovery or
                           characterization of any Factor.

                  3.4.5    DISPUTE RESOLUTION. In the event the RMC is unable to
                           resolve any issue which properly comes before it
                           within sixty (60) days, senior executives from each
                           of GI and MetaMorphix shall meet promptly following a
                           notice from either such Party in order to discuss and
                           resolve, within sixty (60) days, the outstanding
                           issues facing the RMC.

                  3.4.6    DISCLOSURE OF INFORMATION.

                           3.4.6.1  DISCLOSURE OF SEQUENCES. Each of GI and
                                    MetaMorphix represents and warrants to the
                                    other Parties that, on or before the
                                    Effective Date, it has reported and
                                    disclosed to the other Parties the cDNA
                                    sequence(s) encoding the mature/processed
                                    protein region of any BMPs, GDFs or
                                    Collaborative Factors Discovered by that
                                    Party.

                           3.4.6.2  DISCRETIONARY DISCLOSURE OF OTHER
                                    INFORMATION. Subject to Section 3.3:6.3,
                                    below, each of GI and MetaMorphix may, at
                                    its discretion, from time to time disclose
                                    to the other Parties during the
                                    Collaborative Research Term (x) any Factor
                                    Rights (other than the cDNA sequences

<PAGE>

                                    promptly disclosed under Section 3.4.6.1,
                                    above) and (y) any Data which relates to the
                                    Collaborative Research.

                           3.4.6.3  MANDATORY DISCLOSURE OF OTHER INFORMATION.
                                    Notwithstanding Section 3.4.6.2 above, each
                                    of GI and MetaMorphix shall promptly report
                                    and disclose to the other Parties, in
                                    writing, the applicable (x) Factor Rights
                                    and (y) Data, (in each case, including any
                                    Data received from JHU) as follows:

                                    i.       in connection with the preparation,
                                             filing and maintenance by such
                                             Party of a Patent covering the
                                             Factor Patent Rights, or a review
                                             of information by the Parties prior
                                             to public disclosure, the
                                             disclosure of such Factor Rights
                                             and Data may be limited to that
                                             Factor (or those Factors) which: is
                                             (are) the subject of the Patent
                                             action or public disclosure;

                                    ii.      in connection with notice by GI or
                                             MetaMorphix of its intention to
                                             select, or trigger the selection
                                             of, any Available Factor under
                                             Article 5, below, the disclosure of
                                             such Factor Rights and Data shall
                                             not be limited to a particular
                                             Factor, but shall include
                                             information on ALL then-Available
                                             Factors which the disclosing Party,
                                             acting in good faith, determines is
                                             likely to be material to the
                                             selecting Party in making its
                                             selection decision, all according
                                             to the procedures set forth in
                                             Article 5 of this Agreement; and

                                    iii.     in connection with submission of
                                             each Party's annual report, as
                                             provided in Section 3.4.7, below.

                  3.4.7    ANNUAL Reports. Each of GI and MetaMorphix shall
                           prepare and submit to the other, within thirty (30)
                           days of the end of the Collaborative Research Term,
                           and if the Collaborative Research Term is extended in
                           accordance with Section 3.4.1 hereof, within thirty
                           (30) days after the end of each year of such
                           extension of the Collaborative Research Term, a
                           report summarizing that Party's activities under the
                           Collaborative Research during the preceding year. No
                           such annual_ reports are due by GI or by MetaMorphix
                           with respect to the Original Research.

<PAGE>

         3.5      DISCLOSURE OF INFORMATION BY AND TO JHU.

                  3.5.1    JHU DISCLOSURES. For JHU, the information and data it
                           discloses to GI and/or MetaMorphix shall be limited
                           to information and data developed in Dr. Lee's JHU
                           laboratory by Dr. Lee and other JHU faculty,
                           students, fellows and employees who are conducting
                           the Sponsored Research under this Agreement.

                  3.5.2    GI AND METAMORPHIX DISCLOSURES. Any Confidential
                           Information which GI or MetaMorphix desires to
                           disclose to JHU shall be disclosed to (and only to)
                           Dr. Lee. As provided in Section 3.3.6, above, JHU,
                           acting through Dr. Lee, shall require all JHU
                           faculty, students, fellows and employees to whom
                           specific GI and/or MetaMorphix Confidential
                           Information is to be disclosed to first sign a
                           Confidentiality Agreement in the form appearing as
                           Schedule 3.3.6 to this Agreement covering such
                           specific Confidential Information.

         3.6      OWNERSHIP OF RESULTS. GI shall own all GI Rights resulting
                  from the conduct of the Original Research, the Collaborative
                  Research and/or the Sponsored Research, even though use of
                  MetaMorphix' and/or JHU's Confidential Information may have
                  been incidental to the development of such GI Rights.
                  MetaMorphix shall own all MetaMorphix Rights resulting from
                  the conduct of the Original Research and/or the Collaborative
                  Research, even though use of GI's and/or JHU's Confidential
                  Information may have been incidental to the development of
                  such MetaMorphix Rights. JHU shall own all JHU Rights
                  resulting from the conduct of the Original Research, the
                  Collaborative Research and/or the Sponsored Research even
                  though use of GI's and/or MetaMorphix' Confidential
                  Information may have been incidental to the development of
                  such JHU Rights. GI and MetaMorphix, or GI and JHU, or JHU and
                  MetaMorphix, as applicable, - shall jointly own all Joint
                  Rights or Additional Factor Joint Rights resulting from the
                  conduct of the Collaborative Research. Should any issue of
                  inventorship of a BMP. GDF or Collaborative Factor arise among
                  the Parties regarding inventions made prior to June 1, 1998,
                  the chief patent counsel or other designee of each Party shall
                  attempt to resolve such issue. Failing resolution, the
                  inventorship issue shall be referred to an independent,
                  outside patent expert, mutually acceptable to all Parties,
                  whose determination of inventorship shall be binding on GI and
                  MetaMorphix, or GI and JHU, or JHU and MetaMorphix, as
                  applicable. The costs of such outside patent expert shall be
                  shared equally by the Parties involved in the dispute.

         3.7      RESEARCH LICENSE. During the Collaborative Research Term, each
                  Party grants to the other Parties a royalty-free,
                  non-exclusive license under their

<PAGE>

                  respective interests in the Factor Rights solely for the
                  purposes of performing their Collaborative Research activities
                  under this Agreement. During the Sponsored Research Term, GI
                  and JHU grant to each other a royalty-free, non-exclusive
                  license under their respective interests in the Factor Rights
                  and the Additional Factor Rights, solely for the purposes of
                  performing the Sponsored Research activities under this
                  Agreement. At the end of the Collaborative Research Term JHU
                  shall have a royalty-free. non-exclusive, non-transferable,
                  perpetual license under the Factor Rights existing as of the
                  end of the Collaborative Research Term, without the right to
                  grant sublicenses except as provided in Section 6.6, below,
                  solely for academic, non-commercial research purposes. At the
                  end of the Sponsored Research Term, JHU shall have a
                  royalty-free, non-exclusive, nontransferable license under the
                  Additional Factor Rights existing as of the end of the
                  Sponsored Research Term, without the right to grant
                  sublicenses except as provided in Section 6.6, below, solely
                  for academic, noncommercial research purposes.

         3.8      ACKNOWLEDGEMENT. Each Party acknowledges that its promise to
                  fully disclose in a timely manner information to the other
                  Parties related to the Collaborative Research and/or the
                  Sponsored Research, as provided in this Article 3, was
                  material to the other Parties' decisions to enter this
                  Agreement and is crucial to the Parties' success hereunder.

         3.9      METAMORPHIX SPONSORED RESEARCH. So long as the confidentiality
                  requirements and other restrictions and obligations
                  (including, without limitation, the obligation to disclose and
                  license to GI certain intellectual property relating to
                  Additional Factors and BMPs, GDFs and Collaborative Factors as
                  set forth in this Article 3 and in Article 6 hereof) of the
                  JHU/GI Sponsored Research relationship are recognized and
                  adhered to. MetaMorphix may sponsor research in Dr. Lee's
                  laboratory at JHU, which research may relate to the
                  characterization of MetaMorphix Factors, GDF-16. GDF-17 and
                  unassigned BMPs, GDFs and Collaborative Factors but may not
                  relate to any GI Factor, any Additional Factor, or the
                  Discovery evaluation or characterization of any other
                  TGF(beta) Factor, PROVIDED HOWEVER, that (i) any and all
                  information or data developed or generated by Dr. Lee. JHU or
                  MetaMorphix in performing such sponsored research, which
                  information or data relates to any TGF-(beta) Factor or the
                  Collaborative Research or Sponsored Research activities
                  conducted by the Parties under this Agreement, shall be
                  disclosed to GI as if such information and data were developed
                  or generated by Dr. Lee of JHU as part of or in connection
                  with the GI/JHU Sponsored Research relationship and (ii) all
                  such data and information shall be deemed to be included
                  within the definition of the JHU Know-How or the MetaMorphix
                  Know-How as applicable and GI and MetaMorphix shall each have
                  the

<PAGE>

                  right and license to use all such data and information in
                  accordance with and subject to the terms and conditions of
                  this Agreement.

         3.10     DR. LEE AS CONSULTANT TO METAMORPHIX. During the Sponsored
                  Research Term, Dr. Lee shall be permitted to continue to serve
                  as a consultant to MetaMorphix should Dr. Lee and MetaMorphix
                  agree to continue such relationship, PROVIDED, HOWEVER, that,
                  upon and after the execution of this Agreement, (i) the
                  confidentiality requirements and other restrictions and
                  obligations (including, without limitation, the obligation to
                  disclose and license to GI certain intellectual property
                  relating to Additional Factors and BMPs, GDFs and
                  Collaborative Factors as set forth in this Article 3 and in
                  Article 6 hereof) of the JHU/GI Sponsored Research
                  relationship are recognized and adhered to, (ii) such
                  consulting services shall not relate to the Discovery of any
                  TGF-(beta) Factor, to any GI Factor or to any Additional
                  Factors, (iii) any information, data, or inventions, made or
                  developed by Dr. Lee or MetaMorphix in connection with such
                  consulting services, shall be deemed to be included within the
                  JHU Know-How or the MetaMorphix Know-How as applicable, would
                  be included in the rights licensed by MetaMorphix or JHU, as
                  applicable, and, to the extent such information, data. or
                  inventions relate to the Collaborative Research, GI shall have
                  the right to use all such data and information in accordance
                  with and subject to the terms and conditions of this
                  Agreement.

4.       SUPPLY OF MATERIALS.

         4.1      SUPPLY OF Materials in Connection WITH THE SPONSORED RESEARCH.
                  Except as otherwise expressly provided by this Agreement,
                  during the Sponsored Research Term, each of JHU and GI shall,
                  at its respective sole cost and expense, use reasonable and
                  diligent efforts to supply to the other such reasonable
                  quantities and types of GDFs, Collaborative Factors,
                  Additional GDFs or Additional Collaborative Factors (or cell
                  lines that express such GDFs, Collaborative Factors,
                  Additional GDFs and/or Additional Collaborative Factors) and
                  other materials in that Party's possession and control as GI
                  and JHU may agree are reasonably required to carry out their
                  respective obligations under this Agreement. GI, in turn,
                  shall have the right to supply any such GDFs or Collaborative
                  Factors (or cell lines that express such GDFs or Collaborative
                  Factors) received from JHU hereunder to MetaMorphix in
                  accordance with Section 4.2 hereof, or, alternatively, to
                  require JHU to supply any such GDFs or Collaborative Factors
                  (or cell lines that express such GDFs or Collaborative
                  Factors) directly to MetaMorphix. GI shall permit two (2) JHU
                  students, working under Dr. Lee's supervision, to visit GI
                  facilities during the Sponsored Research Term (subject to
                  those students signing appropriate confidentiality agreements
                  required by GI) for the sole purpose of expressing and
                  purifying proteins expressed from unassigned GDFs and
                  Collaborative

<PAGE>

                  Factors and from Additional GDFs and Additional Collaborative
                  Factors for subsequent evaluation and characterization at JHU
                  in accordance with the Sponsored Research Plan. Any GDFs,
                  Collaborative Factors. Additional GDFs, Additional
                  Collaborative Factors and other materials delivered to a Party
                  in accordance with this Section 3.1 shall remain the property
                  of the furnishing Party.

         4.2      SUPPLY OF MATERIALS TO METAMORPHIX.

                  4.2.1    UNASSIGNED BMPS, GDFS AND COLLABORATIVE FACTORS.
                           During the Collaborative Research Term, GI shall, at
                           its sole cost and expense, use commercially
                           reasonable and diligent efforts to supply MetaMorphix
                           with reasonable quantities of protein expressed from
                           unassigned BMPs, GDFs and Collaborative Factors which
                           GI has elected to evaluate, for MetaMorphix to
                           perform its own evaluations. The quantity (which,
                           subject to the limitations set forth below, shall be
                           no less than 50% of the amount GI produces for its
                           own use in evaluating such Factors), quality and
                           purity of any protein so provided to MetaMorphix
                           under this Section 4.2.1 shall be substantially
                           equivalent to the quantity (if any), quality and
                           purity of such protein GI produces for its own use in
                           its evaluation of such unassigned BMPs, GDFs and
                           Collaborative Factors, PROVIDED, HOWEVER, that in no
                           event shall GI be obligated to supply to MetaMorphix
                           more than two (2) milligrams of protein for each such
                           BMP. GDF or Collaborative Factor. In addition, GI
                           may, but shall not be obligated, to supply
                           MetaMorphix, at MetaMorphix's cost and expense. with
                           protein expressed from unassigned BMPs, GDFs and
                           Collaborative Factors which GI has not yet elected to
                           evaluate, for MetaMorphix to perform its evaluations
                           in accordance with the Collaborative Research Plan
                           and Section 5.1 of this Agreement. MetaMorphix agrees
                           to make no other use of any protein supplied to it
                           under this Section 4.2.1 (unless and until
                           MetaMorphix may select such Factor as a MetaMorphix
                           Factor, in which event MetaMorphix may use any
                           remaining stocks of such protein supplied to
                           MetaMorphix hereunder for the continued research and
                           development of such MetaMorphix Factor. Any BMPs,
                           GDFs. Collaborative Factors and other materials
                           delivered to MetaMorphix in accordance with this
                           Section 4.2.1 shall remain the property of the
                           furnishing Party (GI or JHU, as applicable).

                  4.2.2    METAMORPHIX FACTORS. During the Collaborative
                           Research Term, GI, subject to GI's manufacturing
                           capabilities, limitations, schedules and priorities,
                           will use its Commercially Reasonable Efforts to
                           supply MetaMorphix, at GI's cost, with reasonable
                           quantities of protein expressed from GDF-8, GDF-11
                           and GDF-12

<PAGE>

                           for use by MetaMorphix in developing MetaMorphix
                           Products based on such MetaMorphix Factors for use in
                           the MetaMorphix Field. The quantity (which. subject
                           to the limitation set forth below, shall be no less
                           than 50% of the amount GI produces for its own use),
                           quality and purity of any protein so provided to
                           MetaMorphix under this Section 4.2.1 shall be
                           substantially equivalent to the quantity (if any),
                           quality and purity of such protein GI produces for
                           its own use in the research and development of GI
                           Type B Products based on such Factors, PROVIDED,
                           HOWEVER, that in no event shall GI be obligated to
                           supply to MetaMorphix more than two (2) milligrams of
                           protein for each such MetaMorphix Factor. MetaMorphix
                           shall not request unreasonable quantities of any such
                           MetaMorphix Factor or impose unreasonable time or
                           other constraints on GI, it being understood that GI
                           has and will have other products which place demands
                           on its protein expression capacity and that GI will
                           endeavor to supply such protein to MetaMorphix during
                           the six (6) month period following the Effective
                           Date. GI shall consider, in good faith, MetaMorphix'
                           requests for such MetaMorphix Factors at the time GI
                           is evaluating its other protein expression
                           priorities. In the event GI is unable or unwilling to
                           supply MetaMorphix with such quantities of such
                           MetaMorphix Factors for such development purposes as
                           required above in this Section 4.2.2, GI will use its
                           Commercially Reasonable Efforts to provide
                           MetaMorphix, at GI's cost and expense, WITH vectors
                           and/or cell Lines, if available, which are necessary
                           for MetaMorphix to express, or have expressed, such
                           MetaMorphix Factors for use by MetaMorphix in
                           developing MetaMorphix Products based on such
                           MetaMorphix Factors in the MetaMorphix Field. Any
                           BMPs, GDFs, Collaborative Factors, vectors, cell
                           lines and other materials delivered to MetaMorphix in
                           accordance with this Section 4.2.2 shall remain the
                           property of GI, PROVIDED, HOWEVER, that GI shall have
                           no right or license to any intellectual property
                           right arising from MetaMorphix' use of such BMPs.
                           GDFs. Collaborative Factors, vectors, cell lines and
                           other materials, except as expressly provided in this
                           Agreement.

                  4.2.3    SUPPLY of Reagents and ANTIBODIES. During the
                           Collaborative Research Term GI, subject to GI's
                           manufacturing capabilities, limitations, schedules
                           and priorities, shall use its Commercially Reasonable
                           Efforts to supply, at its expense, MetaMorphix with
                           up to thirty (30) liters of GDF-8 conditioned media,
                           up to ten (10) liters of GDF-9 conditioned media, up
                           to ten (10) liters of GDF-11 conditioned media, up to
                           ten (10) liters of GDF-12 conditioned media, up to
                           five (5) milligrams of monoclonal antibodies targeted
                           against GDF-8, up to five (5) milligrams of
                           monoclonal antibodies

<PAGE>

                           targeted against GDF-9, up to five (5) milligrams of
                           monoclonal antibodies targeted against GDF-11 and up
                           to two (2) milliliters of polyclonal antibodies
                           targeted against GDF-12. GI will endeavor to supply
                           such reagents and antibodies to MetaMorphix during
                           the six (6) month period following the Effective
                           Date, PROVIDED, HOWEVER. that any failure to supply
                           such quantities of reagents and/or antibodies to
                           MetaMorphix shall not be considered to be a material
                           breach of GI's obligations under this Agreement. Any
                           reagents and antibodies delivered to MetaMorphix in
                           accordance with this Section 4.2.2 shall remain the
                           property of GI, provided, however, that GI shall have
                           no right or license to any intellectual property
                           rights arising from MetaMorphix' use of such reagents
                           and antibodies, except as expressly provided in this
                           Agreement.

                  4.2.4    SUPPLY OF FACTORS, REAGENTS AND ANTIBODIES AFTER
                           COLLABORATIVE RESEARCH TERM. GI shall have no
                           obligation to supply any Factors, reagents or
                           antibodies to MetaMorphix after the expiration or
                           earlier termination of the Collaborative Research
                           Term. In the event that, after the expiration or
                           earlier termination of the Collaborative Research
                           Term, MetaMorphix desires to continue purchasing
                           MetaMorphix Factors, related reagents and/or
                           antibodies from GI for use in the development and
                           commercialization of MetaMorphix Factors for use in
                           the MetaMorphix Field and GI, in its sole discretion,
                           is willing to continue supplying MetaMorphix with
                           such MetaMorphix Factors, reagents and/or antibodies
                           for such purpose, GI and MetaMorphix, with no
                           obligation as to outcome, will each use its
                           respective good faith efforts to negotiate a supply
                           agreement pursuant to which GI would manufacture and
                           MetaMorphix would purchase from GI such MetaMorphix
                           Factors, reagents and/or antibodies.

         4.3      SUPPLY OF MATERIALS BY METAMORPHIX. In the event that, during
                  the Collaborative Research Term, MetaMorphix expresses or
                  otherwise has obtained (other than from GI) or has excess
                  quantities of any BMP, GDF or Collaborative Factor that has
                  not yet been selected, in accordance with Article 5 hereof, as
                  either a MetaMorphix Factor or a GI Factor, MetaMorphix, upon
                  GI's request, shall supply to GI a reasonable quantity of such
                  Factors (or, if available, cell lines expressing such
                  Factors), for use by GI in conducting its evaluation of such
                  Factors in accordance with the Collaborative Research Plan and
                  Section 5.1 hereof. The quantity, quality and purity of any
                  protein so provided to GI under this Section 4.3 shall be
                  substantially equivalent to the quantity, quality and purity
                  of such protein MetaMorphix produces or obtains for its own
                  use in its evaluation of such Factors. GI will, in turn, have
                  the right to supply to JHU any such Factors (or cell lines
                  expressing such Factors) received from MetaMorphix in

<PAGE>

                  accordance with this Section 4.3 or, alternatively,
                  MetaMorphix. upon GI's request, shall supply such Factors (or
                  cell lines expressing such Factors) directly to JHU for
                  subsequent evaluation and characterization of such Factors in
                  accordance with the Sponsored Research Plan. Any BMPs. GDFs,
                  Collaborative Factors and other materials delivered by
                  MetaMorphix to GI or JHU in accordance with this Section 4.3
                  shall remain the property of MetaMorphix, unless such Factors
                  or materials were previously provided to MetaMorphix by GI or
                  JHU in accordance with Sections 4.2 hereof, in which case,
                  such Factors or Materials shall remain the property of the
                  Party that supplied such Factors or materials to MetaMorphix.

         4.4      SUPPLY OF CERTAIN MATERIALS TO DR. Lee. During the term of
                  this Agreement, each of GI and MetaMorphix shall provide
                  reasonable quantities of GDFs Discovered by JHU, if available
                  in excess of such Party's own needs, to Dr. Lee (whether or
                  not Dr. Lee is then affiliated with JHU) solely for academic,
                  non-commercial research purposes, pursuant to GI's or
                  MetaMorphix's standard material transfer agreement, as
                  applicable. Additionally, during the term of this Agreement,
                  GI shall have a continuing obligation to provide reasonable
                  quantities of Additional GDFs Discovered by JHU, if available,
                  to Dr. Lee (whether or not Dr. Lee is then affiliated with
                  JHU) solely for academic, non-commercial research purposes,
                  pursuant to GI's standard material transfer agreement.

         4.5      LIMITATIONS ON USE OF Factors. Unless the furnishing Party
                  shall otherwise give its prior written consent, the receiving
                  Party shall not use the BMPs, GDFs, Collaborative Factors,
                  Additional GDFs, Additional Collaborative Factors or other
                  materials provided to it under this Article 4 for any purposes
                  other than to conduct (a) the Sponsored Research during the
                  Sponsored Research Term or the Collaborative Research during
                  the Collaborative Research Term, as applicable, and (b)
                  following the Sponsored Research Term or the Collaborative
                  Research Term, as applicable, such other activities as are
                  expressly permitted under this Article 4, including, without
                  limitation, JHU's continuing right to use such Factors solely
                  for academic, non-commercial research. Any other uses of the
                  BMPs, GDFs, Collaborative Factors, Additional GDFs or
                  Additional Collaborative Factors or other materials by a
                  receiving Party shall be governed by the terms of separate
                  material transfer agreements, if any, executed by the
                  furnishing Party and the receiving Party.

5.       EVALUATION AND SELECTION OF FACTORS.

         5.1      EVALUATION. During the Collaborative Research Term, GI and
                  MetaMorphix each shall evaluate those BMPs. GDFs and
                  Collaborative Factors which, it, in its sole discretion
                  chooses to evaluate, for purposes of ascertaining which

<PAGE>

                  Factors such Party desires to select in accordance with
                  Section 5.3 below. The RMC shall determine when sufficient
                  quantities of protein are available for GI and MetaMorphix to
                  evaluate a particular BMP, GDF or Collaborative Factor. The
                  Parties shall have up to six (6) months. or such shorter
                  period of time as the RMC may determine. (the "Evaluation
                  Period" to perform their evaluations of such Factors. The
                  RMC's determination that sufficient quantities of a particular
                  Factor are available may be made at any time during the term
                  of this Agreement. and need not be made at a bi-annual meeting
                  of the RMC.

         5.2      AVAILABLE FACTORS. As of the Effective Date, the BMPs, GDFs
                  and Collaborative Factors listed on Schedule 5.2 are available
                  for selection by GI or MetaMorphix in accordance with the
                  selection procedures set forth in Section 5.3 hereof (each, an
                  "Available Factor"). Upon completion of the Evaluation Period
                  described in Section 5.1 hereof with respect to any BMP. GDF
                  or Collaborative Factor that has not yet been selected by GI
                  as a GI Factor or MetaMorphix as a MetaMorphix Factor or which
                  has not yet been included on the list of Available Factors
                  referenced in the preceding sentence, such Factor shall, at
                  such time, become an Available Factor and shall be added to
                  the list of Available Factors appearing in Schedule 5.2.
                  Notwithstanding the foregoing, any BMP, GDF or Collaborative
                  Factor that has not yet been selected by GI as a GI Factor or
                  MetaMorphix as a MetaMorphix Factor and which has not become
                  an Available Factor as of November 30. 1999. or such later
                  date as GI and MetaMorphix may mutually agree upon. in
                  writing, shall, as of such date, be deemed to be an Available
                  Factor and added to the list of Available Factors appearing in
                  Schedule 5.2.

         5.3      SELECTION OF AVAILABLE FACTORS.

                  5.3.1    ORDER OF SELECTION.

                           5.3.1.1  METAMORPHIX HAS FIRST SELECTION. MetaMorphix
                                    shall be the first Party to select an
                                    Available Factor from among the
                                    then-Available Factors, by giving written
                                    notice to the other Parties of its intention
                                    to make a selection. Following receipt of
                                    such notice, the other Parties shall
                                    promptly disclose Factor Rights and Data to
                                    MetaMorphix, as provided in Section 3.4.6,
                                    above, and thereafter, MetaMorphix shall
                                    promptly (within thirty (30) days) make its
                                    selection. Upon its selection by
                                    MetaMorphix, that Available Factor shall be
                                    designated a MetaMorphix Factor by deleting
                                    it from Schedule 5.2 and listing it on
                                    Schedule 1.62. The Parties acknowledge that
                                    on September 28, 1998 MetaMorphix provided
                                    written notice. to the other Parties of its
                                    intention to make the first selection of an
                                    Available

<PAGE>

                                    Factor, and agree that, to the extent the
                                    Factor Rights and Data required to be
                                    disclosed by each Party to the other Parties
                                    in response to such notice has not been
                                    disclosed to such other Parties as of the
                                    Effective Date, such undisclosed Factor
                                    Rights and Data shall be disclosed to
                                    MetaMorphix and GI as soon as practicable
                                    after the Effective Date..

                           5.3.1.2  GI HAS NEXT SELECTION. GI shall be the
                                    second Party to select an Available Factor
                                    from among the then-Available Factors, by
                                    giving written notice to the other Parties
                                    of its intention to make a selection.
                                    Following receipt of such notice, the other
                                    Parties shall promptly disclose Factor
                                    Rights and Data to GI, as provided in
                                    Sections 3.3.7 and 3.4.6, above, and
                                    thereafter, GI shall promptly (within thirty
                                    (30) days) make its selection. Upon its
                                    selection by GI, that Available Factor shall
                                    be designated a GI Factor by deleting it
                                    from Schedule 5.2 and listing it on Schedule
                                    1.39.

                           5.3.1.3  ALTERNATING SELECTIONS. Thereafter,
                                    MetaMorphix and GI shall alternate in their
                                    selections from the Available Factors. If it
                                    is a Party's turn to select an Available
                                    Factor, it may do so at any time, subject to
                                    the other Party's right to trigger the
                                    selection procedure, as set forth in Section
                                    5.3.2, below.

                  5.3.2    TRIGGERING A SELECTION.

                           5.3.2.1  GI'S RIGHT TO TRIGGER A SELECTION. Where
                                    MetaMorphix has the next selection, GI can
                                    trigger the selection procedure for an
                                    Available Factor by giving MetaMorphix
                                    written notice of GI's desire to select from
                                    among the then Available Factors. Following
                                    receipt of such notice, the Parties shall
                                    promptly disclose to one another Factor
                                    Rights and Data, as provided in Sections
                                    3.3.7 and 3.4.6, above. Following such
                                    disclosure, MetaMorphix shall have thirty
                                    (30) days to exercise its turn to select an
                                    Available Factor from among the
                                    then-Available Factors. If MetaMorphix
                                    selects an Available Factor, then the
                                    selection procedure continues, on an
                                    alternating basis, with GI having the right
                                    to make the next selection. If, at the end
                                    of the thirty (30) day period. MetaMorphix
                                    has not exercised its turn to select an
                                    Available Factor, then GI shall have the
                                    right to select from among the
                                    then-Available Factors, and the selection
                                    process continues, on an alternating basis,
                                    with MetaMorphix having the right to make
                                    the next selection.

<PAGE>

                           5.3.2.2  METAMORPHIX' RIGHT TO TRIGGER A SELECTION.
                                    Where GI has the next selection. MetaMorphix
                                    can trigger the selection procedure for an
                                    Available Factor, by giving GI written
                                    notice of MetaMorphix's desire to select
                                    from among the then-Available Factors.
                                    Following receipt of such notice, the
                                    Parties shall promptly disclose to one
                                    another Factor Rights and Data, as provided
                                    in Section 3.4.6, above. Following such
                                    disclosure, GI shall have thirty (30) days
                                    to exercise its turn to select an Available
                                    Factor from among the then-Available
                                    Factors. If GI selects an Available Factor,
                                    then the selection procedure continues, on
                                    an alternating basis, with MetaMorphix
                                    having the right to make the next selection.
                                    If, at the end of the thirty (30) day
                                    period, GI has not exercised its turn to
                                    select an Available Factor, then MetaMorphix
                                    shall have the right to select from among
                                    the then-Available Factors, and the
                                    selection process continues, on an
                                    alternating: basis, with GI having the right
                                    to make the next selection.

                           5.3.2.3  LIMITATION ON RIGHT TO TRIGGER A SELECTION.
                                    A Party which triggers a selection under
                                    Sections 5.3.2.1 or 5.3.2.2 may not trigger
                                    a subsequent selection until three (3)
                                    months has lapsed from the date it triggered
                                    the prior selection, unless the other Party
                                    has made an intervening selection (including
                                    a selection made as a result of the
                                    triggering of a selection under this Section
                                    5.3.2.

                  5.3.3    COMPLETION OF SELECTION PROCESS. During the thirty
                           (30) day period following the expiration of the
                           Collaborative Research Term (i.e., on or before
                           December 30, 1999 if the Collaborative Research Term
                           is not extended past November 30, 1999 in accordance
                           with Section 3.4.1 hereof) GI and MetaMorphix shall
                           meet, at a time and location to be mutually agreed
                           upon by GI and MetaMorphix. to select GI Factors and
                           MetaMorphix Factors from the then Available Factors,
                           with such selections alternating between GI and
                           MetaMorphix until all such Factors have been
                           selected. The first selection during such meeting
                           will be made by GI if MetaMorphix had made the most
                           recent selection prior to such meeting or by
                           MetaMorphix if GI had made the most recent selection
                           prior to such meeting.

6.       LICENSES.

         6.1      RESTATEMENT OF RIGHTS. GI. MetaMorphix and JHU hereby restate
                  all obligations assumed by each such Party and all rights and
                  licenses

<PAGE>

                  previously granted to any of them. whether under the 1994
                  Collaboration Agreement or otherwise, by JHU, MetaMorphix or
                  GI with respect to any MetaMorphix Factors. MetaMorphix
                  Products. GI Factors. Additional Factors, GI Products, GDF-16.
                  GDF-17. GDF-16 Products and GDF-17 Products so that each
                  Party. as of the Effective Date is able to grant the licenses
                  to MetaMorphix and GI as set forth below in this Article 6.

         6.2      LICENSES FROM JHU TO METAMORPHIX. Subject to (i) the terms and
                  conditions of this Agreement. (ii) the licenses granted by JHU
                  to GI under Section 6.3 hereof, (iii) the reservation of
                  rights set forth in Section 6.6 of this Agreement, and (iv)
                  any rights retained by the United States government in
                  accordance with P.L. 96-517, as amended by P.L. 98-620. JHU
                  grants to MetaMorphix and its designated Affiliates which
                  agree in writing to comply with the terms and conditions of
                  this Agreement (with a copy of such written agreement being
                  provided to JHU):

                           a.       an exclusive, royalty-bearing license to
                                    JHU's interest under the Factor Patent
                                    Rights; and

                           b.       a non-exclusive, perpetual, royalty-free
                                    license to use JHU's interest in the Factor
                                    Know-How relating to the subject matter
                                    disclosed or claimed in such Factor Patent
                                    Rights,

                  including the right to grant sublicenses, (i) to make, have
                  made, use, import, market, offer for sale and sell MetaMorphix
                  Products in the Territory, in each case only for use in the
                  MetaMorphix Field, (ii) to make, have made and use MetaMorphix
                  Products for MetaMorphix's and/or its designated Affiliates'
                  internal research and development purposes and (iii) to make,
                  have made, use, import, market, offer for sale and sell GDF-16
                  Products and GDF-17 Products in the Territory. The license
                  granted pursuant to Section 6.2(a) shall continue in effect
                  until the expiration of the last patent licensed to
                  MetaMorphix under this Section 6.2.

         6.3      LICENSES FROM JHU TO GL

                  6.3.1    GI TYPE A PRODUCTS. Subject to (i) the terms and
                           conditions of this Agreement, (ii) the reservation of
                           rights set forth in Section 6.6 of this Agreement,
                           and (iii) any rights retained by the United States
                           government in accordance with P.L. 96-517, as amended
                           by P.L. 98-620, JHU grants to GI and its designated
                           Affiliates which agree in writing to comply with the
                           terms and conditions of this Agreement (with a copy
                           of such written agreement being provided to JHU):

<PAGE>

                           a.       an exclusive royalty-bearing license to
                                    JHU's interest under the Factor Patent
                                    Rights and the Additional Factor Patent
                                    Rights; and

                           b.       a non-exclusive, perpetual, royalty-free
                                    license to use JHU's interest in the Factor
                                    Know-How and the Additional Factor Know-How
                                    relating to the subject matter disclosed or
                                    claimed in such Factor Patent Rights and/or
                                    Additional Factor Patent Rights,

                           including the right to grant sublicenses, to make,
                           have made, import, market, use, offer for sale and
                           sell GI Type A Products in the Territory. The license
                           granted pursuant to Section 6.3.1(a) shall continue
                           in effect until the expiration of the last patent
                           licensed to GI under this Section 6.3.1.

                  6.3.2.   GI TYPE B PRODUCTS. Subject to (i) the terms and
                           conditions of this Agreement, (ii) the licenses
                           granted by JHU to MetaMorphix under Section 6.2
                           hereof, (iii) the reservation of rights set forth in
                           Section 6.6 of this Agreement, and (iv) any rights
                           retained by the United States government in
                           accordance with P.L. 96-517, as amended by P.L.
                           98-620, JHU grants to GI and its designated
                           Affiliates which agree in writing to comply with the
                           terms and conditions of this Agreement (with a copy
                           of such written agreement being provided to JHU):

                                    a.       an exclusive, royalty-bearing
                                             license to JHU's interest under the
                                             Factor Patent Rights and the
                                             Additional Factor Patent Rights;
                                             and

                                    b.       a non-exclusive, perpetual,
                                             royalty-free license to use JHU's
                                             interest in the Factor Know-How and
                                             Additional Factor Know-How relating
                                             to the subject matter disclosed or
                                             claimed in such Factor Patent
                                             Rights and/or Additional Factor
                                             Patent Rights,

                           including the right to grant sublicenses, (i) to
                           make, have made, use, import, market, offer for sale
                           and sell GI Type B Products in the Territory, in each
                           case only for use in the GI Field and (ii) to make,
                           have made and-use GI Type B Products for GI's and/or
                           its designated Affiliates' internal research and
                           development purposes. The license granted pursuant to
                           Section 6.3.2(a) shall continue in effect until the
                           expiration of the last patent licensed to GI under
                           this Section 6.3.2.

<PAGE>

                  6.3.3    GI TYPE C PRODUCTS. Subject to (i) the terms and
                           conditions of this Agreement. (ii) the reservation of
                           rights set forth in Section 6.6 of this Agreement,
                           and (iii) any rights retained by the United States
                           government in accordance with P.L. 96-517, as amended
                           by P.L. 98-620, JHU grants to GI and its designated
                           Affiliates which agree in writing to comply with the
                           terms and conditions of this Agreement (with a copy
                           of such written agreement being provided to JHU):

                                    a.       an exclusive, royalty-bearing
                                             license to JHU's interest under the
                                             Factor Patent Rights and Additional
                                             Factor Patent Rights; and

                                    b.       a non-exclusive, perpetual,
                                             royalty-free license to use JHU's
                                             interest in the Factor Know-How and
                                             Additional Factor Know-How relating
                                             to the subject matter disclosed or
                                             claimed in such Factor Patent
                                             Rights and/or-Additional Factor
                                             Patent Rights,

                           including the right to grant sublicenses, (i) to
                           make, have made, import, market use, offer for sale
                           and sell GI Type C Products in the Territory. The
                           license granted pursuant to Section 6.3.3(a) shall
                           continue in effect until the expiration of the last
                           patent licensed to GI under this Section 6.3.3.

         6.4      LICENSES FROM METAMORPHIX TO GL

                  6.4.1    GI TYPE A Products. Subject to (i) the terms and
                           conditions of this Agreement, (ii) the reservation of
                           rights set forth in Section 6.6 of this Agreement and
                           (iii) any rights retained by the United States
                           government in accordance with P.L. 96-517, as amended
                           by P.L. 98-620, MetaMorphix grants to GI and its
                           designated Affiliates which agree in writing to
                           comply with the terms and conditions of this
                           Agreement (with a copy of such written agreement
                           being provided to MetaMorphix):

                                    a.       an exclusive, royalty-bearing
                                             license to MetaMorphix's interest
                                             under the Factor Patent Rights;

                                    b.       a non-exclusive, perpetual,
                                             royalty-free license to use
                                             MetaMorphix's interest in the
                                             Factor Know-How relating to the
                                             subject matter disclosed or claimed
                                             in such Factor Patent Rights;

<PAGE>

                           including the right to grant sublicenses, to make,
                           have made, import, market, use, offer for sale and
                           sell GI Type A Products in the Territory. The license
                           granted pursuant to Section 6.4.1(a) shall continue
                           in effect until the expiration of the last patent
                           licensed to GI under this Section 6.4.1.

                  6.4.2    GI TYPE B PRODUCTS. Subject to (i) the terms and
                           conditions of this Agreement, (ii) the reservation of
                           rights set forth in Section 6.6 of this Agreement and
                           (iii) any rights retained by the United States
                           government in accordance with P.L. 96-517, as amended
                           by P.L. 98-620, MetaMorphix grants to GI and its
                           designated Affiliates which agree in writing to
                           comply with the terms and conditions of this
                           Agreement (with a copy of such written agreement
                           being provided to MetaMorphix):

                                    a.       an exclusive, royalty-bearing
                                             license to MetaMorphix's interest
                                             under the Factor Patent Rights;

                                    b.       a non-exclusive, perpetual,
                                             royalty-free license to use
                                             MetaMorphix's interest in the
                                             Factor Know-How relating to the
                                             subject matter disclosed or claimed
                                             in such Factor Patent Rights;

                           including the right to grant sublicenses, (i) to
                           make, have made, use, import, market, offer for sale
                           and sell GI Type B Products in the Territory, in each
                           case only for use in the GI Field and (ii) to make,
                           have made and use GI Type B Products for GI's and/or
                           its designated Affiliates' internal research and
                           development purposes. The license granted pursuant to
                           Section 6.4.2(a) shall continue in effect until the
                           expiration of the last patent licensed to GI under
                           this Section 6.4.2.

         6.5      LICENSES FROM GI TO METAMORPHIX. Subject to (i) the terms and
                  conditions of this Agreement and (ii) the reservation of
                  rights set forth in Section 6.6 of this Agreement, GI grants
                  to MetaMorphix and its designated Affiliates which agree in
                  writing to comply with the terms and conditions of this
                  Agreement (with a copy of such written agreement being
                  provided to GI):

                           a.       an exclusive, royalty-bearing license to
                                    GI's interest under the Factor Patent
                                    Rights; and

                           b.       a non-exclusive, perpetual, royalty-free
                                    license to use GI's interest in the Factor
                                    Know-How relating to the subject matter
                                    disclosed or claimed in such Factor Patent
                                    Rights,

<PAGE>

                  including the right to grant sublicenses. (i) to make, have
                  made, use. import, market, offer for sale and sell MetaMorphix
                  Products in the Territory, in each case only for use in the
                  MetaMorphix Field and (ii) to make, have made and use
                  MetaMorphix Products for MetaMorphix's and/or its designated
                  Affiliates' internal research and development . purposes. The
                  license granted pursuant to Section 6.5(a) shall continue in
                  effect until the expiration of the last patent licensed to
                  MetaMorphix under this Section 6.5. Notwithstanding the
                  foregoing, nothing in this Agreement shall constitute a grant
                  by GI to MetaMorphix of any right or license under GI's
                  interest in any Joint Factor Rights, Additional Joint Factor
                  Rights, or any Factor Patent Rights, Factor Know-How,
                  Additional Factor Patent Rights, Additional Factor Know-How or
                  any other intellectual property that GI may own, Control or
                  otherwise have rights to which relate to GDF-16 and/or GDF-17.

         6.6      RESERVATION OF RIGHTS. Each Party retains the right under its
                  interest in the Factor Rights to use all BMPs, GDFs, and
                  Collaborative Factors in its internal research. In addition,
                  each of GI and JHU retains the right under its interest in the
                  Additional Factor Rights to use all Additional BMPs,
                  Additional GDFs and Additional Collaborative Factors in its
                  internal research. Further, JHU, for itself and The Johns
                  Hopkins Health System, retains the right under its interest in
                  the Factor Rights and its interest in the Additional Factor
                  Rights to use, and sublicense the use of, all GDFs and
                  Additional GDFs solely for academic, non-profit purposes;
                  PROVIDED, HOWEVER, neither JHU nor any of its sublicensees
                  shall have any right to (a) sell Products or (b) make, have
                  made or use Products for (i) toxicology or other IN vivo
                  studies in non-human primates or (ii) administration to human
                  subjects (in clinical trials or otherwise) without the prior
                  written consent of MetaMorphix, for Products licensed to
                  MetaMorphix under this Agreement and/or GI. for Products
                  licensed to GI under this Agreement, which consent shall be
                  forthcoming unless the Party from which consent is required
                  has determined that use of such Products for (x) toxicology or
                  other in VIVO studies in non-human primates could interfere
                  with that Party's existing or planned clinical trials or
                  commercialization of that Product or (y) administration to
                  human subjects raises regulatory or health and safety
                  concerns. JHU, acting through Dr. Lee, shall use reasonable
                  efforts to promptly notify GI, in writing, of any proposed and
                  permitted JHU preclinical studies in non-human primates. JHU
                  retains the right under the applicable Factor Rights to
                  distribute the GDFs Discovered by JHU and under the applicable
                  'Additional Factor Rights to distribute the Additional GDFs
                  Discovered by JHU, each under JHU's standard Material Transfer
                  Agreement, a copy of which is attached hereto as Schedule
                  6.6A; and GI and MetaMorphix shall have no rights, absent
                  JHU's prior written consent, to distribute such GDFs or
                  Additional GDFs. Notwithstanding

<PAGE>

                  the foregoing, (i) commencing six (6) months after the date
                  such GDF becomes a GI Factor or such Additional GDF is
                  Discovered by JHI:. GI shall have the right to distribute such
                  GI Factor or Additional GDF. under a standard material
                  transfer agreement which is reasonably acceptable to JHU or
                  MetaMorphix shall' have the right to distribute such GI Factor
                  or MetaMorphix Factor, under a standard material transfer
                  agreement which is reasonably acceptable to JHU and (ii)
                  commencing six (6) months after the date such GDF becomes a
                  MetaMorphix Factor, GI and MetaMorphix each shall have the
                  right to distribute such MetaMorphix Factor under a standard
                  material transfer agreement which is reasonably acceptable to
                  JHU. GI retains the right under its interest in the Factor
                  Rights to distribute the BMPs and the Additional BMPs under
                  GI's standard Material Transfer Agreement, a copy of which is
                  attached hereto as Schedule 6.6B to this Agreement; and JHU
                  and MetaMorphix shall have no rights, absent GI's prior
                  written consent, to distribute such BMPs or Additional BMPs.

         6.7      FACTOR RIGHTS LICENSED FROM THIRD PARTIES. In the event that
                  the license to MetaMorphix or GI under Sections 6.2, 6.3, 6.4
                  or 6.5 includes rights acquired by the licensor Party from a
                  Third Party which involve the payment of royalties, fees or
                  other payments to such Third Party, the licensor Parry shall
                  notify the licensee Party of the obligation to make such
                  payment(s) prior to (a) the selection of a GI Factor or a
                  MetaMorphix Factor, as the case may be or (b) a subsequent
                  acquisition of such rights by the licensor Party. The licensee
                  Party promptly shall elect in writing whether to exclude such
                  Third Party rights from the licenses under this Agreement, and
                  if the licensee Party fails to exclude such rights, it shall
                  be fully responsible for the payment of any such royalties,
                  fees and other payments to such Third Party.

         6.8      NONCOMPETE.

                  6.8.1    BY METAMORPHIX. MetaMorphix and GI agree that, for so
                           long as the licenses granted to GI, under Sections
                           6.3.2(a) and 6.4.2(a), with respect to the
                           development and commercialization of Products based
                           on GDF-8. remain in effect, MetaMorphix will not sell
                           or otherwise distribute any GDF-8 Derivative Product
                           for use in the GI Field (only to the extent that the
                           intended goal of such GDF-8 Derivative Product is to
                           modulate the effects of GDF-8). The preceding
                           sentence shall not apply to any products that
                           MetaMorphix obtains from a Third Party who has
                           developed (or obtained from another Third Party who
                           has developed) such products without infringing
                           issued patents of another Party included within such
                           other Party's Patent Rights under this Agreement,
                           which products were fully developed by or on behalf
                           of such Third Parry without the use of any of the JHU
                           Know-How, the GI Know-

<PAGE>

                           How or any Confidential Information of JHU or GI.
                           GI's right to enforce this Section 6.8.1 shall not be
                           assignable, except to its Affiliates.

                  6.8.2    BY GI. GI and MetaMorphix agree that, for so long as
                           the licenses granted to MetaMorphix, under Sections
                           6.2(a) and 6.5(a), with respect to the development
                           and commercialization of Products based on GDF-8,
                           remain in effect, GI will not sell or otherwise
                           distribute any GDF-8 Derivative Product for use in
                           the MetaMorphix Field (only to the extent that the
                           intended goal of such GDF-8 Derivative Product is to
                           modulate the effects of GDF8). The preceding sentence
                           shall not apply to any products that GI obtains from
                           a Third Party who has developed (or obtained from
                           another Third Party who has developed) such products
                           without infringing issued patents of another Party
                           included within such other Party's Patent Rights
                           under this Agreement, which products were fully
                           developed by or on behalf of such Third Party without
                           the use of any of the IHU Know-How, the MetaMorphix
                           KnowHow or any Confidential Information of JHU or
                           MetaMorphix. MetaMorphix's right to enforce this
                           Section 6.8.2 shall not be assignable, except to its
                           Affiliates.

         6.9      OPTION TO CERTAIN GDF-8 DERIVATIVE PRODUCTS. In the event that
                  either GI or MetaMorphix develops or otherwise acquires rights
                  to any GDF-8 Derivative Products and such Party determines, in
                  its sole reasonable discretion. that the grant by it of rights
                  to confidential data, know-how and/or Patents owned or
                  Controlled by it covering or relating to such GDF-8 Derivative
                  Product would not interfere with its development and/or
                  commercialization of its own Products based on GDF-8 or GDF-8
                  Derivative Products, such Party (the "Offering Party") agrees
                  to extend to the other Party, by written notice, the
                  opportunity to negotiate a royalty bearing license to some or
                  all of such GDF-8 Derivative Product rights, which license
                  would he restricted to the GI Field or the MetaMorphix Field,
                  as applicable. Within thirty (30) days of receiving such
                  notice, such other Party may elect to negotiate such an
                  agreement by providing the Offering Party written notice of
                  such election, in which event the Parties would promptly
                  commence good faith negotiations of the license terms
                  (including, without limitation. royalty rates and other
                  financial terms). If MetaMorphix and G1 are unable to agree on
                  the terms and conditions of such a license within ninety (90)
                  days after the Offering Party receives such notice from the
                  other Party. the Offering Party shall thereafter be free to
                  grant such rights and licenses to any Third Party.

<PAGE>

7.       CONSIDERATION.

         7.1      LICENSE FEES.

                  7.1.1    INITIAL LICENSE PROCESSING FEE. JHU acknowledges and
                           agrees that, as required by the 1994 Collaboration
                           Agreement. it has received from MetaMorphix a Forty
                           Thousand Dollar ($40,000) non-refundable,
                           non-deductible license processing fee, as required by
                           JHU policies for JHU licenses to stare-up companies.

                  7.1.2    ADDITIONAL LICENSE PROCESSING FEES. JHU acknowledges
                           and agrees that, as required by the 1994
                           Collaboration Agreement and except as provided in
                           this Section 7.1.2, it has received from MetaMorphix
                           all additional license processing fees required to be
                           paid thereunder, which additional license processing
                           fees were in the amount of Two Thousand Dollars
                           ($2,000) for each Patent filed by JHU claiming a new
                           GDF Discovered by JHU following the effective date of
                           the 1994 Collaboration Agreement, which Patents were
                           licensed to MetaMorphix thereunder. MetaMorphix shall
                           pay to JHU the remaining eighteen thousand dollars
                           ($18,000.00) due for such fees within ninety (90)
                           days of the Effective Date.

                  7.1.3    LICENSE MAINTENANCE FEES. JHU acknowledges and agrees
                           that it has received from MetaMorphix all annual
                           license maintenance fees due under the 1994
                           Collaboration Agreement prior to the Effective Date
                           of this Agreement. The Parties agree that during the
                           term of this Agreement, as required by JHU policies
                           for its licensees,

                                    (i)      in partial consideration for the
                                             JHU's grant of licenses to
                                             MetaMorphix under Section 6.2
                                             hereof, MetaMorphix shall pay JHU
                                             an annual license maintenance fee
                                             of Two Thousand Five Hundred
                                             Dollars ($2,500), which payment
                                             shall be made within thirty (30)
                                             days of each December 1 during the
                                             term of this Agreement.

                                    (ii)     in partial consideration for the
                                             JHU's grant of licenses to GI under
                                             Section 6.3 hereof, GI shall pay
                                             JHU an annual license maintenance
                                             fee of Seven Thousand Five Hundred
                                             Dollars ($7,500), which payment
                                             shall be made within thirty (30)
                                             days of each December 1 during the
                                             term of this Agreement.

         7.2      ADDITIONAL LICENSE FEES. In addition to any Sponsored Research
                  payments payable by GI under Sections 3.3 above and any
                  royalties

<PAGE>

                  payable by GI under Sections 7.3.2. 7.3.3. and 7.3.4 below. GI
                  shall, with respect to its development of GI Factors or
                  Additional Factors, pay to MetaMorphix or JHU, as applicable,
                  the amounts set forth in Schedule 7.2A and. with respect to
                  its development of MetaMorphix Factors, pay to MetaMorphix or
                  JHU, as applicable, the amounts set forth in Schedule 7.2B.
                  Payments to JHU and/or MetaMorphix under this Section 7.2
                  shall be (i) fully creditable against royalty payments by GI
                  to JHU and/or MetaMorphix, as applicable under Section 7.3 and
                  (ii) paid within thirty (30) days following occurrence of the
                  applicable benchmark, by check payable to, in the case of
                  payments to JHU, The Johns Hopkins University and sent to the
                  Director of the Office for Technology Licensing, The Johns
                  Hopkins University School of Medicine, 2024 East Monument
                  Street, Suite 2-100, Baltimore, Maryland 21205 and shall be
                  labeled "Additional License Fees" and in the case of payments
                  to MetaMorphix, MetaMorphix,-Inc. 1450 South Rolling Road,
                  Baltimore, Maryland 21227.

         7.3      ROYALTIES.

                  7.3.1    METAMORPHIX PRODUCTS.

                           7.3.1.1  PAYABLE BY METAMORPHIX TO JHU. MetaMorphix
                                    shall pay to JHU a royalty on sales made by
                                    MetaMorphix, its Affiliates or sublicensees
                                    of each MetaMorphix Product, the
                                    manufacture, use or sale of which is covered
                                    by a Valid Claim under applicable Factor
                                    Patent Rights, which royalty shall be
                                    calculated using the following formula:

                                              royalty =A+B+C+D+E

                                              where

                                    A equals either (i) three and one-half
                                    percent (3 1/2%) of Net Sales obtained from
                                    such sales of such MetaMorphix Product, if
                                    the First Member of such MetaMorphix
                                    Product's TGF-(beta) Class is a GDF
                                    Discovered by JHU; OR (ii) one and three
                                    quarters percent (1 3/4%) of MetaMorphix's
                                    Net Sales of such MetaMorphix Product, if
                                    the First Member of such MetaMorphix
                                    Product's TGF-(beta) Class is a
                                    Collaborative Factor Discovered jointly by
                                    JHU and MetaMorphix or a Collaborative
                                    Factor Discovered jointly by JHU and GI;

<PAGE>

                                    B equals seven-eighths percent (7/8%) of Net
                                    Sales obtained from such sales of such
                                    MetaMorphix Product, multiplied by the
                                    number (if any) of Subsequent Members in
                                    such MetaMorphix Product's TGF-(beta) Class
                                    (not to exceed three (3)) which are GDFs
                                    Discovered by JHU:

                                    C equals seven-sixteenths percent (7/16%) of
                                    Net Sales obtained from such sales of such
                                    MetaMorphix Product, multiplied by the
                                    number (if any) of Subsequent Members in
                                    such MetaMorphix Product's TGF-(beta) Class
                                    (not to exceed three (3) which are either
                                    Collaborative Factors Discovered jointly by
                                    JHU and MetaMorphix or Collaborative Factors
                                    Discovered jointly by JHU and GI;

                                    D equals seven-eighths percent (7/8%) of Net
                                    Sales obtained from such sales of such
                                    MetaMorphix Product, if such MetaMorphix
                                    Product is labeled for an indication which
                                    is covered by a Valid Claim of a Use Patent
                                    within the JHU Patent Rights;

                                    E equals seven-sixteenths percent (7/16%) of
                                    Net Sales obtained from such sales of such
                                    MetaMorphix Product, if such MetaMorphix
                                    Product is labeled for an indication which
                                    is covered by a Valid Claim of a Use Patent
                                    within the Joint Patent Rights of JHU and
                                    MetaMorphix, or JHU and GI;

                                    PROVIDED, HOWEVER, that in no event shall
                                    the sum of A, B and C exceed six percent
                                    (6%).

                           7.3.1.2  PAYABLE BY METAMORPHIX TO GI. MetaMorphix
                                    shall pay to GI royalties on sales made by
                                    MetaMorphix, its Affiliates or sublicensees,
                                    of each MetaMorphix Product, the
                                    manufacture, use or sale of which is covered
                                    by a Valid Claim under the applicable Factor
                                    Patent Rights, which royalty shall be
                                    calculated using the following formula:

                                            royalty = A+B+C+D+E

                                    where

                                    A equals either (i) four percent (4%) of Net
                                    Sales obtained from such sales of such
                                    MetaMorphix Product, if the First Member of
                                    that Product's TGF-(beta)

<PAGE>

                                    Class is a BMP: OR (ii) two percent (2%) of
                                    Net Sales obtained from such sale of such
                                    MetaMorphix Product, if the First Member of
                                    that Product's TGF(beta) Class is a
                                    Collaborative Factor of GI and(.) JHlU or a
                                    Collaborative Factor of GI and MetaMorphix;

                                    B equals one percent (1 %) of the Net Sales
                                    obtained from such sales of such MetaMorphix
                                    Product, multiplied by the number (if any)
                                    of Subsequent Members in such MetaMorphix
                                    Product's TGF-(beta) Class (not to exceed
                                    three (3)) which are BMPs;

                                    C equals one-half percent (1/2%) of Net
                                    Sales obtained from such sales of such
                                    MetaMorphix Product, multiplied by the
                                    number (if any) of Subsequent Members in
                                    that MetaMorphix Product's TGF-(beta) Class
                                    (not to exceed three (3)) which are either
                                    Collaborative Factors of GI and JHU or
                                    Collaborative Factors of GI and MetaMorphix;

                                    D equals one percent (1 %) of Net Sales
                                    obtained from such sales of such MetaMorphix
                                    Product, if such MetaMorphix Product is
                                    labeled for an indication which is covered
                                    by a Valid Claim of a Use Patent within the
                                    GI Patent Rights; and

                                    E equals one-half percent (1/2%) of Net
                                    Sales obtained from such sales of such
                                    MetaMorphix Product, if such MetaMorphix
                                    Product is labeled for an indication which
                                    is covered by a Valid Claim of a Use Patent
                                    within the Joint Patent Rights of GI and
                                    JHU. or GI and MetaMorphix;

                                    PROVIDED, HOWEVER, that In no event shall
                                    the sum of A, B and C exceed seven percent
                                    (7%).

                  7.3.2    GI TYPE A PRODUCTS.

                           7.3.2.1  PAYABLE BY GI TO METAMORPHIX. GI shall pay
                                    to MetaMorphix a royalty on sales made by
                                    GI, its Affiliates or sublicensees of each
                                    GI Type A Product, the manufacture, USE or
                                    sale of which is covered by a Valid Claim
                                    under the applicable Factor Patent Rights,
                                    which royalty shall be calculated using the
                                    following formula:

<PAGE>

                                               (A+B+C+D+E)-F

                                    where

                                    A equals either (i) four percent (4%) of the
                                    Net Sales obtained from such sales of such
                                    GI Type A Product. if the First Member of
                                    such GI Type A Product's TGF-(beta) Class is
                                    a GDF or a Collaborative Factor of JHU and
                                    MetaMorphix. or (ii) two percent (2%) of Net
                                    Sales of such GI Type A Product. if the
                                    First Member of such GI Type A Product's
                                    TGF-(beta) Class is a Collaborative Factor
                                    of GI and JHU or GI and MetaMorphix;

                                    B equals one percent (1%) of Net Sales
                                    obtained from such sales of such GI Type A
                                    Product, multiplied by the number (if any)
                                    of Subsequent Members in that GI Type A
                                    Product's TGF-(beta) Class (not to exceed
                                    three (3) which are GDFs or Collaborative
                                    Factors of JHU and-MetaMorphix;

                                    C equals one-half percent (1/2%) of Net
                                    Sales obtained from such sales of such GI
                                    Type A Product, multiplied by the number (if
                                    any) of Subsequent Members in that Product's
                                    TGF-(beta) Class (not to exceed three (3)
                                    which are Collaborative Factors of GI and
                                    JHU or GI and MetaMorphix;

                                    D equals one percent (1 %) of Net Sales
                                    obtained from such sales of such GI Type A
                                    Product, if that GI Type A Product is
                                    labeled for an indication which is covered
                                    by a Valid Claim of a Use Patent within the
                                    MetaMorphix Patent Rights, the JHU Patent
                                    Rights or the Joint Patent Rights of JHU and
                                    MetaMorphix;

                                    E equals one-half percent (1/2%) of the Net
                                    Sales obtained from such sales of such GI
                                    Type A Product, if that Product is labeled
                                    for an indication which is covered by a
                                    Valid Claim of a Use Patent within the Joint
                                    Patent Rights of GI and JHU or GI and
                                    MetaMorphix: and

                                    F equals the royalty payable by GI to JHU
                                    under Section 7.3.2.2 below,

<PAGE>

                                    PROVIDED. HOWEVER, that In no event shall
                                    the sum of A. B and C exceed seven percent
                                    (7%).

                           7.3.2.2  PAYABLE BY GI to JHU. GI shall pay to JHU a
                                    royalty on sales made by GI, its Affiliates
                                    or sublicensees of each GI Type A Product,
                                    the manufacture, use or sale of which is
                                    covered by a Valid Claim under applicable
                                    Factor Patent Rights, which royalty shall be
                                    calculated using the following formula:

                                                A+B+C+D+E

                                    where

                                    A equals either (i) three and one-half
                                    percent (3 1/2%) of the Net Sales obtained
                                    from such sales of such GI Type A Product,
                                    if the First Member of such GI Type A
                                    Product's TGF-(beta) Class is a GDF
                                    Discovered by JHU; OR (ii) one and three
                                    quarters percent (1 3/4%) of GI's Net Sales
                                    of such GI Type A Product, if the First
                                    Member of such GI Type A Product's
                                    TGF-(beta) Class is a Collaborative Factor
                                    Discovered jointly by JHU and MetaMorphix or
                                    a Collaborative Factor Discovered jointly by
                                    JHU and GI;

                                    B equals seven-eighths percent (7/8%) of the
                                    Net Sales obtained from such sales of such
                                    GI Type A Product, multiplied by the number
                                    (if any) of Subsequent Members IN SUCH GI
                                    Type A Product's TGF-(beta) Class (not to
                                    exceed three (3) which are GDFs Discovered
                                    by JHU;

                                    C equals seven-sixteenths percent (7/16%) of
                                    the Net Sales obtained from such sales of
                                    such GI Type A Product, multiplied by the
                                    number (if any) of Subsequent Members in
                                    such GI Type A Product's TGF-(beta) Class
                                    (not to exceed three (3) which are either
                                    Collaborative Factors Discovered jointly by
                                    JHU and MetaMorphix or Collaborative Factors
                                    Discovered jointly by JHU and GI;

                                    D equals seven-eighths percent (7/8%) of the
                                    Net Sales obtained from such sales of such
                                    GI Type A Product, if such GI Type A Product
                                    is labeled for an

<PAGE>

                                    indication which is covered by a Valid Claim
                                    of a Use Patent within the JHU Patent
                                    Rights:

                                    E equals seven-sixteenths percent (7/16%) of
                                    the Net Sales obtained from such sales of
                                    such GI Type A Product, if such GI Type A
                                    Product is labeled for an indication which
                                    is covered by a Valid Claim of a Use Patent
                                    within the Joint Patent Rights of JHU and
                                    MetaMorphix, or JHU and GI;

                                    PROVIDED, HOWEVER, that in no event shall
                                    the sum of A. B and C exceed six percent
                                    (6%).

                  7.3.3    GI TYPE B PRODUCTS.

                           7.3.3.1  PAYABLE BY GI TO METAMORPHIX. GI shall pay
                                    to MetaMorphix a royalty on sales made by
                                    GI, its Affiliates or sublicensees of each
                                    GI Type B Product, the manufacture, use or
                                    sale of which is covered by a Valid Claim
                                    under the applicable Factor Patent Rights,
                                    which royalty shall be calculated using the
                                    following formula:

                                    royalty =A-(B+C+D+E+F+G)

                                    where

                                    A equals eight percent (8%) of the Net Sales
                                    obtained from such sales of such GI Type B
                                    Product;

                                    B equals the royalty payable by GI to JHU
                                    under Section 7.3.3.2 below;

                                    C equals either (i) four percent (4%) of Net
                                    Sales obtained from such sales of such GI
                                    Type B Product, if the First Member of that
                                    Product's TGF-(beta) Class is a BMP; OR (ii)
                                    two percent (2%) of Net Sales obtained from
                                    such sale of such MetaMorphix Product, if
                                    the First Member of that Product's
                                    TGF-(beta) Class is a Collaborative Factor
                                    of GI and JHU or a Collaborative Factor of
                                    GI and MetaMorphix;

                                    D equals one percent (1 %) of the Net Sales
                                    obtained from such sales of such GI Type B
                                    Product, multiplied by the number (if any)
                                    of Subsequent Members in such GI Type B
                                    Product's TGF-(beta) Class (not to exceed
                                    three (3) which are BMPs;

<PAGE>

                                    E equals one-half percent (1/2%) of Net
                                    Sales obtained from such sales of such GI
                                    Type B Product, multiplied by the number (if
                                    any) of Subsequent Members in that GI Type B
                                    Product's TGF-(beta) Class (not to exceed
                                    three (3) which are either Collaborative
                                    Factors of GI and JHU or Collaborative
                                    Factors of GI and MetaMorphix:

                                    F equals one percent (1%) of Net Sales
                                    obtained from SUCH sales of such GI Type B
                                    Product, if such GI Type B Product is
                                    labeled for an indication which is covered
                                    by a Valid Claim of a Use Patent within the
                                    GI Patent Rights; and

                                    G equals one-half percent (1/2%) of Net
                                    Sales obtained from SUCH sales of such GI
                                    Type B Product, if such GI Type B Product is
                                    labeled for an indication which-is covered
                                    by a Valid Claim of a Use Patent within the
                                    Joint Patent Rights of GI and JHU, or GI,
                                    and MetaMorphix;

                                    PROVIDED, HOWEVER, that in no event shall
                                    the sum of C, D and E exceed six percent
                                    (6%) or shall the sum of B, C, D, E, F and G
                                    exceed seven percent (7%).

                           7.3.3.2  PAYABLE BY GI TO JHU. GI shall pay to JHU a
                                    royalty on sales made by GI, its Affiliates
                                    or sublicensees of each GI Type B Product,
                                    the manufacture, use or sale of which is
                                    covered by a Valid Claim under the
                                    applicable Factor Patent Rights, which
                                    royalty shall be calculated using the
                                    following formula:

                                               royalty =A+B+C+D+E
                                    where

                                    A equals either (i) three and one-half
                                    percent (3 1/2%) of the Net Sales obtained
                                    from such sales of such GI Type B Product,
                                    if the First Member of such GI Type B
                                    Product's TGF-(beta) Class is a GDF
                                    Discovered by JHU; OR (ii) one and three
                                    quarters percent (1 3/4%) of GI's Net Sales
                                    of such GI Type B Product, if the First
                                    Member of such GI Type A Product's
                                    TGF-(beta) Class is a Collaborative Factor
                                    Discovered jointly by JHU and MetaMorphix or
                                    a Collaborative Factor Discovered jointly by
                                    JHU and GI;

<PAGE>

                                    B equals seven-eighths percent (7/8%) of the
                                    Net Sales obtained from such sales of such
                                    GI Type B Product, multiplied by the number
                                    (if any) of Subsequent Members in such GI
                                    Type B Product's TGF-(beta) Class (not to
                                    exceed three (3) which are GDFs Discovered
                                    by JHU;

                                    C equals seven-sixteenths percent (7/16%) of
                                    the, Net Sales obtained from such sales of
                                    such GI Type B Product, multiplied by the
                                    number (if any) of Subsequent Members in
                                    such GI Type B Product's TGF-(beta) Class
                                    (not to exceed three (3)) which are either
                                    Collaborative Factors Discovered jointly by
                                    JHU and MetaMorphix or Collaborative Factors
                                    Discovered jointly by JHU and GI;

                                    D equals seven-eighths percent (7/8%) of the
                                    Net Sales obtained from such sales of such
                                    GI Type A Product, if such GI Type B Product
                                    is labeled for an indication which is
                                    covered by a Valid Claim of a Use Patent
                                    within the JHU Patent Rights;

                                    E equals seven-sixteenths percent- (7/16%)
                                    of the Net Sales obtained from such sales of
                                    such GI Type B Product, if such GI Type B
                                    Product is labeled for an indication which
                                    is covered by a Valid Claim of a Use Patent
                                    within the Joint Patent Rights of JHU and
                                    MetaMorphix or JHU and GI;

                                    PROVIDED, HOWEVER, that in no event shall
                                    the sum of A, B and C exceed six percent
                                    (6%).

                  7.3.4    GI TYPE C PRODUCTS. GI shall pay to JHU a royalty on
                           sales made by GI, its Affiliates or sublicensees of
                           each GI Type C Product, the manufacture, use or sale
                           of which is covered by a Valid Claim under the JHU
                           Patent Rights or the Joint Patent Rights of JHU and
                           GI, which royalty shall be calculated using the
                           following formula:

                                              royalty =A+B+C+D+E
                           where

                           A equals either (i) three and one-half percent (3
                           1/2%) of the Net Sales obtained from such sales of
                           such GI Type C

<PAGE>

                                    Product, if the First Member of such GI Type
                                    C Product's TGF-(beta) Class is a Additional
                                    GDF Discovered by JHU: OR (ii) one and three
                                    quarters percent (1 3/4%) of GI's Net Sales
                                    of such GI Type C Product, if the First
                                    Member of such GI Type C Product's
                                    TGF-(beta) Class is a Additional
                                    Collaborative Factor Discovered jointly by
                                    JHU and GI;

                                    B equals seven-eighths percent (7/8%) of the
                                    Net Sales obtained from such sales of such
                                    GI Type C Product, multiplied by the number
                                    (if any) of Subsequent Members in such GI
                                    Type C Product's TGF-(beta) Class (not to
                                    exceed three (3) which are Additional GDFs
                                    Discovered by JHU;

                                    C equals seven-sixteenths percent (7/16%) of
                                    the Net Sales obtained from such sales of
                                    such GI Type C Product, multiplied by the
                                    number (if any) of Subsequent Members in
                                    such GI Type C Product's TGF-(beta) Class
                                    (not to exceed three (3) which are
                                    Additional Collaborative Factors Discovered
                                    jointly by JHU and GI;

                                    D equals seven-eighths percent (7/8%) of the
                                    Net Sales obtained from such sales of such
                                    GI Type C Product, if such GI Type C Product
                                    is labeled for an indication which is
                                    covered by a Valid Claim of a USE PATENT
                                    WITHIN THE JHU PATENT RIGHTS;

                                    E equals seven-sixteenths percent (7/16%) of
                                    the Net Sales obtained from such sales of
                                    such GI Type A Product, if such GI Type C
                                    Product is labeled for an indication which
                                    is covered by a Valid Claim of a USE PATENT
                                    WITHIN THE JOINT PATENT RIGHTS OF JHU AND
                                    GI;

                                    PROVIDED, HOWEVER, that in no event shall
                                    the sum of A, B and C exceed six percent
                                    (6%).

                  7.3.5    OTHER TGF-(BETA) FACTORS.

                           7.3.5.1  PAYABLE BY METAMORPHIX TO JHU. MetaMorphix
                                    shall pay to JHU a royalty on the sales,
                                    made by MetaMorphix, its Affiliates or
                                    sublicensees, of each Other TGF-(beta)
                                    Product, which royalty shall be calculated
                                    using the following formula:

                                           royalty = A + B

<PAGE>

                                    where

                                    A equals one percent (1 %) of the Net Sales
                                    obtained from such sales of such Other
                                    TGF-(beta) Product, multiplied by the number
                                    (if any) of GDFs of JHU (not to exceed three
                                    (3) for each TGF-(beta) Class), the
                                    manufacture, use or sale of which is covered
                                    by a Valid Claim under the applicable Factor
                                    Patent Rights, which GDFs belong to the
                                    TGF-(beta) Class containing the Other
                                    TGF-(beta) Factor that such Other TGF-(beta)
                                    Product is based on; and

                                    B equals one-half percent (1/2%) of the Net
                                    Sales obtained from such sales of such Other
                                    TGF-(beta) Product, multiplied by the number
                                    (if any) of Collaborative Factors of JHU and
                                    GI, or JHU and MetaMorphix (not to exceed
                                    three (3) for each TGF-(beta) Class), the
                                    manufacture, use or sale of which is covered
                                    by a Valid Claim under the applicable Factor
                                    Patent Rights, which Collaborative Factors
                                    belong to a TGF-(beta) Class containing the
                                    Other TGF-(beta) Factor that such Other
                                    TGF-(beta) Product is based on.

                           7.3.5.2  PAYABLE BY METAMORPHIX TO GI. MetaMorphix
                                    shall pay to GI royalties on the sales made
                                    by MetaMorphix, its Affiliates or
                                    sublicensees of each Other TGF-(beta)
                                    Product, which royalty shall be calculated
                                    using the following formula:

                                             royalty = A + B

                                    where

                                    A equals one percent (1 %) of the Net Sales
                                    obtained from the sale of such Other
                                    TGF-(beta) Product, multiplied by the number
                                    (if any) of BMPs (not to exceed three (3)
                                    for each TGF-(beta) Class), the manufacture,
                                    use or sale of which is covered by a Valid
                                    Claim under the applicable Factor Patent
                                    Rights. which BMPs belong to a TGF-(beta)
                                    Class containing the Other TGF-(beta) Factor
                                    that such Other TGF-(beta) Product is based
                                    on; and

<PAGE>

                                    B equals one-half percent (1/2%) of the Net
                                    Sales obtained from the sale of such Other
                                    TGF-(beta) Product. multiplied by the number
                                    (if any) of Collaborative Factors of GI and
                                    JHU. or GI and MetaMorphix (not to exceed
                                    three (3) for each TGF(beta) Class), the
                                    manufacture, use or sale of which is covered
                                    by a Valid Claim under the applicable Factor
                                    Patent Rights, which Collaborative Factors
                                    belong to a TGF-(beta) Class containing the
                                    Other TGF-(beta) Factor that such Other
                                    TGF-(beta) Product is based on.

                           7.3.5.3  PAYABLE BY GI TO JHU. GI shall pay to JHU a
                                    royalty on the sales by GI, its Affiliates
                                    or sublicensees of Other TGF-(beta)
                                    Products, which royalty shall be calculated
                                    by using the formula:

                                            royalty =A+B+C+D

                                    where

                                    A equals (i) seven-sixteenths percent
                                    (7/16%) of the Net Sales obtained from such
                                    sales made in North America of any Other
                                    TGF-(beta) Product based on a Factor known
                                    to GI as BMPs 2, 4, 5, 6, 7, 9 or 12,
                                    multiplied by the number (if any) of GDFs
                                    discovered by JHU which belong to a
                                    TGF-(beta) Class containing the Other
                                    TGF-(beta) Factor on which the Other
                                    TGF-(beta) Product being sold is based, plus
                                    (ii) seven-thirty-seconds percent (7/32%) of
                                    the Net Sales obtained .from such sales made
                                    in North America of any Other TGF-(beta)
                                    Product based on a Factor known to GI as
                                    BMPs 2, 4, 5, 6, 7, 9 or 12, multiplied by
                                    the number (if any) of Collaborative Factors
                                    of JHU and MetaMorphix which belong to a
                                    TGF-(beta) Class containing the Other
                                    TGF-(beta) Factor on which the Other
                                    TGF-(beta) Product being sold is based, in
                                    each case only where the manufacture, use or
                                    sale of such GDFs or Collaborative Factors
                                    is covered by a Valid Claim under the
                                    applicable Factor Patent Rights, PROVIDED,
                                    HOWEVER, that the aggregate number of such
                                    GDFs and Collaborative Factors considered in
                                    making such calculation shall not exceed
                                    three (3) AND, PROVIDED FURTHER, that if
                                    more

<PAGE>

                                    than three (3) of such GDFs and
                                    Collaborative Factors that exist in the
                                    aggregate, each such GDF shall be considered
                                    in making such calculation prior to the
                                    consideration of any Collaborative Factor in
                                    making such calculation;

                                    B equals seven-thirty seconds percent
                                    (7/32%) of the Net Sales obtained from such
                                    sales made in North America of Other
                                    TGF-(beta) Products based on any Factor
                                    known to GI as BMPS 2, 4, 5, 6, 7, 9 and 12,
                                    multiplied by the number (if any) of
                                    Collaborative Factors of GI and JHU (not to
                                    exceed three (3) for each TGF-(beta) Class)
                                    which belong to a TGF-(beta) Class
                                    containing the Other TGF-(beta) Factor on
                                    which the Other TGF-(beta) Product being
                                    sold is based, where the manufacture, use or
                                    sale: of such Collaborative Factors is
                                    covered by a Valid Claim under the
                                    applicable Factor Patent Rights;

                                    C equals (i) seven-eighths percent (7/8%) of
                                    the Net Sales obtained from such sales of
                                    any Other TGF-(beta) Product (excluding
                                    Other TGF-(beta) Products based on the
                                    Factors known to GI as BMPs 2, 4, 5, 6, 7, 9
                                    and 12), multiplied by the number (if any)
                                    of GDFs Discovered by JHU which belong to a
                                    TGF-(beta) Class containing the Other
                                    TGF-(beta) Factor on which such Other TGF-R
                                    Product is based, plus (ii) sevensixteenths
                                    percent (7/16%) of the Net Sales obtained
                                    from such sales of any Other TGF-(beta)
                                    Product (excluding Other TGF-(beta) Products
                                    based on the Factors known to GI as BMPs 2,
                                    4, 5, 6, 7, 9 and 12), multiplied by the
                                    number (if any) of Collaborative Factors of
                                    JHU and MetaMorphix which belong to a
                                    TGF-(beta) Class containing the Other
                                    TGF-(beta) Factor on which such Other
                                    TGF-(beta) Product is based, in each case
                                    only where the manufacture, use or sale of
                                    such GDFs or Collaborative Factors is
                                    covered by a Valid Claim under the
                                    applicable Factor Patent Rights, PROVIDED,
                                    HOWEVER, that the aggregate number of such
                                    GDFs and Collaborative Factors considered in
                                    making such calculation shall not exceed
                                    three (3) and, PROVIDED FURTHER, that if
                                    more than three (3) of such GDFs and
                                    Collaborative Factors that exist, in the
                                    aggregate, each such GDF

<PAGE>

                                    shall be considered in making such
                                    calculation prior to the consideration of
                                    any Collaborative Factor in making such
                                    calculation and

                                    D equals seven-sixteenths percent (7/16%) of
                                    the Net Sales obtained from the sales of any
                                    Other TGF(beta) Product (excluding Other
                                    TGF-(beta) Products based on the Factors
                                    known to GI as BMPs 2. 4, 5., 6. 7. 9 and
                                    12), multiplied by the number (if any) of
                                    Collaborative Factors of GI and JHU (not to
                                    exceed three (3) for each TGF-(beta) Class)
                                    which belong to a TGF-(beta) Class
                                    containing the Other TGF-(beta) Factor on
                                    which such Other TGF-(beta) Product is
                                    based, where the manufacture, use or sale of
                                    such Collaborative Factor is covered by a
                                    Valid Claim under the applicable Factor
                                    Patent Rights.

                           7.3.5.4  PAYABLE BY GI TO METAMORPHIX. GI shall pay
                                    to MetaMorphix a royalty on the sales made
                                    by GI, its Affiliates or sublicensees of
                                    Other TGF-(beta) Products, which royalty
                                    shall be calculated using the formula:

                                             royalty =(A+B+C+D)-E

                                    where

                                    A equals one-half percent (1/2%) of the Net
                                    Sales obtained from sales made in North
                                    America of any Other TGF-(beta) Product
                                    based on a Factor known to GI as BMPs 2, 4,
                                    5, 6, 7, 9 or 12, multiplied by the number
                                    (if any) of GDFs or Collaborative Factors of
                                    JHU and MetaMorphix (not to exceed three (3)
                                    for each TGF-beta Class), the manufacture,
                                    use or sale of which is covered by a Valid
                                    Claim under the applicable Factor Patent
                                    Rights, which belong to a TGF-(beta) Class
                                    containing the Factor on which the Other
                                    TGF-(beta) Product being sold is based;

                                    B equals one-quarter percent (1/4%) of the
                                    Net Sales obtained from sales made in North
                                    America of any Other TGF-(beta) Product
                                    based on a Factor KNOWN to GI as BMPs 2, 4,
                                    5, 6, 7, 9 and 12, multiplied by the number
                                    (if any) of Collaborative Factors of GI and
                                    JHU, or GI and MetaMorphix (not to exceed

<PAGE>

                                    three (3) for each TGF-(beta) Class), the
                                    manufacture. use or sale of which is covered
                                    by a Valid Claim under the applicable Factor
                                    Patent Rights, which belong to a TGF-(beta)
                                    Class containing the Other TGF-(beta) Factor
                                    on which the Other TGF-(beta) Product being
                                    sold is based:

                                    C equals one percent (1 %) of the Net Sales
                                    obtained from the sale of any Other
                                    TGF-(beta) Product (excluding Other TGF-P
                                    Products based on the Factors known to GI as
                                    BMPs 2, 4, 5, 6, 7, 9 and 12), multiplied by
                                    the number (if any) of GDFs and
                                    Collaborative Factors of JHU and MetaMorphix
                                    (not to exceed three (3) for each TGF-beta
                                    Class), the manufacture, use or sale of
                                    which is covered by a Valid Claim under the
                                    applicable Factor Patent Rights, which
                                    belong to a TGF-(beta) Class .containing the
                                    Other TGF-(beta) Factor on which the Other
                                    TGF-(beta) Product being sold is based;

                                    D equals one-half percent (1/2%) of the Net
                                    Sales obtained from the sale of any Other
                                    TGF-(beta) Product (excluding Other
                                    TGF-(beta) Products based on the Factors
                                    known to GI as BMPs 2, 4, 5, 6, 7, 9 and
                                    12), multiplied by the number (if any) of
                                    Collaborative Factors of GI and JHU, or GI
                                    and MetaMorphix (not to exceed three (3) for
                                    each TGF-(beta) Class), the manufacture, use
                                    or sale of which is covered by a Valid Claim
                                    under the applicable Factor Patent Rights,
                                    which belong to a TGF-(beta) Class
                                    containing the Other TGF-(beta) Factor on
                                    which the Other TGF-(beta) Product being
                                    sold is based; and

                                    E equals the royalty payable by GI to JHU
                                    under Section 7.3.5.3 above.

                           7.3.5.5  PATENT INTERFERENCE. The Parties acknowledge
                                    that an interference proceeding has been
                                    declared and is currently pending in the
                                    United States Patent and Trademark Office
                                    with respect to patent applications filed by
                                    GI claiming BMP12 and patent applications
                                    filed by JHU claiming GDF-7. In the event
                                    that it is finally determined that the
                                    inventions claimed in the GDF-7 patent
                                    applications have priority (i.e., were
                                    invented prior to) the inventions claimed in
                                    the BMP-12

<PAGE>

                                 patent applications and a patent is issued from
                                 the GDF-7 patent applications, then this
                                 Agreement thereupon shall be deemed to be
                                 automatically amended such that all references
                                 to BMP-12 in Sections 7.3.5.3 and 7.3.5.4 shall
                                 be deleted.

         7.4      ROYALTY CALCULATIONS.

                  7.4.1    COUNTRY-BY-COUNTRY BASIS. For each Product, royalties
                           shall be payable by a Party on a country-by-country
                           basis solely with respect to Net Sales for any
                           country where such Product is manufactured or sold in
                           which there is a Valid Claim under the applicable
                           Factor Patent Rights or Additional Factor Patent
                           Rights. However, for sales of a Product which is
                           manufactured in a country in which there is a Valid
                           Claim under the applicable Factor Patent Rights or
                           Additional Factor Patent Rights, but sold in a
                           country where the applicable Factor Patent Rights or
                           Additional Factor. Patent Rights do not exist, the
                           royalties payable by the Parties for sales in that
                           country shall be reduced by fifty percent (50%) if
                           products are being sold in that country which
                           directly compete with such Product.

                  7.4.2    ADVANCED PRODUCTS. For Products which are not
                           finished formulations, mixtures or compositions of a
                           Factor (that is, for Products which could not have
                           been developed by a Party but for the application of
                           substantial advanced technologies developed by that
                           Party (e.g., WITHOUT LIMITATION, Products which are
                           antibodies, antisense molecules or ribozymes to, a
                           Factor)), the royalty payable by that developing
                           Party on Net Sales of that Product shall be reduced
                           to reflect the fair market value contribution of that
                           advanced technology to the Product, as determined by
                           mutual agreement of the Parties. In the event that
                           the Parties are unable to calculate or agree Upon the
                           fair market value contribution of the advanced
                           technology to the Product, then the royalty payable
                           by the developing Party on Net Sales of that Product
                           shall be reduced by fifty percent (50%)-

                  7.4.3    THIRD PARTY Royalties If it becomes necessary, in
                           order for a Party or its Affiliates or sublicensees
                           to make, use or sell Products or products based upon
                           Other TGF-p Factors, to pay royalties under a Third
                           Party's patent rights (including amounts, if any,
                           payable to Third Parties, under Section 6.7, above;
                           and with respect to MetaMorphix. excluding amount
                           payable by MetaMorphix to JHU and/or GI under this
                           Agreement; and with respect to GI, excluding amount
                           payable by GI to MetaMorphix under this Agreement),
                           then the licensee Party shall have the right to
                           deduct

<PAGE>

                  fifty percent (50%) of the amounts so paid to Third Parties up
                  to a total of fifty percent (50%) of the amount due the
                  licensor Party on account of such particular Products or
                  products based on Other TGF-(beta) Factors.

                  7.4.4    LIMITATION ON ROYALTY DEDUCTIONS. Total royalty
                           deductions under this Section 7.4 shall not exceed
                           fifty percent (50%) of the amount due the licensor
                           Party on account of Net Sales of the Product or Other
                           TGF-(beta) Product, for which royalty payments are
                           owed.

         7.5      REPORTS AND PAYMENT. Each Party shall deliver to the Party to
                  which royalties are owed, within sixty (60) days after the end
                  of each calendar quarter, a written report showing its
                  computation of royalties due under this Agreement upon Net
                  Sales by such Party, its Affiliates and sublicensees during
                  such calendar quarter. All Net Sales shall be segmented in
                  each such report according to sales by such Party, each
                  AFFILIATE and each sublicensee, as well as on a
                  country-by-country basis, including the rates of exchange used
                  to convert such royalties to United States Dollars from the
                  currency in which such sales were made. Subject to the
                  provisions of Sections 7.6 and 7.7 of this Agreement,
                  simultaneously with the delivery of each such report, the
                  paying Party shall tender payment in United States Dollars of
                  all royalties shown to be due therein.

                  For purposes hereof, the rates of exchange to be used for
                  convening royalties hereunder to United States Dollars shall
                  be the closing price published for the purchase of United
                  States Dollars in the East Coast Edition of the Wall Street
                  Journal for the last business day of the calendar quarter for
                  which payment is due.

         7.6      FOREIGN Royalties. Where royalties are due hereunder for sales
                  of Products or products based on Other TGF-(beta) Factors in a
                  country where, by reason of currency regulations or taxes of
                  any kind, it is impossible or illegal for such Party, any
                  Affiliate or sublicensee to transfer royalty payments to the
                  licensor Party for Net Sales in that country, such royalties
                  shall be deposited in whatever currency is allowable by the
                  person or entity not able to make the transfer for the benefit
                  or credit of the licensor Party in an accredited bank in that
                  country that is reasonably acceptable to the licensor Party.

         7.7      TAXES. Any and all income or similar taxes imposed or levied
                  on account of the receipt of royalties payable under this
                  Agreement which are required to be withheld by a Party shall
                  be paid by such Party, its Affiliates or sublicensees on
                  behalf of the licensor Party and shall be paid to the proper

<PAGE>

                  taxing authority. Proof of payment shall be secured and sent
                  to the licensor. Party by such Party, its Affiliates or
                  sublicensees as evidence of such payment in such form as
                  required by the tax authorities having jurisdiction over such
                  Party, its Affiliates or sublicensees. Such taxes shall be
                  deducted from the royalty that would otherwise be remittable
                  by the Parry, its Affiliates or sublicensees.

         7.8      RECORDS. Each Party shall keep, and shall require all
                  Affiliates and sublicensees to keep, for a period of at least
                  two (2) years, full, true and accurate books of accounts and
                  other records containing all information and data which may be
                  necessary to ascertain and verify the royalties payable
                  hereunder. During the term of this Agreement and for a period
                  of two (2) years following its termination, each Party shall
                  have the right from time to time (not to exceed once during
                  each calendar year) to inspect in confidence, or have an
                  agent, accountant or other representative inspect in
                  confidence, such books, records and supporting data.

8.       ADDITIONAL CONSIDERATION.

         8.1      ASSIGNMENT OF METAMORPHIX STOCK. At the Closing, GI would
                  assign to MetaMorphix two million seven hundred thousand
                  (2.700,000) shares of the MetaMorphix Series A Convertible
                  Preferred Stock and nine hundred thousand (900.000) shares of
                  the MetaMorphix Series B Convertible Preferred Stock,
                  currently owned by GI, which assignment will be substantially
                  in the form as the assignment form attached hereto as Schedule
                  8.1A. At the Closing, GI also will deliver to MetaMorphix an
                  executed Stock Power, substantially in the form as attached
                  hereto as Schedule 8.1 B, for each MetaMorphix stock
                  certificate held by GI for the purpose of effecting such
                  assignment. After making such assignment, GI would still own
                  two hundred thousand (200,000) shares of MetaMorphix Series A
                  Convertible Preferred Stock and, at the Closing, MetaMorphix
                  shall, upon receiving the executed Assignment Agreement and.
                  Stock Powers, issue to GI a new stock certificate representing
                  such shares. Upon making such assignment, in accordance with
                  Section 8.6 hereof GI (i) shall acknowledge that it no longer
                  owns the minimum number of shares of MetaMorphix Stock such
                  that the MetaMorphix shareholders would be required to elect 2
                  or 3 persons designated by GI to serve as Directors on the
                  MetaMorphix Board of Directors, and (ii) would irrevocably
                  waive its right to exercise its purchase options under the
                  April 18, 1995 Stock Restriction Agreement and each of the
                  April 18, 1995 Right of First Refusal Agreements to which it.
                  MetaMorphix and JHU are parties.

         8.2      AMENDMENT OF PROMISSORY NOTE. At the Closing, GI and
                  MetaMorphix would execute a Third Allonge to the Promissory
                  Note, which shall be substantially in the form as the Third
                  Allonge appearing in Schedule 8.2 attached hereto. Such Third
                  Allonge shall provide, INTER ALIA, (I) for an

<PAGE>

                  extension of the due date for the payment of the note until
                  January 1. 2005, (ii) that MetaMorphix will he permitted to
                  repay the principal and interest at any time. (iii) that at
                  the end of the loan term. if MetaMorphix's stock is publicly
                  traded, MetaMorphix will be permitted to pay off the then
                  outstanding principal and interest with shares of
                  MetaMorphix's stock valued at the then current market price.
                  and (iv) that GI will be permitted, at any time and at its
                  sole election, to convert the outstanding principle and
                  interest of the loan to MetaMorphix stock. which stock shall
                  be valued at either (x) 125% of the IPO price if the stock is
                  then publicly traded or (y) a price to be negotiated in good
                  faith by MetaMorphix and GI if the stock is not then publicly
                  traded.

         8.3      PUT OPTION. Subject to the terms and conditions of this
                  Agreement, after the Closing, GI would enter into put option
                  agreements with qualified and accredited Third Party
                  investors, which put option agreements collectively, would
                  permit such investors to require GI to purchase up to
                  $2,000,000. in the aggregate, of the MetaMorphix stock
                  purchased by such Third Party investors. Each such put option
                  agreement shall be substantially in the form as the sample put
                  option agreement appearing in Schedule 8.3 attached hereto.
                  The per share purchase price to be paid by GI upon the
                  exercise of such put option shall be the per share price paid
                  by such Third Party investors to MetaMorphix for the purchase
                  of such stock. Such Third Party investors would be permitted
                  to exercise such put options between January 1, 2000 and
                  December 31, 2001 only if MetaMorphix (i) has voluntarily
                  filed for bankruptcy under Chapter 7 of the U.S. Bankruptcy
                  Code or (ii) is placed into bankruptcy under Chapter 7 of the
                  U.S. Bankruptcy Code by a petition of a Third Party and such
                  proceeding is not lifted within sixty (60) days of the filing
                  of such petition for bankruptcy, in either event on or before
                  December 31, 2001. Notwithstanding the foregoing, each such
                  put option shall automatically expire if, prior to December
                  31, 2001. MetaMorphix raises an aggregate of eight million
                  dollars ($8.000.000) or more, in cash and/or non-cash
                  consideration, through financing from one or more Third
                  Parties and/or the transfer to one or more Third. Parties of
                  any rights relating to one or more MetaMorphix Factors,
                  MetaMorphix shall promptly notify GI, in writing, upon
                  entering each such transaction, which notice shall include a
                  copy of the transaction agreements and a summary of all
                  consideration received or to be received and the dates on
                  which such consideration was or is to be received. In
                  determining whether such eight million dollars ($8,000,000)
                  has been raised, only consideration actually received by
                  MetaMorphix on or before December 31, 2001 shall be counted,
                  PROVIDED, HOWEVER, that, with respect to any consideration
                  received in a form other than cash, the fair market value, as
                  determined in good faith by GI and MetaMorphix' Board of
                  Directors, of such consideration shall be utilized in
                  calculating whether such eight million dollars ($8,000,000)
                  has been raised. In the event that MetaMorphix becomes
                  insolvent and desires to

<PAGE>

                  seek protection under U.S. Bankruptcy laws, MetaMorphix shall
                  use its good faith and diligent efforts to seek such
                  protection under Chapter 1 1 of' the U.S. Bankruptcy Code and,
                  if a bankruptcy petition is filed against MetaMorphix by any
                  Third Party. MetaMorphix shall uses its good faith diligent
                  efforts to have such petition dismissed as soon as possible.
                  MetaMorphix shall promptly notify. in writing. GI and each
                  such Third Party investor upon the occurrence of any events
                  which result in the expiration of the put options, provided,
                  however, that any failure to give or delay in giving such
                  notice shall have no effect upon the expiration of any such
                  put option. Notwithstanding, the foregoing. the obligation to
                  grant any put option to any Third Party investor pursuant to
                  this Section 8.3 shall be subject to GI's receiving, from
                  MetaMorphix' legal counsel. a written opinion (which written
                  opinion shall be prepared and given at no cost or expense to
                  GI) to the effect that the sale of the shares of the capital
                  stock of MetaMorphix which are to be the subject of such put
                  option and the issuance of the put option by GI to such Third
                  Party Investor, each are exempt from registration under
                  applicable federal and state securities laws.

         8.4      PURCHASE OF EQUIPMENT. At the Closing, GI and MetaMorphix
                  shall enter into an Asset Purchase Agreement, substantially in
                  the form of the Asset Purchase Agreement attached hereto as
                  Schedule 8.4A, pursuant to which GI will purchase from
                  MetaMorphix the equipment identified in Schedule 8.4B attached
                  hereto. Pursuant to such Asset Purchase Agreement, in
                  consideration of such purchase, GI will pay to MetaMorphix two
                  hundred eighty four thousand five hundred twenty four dollars
                  ($284,524), such amount payable to MetaMorphix upon Closing
                  for immediate payment by MetaMorphix to Transamerica Business
                  Credit Corporation (from which MetaMorphix leases such
                  equipment) as payment in full for the exercise of MetaMorphix'
                  option to purchase such equipment from Transamerica Business
                  Corporation. Such purchase price is inclusive of all costs
                  associated with the purchase of such equipment, PROVIDED,
                  HOWEVER, that GI also shall pay any (i) sales tax, use tax or
                  any other federal, state of local tax (but not any income tax)
                  measured solely by the equipment price and required to be paid
                  by MetaMorphix by virtue of the sale and/or delivery of the
                  equipment to GI and (ii) freight, packing, shipping and
                  insurance costs. GI shall select a carrier and arrange for
                  such carrier to deliver such equipment to the location(s)
                  designated by GI within thirty (30) days after the Closing. GI
                  shall (i) prepay all freight, packing, shipping and insurance
                  costs required for the shipment of the equipment to GI and
                  (ii) bear the risk of loss until the equipment is safely
                  delivered to GI's premises. Simultaneously with the delivery
                  of the equipment to GI, MetaMorphix shall provide to GI all
                  manuals, documents, specifications, and spare parts that
                  relate to such equipment and are in MetaMorphix' possession.
                  GI has had the opportunity, prior to the signing of this
                  Agreement to inspect such equipment which shall be delivered
                  to GI in "as is" condition, PROVIDED, HOWEVER, that until such
                  equipment is

<PAGE>

                  delivered by MetaMorphix to GI's carrier. MetaMorphix shall
                  use all reasonable efforts to maintain such equipment in the
                  condition as it was in at the time of GI's inspection.

         8.5      BAYLOR AGREEMENT. As of the date this Agreement was signed by
                  each of the Parties, MetaMorphix has paid to Baylor
                  forty-eight thousand dollars ($48,000) of the total amount to
                  be paid by MetaMorphix to Baylor under the Baylor Agreement,
                  which payments are sufficient to cover the research activities
                  to be performed thereunder by Baylor during the period
                  commencing on February 1, 1998 and ending on July 31, 1998. As
                  of the date this Agreement was signed by each of the Parties,
                  MetaMorphix is in arrears in the additional amount of
                  forty-eight thousand dollars ($48,000) of the payments to be
                  made to Baylor under the Baylor Agreement. GI. on the
                  Effective Date, shall pay to MetaMorphix, forty-eight thousand
                  dollars ($48,000) which amount is to be used by MetaMorphix to
                  immediately pay Baylor the past due amount under the Baylor
                  Agreement, and in consideration therefor, MetaMorphix shall
                  assign to GI all rights and licenses to any data, information
                  or intellectual property arising from the Baylor Agreement on
                  or after August 1, 1998 and prior to February 1, 1999, which
                  assignment shall be represented by an Intellectual Property
                  Assignment Agreement which is substantially in the form of the
                  Intellectual Property Assignment Agreement attached hereto as
                  Schedule 8.5. If MetaMorphix elects to terminate the Baylor
                  Agreement and should Baylor be willing to do so, GI hereby
                  agrees to enter into good faith negotiations with Baylor for a
                  sponsored research agreement which agreement would replace the
                  Baylor Agreement.

         8.6      SHAREHOLDER AGREEMENTS. At the Closing, GI, MetaMorphix, JHU
                  and Dr. Lee each shall execute and deliver to the others a
                  Termination Agreement, which shall be substantially in the
                  form of the Termination Agreement appearing in Schedule 8.6
                  attached hereto., pursuant to which the 1995 Voting Agreement,
                  the 1995 Stock Restriction Agreements and the 1995 Right of
                  First Refusal Agreements will be terminated.

9.       PRODUCT DEVELOPMENT AND COMMERCIALIZATION.

         9.1      METAMORPHIX'S OBLIGATIONS.

                  9.1.1    GENERAL Diligence Obligation. MetaMorphix shall use
                           its Commercially Reasonable Efforts, in its
                           reasonable scientific and business judgment, as
                           permitted by the licenses granted to it under Article
                           6 hereof, to further characterize, evaluate, select,
                           conduct all necessary and appropriate preclinical and
                           clinical trials and seek regulatory approvals for at
                           least one (1) product based on each TGF-(beta) Factor
                           Class selected by MetaMorphix under Section 5.3
                           hereof. Additionally, MetaMorphix shall use its
                           Commercially

<PAGE>

                           Reasonable Efforts to manufacture or have
                           manufactured, market and sell such products in those
                           countries of the Territory where MetaMorphix has
                           obtained Regulatory Approval for such products.

                  9.1.2    DEVELOPMENT MILESTONES. As a measure of the diligence
                           obligations set forth in Section 9.1.1. MetaMorphix
                           shall either (i) spend an average of five hundred
                           thousand dollars ($500,000) per year over the five
                           (5) year period commencing with the Effective Date
                           (for a total of two million five hundred thousand
                           dollars ($2,5000,000) in the aggregate over such five
                           (5) year period) or (ii) meet the following
                           development milestones with respect to at least one
                           (1) product based on each at least one (1) of the
                           TGF-0 Factor Classes selected by MetaMorphix under
                           Section 5.3 hereof:

                           (a)      within three (3) years from the date all
                                    Available Factors have been selected as
                                    MetaMorphix Factors or GI Factors pursuant
                                    to Section 5.3, above, MetaMorphix-shall
                                    perform initial pre-clinical
                                    characterization and demonstrate efficacy in
                                    an animal model, for at least one (1)
                                    product based on a Factor from at least one
                                    (1) of the TGF-(3 Factor Classes selected by
                                    MetaMorphix;

                           (b)      within five (5) years from the date set
                                    forth in Section 9.1.2(a), above,
                                    MetaMorphix shall submit an INAD for at
                                    least one (1) product based on at least one
                                    (I) of the TGF-f3 Factor Classes selected by
                                    MetaMorphix under Section 5.3 hereof; and

                           (c)      within seven (7) years from the date set
                                    forth in Section 9.1.2(a), above,
                                    MetaMorphix shall apply for approval from
                                    the United States Department of Agriculture
                                    and/or the FDA for at least one (1) product
                                    based on at least one (1) of the TGF-J3
                                    Factor Classes selected by MetaMorphix under
                                    Section 5.3 hereof.

                  9.1.3    SATISFACTION OF DILIGENCE AND DEVELOPMENT MILESTONE
                           OBLIGATIONS. MetaMorphix may satisfy the diligence
                           obligations under Section 9.1.1 hereof and achieve
                           the development milestones under Section 9.1.2, in.
                           either case, on its own account, or through an
                           Affiliate or sublicensee, or by forming a partnership
                           or other venture to satisfy such diligence
                           obligations, all as permitted under the terms and
                           conditions of this Agreement. While MetaMorphix is

<PAGE>

                           committed to satisfying such diligence obligations
                           and achieving such development milestones.
                           MetaMorphix does not represent, warrant or guarantee
                           that a product based on each TGF-(beta) Factor Class
                           selected by MetaMorphix will or can be successfully
                           developed or that the applicable development
                           milestones for any product based on such TGF-(beta)
                           Factor Class can be met.

                  9.1.4    FAILURE TO ACHIEVE DEVELOPMENT MILESTONES. Where
                           MetaMorphix fails to both (i) make the minimum
                           expenditures and (ii) meet a development milestone as
                           required under Section 9.1.2 hereof, JHU, in its sole
                           discretion and upon thirty (30) days prior written
                           notice to MetaMorphix and GI, may terminate the
                           licenses granted by it to MetaMorphix under Section
                           6.2 hereof, PROVIDED, HOWEVER, in the event
                           MetaMorphix fails to meet any such Milestone,
                           MetaMorphix may, at its option, retain its licenses
                           to such Factor Rights if MetaMorphix, thereafter,
                           pays to JHU a license maintenance fee in the amount
                           of five thousand dollars ($5,000) per calendar
                           quarter, the first such quarterly payment (which
                           payment shall be prorated based on the number of days
                           remaining between the end of such thirty (30) day
                           notice period and the end of the calendar quarter in
                           which such payment becomes due) being due at the end
                           of such thirty (30) day notice period, and each
                           subsequent payment being due on the last day of each
                           subsequent calendar quarter.. Notwithstanding the
                           foregoing, MetaMorphix' obligation to make such
                           payments shall cease if MetaMorphix has either (i)
                           increased its spending to the minimum levels required
                           under Section 9.1.2 hereof or (ii) achieved such
                           development milestone. In the event that, pursuant to
                           this Section 9.1, JHU terminates the licenses granted
                           to MetaMorphix under Section 6.2 hereof. GI. at its
                           sole option, within sixty (60) days after the end of
                           the thirty (30) day notice period provided for in
                           this Section 9.1.4, may. by written notice to JHU,
                           assume such licenses and MetaMorphix' obligations to
                           JHU with respect to such licenses, PROVIDED, HOWEVER,
                           that GI's obligations under the development
                           milestones set forth in Section 9.1.2(a) hereof shall
                           be measured beginning on the date of such assumption
                           of rights and obligations rather than the date all
                           Available Factors have been selected as MetaMorphix
                           Factors of GI Factors.

         9.2      GI'S DILIGENCE OBLIGATIONS.

                  9.2.1    GENERAL DILIGENCE OBLIGATION. GI shall use its
                           Commercially Reasonable Efforts, in its reasonable
                           scientific and business judgment, as permitted by the
                           licenses granted to it under Article 6

<PAGE>

                           hereof, to further Discover, characterize, evaluate,
                           select, conduct all necessary and appropriate
                           preclinical and clinical trials and seek regulatory
                           approvals for at least one (1) product based on each
                           TGF-beta Factor Class to which GI has received a
                           license from J IU under Section 6.3 hereof.
                           Additionally, GI shall use its Commercially
                           Reasonable Efforts to manufacture or have
                           manufactured, market and sell such products in those
                           countries of the Territory where GI has obtained
                           Regulatory Approval for such products.

                  9.2.2    MILESTONES. As a measure of the diligence obligations
                           set forth in Section 9.2.1, GI shall either (i) spend
                           an average of five hundred thousand dollars
                           ($500,000) per year over the five (5) year period
                           commencing with the Effective Date (for a total of
                           two million five hundred thousand dollars
                           ($2,500,000) in the aggregate over such five (5) year
                           period) or (ii) meet the following development
                           milestones with respect to at least one (1) product
                           based on at least one (1) of the TGF-(3 Classes to
                           which GI has rights under this Agreement: _

                           (a)      within three (3) years from the date all
                                    Available Factors have been selected as GI
                                    Factors or MetaMorphix Factors pursuant to
                                    Section 5.3, above, GI shall perform initial
                                    pre-clinical characterization, and
                                    demonstrate efficacy in an animal model, for
                                    at least one (1) product based on a Factor
                                    from at least one (1) TGF-(beta) Class to
                                    which GI has rights under this Agreement;

                           (b)      within five (5) years from the date GI
                                    achieves the development milestone set forth
                                    in Section 9.2.2(a), above. GI shall submit
                                    an IND for a Phase I clinical study of at
                                    least one (1) product based on a Factor from
                                    at least one (1) TGF-(beta) Class to which
                                    GI has rights under this Agreement; and

                           (c)      within seven (7) years from the date GI
                                    achieves the development milestone set forth
                                    in Section 9.2.2(b), above. GI shall submit
                                    a PLA seeking commercial approval of at
                                    least one (1) product based on a Factor from
                                    at least one (1) TGF-beta Class to which GI
                                    has rights under this Agreement.

<PAGE>

                  9.2.3    SATISFACTION OF DILIGENCE AND DEVELOPMENT MILESTONE
                           OBLIGATIONS. GI may satisfy the diligence obligations
                           under Section 9.2.1 hereof and achieve the
                           development milestones under Section 9.2.2, in either
                           case, on its own account. or through an Affiliate or
                           sublicensee, or by forming a partnership or other
                           venture to satisfy such diligence obligations, all as
                           permitted under the terms and conditions of this
                           Agreement. While GI is committed to satisfying such
                           diligence obligations and achieving such development
                           milestones, GI does not represent, warrant or
                           guarantee that a product based on each TGF-(beta)
                           Class selected by GI will or can be successfully
                           developed or that the applicable development
                           milestones for any product based on such TGF-(beta)
                           Class can be met.

                  9.2.4    FAILURE TO ACHIEVE DEVELOPMENT MILESTONES. Where GI
                           fails to both (i) make the minimum expenditures and
                           (ii) meet a development milestone as required under
                           Section 9.2.2 hereof, JHU may, in its sole discretion
                           and upon thirty (30) days prior written notice to GL
                           may terminate the licenses granted by it to GI under
                           Section 6.3 hereof; PROVIDED, HOWEVER, GI may, at its
                           sole option, retain its licenses to such Factor
                           Rights and Additional Factor Rights if GI,
                           thereafter, pays to JHU a license maintenance fee in
                           the amount of twenty five thousand dollars ($25,000)
                           per calendar quarter, the first such quarterly
                           payment (which payment shall be prorated based on the
                           number of days remaining between the end of such
                           thirty (30) day notice period and the end of the
                           calendar quarter in which such payment becomes due)
                           being due at the end of such thirty (30) day notice
                           period, and each subsequent payment being due on the
                           last day of each subsequent calendar quarter.
                           Notwithstanding the foregoing, GI's obligation to
                           make such payments shall cease if GI has either (i)
                           increased its spending to the minimum levels required
                           under Section 9.2.2 hereof or (ii) achieved such
                           development milestone. In the event that, pursuant to
                           this Section 9.1, JHU terminates the licenses granted
                           to GI under Section 6.3 hereof. MetaMorphix, at its
                           sole option, within sixty (60) days after the end of
                           the thirty (30) day notice period provided for in
                           this Section 9.2.4, may, by written notice to JHU,
                           assume such licenses and GI's obligations to JHU with
                           respect to such licenses, PROVIDED, HOWEVER, that
                           MetaMorphix' obligations under the development
                           milestones set forth in Section 9.2.2(a) hereof shall
                           be measured beginning on the date of such assumption
                           of rights and obligations rather than the date all
                           Available Factors have been selected as MetaMorphix
                           Factors of GI Factors.

<PAGE>

         9.3      RIGHT OF FIRST REFUSAL. GI, for itself and its parent company,
                  American Home Products Corporation, hereby waives and shall
                  have no further rights under any Right of First Refusal Offer
                  made by MetaMorphix pursuant to Section 9.2 of the 1994
                  Collaboration Agreement prior to the Effective Date, which
                  offer has not yet been accepted by GI or American Home
                  Products Corporation. Additionally, no right of first refusal
                  is provided to GI or American Home Products Corporation
                  hereunder with respect to MetaMorphix' licensing to any Third
                  Party the right to develop. make. use and/or sell any
                  MetaMorphix Product for use in the MetaMorphix Field.

10.      PATENT PROSECUTION AND INFRINGEMENT.

         10.1     RESPONSIBILITY FOR PATENTING FACTOR RIGHTS.

                  10.1.1   GI PATENT RIGHTS AND CERTAIN JOINT PATENT RIGHTS. GI
                           shall have the first right, but not the obligation,
                           to seek or continue to seek or maintain Patent
                           protection on any GI Patent Rights, any Joint Patent
                           Rights OF GI and MetaMorphix, and any Joint Patent
                           Rights of GI and JHU, any GI Additional Factor Patent
                           Rights and any Additional Factor Joint Patent Rights,
                           in any country. If GI elects, in any country not to
                           seek or continue to seek or maintain Patent
                           protection on any such Factor Patent Rights (but not
                           any GI Additional Factor Patent Right or Additional
                           Factor Joint Patent Rights), to the extent the
                           manufacture use or sale of a MetaMorphix Factor would
                           infringe such Factor Patent Rights Factor in such
                           country, MetaMorphix shall have the right, but not
                           the obligation, at its expense, to file, procure and
                           maintain in such countries Patents on such Factor
                           Patent Rights in such country.

                  10.1.2   METAMORPHIX PATENT Rights. MetaMorphix shall have the
                           first right, but not the obligation, to seek or
                           continue to seek or maintain Patent protection on any
                           MetaMorphix Patent Rights in any country. If
                           MetaMorphix elects not to seek or continue to seek or
                           maintain Patent protection on any MetaMorphix Patent
                           Rights in any country, GI shall have the right, but
                           not the obligation, at its expense, to file, procure
                           and maintain in such countries Patents on such
                           MetaMorphix Patent Rights, in which event,
                           MetaMorphix shall assign its entire right, title and
                           interest in and to those of such MetaMorphix Patent
                           Right(s) that relate to any of the GI Factors in such
                           country(ies) to GI and such MetaMorphix Patent
                           Right(s) shall thereafter be excluded from the
                           definitions of MetaMorphix Patent Right(s) and GI
                           Patent Rights for all purposes of this Agreement.

<PAGE>

                  10.1.3   JHU PATENT RIGHTS AND CERTAIN JOINT PATENT RIGHTS.
                           JHU shall have the first right to seek or continue to
                           seek or maintain Patent protection on any JHU Patent
                           Rights. any Joint Patent Rights of JHU and
                           MetaMorphix, and any JHU Additional Factor Patent
                           Rights in any country. If JHU elects not to seek or
                           continue to seek or maintain Patent protection on any
                           such Factor Patent Rights or Additional Factor Patent
                           Rights in any country. GI shall have the right, but
                           not the obligation, at its expense, to file, procure
                           and maintain in such countries Patents on such Factor
                           Patent Rights or Additional Factor Patent Rights,
                           PROVIDED, HOWEVER, that if GI does not exercise such
                           right with respect to any Factor Patent Right (but
                           not with respect to any Additional Factor Patent
                           Right), which, but for this Agreement, would be
                           infringed by MetaMorphix' making. using or selling of
                           a MetaMorphix Factor or a MetaMorphix Product, then
                           MetaMorphix shall have the right, but not the
                           obligation, at its expense, to file, procure and
                           maintain such Patents in such country(ies).

                  10.1.4   PATENT COOPERATION. Each Party shall advise the other
                           applicable Party of all decisions taken under this
                           Section in a timely manner in order to allow the
                           other applicable Party to protect its rights under
                           this Section. Each Party shall provide the other
                           applicable Party (or Parties) with copies of all
                           substantive communications from all patent offices
                           regarding Patents on Joint Patent Rights, and Patents
                           on Factors selected or assigned to the other
                           applicable Party under this Agreement, promptly after
                           the receipt thereof. Each Party shall provide the
                           other applicable Party with copies of all proposed
                           substantive communications to such patent offices
                           regarding Patents on any Joint Patent Rights, and
                           Patents on Factors selected or assigned to the other
                           applicable Party under this Agreement, in sufficient
                           time before the due date in order to enable the other
                           applicable Party an opportunity to comment on the
                           content thereof. Each Party shall make available to
                           the other applicable Party, or its authorized
                           attorneys, agents or representatives, such of its
                           employees whom the other applicable Party, in its
                           reasonable judgment, deems necessary in order to
                           assist it in obtaining Patent protection for the
                           applicable Factor Patent Rights, in the event the
                           Party with first rights to seek or continue to seek
                           or maintain Patent protection on any such Factor
                           Patent Rights chooses not to do so. Each Party shall
                           sign or use its best efforts to have signed all legal
                           documents necessary to file and prosecute Patents or
                           to obtain or maintain Patents at no cost to the other
                           Parties. Except as provided in Section 10.2 below,
                           each Party shall bear all costs incurred by it in
                           exercising the foregoing rights.

<PAGE>

                  10.1.5   USE OF INFORMATION. Information, data and materials
                           resulting from the Collaborative Research or
                           Sponsored Research disclosed pursuant to this
                           Agreement or the 1994 Collaboration Agreement, may be
                           used by a receiving Party to support utility or
                           activity hypothecations made in a Patent application
                           filed by that Party directed to a BMP, GDF or
                           Collaborative Factor. The Parties shall collaborate
                           to assure that relevant data is used to support the
                           Factor Patent Rights (with a preference for
                           supporting composition of matter claims) through
                           affidavits and/or continuation applications or
                           continuation-in-part applications. Inventorship under
                           such Factor Patent Rights or Additional Factor Patent
                           Rights will be determined according to U.S. patent
                           law. Information and materials relating to (a) a GDF
                           or Additional GDF Discovered by JHU or (b) a
                           Collaborative Factor or Additional Collaborative
                           Factor jointly Discovered by JHU and another Party,
                           as applicable, which are supplied by JHU to GI or
                           MetaMorphix pursuant to this Agreement, shall not be
                           distributed by GI or MetaMorphix to Third Parties
                           (even under a duty of confidentiality) without JHU's
                           written consent, which consent shall not be
                           unreasonably withheld or delayed, until JHU has had
                           an opportunity to publish on such GDF, Additional
                           GDF. Collaborative Factor or Additional Collaborative
                           Factor.

                  10.1.6   DIVISION OF CLAIMS. With respect to any Patents
                           included within a Party's 'Patent Rights or the Joint
                           Patent Rights, which Patents would, but for this
                           Agreement, be infringed by either GI's or
                           MetaMorphix' making, using or selling of a
                           MetaMorphix Factor, a MetaMorphix Product or a GI
                           Type B Product, the Parties will use good faith
                           efforts to take all necessary action, to the extent
                           possible, to file divisional patent applications that
                           are directed to the manufacture, use or sale of the
                           MetaMorphix Factors solely in the GI Field and to the
                           manufacture, use or sale of the MetaMorphix Factors
                           in the MetaMorphix Field.

                  10.1.7   INTERFERENCES. The Parties shall each, in good faith,
                           use its respective Commercially Reasonable Efforts to
                           resolve any patent interferences between any of the
                           Parties relating to Patents directed to any Factor or
                           Additional Factor.

         10.2     EXPENSES.

                  10.2.1   PREVIOUSLY INCURRED EXPENSES - GI FACTORS. At the
                           Closing, GI will pay to MetaMorphix one hundred fifty
                           five thousand dollars ($155,000) which amount is
                           being paid to reimburse MetaMorphix for a portion of
                           the expenses incurred by MetaMorphix, between

<PAGE>

                           December 1. 1994 and the Effective Date, in the
                           prosecution (whether such prosecution is conducted by
                           MetaMorphix directly or by JHU and, pursuant to the
                           1994 Collaboration Agreement. reimbursed by
                           MetaMorphix) of Patents claiming any Factors that
                           prior to the Effective Date have been selected or
                           otherwise identified as GI Factors.

                  10.2.2   PREVIOUSLY INCURRED EXPENSED -- METAMORPHIX FACTORS
                           AND UNASSIGNED FACTORS. At the Closing, GI will pay
                           to MetaMorphix sixty thousand dollars ($60,000),
                           which amount is to be used by MetaMorphix for out of
                           pocket patent expenses that MetaMorphix incurred, on
                           or after January 1, 1998 and prior to January 4,
                           1999, but, as of the Closing has not yet paid to
                           either JHU or any Third Party, for the prosecution of
                           Patents claiming any Factors that, prior to such
                           date, have not been selected or otherwise identified
                           as GI Factors.

                  10.2.3   CONTINUING EXPENSES -- GI FACTORS AND ADDITIONAL
                           FACTORS. With respect to each (i) Factor that has,
                           prior to the Effective Date been selected as or
                           otherwise identified as a GI Factor, (ii) Factor
                           that, after the Effective Date, is selected as a GI
                           Factor, (iii) Factor that, after the Effective Date,
                           becomes an Additional GDF or an Additional
                           Collaborative Factor. GI shall, as of (x) the
                           Effective Date for Factors that, prior to the
                           Effective Date, have been selected by GI or otherwise
                           identified as a GI Factor, or (y) the date such
                           Factor becomes a GI Factor, an Additional GDF or an
                           Additional Collaborative Factor, and thereafter,
                           reimburse JHU for one hundred (100%) of the expenses
                           incurred by JHU for the prosecution of Patents
                           claiming such GI Factors, Additional GDFs or
                           Additional Collaborative Factors. Such reimbursements
                           shall be made by GI, from time to time, within thirty
                           (30) days after GI receives from JHU an invoice
                           detailing such incurred expenses, which invoice shall
                           he accompanied by copies of invoices JHU has received
                           from Third Parties for such Patent prosecution.

                  10.2.4   CONTINUING EXPENSES -- METAMORPHIX FACTORS. With
                           respect to each Factor that (i) has been identified
                           as a MetaMorphix Factor prior to the Effective Date
                           or (ii) is, after the Effective Date, selected as a
                           MetaMorphix Factor, GI and MetaMorphix each shall
                           reimburse JHU for fifty percent (50%) of the
                           out-of-pocket expenses incurred by JHU in prosecuting
                           Patents claiming such MetaMorphix Factors, which
                           expenses were incurred on or after (i) the Effective
                           Date for each Factor that has been identified as a
                           MetaMorphix Factor prior to the Effective Date, or
                           (ii) the date that such Factor becomes a MetaMorphix
                           Factor for those Factors that,

<PAGE>

                           as of the Effective Date, have not been identified as
                           either a MetaMorphix Factor or a GI Factor.
                           Notwithstanding the foregoing, if the Parties, after
                           the Effective Date, are able to divide out the claims
                           of such Patents, as provided in Section 10.1.6 above,
                           such that separate Patents respectively claim such
                           MetaMorphix Factors for use in the GI Field only and
                           such MetaMorphix Factors for use in the MetaMorphix
                           Field only, GI, shall reimburse JHU for one hundred
                           percent (100%) of the out-of-pocket expenses incurred
                           by JHU, after such Patents are so divided, in
                           prosecuting those Patents which claim such
                           MetaMorphix Factors for use in the GI Field only and
                           MetaMorphix, shall reimburse JHU for one hundred
                           percent (100%) of the out-of-pocket expenses incurred
                           by JHU, after such Patents are so divided, in
                           prosecuting those Patents which claim such
                           MetaMorphix Factors for use in the MetaMorphix Field
                           only. Each reimbursement under this Section 10.2.4
                           shall be made by GI or MetaMorphix, as applicable,
                           from time to time, within thirty (30) days after GI
                           or MetaMorphix, as applicable, receives from JHU 'an
                           invoice detailing such incurred expenses, which
                           invoice shall be accompanied by copies of invoices
                           JHU has received from Third Parties for such Patent
                           prosecution.

                  10.2.5   CONTINUING EXPENSES - UNASSIGNED FACTORS. GI and
                           MetaMorphix shall each reimburse JHU for fifty
                           percent (50%) of the out-of-pocket expenses incurred
                           by JHU after January 4, 1999 in prosecuting any
                           Patents claiming any Factor that has not yet been
                           identified as either a GI Factor or a MetaMorphix
                           Factor. Expenses incurred by JHU after the date a
                           Factor is identified as either a GI Factor or a
                           MetaMorphix Factor shall be reimbursed to JHU in
                           accordance with the provisions of Sections 10.2.3 or
                           10.2.4 above, as applicable.

                  10.2.5   CONTINUING EXPENSES - GDF-16 AND GDF-17. MetaMorphix
                           shall reimburse JHU for one hundred percent (100%) of
                           the out of pocket expenses incurred by JHU, whether
                           incurred before or after the Effective Date. in
                           prosecuting any JHU Patent Rights claiming (i) GDF-16
                           and/or GDF-17. (ii) any GDF-16 Product and/or GDF17
                           Product, or (iii) the-manufacture or use of (i) or
                           (ii).

         10.3     INFRINGEMENT.

                  10.3.1   NOTICE. With respect to the BMPs, the GDFs and the
                           Collaborative Factors, each Parry shall promptly
                           report in writing to the other Parties during the
                           term of this Agreement any (i) known infringement or
                           suspected infringement of any of the Factor Patent
                           Rights or (ii) unauthorized use or misappropriation
                           of the

<PAGE>

                           Confidential Information by a Third Party of which it
                           becomes aware, and shall provide the other Parties
                           with all available evidence supporting said
                           infringement, suspected infringement or unauthorized
                           use or misappropriation. With respect to the
                           Additional Factors, JHU and GI shall promptly report
                           in writing to each other during the term of this
                           Agreement any (i) known infringement or suspected
                           infringement of any of the Additional Factor Patent
                           Rights or (ii) unauthorized use or misappropriation
                           of the Confidential Information by MetaMorphix or a
                           Third Pam of which it becomes aware, and shall
                           provide such other Party with all available evidence
                           supporting said infringement, suspected infringement
                           or unauthorized use or misappropriation.

                  10.3.2   FIRST RIGHT TO INITIATE SUITS - GI FACTORS AND
                           ADDITIONAL FACTORS. GI shall have the first right to
                           initiate an infringement or other appropriate suit
                           against any Third Party who at any time has
                           infringed, or is suspected of infringing, any Factor
                           Patent Rights or Additional Factor Patent Rights, as
                           applicable, of using without proper authorization all
                           or any Confidential Information, where such
                           infringement, suspected infringement or unauthorized
                           use is determined by GI to have an adverse affect on
                           its ability to make, have made, use and/or sell
                           products based on any GI Factor or any Additional
                           Factor. GI and MetaMorphix agree to consult with each
                           other prior to instituting any such suit and to
                           provide the other Party a reasonable opportunity to
                           participate, at its own expense, in any such suit to
                           protect its respective interests.

                  10.3.3   FIRST RIGHT TO INITIATE SUITS - METAMORPHIX FACTORS,
                           GDF-16 AND GDF-17. MetaMorphix shall have the first
                           right to initiate an infringement or other
                           appropriate suit against any Third Party who at any
                           time has infringed, or is suspected of infringing,
                           any Factor Patent Rights or of using without proper
                           authorization all or any Confidential Information,
                           where such infringement, suspected infringement or
                           unauthorized use is determined by MetaMorphix to have
                           an adverse affect on its ability to make, have made,
                           use and/or sell products based on MetaMorphix
                           Factors, GDF-16 Products or GDF-17 Products,
                           PROVIDED, HOWEVER, that GI shall have the first right
                           to initiate such infringement or other appropriate
                           suit against any such Third Party, where the actual
                           or suspected infringement is occurring only in the GI
                           Field. GI and MetaMorphix agree to consult with each
                           other prior to instituting any such suit and to
                           provide the other Party a reasonable opportunity to
                           participate, at its own expense, in any such suit to
                           protect its respective interests.

<PAGE>

                  10.3.4   FIRST RIGHT TO INITIATE SUITS - UNASSIGNED FACTORS.
                           With respect to any BMP. GDF or Collaborative Factor
                           that has not yet been identified as either a
                           MetaMorphix Factor or a GI Factor, the Parties shall
                           jointly determine which Party (or Parties) shall have
                           the first right to initiate an infringement or other
                           appropriate suit against any Third Party who at any
                           time has infringed, or is suspected of infringing,
                           any Factor Patent Rights or of using without proper
                           authorization all or any Confidential Information, in
                           order to preserve GI's or MetaMorphix' ability to
                           make, have made, use and/or sell Products based on GI
                           Factors or MetaMorphix Factors, as the case may be,
                           following the selection of such Available Factors
                           pursuant to Article 5 of this Agreement.

                  10.3.5   DETERMINATION OF RIGHT TO PARTICIPATE IN, AND SECOND
                           RIGHT TO INITIATE, SUITS. The Parties shall jointly
                           determine which Party (or Parties) shall have the
                           right to (i) participate in any infringement or other
                           appropriate suit brought by a Party against a Third
                           Parry pursuant to Sections 10.3.2, 10.3.3 pr 10.3.4,
                           above, as applicable, by contributing costs AND
                           sharing in any recovery, as provided in Section
                           10.3.6, below, and (ii) initiate an infringement or
                           other appropriate suit against a Third Party in the
                           event the Party with the first right to initiate a
                           suit, as provided in Section 10.3.2, 10.3.3, or
                           10.3.4, above, as applicable, elects not to do so. In
                           making this determination, the Parties shall take
                           into consideration which Party (or Parties) owns the
                           Factor Patent Rights and/or Confidential Information
                           which has been, or is suspected of being, infringed
                           or misappropriated by a Third Party. Notwithstanding
                           the foregoing, MetaMorphix shall have no right to
                           participate in or initiate any infringement or other
                           suit against any Third Party who (a) has infringed or
                           is suspected of infringing any Additional Factor
                           Patent Rights (b) has infringed or is suspected of
                           infringing any GI Patent Rights relating to BMPs that
                           have not been selected by MetaMorphix as a
                           MetaMorphix Factor, or (c) of using, without proper
                           authorization, any of GI's or JHU's Confidential
                           Information which relates solely to one or more
                           Additional Factors or to any BMPs which have not been
                           selected by MetaMorphix as a MetaMorphix Factor.

                  10.3.6   Right to Participate in Suit. The Party initiating a
                           suit pursuant to Section 10.3.2, 10.3.3, or 10.3.4,
                           above, as applicable, (the "first Party") shall give
                           the Party which has rights to participate in that
                           suit pursuant to Subsection 10.3.5(i), above (the
                           "second Party") sufficient advance notice of its
                           intent to file said suit and the reasons therefor,
                           and shall provide the second Party with an
                           opportunity to make suggestions and comments
                           regarding such suit, including,

<PAGE>

                           without limitation, the initiation thereof and the
                           selection of counsel therefor. The first Party shall
                           keep the second Party promptly informed, and shall
                           from time to time consult with the second Party
                           regarding the status of any such suit and shall
                           provide the second Party with copies of all documents
                           filed in, and all written communications relating to,
                           such suit. Except as provided herein, the first Party
                           shall have the sole and exclusive right to select
                           counsel for any suit and shall pay all expenses of
                           the suit, including without limitation attorneys'
                           fees and court costs. The second Party, in its sole
                           discretion, may elect, within sixty (60) days after
                           the commencement of such litigation, to contribute a
                           fixed percentage of up to fifty percent (50%) of the
                           costs incurred by the first Party in connection with
                           such litigation, including, without limitation,
                           reimbursement of the first Party's expenses
                           hereunder. If it so elects, any damages, royalties,
                           settlement fees or other consideration received by
                           the first Party or any of its Affiliates for past
                           infringement or misappropriation as a result of such
                           litigation shall be shared by the first and second
                           Parties pro-rata based on their respective sharing of
                           the costs of such litigation, subject to Section
                           10.3.8, below. In the event that the second Party
                           elects not to contribute to the costs of such
                           litigation, the first Party and/or its Affiliates
                           shall be entitled to retain any damages, royalties,
                           settlement fees or other consideration for past
                           infringement or misappropriation resulting therefrom,
                           subject to Section 10.3.8, below. If necessary or
                           desirable, the second Party shall join as a party to
                           the suit but shall be under no obligation to
                           participate except to the extent that such
                           participation is required as the result of being a
                           named parry to the suit. The second Party shall offer
                           reasonable assistance to the first Party in
                           connection therewith at no charge to the first Party
                           except for reimbursement of reasonable out-of-pocket
                           expenses; PROVIDED, HOWEVER, if JHU is joined in the
                           suit as an indispensable party, any costs incurred by
                           JHU in joining such suit will be reimbursed by the
                           Party (or Parties) initiating such suit. The second
                           Party shall have the right to participate and be
                           represented in any such suit by its own counsel at
                           its own expense. The first Party shall not settle any
                           such suit involving rights of the second Party
                           without obtaining the prior written consent of the
                           second Parry, which consent shall not be unreasonably
                           withheld.

                  10.3.7   SECOND RIGHT TO INITIATE SUIT. In the event that the
                           first Party elects not to initiate an infringement or
                           other appropriate suit pursuant to Sections 10.3.2,
                           10.3.3, or 10.3.4, above, as applicable, the first
                           Party shall promptly advise the second Party of its
                           intent not to initiate such suit, and the second
                           Party shall have the right, at its expense, of
                           initiating an infringement or other

<PAGE>

                           appropriate suit against any Third Party who at any
                           time has infringed, or is suspected of infringing,
                           any of the Factor Patent Rights or Additional Factor
                           Patent Rights or of using without proper
                           authorization all or any portion of the Confidential
                           Information. In exercising its rights pursuant to
                           this Section 10.3.7, the second Parry shall have the
                           sole and exclusive right to select counsel and shall,
                           except as provided below, pay all expenses of the
                           suit including without limitation attorneys' fees and
                           court costs. The first Party, in its sole discretion,
                           may elect, within sixty (60) days after the
                           commencement of such litigation, to contribute a
                           fixed percentage of up to fifty percent (50%) of the
                           costs incurred by the second Party in connection with
                           such litigation, including, without limitation,
                           reimbursement of the second Party's expenses
                           hereunder. If it so elects, any damages, royalties,
                           settlement fees or other consideration received by
                           the second Party or any of its Affiliates for past
                           infringement or misappropriation as a result of such
                           litigation shall be shared by the second and first
                           Parties prorata based on their respective sharing of
                           the costs of such litigation, subject to Section
                           10.3.8, below. In the event that the first Party
                           elects not to contribute to the costs of such
                           litigation, the second Party and/or its Affiliates
                           shall be entitled to retain any damages, royalties,
                           settlement fees or other consideration for past
                           infringement or misappropriation resulting therefrom,
                           subject to Section 10.3.8, below. If necessary or
                           desirable, the first Party shall join as a party to
                           the suit but shall be under no obligation to
                           participate except to the extent that such
                           participation is required as a result of being a
                           named party to the suit. At the second Party's
                           request, the first Party shall offer reasonable
                           assistance to the second Party in connection
                           therewith at no charge to the second Parry except for
                           reimbursement of reasonable out-of-pocket expenses:
                           PROVIDED. HOWEVER, IF JHU is joined in the suit as an
                           indispensable parry, any costs incurred by JHU in
                           joining such suit will be reimbursed by the Party (or
                           Parties) initiating such suit. The first Party shall
                           have the right to participate and be represented in
                           any such suit by its own counsel at its own expense.

                  10.3.8   ROYALTY DEDUCTION. Any damages, royalties, settlement
                           fees or other consideration for past infringement or
                           misappropriation awarded to and/or collected by a
                           Party (or Parties) resulting from an infringement or
                           other appropriate suit against a Third Party or a
                           settlement thereof shall: after deduction of all
                           costs and expenses associated with such suit or
                           settlement, be deemed to reflect a loss OF commercial
                           sales, and royalties shall be payable thereon to the
                           Parry (or Parties) to which royalties would have been
                           owed under Section 7.3 of this Agreement, provided
                           that such Party (or Parties)

<PAGE>

                           is not otherwise entitled to receive a portion of any
                           recovery other than reimbursement of its litigation
                           expenses) obtained from such suit or settlement
                           pursuant to this Section 10.3.

         10.4     CLAIMED INFRINGEMENT.

                  10.4.1   NOTICE; COOPERATION. In the event that a Third Party
                           at any time provides written notice of a claim to, or
                           brings an action. suit or proceeding against, any
                           Party or any of their respective Affiliates or
                           sublicensees, claiming infringement of its patent
                           rights or copyrights or unauthorized use or
                           misappropriation of its Confidential Information,
                           based upon an assertion or claim arising out of the
                           manufacture, use and/or sale of any Product, such
                           Party shall promptly notify the other Parties of the
                           claim or the commencement of such action, suit or
                           proceeding, enclosing a copy of the claim and/or all
                           papers served, PROVIDED, HOWEVER, that GI and JHU
                           shall have no obligation to provide such notice to
                           MetaMorphix to the extent that such assertion or
                           claim arises-out of or relates to the manufacture,
                           use or sale of GI Type C Products. Each Party agrees
                           to make available to the other Parties its advice and
                           counsel regarding the technical merits of any such
                           claim at no cost to the other Party.

                  10.4.2   LIMITATION OF LIABILITY. EXCEPT FOR BREACHES OF
                           SECTIONS 12.1, 12.2. 12.3 AND 12.4 OF THIS AGREEMENT,
                           THE FOREGOING STATES THE ENTIRE RESPONSIBILITY OF THE
                           PARTIES IN THE CASE OF ANY CLAIMED INFRINGEMENT OR
                           VIOLATION OF ANY THIRD PARTY'S PATENT RIGHTS OR
                           COPYRIGHTS OR UNAUTHORIZED USE OR MISAPPROPRIATION OF
                           ANY THIRD PARTY'S KNOW-HOW.

11.      CONFIDENTIAL INFORMATION.

         11.1     NONDISCLOSURE OF Confidential Information. Neither Party may
                  directly or indirectly publish, disseminate or otherwise
                  disclose, deliver or make available to any person outside its
                  organization any of the other Parties' Confidential
                  Information. Each Party may disclose the other Parties'
                  Confidential Information to persons within its organization
                  and to its Affiliates and sublicensees who/which have a need
                  to receive such Confidential Information in order to further
                  the purposes of this Agreement and who/which are bound to
                  protect the confidentiality of such Confidential Information,
                  as set forth in Section 11.3 below. Each Party may disclose
                  the other Parties' Confidential Information to a governmental
                  authority or by order of a court of competent jurisdiction,
                  provided that such disclosure

<PAGE>

                  is subject to all applicable governmental or judicial
                  protection available for like material and reasonable advance
                  notice is given to the other Parties.

         11.2     USE OF CONFIDENTIAL INFORMATION. Each Party shall use the
                  other Parties' Confidential Information solely for the
                  purposes contemplated in this Agreement or for such other
                  purposes as may be agreed upon by the Parties in writing.

         11.3     AGREEMENTS WITH PERSONNEL and Third PARTIES. The Parties have
                  or shall obtain agreements with all personnel and Third
                  Parties who will have access to the other Parties'
                  Confidential Information which impose comparable
                  confidentiality obligations as are set forth in this Agreement
                  on such personnel and Third Parties.

         11.4     PUBLICATIONS.

                  11.4.1   RIGHT TO PUBLISH. Any Party may publish any
                           manuscripts or other scientific papers on work
                           conducted exclusively by that Party as part of the
                           Original Research or under the Collaborative Research
                           Plan or the Sponsored Research Plan, as applicable,
                           without the written consent of the other Parties.
                           However, a Party may not publish (or permit a Third
                           Party to publish) any manuscript or other scientific
                           paper that discloses or uses any Confidential
                           Information of another Parry without first obtaining
                           that other Party's written consent; and a Parry may
                           .not publish any manuscript or other scientific paper
                           that would prejudice any Patent rights of another
                           Party (including, without limitation, prospective
                           Patent rights covering an Available Factor) without
                           first complying with the provisions of this Section
                           11.4 and Section 10.1, above.

                  11.4.2   NOTICE AND REVIEW. In order to balance the Parties'
                           interests in securing Patents covering the Factor
                           Rights with each Party's right to publish any
                           manuscripts or other scientific papers on work
                           conducted exclusively by that Party under the
                           Research Plan, prior to the publication or other
                           public disclosure of any manuscripts or other form of
                           disclosure describing the results of its work
                           hereunder, the publishing Party shall provide (a) the
                           data to be disclosed in that manuscript or other form
                           of public disclosure to the other Parties as soon as
                           practicable, but at least four (4) weeks prior to
                           intended submission for publication or other method
                           of public disclosure. (b) a(.) copy of the draft
                           manuscript to be published, or a detailed summary of
                           any other public disclosure to the other Parties as
                           soon as practicable, but at least two (2) weeks prior
                           to intended submission for publication or other
                           method of public disclosure, (c) a copy of the
                           completed manuscript or other

<PAGE>

                           form of public disclosure at the time of submission
                           and (d) a copy of any reviewer's comments on the
                           manuscript or other form of public disclosure with a
                           revised copy thereof at least two (2) weeks prior to
                           publication.

                  11.4.3   DELETION OF CONFIDENTIAL INFORMATION; PATENT
                           PROTECTION. A Parry may request that the publishing
                           Party delete from its manuscripts or other scientific
                           papers or other forms of public disclosure reference
                           to that Parry's Confidential Information. In
                           addition, if a Party notifies another Party that it
                           desires patent applications to be filed on any Factor
                           Rights to be disclosed by that other Party in a
                           public forum other than in manuscripts or other
                           scientific papers, the presenting Party will defer
                           such presentation for a period, not to exceed thirty
                           (30) additional days, sufficient to permit the Party
                           with rights to file any desired patent applications
                           to do so.

                  11.4.4   GDFS DISCOVERED BY JHU..GI and/or MetaMorphix. shall
                           not publish a scientific paper on a GDF Discovered by
                           JHU until JHU has published a scientific paper on
                           that GDF, unless written permission to so publish has
                           been given by Dr. Lee. GI acknowledges that providing
                           purified protein to another Party would not
                           necessarily warrant authorship on a JHU publication.
                           Authorship on a publication by another Party requires
                           significant - scientific contributions to that other
                           Party's research. Disputes as to the appropriate
                           authorship of papers resulting from the Original
                           Research, the Collaborative Research or the Sponsored
                           Research will be referred to (i) the RMC, in the case
                           of disputes between GI and MetaMorphix, (ii) Dr. Lee
                           and a senior GI scientist to be designated by GI, in
                           the case of disputes between GI and JHU and (iii) Dr.
                           Lee and a senior MetaMorphix scientist or scientific
                           advisor, to be designated by MetaMorphix, in the case
                           of disputes between MetaMorphix and JHU.

         11.5     NON-USE OF Certain Confidential INFORMATION. GI shall not use
                  information of which it learned in reviewing (a) JHU's GDF 12
                  patent application to support GI's BMP 14 patent application,
                  (b) JHU's GDF 11 patent application to support GI's BMP 11
                  patent application or (c) JHU's GDF 3 patent application to
                  support GI's Vgr 2 patent application.

12.      REPRESENTATION AND WARRANTIES.

         12.1     Representations and Warranties of GI AND METAMORPHIX. As of
                  the Effective Date, each of GI and MetaMorphix hereby
                  represents, warrants and covenants to the other Parties hereto
                  as follows:

<PAGE>

                  (a)      it is a corporation or entity duly organized and
                           validly existing under the laws of the state or other
                           jurisdiction of 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 do 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 shall at all times comply with all applicable
                           material laws and regulations relating to its
                           activities under this Agreement.

         12.2     ADDITIONAL REPRESENTATIONS AND WARRANTIES OF GI.

                  12.2.1   Patent Rights and Know-How. To the best of GI's
                           knowledge, information and belief, GI represents and
                           warrants that it owns the GI Patent Rights and GI
                           Know-How in existence on the Effective Date and/or
                           has the right to grant the licenses under the GI
                           Patent Rights and to the GI Know-How in existence on
                           the Effective Date subject to the terms of this
                           Agreement. The foregoing representation and warranty
                           shall not be construed as a warranty as to the scope
                           and/or validity of any claims in the GI Patent
                           Rights.

                  12.2.2   No Conflicting Agreements. GI represents and warrants
                           that (a) the execution of, and performance of the
                           transactions contemplated by, this Agreement will not
                           conflict with or result in any breach of any of the
                           terms, conditions or provisions of, or constitute a
                           default under, any agreement to which GI is a party
                           or by which GI is bound; and (b) as of the Effective
                           Date, other than its preexisting collaborations with
                           Yamanouchi Pharmaceutical Company Ltd. and
                           Affymetrix. Inc., GI has not entered a collaboration
                           or other

<PAGE>

                           arrangement with a commercial Third Party for the
                           specific purpose of identifying sequences for Factors
                           in the TGF-(beta) Superfamily.

         12.3     ADDITIONAL REPRESENTATIONS AND WARRANTIES OF METAMORPHIX.

                  12.3.1   PATENT RIGHTS AND KNOW-HOW. To the best of
                           MetaMorphix' knowledge, information and belief,
                           MetaMorphix represents and warrants that it owns the
                           MetaMorphix Patent Rights and MetaMorphix Know-How in
                           existence on the Effective Date and/or has the right
                           to grant the licenses under the MetaMorphix Patent
                           Rights and to the MetaMorphix Know-How in existence
                           on the Effective Date subject to the terms of this
                           Agreement. The foregoing representation and warranty
                           shall not be construed as a warranty as to the scope
                           and/or validity of any claims in the MetaMorphix
                           Patent Rights.

                  12.3.2   NO CONFLICTING AGREEMENTS. MetaMorphix represents and
                           warrants that the execution of; and performance of
                           the transactions contemplated by, this Agreement will
                           not conflict with or result in any breach of any of
                           the terms, conditions or provisions of, or constitute
                           a default under, any agreement to which MetaMorphix
                           is a party or by which MetaMorphix is bound.

                  12.3.3   EQUIPMENT. MetaMorphix represents and warrants to GI
                           that, as of the Effective Date and the date that the
                           equipment is delivered to GI in accordance with
                           Section 8.4 hereof, such equipment shall be in
                           working order, merchantable, and fit for the purpose
                           for which it was intended to be used when
                           manufactured. MetaMorphix further represents and
                           warrants to GI that Transamerica Business Credit
                           Corporation (subject to that certain October 14, 1997
                           Master Lease Agreement with MetaMorphix) owns such
                           equipment, that no Third Party has any right, title
                           or interest in or to such equipment, and that at
                           Closing, upon GI's MetaMorphix directed payment to
                           Transamerica Business Credit Corporation, such
                           equipment shall be free and clear of such Master
                           Lease Agreement and any right, title or interest that
                           Transamerica Business Credit Corporation may have
                           therein.

         12.4     Representations and Warranties of JHU.

                  12.4.1   AUTHORITY. JHU represents and warrants to each of GI
                           and MetaMorphix that it is a university duly
                           organized and validly existing under the laws of the
                           state of Maryland and that it has the

<PAGE>

                           power and authority to execute and deliver this
                           Agreement and to perform all of its obligations
                           hereunder.

                  12.4.2   COMPLIANCE WITH LAWS AND ORGANIZATIONAL DOCUMENTS.
                           JHU represents and warrants to GI and MetaMorphix
                           that (i) it shall at all times comply with all
                           applicable material laws and regulations relating to
                           its activities under this Agreement (ii) the
                           execution, delivery and performance by JHU 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) the
                           provisions of its charter or operative documents or
                           bylaws; or (ii) any order writ injunction or decree
                           of any court or governmental authority entered
                           against it or by which any of its property is bound

                  12.4.3   PATENT RIGHTS AND KNOW-HOW. To the best of JHU'
                           knowledge, information and belief, JHU represents and
                           warrants that it owns the JHU Patent Rights and JHU
                           Know-How, the JHU Additional Factor Patent Rights and
                           the JHU Additional Factor Know-How in existence on
                           the Effective Date and/or has the right to grant the
                           licenses under the JHU Patent Rights and the JHU
                           Additional Factor Patent Rights, and to the JHU
                           Know-How and JHU Additional Factor Know-How in
                           existence on the Effective Date subject to the terms
                           of this Agreement. The foregoing representation and
                           warranty shall not be construed as a warranty as to
                           the scope and/or validity of any claims in the JHU
                           Patent Rights.

                  12.4.4   NO CONFLICTING AGREEMENTS. JHU further represents and
                           warrants that the execution of, and performance of
                           the transactions contemplated by, this Agreement will
                           not conflict with or result in any breach of any of
                           the terms, conditions or provisions of, or constitute
                           a default under, any agreement to which JHU is a
                           party or by which JHU is bound.

         12.5     REPRESENTATION BY Legal Counsel. Each Party hereto represents
                  that it has been represented by legal counsel in connection
                  with this Agreement and acknowledges that it has participated
                  in the drafting hereof. In interpreting and applying the terms
                  and provisions of this Agreement, the Parties agree that no
                  presumption shall exist or be implied against the Party which
                  drafted such terms and provisions.

         12.6     MATERIALITY. EACH PARTY EXPRESSLY WAIVES ANY RIGHTS TO SEEK
                  DAMAGES OR OTHER RELIEF FOR BREACH OF THE REPRESENTATIONS AND
                  WARRANTIES IN SECTIONS 12.1, 12.2

<PAGE>

                  AND 12.3 UNLESS SUCH BREACH HAS A MATERIAL AND ADVERSE EFFECT
                  ON SUCH PARTY.

         12.7     DISCLAIMER. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
                  NO PARTY MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
                  BUT NOT LIMITED TO IMPLIED WARRANTIES OR MERCHANTABILITY,
                  FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT.

13.      PRODUCT LIABILITY INDEMNIFICATION.

         13.1     METAMORPHIX INDEMNIFICATION. MetaMorphix agrees to defend GI
                  and JHU and their respective Affiliates, sublicensees, agents,
                  directors, officers, employees, students and licensees of
                  rights to a Product, as applicable (the "indemnitees")(other
                  than in settlement of a claim of infringement), at
                  MetaMorphix' cost and expense, and will indemnify and hold
                  harmless such indemnitees from and against any and all
                  liabilities, losses, costs, damages, fees, or expenses claimed
                  by or paid to a Third Party attributable to injury to persons
                  or damage to property (collectively, "Losses") arising out of
                  or in connection with the manufacture, use and/or sale of any
                  MetaMorphix Product by MetaMorphix, its Affiliates, or
                  sublicensees (other than GI); provided that such Losses do not
                  arise out of the gross negligence or willful misconduct of GI
                  (with respect to MetaMorphix' obligations to the GI
                  indemnitees under this Section) or JHU (with respect to
                  MetaMorphix' obligations to the JHU indemnitees under this
                  Section).

         13.2     GI INDEMNIFICATION. GI agrees to defend MetaMorphix and JHU
                  and their respective Affiliates, permitted sublicensees,
                  agents, directors, officers, employees, students and licensees
                  of rights to a Product, as applicable (the
                  "indemnitees")(other than in settlement of a claim of
                  infringement), at GI's cost and expense, and will indemnify
                  and hold harmless such indemnitees from and against any and
                  all Losses arising out of or in connection with the
                  manufacture, use and/or sale of any GI Product by GL its
                  Affiliates, or sublicensees (other than MetaMorphix); provided
                  that such Losses do not arise out of the gross negligence or
                  willful misconduct of MetaMorphix (with respect to GI's
                  obligations to the MetaMorphix indemnitees under this Section)
                  or JHU (with respect to GI's obligations to the JHU
                  indemnitees under this Section).

         13.3     NOTICE; Cooperation. In the event of any such indemnifiable
                  claim, the indemnified Party shall promptly notify the
                  indemnifying Party in writing of the claim and the
                  indemnifying Party shall manage and control, at its sole
                  expense, the defense of the claim and its settlement. The
                  indemnified Party shall cooperate with the indemnifying Party
                  and may, at its option and expense, be represented in any such
                  action or proceeding. The

<PAGE>

                  indemnifying Party shall not be liable for any settlements,
                  litigation costs. or expenses incurred by the indemnified
                  Party without the indemnifying Party's written consent, such
                  consent to be promptly given and not unreasonably withheld.

         13.4     LIABILITY LIMITATION. Neither GI nor MetaMorphix shall be
                  liable for special, incidental or consequential damages or for
                  loss of profit or lost revenue, even another Party had been
                  advised of the possibility of such damages.

         13.5     INSURANCE. Prior to initial human testing or first commercial
                  sale of any Product in any particular country, GI and
                  MetaMorphix each shall secure and maintain at its own expense
                  during the term of this Agreement either self insurance or an
                  insurance policy or policies with an insurer or insurers
                  acceptable to the other Parties, in either case, protecting
                  the Parties against any and all risks typically insured
                  against by businesses comparable to the Party, including
                  without limitation general and products liability, arising or
                  occurring upon or in connection with-each Party's business.
                  Such policy or policies shall include general and products
                  liability coverage in an amount typically secured by
                  businesses comparable to the Party. Each Party shall furnish
                  the other Parry and JHU with certificates evidencing all such
                  insurance. Each Parry shall name the other Party and JHU as
                  additional insureds in such policy or policies.

14.      TERM AND TERMINATION.

         14.1     TERM. This Agreement shall remain in effect until terminated
                  in accordance with the provisions of this Section 14 or until
                  the last to expire of any of the licenses granted pursuant to
                  this Agreement.

         14.2     TERMINATION FOR BREACH. In the event that a Party shall be in
                  default of any of its material obligations to another Party
                  hereunder, and shall fail to remedy any such default within
                  sixty (60) days. after notice thereof by the non-breaching Pam
                  to whom such obligations are owed, such nonbreaching Party
                  shall, by written notice to each of the other Parties, be
                  entitled to terminate the rights it granted to the breaching
                  Party under this Agreement and its obligations to the
                  breaching Party under this Agreement. Any such notice shall
                  specifically describe the alleged default and expressly state
                  that the non-breaching Party intends to terminate the rights
                  it has granted to the breaching Party-under this Agreement in
                  the event that the breaching Party shall fail to remedy the
                  default. Notwithstanding anything contained in this Agreement
                  to the contrary, GI, at its option, shall have the right, but
                  not the obligation, to remedy any default of MetaMorphix
                  hereunder, as provided in Section 14.3, below. Upon any
                  termination of this Agreement pursuant to this Section 14.2,
                  none of the Parties shall be

<PAGE>

                  relieved of any obligations incurred prior to such
                  termination. Notwithstanding the foregoing. (i) the breach
                  (including, without limitation, the failure to make any
                  payment when due) of this Agreement by GI shall not affect the
                  licenses granted by JHU to MetaMorphix under Article 6 hereof
                  or result in any right of JHU to take any action, including
                  without limitation, termination of rights granted by JHU to
                  MetaMorphix. against MetaMorphix and (ii) the breach
                  (including, without limitation. the failure to make any
                  payment when due) of this Agreement by MetaMorphix shall not
                  affect the licenses granted by JHU to GI under Article 6
                  hereof or result in any right of JHU to take any action,
                  including, without limitation, termination of rights granted
                  to GI by JHU, against GI.

         14.3     BREACH OF OR WITHDRAWAL FROM AGREEMENT.

                  14.3.1   BY METAMORPHIX. In the event MetaMorphix breaches and
                           fails to cure such breach within the sixty (60) day
                           cure period or otherwise withdraws from, or ceases to
                           be a Party to, this Agreement, GI, at its option,
                           within thirty (30) days after the expiration of the
                           sixty (60) day cure period or GI's receipt of written
                           notice that MetaMorphix has ceased to be a Party to
                           this Agreement, as applicable, may assume
                           MetaMorphix' rights and obligations under this
                           Agreement, including, without limitation,
                           MetaMorphix' rights under the license from JHU set
                           forth in Section 6.2, above, and MetaMorphix's
                           obligation to pay royalties and fees to JHU, at the
                           rates and in the amounts set forth in this Agreement,
                           or at such other rates and amounts as JHU and GI
                           shall agree are appropriate under the circumstances.
                           An assignment in accordance with Section 15.8 shall
                           not constitute a withdrawal.

                  14.3.2   BY GI. In the event that, (i) pursuant to Section
                           14.2 hereof, JHU terminates the licenses it granted
                           to GI hereunder, or (ii) GI otherwise withdraws from.
                           or ceases to be a Party to this Agreement,
                           MetaMorphix, at its option, within thirty (30) days
                           after the effective date of such termination or
                           MetaMorphix's receipt of written notice that GI has
                           ceased to be a Party to this Agreement, as
                           applicable, may assume GI' rights and obligations
                           under this Agreement, including, without limitation,
                           GI's rights under the license from JHU set forth in
                           Section 6.3, above, and GI's obligation to pay
                           royalties and fees to JHU, at the rates and in the
                           amounts set forth in this Agreement, or at such other
                           rates and amounts as JHU and MetaMorphix shall agree
                           are appropriate under the circumstances. An
                           assignment in accordance with Section 15.8 shall not
                           constitute a withdrawal.

<PAGE>

         14.4     SURVIVAL OF OBLIGATIONS; RETURN OF CONFIDENTIAL INFORMATION.
                  Notwithstanding any termination of this Agreement, the
                  obligations of the Parties under Sections 3.6, 7.8, 11. 12. 13
                  and 15.2, as well as under any other provisions which by their
                  nature are intended to survive any such termination, shall
                  survive and continue to be enforceable. Upon any termination
                  of this Agreement pursuant to Section 14.2 hereof, the
                  breaching Party shall promptly return to the non-breaching
                  Party all written Confidential Information, and all copies
                  thereof, of the non-breaching Party which is not covered by a
                  license surviving such termination.

15.      MISCELLANEOUS.

         15.1     NO ASSUMPTION OF OBLIGATIONS. Except as expressly provided in
                  this Agreement, GI is not assuming and shall have no
                  obligation to assume any preexisting or future obligations
                  that MetaMorphix has or owes to JHU or to any Third Party,
                  including, without limitation, Baylor.

         15.2     PUBLICITY. No Party, nor any of its Affiliates, shall
                  originate any publicity, news release or other public
                  announcement, written or oral, relating to this Agreement
                  without the prior written approval of the other Parties, which
                  approval shall not be unreasonably withheld, except as
                  otherwise required by law. It is expressly understood that
                  nothing in this Section 15.1 shall prevent a Party from making
                  a disclosure in connection with any required filings with the
                  Securities and Exchange Commission or in connection with the
                  offering of securities or any financing. In addition, neither
                  GI nor MetaMorphix shall use the name of The Johns Hopkins
                  University or The Johns Hopkins Health System or any of its
                  constituent parts and affiliated hospitals (e.g., The Johns
                  Hopkins Hospital) or the name of inventors of any Factor
                  Patent Rights licensed from JHU to MetaMorphix and/or GI in
                  any advertising, promotional, sales literature or fundraising
                  documents without the prior written consent from an officer of
                  JHU. JHU shall have not less than five (5) business days to
                  review any proposed use of its name(s).

         15.3     EXPORT CONTROL. The Parties acknowledge that the export of
                  technical data, materials, or products is subject to the
                  exporting Parry receiving the necessary export licenses and
                  that the Parties cannot be responsible for any delays
                  attributable to export controls which are beyond the
                  reasonable control of either Party. The Parties agree that
                  regardless of any disclosure made by the Party receiving an
                  export of an ultimate destination of any technical data,
                  materials, or products, the receiving Party will not reexport
                  either directly or indirectly, any technical data, material,
                  or products without first obtaining the applicable validated
                  or general license from the United States Department of
                  Commerce, United States Food and Drug Administration, and/or
                  any other agency or department of the United States

<PAGE>

                  Government, as required. The receiving Party shall provide the
                  exporting Party with any information, materials,
                  certifications, or other documents which may be reasonably
                  required in connection with such exports under the Export
                  Administration Act of 1979, as amended, its rules and
                  regulations, the Federal Food, Drug and Cosmetic Act, and
                  other applicable export laws.

         15.4     CONDUCT OF STUDIES. All studies, research and testing done by
                  or on behalf of each Party under this Agreement shall be
                  performed in strict compliance with any applicable federal,
                  state, or local laws, rules, and regulations governing the
                  conduct of studies, research, and testing at the site where
                  such studies, research, and testing are being conducted. .

         15.5     NO IMPLIED LICENSES. Only the licenses granted pursuant to the
                  express terms of this Agreement shall be of any legal force
                  and effect. No license rights shall be created by implication
                  or estoppel.

         15.6     NO AGENCY. Nothing herein shall be deemed to constitute any
                  Party as the agent or representative of the other Parties, or
                  the Parties as joint venturers or partners for any purpose.
                  Each Party shall be an independent contractor, not an employee
                  or partner of the other Parties, and the manner in which each
                  Party renders its services under this Agreement shall be
                  within its sole discretion. No Party shall be responsible for
                  the acts or omissions of the other Parties, and no Party will
                  have authority to speak for, represent or obligate the other
                  Parties in any way without prior written authority from the
                  other Party or Parties.

         15.7     NOTICE. All notices required under this Agreement to be given
                  by one Party to another shall be in writing and shall be given
                  by addressing the same to the other at the address or
                  facsimile number set forth below, or at such other addresses
                  or facsimile numbers as the Parties may specify in writing.
                  All notices shall become effective when deposited in the
                  United States Mail with proper postage for first class
                  registered or certified mail prepaid, return receipt
                  requested, or when delivered personally, or, if promptly
                  confirmed by mail as provided above, when dispatched by
                  facsimile.

                  GI:     Genetics Institute, Inc.
                          87 CambridgePark Drive
                          Cambridge, Massachusetts 02140
                          Telecopier (617) 876-5851
                          Attn: Legal Department

<PAGE>

                  JHU:    Johns Hopkins University School of Medicine
                          Office of Technology Licensing
                          2024 E. Monument Street. Suite 2-100 Baltimore.
                          Maryland 21205
                          Telecopier (410) 955-1245
                          Attn: Director

                  MetaMorphix: MetaMorphix, Inc.
                          1450 South Rolling Road Baltimore, Maryland
                          21227 Telecopier (410) 455-5885
                          Attn: President

           with copies to:
                          American Home Products Corporation
                          5 Giralda Farms
                          Madison, New Jersey 07940
                          Telecopier (973) 660-7156
                          Attn: Senior Vice President and General Counsel

                          Johns Hopkins University School. of Medicine Office of
                          Technology Licensing
                          2024 E. Monument Street, Suite 2-100 Baltimore.
                          Maryland 21205
                          Telecopier (410) 955-1245
                          Attn: Director

                          Shapiro and Olander
                          2000 Charles Center South 36 South
                          Charles Street
                          Baltimore, MD 21201-3147
                          Telecopier (410) 539-7611
                          Attn: William E. Carlson, .Esq.

         15.8     ASSIGNMENT. This Agreement. and the rights and obligations
                  hereunder, may not be assigned or transferred, in whole or in
                  part, by any Party without the prior written consent of the
                  other Parties, except that (a) upon notice to the other
                  Parties. GI may assign this Agreement to an Affiliate
                  controlled by GI, and MetaMorphix may assign this Agreement to
                  an Affiliate which is majority controlled by MetaMorphix,
                  provided that each such Party remains primarily liable and/or
                  responsible for the performance of such obligations and such
                  controlled Affiliate, and provided further that such
                  controlled Affiliate agrees to be bound to the terms and
                  conditions of this Agreement and (b) upon notice to the other
                  Parties, GI may assign this Agreement in connection with the
                  merger, consolidation or sale of all or

<PAGE>

                  substantially all of GI's assets and MetaMorphix may assign
                  this Agreement in connection with the merger. consolidation or
                  sale of all or substantially all of MetaMorphix' assets.

         15.9     ENTIRE AGREEMENT. This Agreement, the exhibits and schedules
                  attached hereto, the Promissory Note (including each of the
                  allonges thereto), and the agreements to be executed and
                  delivered in accordance with Article 8 hereof, together
                  constitute the entire agreement of the Parties with regard to
                  its subject matter, and supersedes all previous written or
                  oral representations, agreements and understandings between
                  the Parties, including, without limitation, the 1994
                  Collaboration Agreement and the Letter of Intent. Nothing
                  herein shall affect the continued effect of that
                  Confidentiality and Non-Disclosure agreement date September 9,
                  1998 by and between MetaMorphix and American Home Products
                  Corporation, acting through its Wyeth-Ayerst Laboratories
                  Division and that Confidentiality Agreement dated October 13,
                  1997 by and between MetaMorphix and Fort Dodge Animal Health,
                  a division of American Home Products Corporation.

         15.10    NO MODIFICATION. This Agreement may be changed only by a
                  writing signed by the Parties.

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

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

                  (REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)

<PAGE>

         15.13    SEVERABILITY. In the event that any one or more of the
                  provisions contained in this Agreement shall, for any reason,
                  be held to be invalid, illegal or unenforceable in any
                  respect, such invalidity, illegality or unenforceability shall
                  not affect any other provisions of this Agreement, and all
                  other provisions shall remain in full force and effect. If any
                  of the provisions of this Agreement is held to be excessively
                  broad or invalid, illegal or unenforceable in any
                  jurisdiction, it shall be reformed and construed by limiting
                  and reducing it so as to be enforceable to the maximum extent
                  permitted by law in conformance with its original intent. In
                  the event that after such reformation, a Party's rights or
                  obligations are materially changed, then such Party may
                  terminate this Agreement.

         15.14    SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
                  and inure to the benefit of the Parties hereto and their
                  successors and permitted assigns.

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

         15.16    APPLICABLE LAW. This Agreement shall in all events and for all
                  purposes be governed by, and construed in accordance with, the
                  law of the State of Maryland without regard to any choice of
                  law principle that would dictate the application of the law of
                  another jurisdiction.

         IN WITNESS WHEREOF, duly-authorized representatives of the parties have
signed this Agreement as a document under seal as of the Effective Date.

GENETICS INSTITUTE, INC.               METAMORPHIX I C.

     By /s/ Katherine Turner              By /s/ Edwin C. Quattlebaum
        --------------------------           -----------------------------
     Name: Katherine Turner               Edwin C. Quattlebaum, Ph.D.
     Title:  Vice President               President and Chief Executive Officer

THE JOHNS  HOPKINS UNIVERSITY SCHOOL OF MEDICINE
By
Name:
Title:

I HAVE READ AND UNDERSTAND, AND AGREE TO COMPLY WITH, THE TERMS OF THIS
AGREEMENT:

         ________________________________
         Se-Jin Lee, M.D., Ph.D.

<PAGE>

         15.13    SEVERABIIITY. In the event that any one or more of the
                  provisions contained in this Agreement shall, for any reason,
                  BE held to be invalid, illegal or unenforceable in any
                  respect, such invalidity, illegality or unenforceability shall
                  not affect any other provisions of this Agreement, and all
                  other provisions shall remain in full force and effect. If any
                  of the provisions of this Agreement is held to be excessively
                  broad or invalid, illegal or unenforceable in any
                  jurisdiction, it SHALL be reformed and construed BY limiting
                  and reducing IT so as to be enforceable to the MAXIMUM extent
                  permitted by law in conformance with its original INTERN. In
                  the event that after such reformation, a Parry's rights or
                  obligations are materially changed, then such Party may
                  terminate this Agreement.

         15.14    SUCCESSORS AND ASSIGNS. This Agreement SHALL be binding upon
                  and inure to the benefit of the Parties hereto and their
                  successors and permitted assigns.

         15.15    COUNTERPARTS. This Agreement may be executed in any number of
                  counterparts, each of which shall be deemed an original but
                  all of which together SHALL constitute one and. THE SAME
                  instrument.

         15.16    APPLICABLE LAW. This Agreement shall in all events and for all
                  purposes be governed by, and construed in accordance with, the
                  law of the State of Maryland without regard to any choice of
                  law principle that would dictate the application of the law of
                  another jurisdiction.

         IN WITNESS WHEREOF, duly-authorized representatives of the parties have
signed this Agreement as a document. under seal as of the Effective Date.

GENETICS INSTITUTE INC.                   METAMORPHIX, INC.

By________________________________________ By _____________________________
Name:                                      Edwin C. Quattlebaum,Ph.D.
Title:                                     President and Chief Executive Officer

THE JOHNS HOPKINS UNIVERSITY SCHOOL OF MEDICINE

BY
Name:  Bart Chernow, M.D.
Title: Vice Dean for Research and Technology
       Professor of Medicine, Anesthesiology and Critical Care

I HAVE READ AND UNDERSTAND, AND AGREE TO COMPLY WITH, THE
TERMS OF THIS AGREEMENT:

            _______________________________________________
                  Se-Jin Lee, M.D., Ph.D.

<PAGE>

                                  SCHEDULE 1.1

                                 ADDITIONAL BMPS

                         None as of the Effective Date.

Schedule 1.1 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.5

                      ADDITIONAL FACTOR JOINT PATENT RIGHTS

                         None as of the Effective Date.

Schedule 1.5 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.10

                                 ADDITIONAL GDFS

                         None as of the Effective Date.

Schedule 1.10 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.15

                                      BMPS

                                       ***

Schedule 1.15 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.16

                              COLLABORATIVE FACTORS

                                       ***

Schedule 1.16 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.39

                                   GI FACTORS

                                       ***

Schedule 1.39 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.42

                                GI PATENT RIGHTS

   FACTOR/
   SUBJECT     APPLICATION    FILING DATE      PATENT       ISSUE DATE
   MATTER
--------------------------------------------------------------------------------

   ***         ***           09/18/96

   ***         ***           12/10/97
   ***         ***

   ***         ***           03/09/98

   ***         ***         (Note: GI has obtained an exclusive worldwide
                        license, with the right to sublicense, to this
                        application FROM Protegene, Inc. and, as such, if
                        MetaMorphix selects *** as a MetaMorphix Factor,
                        MetaMorphix's rights to this application will be
                        subject to Section 6.7 of the Agreement.)

                        (Note: As of the Effective Date, this application is not
   ***         ***      yet a GI Patent Right, as GI does not yet have a
                        license to it, however, pursuant to a Material Transfer
                        Agreement between GI and Baylor, GI has the option
                        to acquire an exclusive license to this intellectual
                        property and is currently in discussions with *** as
                        to the terms of such license)

Schedule 1.42 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.42

                                GI PATENT RIGHTS

                (TO BE ATTACHED AT OR PROMPTLY AFTER THE CLOSING)

Schedule 1.42 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.48

                                  GPDC FACTORS

                                       ***

Schedule 1.48 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.49

                                      GDFS

                                       ***
                                       ***
                                       ***
                                       ***
                                      GDF-8
                                      GDF-9
                                       ***
                                     GDF-11
                                     GDF-12
                                       ***
                                       ***

Schedule 1.49 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.52

                                     FORM OF

                       INVENTION AND DISCLOSURE AGREEMENT

                       INVENTION AND DISCLOSURE AGREEMENT

         The undersigned, being a faculty member, student, fellow or other
employee of The Johns Hopkins University ("JHU"), assigns and agrees to assign
to JHU all of my right, title and interest in and to any and all inventions I
might make during the course of my research or work at JHU to characterize
certain previously-discovered factors, and discover and characterize new
factors, in the TGF-a Superfamily, including, without limitation, any of my
research or work which is funded, in whole or in part, by Genetics, Institute,
Inc., ("GI") which funds research at JHU under the direction of Se-Jin Lee,
M.D., Ph.D. ("Dr. Lee") under that January 26, 1999 Amended and Restated
Collaboration Agreement (the "1999 Collaboration Agreement") by and among JHU,
GI and MetaMorphix, Inc. ("MetaMorphix). During and after the course of my
research or work at JHU (whether or not I am still employed or associated with
JHU), I will cooperate fully in obtaining patent and other proprietary
protection for such inventions, all in JHU's name and at JHU's cost and expense,
and, without limitation, shall execute and deliver all requested applications,
assignments and other documents, and take such other measures as JHU shall
reasonably request, in order to perfect and enforce JHU's rights in such
inventions.

         I acknowledge that any such inventions shall be exclusively licensed
and/or sublicensed to GI and/or MetaMorphix pursuant to the 1999 Collaboration
Agreement. I understand that I may participate in royalties, if any, received by
JHU from GI or MetaMorphix and their licensees from the commercialization of any
such inventions, pursuant to the JHU School of Medicine's Intellectual Property
Guidelines.

         Finally, during the course of my research or work at JHU, for such time
as I am engaged in the discovery and characterization of TGF-(beta) factors in
Dr. Lee's laboratory, I will give JHU immediate notice of any affiliations that
I am considering or may have (as a researcher, consultant or advisor) with a
commercial entity (except GI) that is intended to discover, identify and/or
characterize factors in the TGF-(beta) Superfamily.

Name:
Title:

Date:
      ---------------

Schedule 1.52 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.54

                       JHU ADDITIONAL FACTOR PATENT RIGHTS

                            (NONE AS OF CLOSING DATE)

Schedule 1.54 -- Page 1 of 1

<PAGE>

                                  Schedule 1.56
                                JHU PATENT RIGHTS
                           (as of the Effective Date)

A.       BMPs: None

B.       GDFs:

         1.       U.S. Application S/N *** filed January 12, 1993, entitled ***;
                  corresponding International PCT Application *** filed January
                  12, 1994 designating Europe, Japan and Canada. (JHU Case No.
                  ***)

         2.      PCT Application *** filed January 21, 1994, entitled ***;
                 International PCT Application S/N *** filed July 11, 1995;
                 International PCT Application *** designating Canada;
                 International PCT Application *** filed July 12, 1995
                 designating Japan; International PCT Application *** filed July
                 11, 1997 designating Europe; DIV Application *** filed
                 September 15, 1998; and Patent No. *** issued September 15,
                 1998. (JHU Case No. ***)

         3.      U. S. Application S/N *** filed January 12, 1993, entitled ***;
                 corresponding continuation-in-part Application *** filed as
                 International PCT Application on January 12, 1994 designating
                 U.S., Europe, Japan and Canada; International
                 PCT-continuation-in-part Application S/N *** filed May 31,
                 1995; International PCT Application *** filed July 12, 1995
                 designating Canada; International PCT Application filed July
                 12, 1995 designating Japan; Patent No. *** issued September 1,
                 1998, entitled ***; DIV Application *** filed September 1,
                 1998. (JHU Case No. ***)

         4.      U. S. Application S/N *** filed July 9, 1993, entitled ***;
                 corresponding *** filed July 8, 1994 designating U.S.,
                 Australia, Europe, Japan and Canada; International PCT
                 Application *** filed July 8, 1994 designating Japan;
                 International PCT Application *** filed July 8, 1994
                 designating Australia; and International PCT *** filed July 8,
                 1994 designating Europe; International PCT Application ***
                 filed January 9, 1996; DIV Application S/N *** filed June 15,
                 1998; Patent No. *** issued June 23, 1998 entitled "***". (JHU
                 Case No. ***)

         5.      U. S. Application S/N *** filed July 9, 1993, entitled "***";
                 corresponding *** filed July 8, 1994 designating U.S.,
                 Australia, Europe, Japan and Canada; International PCT
                 Application *** filed July 8, 1994 designating Japan; Patent
                 No. *** issued January 19, 1995; U.S. Application S/N *** filed
                 interference January 9, 1996; International PCT Application ***
                 filed July 8, 1994 designating Europe; and Patent No. ***
                 entitled "***" issued on July 2, 1998. (JHU Case No. ***)

         6.      U. S. Application S/N *** filed March 19, 1993, entitled "***";
                 corresponding PCT Application S/N PCT *** filed March 18, 1994
                 designating U.S., Europe, Japan and Canada; International PCT
                 Application *** filed September 19, 1995; continuation-in-part
                 Application S/N *** filed February 5, 1997;
                 continuation-in-part Application *** filed April 28, 1997, and
                 International PCT-continuation-in-part Application *** filed
                 May 23, 1997; U.S. Application *** filed November 10, 1997,
                 entitled "***" PCT Application *** filed on February 5, 1998;
                 International PCT Application *** filed March 18, 1994
                 designating Canada; continuation-in-part Application *** filed
                 February 5, 1998; continuation-in-part Application *** filed
                 July 28, 1998; patent no. ***

<PAGE>

                 issued on August 6, 1998; DIV Application *** filed October 23,
                 1998; Patent No. *** issued on October 27, 1998 entitled "***"
                 (JHU Case No. ***)

         7.      U.S. Application S/N *** filed January 12, 1993, entitled
                 "***"; corresponding continuation-in-part Application filed as
                 International PCT Application US *** on January 12, 1994
                 designating U.S., Europe, Japan, and Canada; International PCT
                 *** filed July 12, 1995 designating Japan; `International PCT
                 Application *** filed October 23, 1995; PCI Application ***
                 filed June 27, 1996 designating Canada; DIV Application ***
                 filed September 26, 1997; continuation-in-part Application S/N
                 *** filed October 6, 1997; PCT Application *** filed January
                 12, 1994; PCT Application *** filed October 6, 1998; DIV
                 Application *** filed on October 13, 1998; Patent No. ***
                 issued October 31, 1998. (JHEJ Case No. ***)

         8.      U. S. Application S/N *** filed October 8, 1993, entitled
                 "***"; PCT Application *** filed October 7, 1994; International
                 PCT Application S/N *** filed August 16, 1996; International
                 PCT Application *** filed July 25, 1996 designating Japan; and
                 International PCT Application *** filed July 25, 1996
                 designating Europe. (JHU Case No. ***)

         9.      U. S. Application S/N *** filed July 8, 1994, entitled "***";
                 PCT Application *** filed July 7, 1995; International PCT
                 Application *** filed July 7, 1995; International PCT
                 Application *** filed July 7, 1995 designating Japan;
                 International PCT Application *** filed July 7, 1995
                 designating Canada; FWC Application *** filed September 3,
                 1996; continuation-in-part Application *** filed February 6,
                 1997; PCT Application *** filed February 6, 1998;
                 continuation-in-part Application *** filed February 6, 1998;
                 International PCT Application *** filed September 3, 1996
                 designating Europe; continuation-in-part Application S/N ***
                 filed July 28, 1998. (JHU Case No. ***)

         10.     U. S. Application S/N *** filed July 13, 1994, entitled "***";
                 continuation-in-part filed September 26, 1994 as U.S.
                 Application S/N ***; International PCT Application *** filed
                 July 12, 1995 designating Europe; International PCT Application
                 *** filed July 12, 1995 designating Canada; PCT Application ***
                 filed July 12, 1995; International PCT Application ***filed
                 July 13, 1995 designating Japan; International PCT Application
                 *** filed April 28, 1997; DIV Application S/N *** filed
                 November 2, 1998; and Patent No. *** issued November 13, 1998.
                 (JHU Case No. ***)

         11.     U.S. Application *** filed March 29, 1996, entitled "***" and
                 corresponding International PCT Application *** filed March 31,
                 1997. (JHU Case No. ***)

         12.     PCT Application *** filed July 24, 1998, entitled "***" (JHU
                 Case No. ***)

         13.     PCT Application *** filed June 3, 1998, entitled "***"; PCT
                 Application *** filed July 28, 1998 (JHU Case No. ***)

C.       Collaborative Factors:

         1.      PCT Application *** filed July 24, 1998, entitled "***" (JHU
                 Case No. ***)

         2.      PCT Application *** filed July 24, 1998, entitled "***" (JHU
                 Case No. ***)

D.       ***:

<PAGE>

         1.      PCT Application *** filed July 24, 1998, entitled "***" (JHU
                 Case No. ***)

E.       ***: None

         1.      None.

GENETICS INSTITUTE, INC.               THE JOHNS HOPKINS UNIVERSITY
                                       SCHOOL OF MEDICINE

/s/ Katherine J. Turner                /s/ Bart Cherhow, M.D.

Katherine J. Turner                    Bart Chernow, M.D.
Vice President                         Vice Dean for Research and Technology
Protein Discovery Research             Professor of Medicine, Anesthesiology and
                                       Critical Care

<PAGE>

                                  SCHEDULE 1.59

                               JOINT PATENT RIGHTS

                         None as of the Effective Date.

Schedule 1.59 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.62

                               METAMORPHIX FACTORS

                                      GDF-8
                                     GDF-11
                                     GDF-12

Schedule 1.62 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 1.65

                            METAMORPHIX PATENT RIGHTS

                         None as of the Effective Date.

Schedule 1.65 -- Page 1 of 1

<PAGE>

                                 SCHEDULE 3.3.3

                            SPONSORED RESEARCH BUDGET

                                       ***

Schedule 3.3.3 -- Page 1 of 1

<PAGE>

                                 SCHEDULE 3.3.4

                             SPONSORED RESEARCH PLAN

RESEARCH PROPOSAL

Specific Aim 1:     Generation of inducible cre transgenic mice.

Specific Aim 2:     Construction and characterization of GDF-l0/BMP-3 double
                    knockout mice.

Specific Aim 3:     Construction and characterization of GDF-12-/-,
                    inhibin-(beta)C -/-, and GDF-12/inhibin- (beta)C double
                    knockout
                    mice.

Specific Aim 4:     Construction and characterization of GDF-2 -/- mice.

Specific Aim 5:     Construction and characterization of GDF-l5 -/- mice.

Specific Aim 6:     Search for human myostatin mutations.

Specific Aim 7:     Search for novel cysteine knot-containing factors.

Specific Aim 1:     Generation of inducible cre transgenic mice.

         For a variety of reasons, the ability to induce mutations in members of
the TGF-B superfamily in neonatal or adult animals would be quite useful for
identifying potential therapeutic applications for these molecules. For example.
a number of knockout mice containing targeted mutations in members of the TGF-l3
superfamily have turned out to have be embryonic lethal, making it impossible to
determine the roles that these genes play during postnatal development or in
adult animals. Similarly, even in certain cases where the knockout animals are
viable, such as the myostatin knockout mice, the ability to shut off the gene in
adult animals would be invaluable in further evaluating potential applications.
As a first step toward achieving this goal, we propose to generate transgenic
lines in which the expression of the cre recombinase can be induced at defined
times either during development or postnatally. Our strategy will be to generate
mouse lines carrying two different transgenes. One transgene will contain the
cre recombinase cloned downstream of minimal promoter containing let operator
sequences. The second transgene will contain the reverse-tel hybrid protein that
can be activated by tetracycline. The reverse-tel coding sequence will initially
be cloned downstream of a promoter that is active in a wide range of tissues,
such as the CMV or metallothionein promoter. Eventually, constructs could be
made in which tissue-specific promoters are used. The initial goal will be to
simply demonstrate the feasibility of this approach. If expression of crc can be
induced in these mice, we will then attempt to use these mice to generate
postnatal knockouts of specific TGF-(beta) family members.

Schedule 3.3.4 -- Page 1 of 4

<PAGE>

Specific Aim 2:     Construction and characterization of GDF-l0/BMP-3 double
                    knockout mice.

         We have shown that GDF-I0 is expressed at highest levels in developing
skeletal structures and inner ear during embryogenesis and in the uterus.
cerebellum, and adipose tissue in adult mice. We have also shown that GDF-I0 -/-
mice that we generated by gene targeting appear to be normal with respect to
skeletal development, fertility, and cerebellar development. These results
suggest that the activities of other factors may be compensating for the loss of
GDF- 10 function in GDF-l0 -/- mice. The most likely candidate for a molecule
with redundant activity to GDF-10 is BMP-3, which is the highly related to
GDF-l0, BMP-3 -/- mice generated and characterized by scientists at GI and by
Karen Lyons now at UCLA also appear to be indistinguishable from wild type mice.

         We propose to generate GDF-lO/BMP-3 double knockout mice to determine
whether these molecules are, in fact, functionally redundant. We will send
GDF-I0 -I- mice to Karen Lyons, and she will send BMP-3 -I- mice to us. We will
then breed these mice together to generate the double mutants. The double
mutants will be examined thoroughly for any abnormalities, which particular
focus on those tissues that we have extensively analyzed in the GDF-l0-/- mice.

Specific Aim 3:     Construction and characterization of GDF-l2-/-,
                    inhibin-BC /-. and GDF-l2/inhibin- (beta)C double knockout
                    mice.

         We have shown that both GDF- 12 and inhibin-(beta)C are expressed
specifically in the developing and adult liver and pancreas. In a number of
liver injury models examined, we have found that inhibin-(beta)C is dramatically
and transiently down-regulated following partial hepatectomy. We have generated
both GDF-12 -/- mice and inhibin- (beta)C -/- mice by gene targeting. Our
analysis thus far has shown that these are relatively normal. We do have some
preliminary data suggesting that these mice may be predisposed to developing
fatty liver. However, because the development of fatty liver even in wild type
mice appears to be highly variable among individual mice, we have delayed
further analysis of this phenotype until the mice have been bred into
genetically pure backgrounds.

         We propose to further analyze these mice particularly with respect to
liver and pancreas function in the pure genetic backgrounds. With respect to
liver function, we will examine the livers of these animals not only under
normal conditions but also following a variety of different liver injuries. With
respect to pancreatic function, we will examine the tissue histologically and
examine a variety of serum parameters under normal conditions and response to
exogenously administered glucose (glucose tolerance test).

         We also propose to generate GDF- 12/inhibin- (beta)C double mutants.
The rationale for this experiment is that GDF-12 and inhibin- (beta)C are the
two members of the TB (beta) superfamily that are most highly related to each
other, and the two genes have identical patterns of expression, suggesting the
possibility that they may have similar biological functions. Unfortunately,
because the two genes are only several kilobases apart in the genome, it will
not be practically possible to generate the double mutant simply by breeding the
two individual mutants. We have generated a new targeting vector to
simultaneously delete both genes. and we are ready to electroporate embryonic
stem cells with this construct. Once we have generated the double mutant, these
mice will be analyzed in a similar manner as the individual mutants.

Schedule 3.3.4 -- Page 2 of4

<PAGE>

Specific Aim 4:      Construction and characterization of GDF-2 -/-- mice.

          GDF-2 (identical to BMP-9) is expressed most prominently in the liver
both during development and in adult animals. We have demonstrated a variety of
activities for GDF-2 in culture and in animals. including induction of alkaline
phosphatase activity and bone formation and regulation of branching
morphogenesis in lung explants. We have also generated a GDF-2 mutation in
embryonic stern cells, and from blastocvst injection of these clones, we now
have several germ-line chimeras.

          We propose to examine the phenotype of GDF-2 -/-mice. We will
thoroughly examine these mice for abnormalities. We will first determine whether
GDF-2 -/- mice are viable. If so. we will have complete necropsies performed on
these mice and will analyze a wide range of serum parameters. We will also carry
out an extensive analysis of liver function in these mice using approaches
similar to those that we will use for the GDF-12 and inhibin-(beta)C -/- mice.
If the mutant animals are not viable, we will determine the stage at which the
animals die and then analyze the animals or embryos histologically. Further
analysis will, of course. depend on the specific abnormalities that we find.

Specific Aim 5: Construction and characterization of GDF-15 -/- mice.

          GDF-15 is expressed widely in adult tissues, but most prominently in
the liver. We have shown that the expression of GDF-15 is induced in a variety
of liver injury models. We also have preliminary evidence that the expression of
GDF-15 is induced in other tissues as well in response to injury. These data
raise the possibility that GDF- 15 may be an important mediator of the
regenerative response in a variety of' cell types and tissues. We have also
generated a GDF-15 mutation in embryonic stem cells, and from blastocyst
injection of these clones, we now have at leas one germ-line chimera.

         We propose to examine the phenotype of GDF-15 -/- mice. We will analyze
these mice as described above for the GDF-2 -/- mice. In addition, if the GDF-15
-/- mice are viable, we will subject the mice to a variety of different injury
models for different tissues.

Specific Aim 6: Search for human myostatin mutations.

         We have shown that myostatin functions as a negative regulator of
muscle growth both in mice and in cattle, suggesting that inhibition of
mvostatin function or expression may have important applications for the
treatment of muscle wasting diseases. We would like to extend these studies to
demonstrate that myostatin carries out the same function in humans. We propose
to examine the myostatin gene in heavily-muscled individuals, such as
professional bodybuilders, for the presence of mutations. We have already
accumulated over 100 blood samples form heavily-muscled individuals. We will
complete our preparation of DNA from these blood samples and then sequence the
C-terminal coding region from each sample. Depending on the results of this
study, we may also sequence the other exons encoding the pre-region.

Specific Aim 7:     Search for novel cvsteine knot-containing factors.

         All members of the TGF-B superfamily as well as a variety of other
growth factors and hormones have a cysteine pattern that has been shown in a
number of cases to form a cysteine knot structure. Our search for new factors
has been focused to date almost entirely for new

Schedule 3.3.4 -- Page 3 of 4

<PAGE>

members of the TGF-B superfamily. We propose to continue this search, primarily
focusing on a low stringency approach. and to expand this search to include new
members of the DAN family While all of the published studies on the DAN family
have focused on their ability to bind and inhibit members of the TGF-(beta)
superfamily, we believe that the possibility that these molecules may signal
through their own receptors still has not been ruled out. We also believe that
whatever their mechanism of action may be these molecules also have the
potential to be important therapeutic agents.

Schedule 3.3.4 Page 4 of 4

<PAGE>

                                 SCHEDULE 3.3.6

                                     FORM OF

                            CONFIDENTIALITY AGREEMENT

                            CONFIDENTIALITY AGREEMENT

         The undersigned, being a faculty member, student, fellow or other
employee of The Johns Hopkins University ("JHU"), agrees not to directly or
indirectly publish, disseminate or otherwise disclose, deliver or make available
to any third party any scientific, technical, trade or business information
specifically related to _______________, as more fully described in the Exhibit
attached to this Confidentiality Agreement. Such information is `CONFIDENTIAL"
to MetaMorphix, Inc. (a corporation formed in 1994 for the purposes of funding
research at JHU under the direction of Se-Jin Lee, M.D., Ph.D. to characterize
certain previously-discovered factors, and discover and characterize new
factors, in the TGF-(beta) Superfamily and commercializing such factors) and/or
Genetics Institute, Inc., a JHU licensee which also has provided funding for
TGF-(beta) Superfamily research at JHU.

       This duty of confidentiality shall not apply to all or part of the
above-described information if (a) such information was known to the undersigned
at the time it was disclosed, as evidenced by written records at the time of
disclosure; (b) at the time of disclosure or later becomes publicly known under
circumstances involving no breach of this Confidentiality Agreement: or (C) is
lawfully and in good faith made available to the undersigned by a third party
who did not derive it from the undersigned and who imposes no obligation of
confidence on the undersigned. For each disclosure of confidential information,
this duty of confidentiality shall last five (5) years from the date of
disclosure of such confidential information.

         I further understand that general know-how and research skills are not
considered confidential by JHU, MetaMorphix and/or GI.

Print Name
           ---------------

Title
      --------------------

Date
     --------------

Schedule 3.3.6 -- Page 1 of 1

<PAGE>

                                 SCHEDULE 3.3.9

                                  JHU EQUIPMENT

                EQUIPMENT                               PRICE PAID TO PURCHASE

                Thermal cvcler                         $ 6,000
                Microcentrifuges (3)                     5,100
                New Brunswick incubator/
                Shaker and accessories                   5,200
                Macintosh computer, monitor, etc.        2,500
                Shimadzu spectrophotometer               8,000
                Belico hot shaker                        1,900
                Tissue culture incubators (2)           15,000
                Crvostat                                20,000
                Miscellaneous                            6,000

Schedule 3.3.9 -- Page 1 of 1

<PAGE>

                                 SCHEDULE 3.4.2

                           COLLABORATIVE RESEARCH PLAN

           GI and MetaMorphix each shall conduct research on their own and/or
  through the efforts of collaborators (which efforts shall be subject to the
  terms and conditions of the Agreement) to evaluate and characterize those
  BMPs, GDFs and Collaborative Factors that have not yet been designated or
  selected as either GI Factors or MetaMorphix Factors, so that GI and
  MetaMorphix may each utilize the information gained from conducting such
  research to select GI Factors and MetaMorphix Factors, respectively, from the
  Available Factors in accordance with Article 5 of the Agreement. Information
  gained from conducting such research shall be shared among the Parties as
  provided in the Agreement.

Schedule 3.4.2 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 5.2

                                AVAILABLE FACTORS

                                       ***

Schedule 5.2 -- Page 1 of 1

<PAGE>

                                  SCHEDULE 6.6A

                    JHU STANDARD MATERIAL TRANSFER AGREEMENT

                                [JHU LETTERHEAD]

                                     [date]
    Dear
         -------------------

           Johns Hopkins University (JHU) agrees to provide you the material(s)
   indicated below which you requested from Dr. Se-Jin Lee for your nonclinical
   research studies. in order to protect JHU's proprietary rights in the
   material(s) or its (their) progeny, portions. and derivatives thereof
   (hereinafter "Materials"), we request that you and an authorized official of
   your institution sign, date, and return this letter agreement to us.

           Material(s) identification:

           Acceptance of the Material(s) by your institution confirms your
  agreement to the following conditions:.

I)    This agreement and the resulting transfer of the Material(s) constitute a
      nonexclusive license to use the Material(s) for nonprofit. nonclinical
      research purposes only. The Material(s) will not be used in humans and
      will be stored, used, and disposed of in accordance with applicable law
      and regulations. The Material(s) will not be used for any commercial
      purpose. This agreement is not assignable and the Material(s) may not be
      transferred to another party.

2)    Nothing in this Letter Agreement grants you any rights under any patents
      claiming the Material(s) nor any rights to use Materials for profit-making
      or commercial purposes.

3)    Subject to Paragraph 4 below, you are free to publish your work involving
      this Material(s). You agree to provide JHU with a copy of any publication
      which contains results obtained from use of the Material(s), as provided
      in Paragraph 4 below.

4)    INVENTIONS.

      a.  DISCLOSURE. You will promptly and fully disclose in writing to JHU any
          and all inventions, know-how and other rights (whether or not
          protected under state, federal, or foreign intellectual property laws)
          related to the Material(s) or its (their) use which are conceived
          and/or reduced to practice by you, alone or jointly with others, in
          the course of your research (the "lnventions").

      b.  LICENSE AND OPTION. You and your institution grant to JHU (I) a
          non-exclusive royalty-free license to Inventions for non-commercial
          academic research purposes (ii) a non-exclusive, royalty bearing (not
          to exceed 1% of JHU's licensee's net sales) transferable license to
          Inventions which are new uses of the Material(s) (for example, new
          therapeutic indications for, and new methods of administration of, the
          Material(s) and (iii) a first option to obtain an exclusive,
          royalty-bearing transferable license to any or all of your interests
          in the Inventions, all with the right to grant sublicenses. For each
          Invention, JHU's first option must be exercised within ninety (90)
          days of your disclosure of that Invention to JHU. The royalty payable
          to you and other terms of the

Schedule 6.6A -- Page 1 of 2

<PAGE>

          exclusive license will be negotiated by the parties in good faith.

   5)  JHU makes no representations whatsoever as to the Material(s). They are
       experimental in nature and are provided WITHOUT WARRANTY OF
       MERCHANTABILITY OR FITNESS FOR A PARTICULAR PRUPOSE OR ANY OTHER
       WARRANTY. EXPRESS OR IMPLIED. JHU MAKES NO REPRESENTATION OR WARRANTY
       THAT THE USE OF
          THE MATERIAL(S) WILL NOT INFRINGE ANY PATENT OR OTHER PROPRIETARY
       RIGHT.

   6)  Except where precluded by Federal law and to the extent allowed by State
       law, you and our institution agree to defend, indemnify, and hold
       harmless JHU its trustees, officers, employees, and agents FROM any loss,
       claim, damage, or liability, of any kind whatsoever. which may arise for
       you or your institution's use, storage. or-disposal of the Material(s) or
       any other material that could not have been made but for the Material(s),
       except to the extent such arise due to the gross negligence of JHU.

   7) You shall not use the name of THE JOHNS HOPKINS UNIVERSITY or THE JOHNS
      HOPKINS HEALTH SYSTEM or any of its constituent parts such as the Johns
      Hopkins Hospital or any contraction thereof or the name of its employees
      in any advertising, promotional, sales literature or fundraising documents
      without prior written consent from an officer of JHU.

         To indicate you and your institution's agreement to these conditions,
you and an authorized official should sign and date this letter in the spaces
indicated below and return it to me. If you have any questions concerning this
agreement, you may call me at 410-955-4666.

Sincerely,

Howard W. Califano. Esq.
Assistant Dean and Director
Office of Technology Licensing

HWC:spa

Signature:
           ------------------------------------------------------------
                        (Recipient lnvestigator Signature)
Name:
Title:
Date:

RECIPTIENT INSTITUTLON'S AUTHORIZED OFFICIAL

AN AUTHORIZED SIGNATURE IS THAT OF AN INSTITUTIONAL OFFICIAL OR COMPANY OFFICER
SPECIFICALLY AUTHORIZED TO EXECUTE DOCUMENTS OF THIS TYPE ON BEHALF OF THE
INSTITUTION.

Institution/Company:
                     -------------------------------------------

Signature:
            ----------------------------------------------------

NAME:
Title:
Date:

Schedule 6.6A -- Page 2 of 2

<PAGE>

                                  SCHEDULE 6.6B

                     GI STANDARD MATERIAL TRANSFER AGREEMENT

                                       ***

<PAGE>

                                  SCHEDULE 7.2A

                      ADDITIONAL LICENSE FEES PAYABLE BY GI
                      FOR GI FACTORS AND ADDITIONAL FACTORS
<TABLE>
<CAPTION>
                       ADDITIONAL LICENSE FEES FOR GI's DEVELOPMENT OF GI FACTORS
-------------------------------------------------------------------------------------------------------
                              EVENT                                     ADDITIONAL LICENSE FEE
-------------------------------------------------------------------------------------------------------
                                                                     PAYABLE TO       PAYABLE TO
                                                                        JHU           METAMORPHIX
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
<S>                                                                     <C>          <C>
Commencement of the first Phase III clinical trial in the U.S. a            $***         $***
European country or Japan sponsored by GI. or its Affiliates or
sublicensees, for each GI Factor that is a GDF Discovered by JHU
-------------------------------------------------------------------------------------------------------
Commencement of the first Phase III clinical trial in the U.S.. a           $***         $***
European country or Japan sponsored by GI, or its Affiliates or
sublicensees, for each GI Factor that is a GDF Discovered by
MetaMorphi.x
-------------------------------------------------------------------------------------------------------
Commencement of the first Phase 111 clinical trial in the U.S.,             $***         $***
a European country or Japan sponsored by GI. or its
Affiliates or sublicensees. for each GI Factor that is a
Collaborative Factor of JHU and MetaMorphix
-------------------------------------------------------------------------------------------------------
Commencement  of the first Phase III clinical  trial in the U.S.,           $***         $***
a European country or Japan sponsored by Gl. or its Affiliates or
sublicensees, for each Collaborative Factor of 01 and MetaMorphix
-------------------------------------------------------------------------------------------------------
Commencement of the first Phase III clinical trial in the U.S..             $***         $***
a European country or Japan sponsored by one of its Affiliates
or sublicensees, for each Collaborative Factor of GI and JHU
-------------------------------------------------------------------------------------------------------
Approval of the first PLA filed by 01, or its Affiliates or                 $***         $***
sublicensees, in the U.S., a European country or Japan. for each
GI Factor that is a GDF Discovered by JHU
-------------------------------------------------------------------------------------------------------
Approval of the first PLA filed by GI or its Affiliates or                  $***         $***
sublicensees in the U.S., a European country or Japan for each
GI Factor that is a GDF Discovered by MetaMorphix
-------------------------------------------------------------------------------------------------------
Approval of the first PLA filed by GI, or its Affiliates or                 $***         $***
sublicensees. in the U.S.. a European country or Japan. for each
GI Factor that is a Collaborative Factor of JHU and MetaMorphix
-------------------------------------------------------------------------------------------------------
Approval of the first PLA filed by GI or its Affiliates or                  $***         $***
sublicensees in the U.S.. a European country or Japan, for each
GI Factor that is a Collaborative Factor of GI and MetaMorphix
-------------------------------------------------------------------------------------------------------
Approval of the first PLA filed by GI or its Affiliates or                  $***         $***
sublicensees. in the U.S., a European country or Japan. for each
GI Factor that is a Collaborative Factor of GI and JHU
-------------------------------------------------------------------------------------------------------

</TABLE>

Schedule 7.2A -- Page I of 2

<PAGE>

                           ADDITIONAL LICENSE FEES FOR
                     GI's DEVELOPMENT OF ADDITIONAL FACTORS
<TABLE>
<CAPTION>
         ---------------------------------------------------------------------------------------------------
                                                                                  ADDITIONAL LICENSE FEE
                                       EVENT                                         PAYABLE TO JHU
         ---------------------------------------------------------------------------------------------------
        <S>                                                                                         <C>

         Commencement of the first Phase III clinical trial in the US, a                                $***
         European country or Japan sponsored by GI or its Affiliates or
         Sublicensees for each Additional GDF that is Discovered by JHU
         ---------------------------------------------------------------------------------------------------
         Commencement of the first Phase III clinical trial in the US, a                                $***
         European country or Japan sponsored by GI or its Affiliates or
         sublicensees, for each Additional Collaborative Factor
        ----------------------------------------------------------------------------------------------------
         Approval of the first PLA filed by GI or its Affiliates or                                     $***
         sublicensees. in the U.S., a European country or Japan for each
         Additional GDF that is Discovered by JHU
         ---------------------------------------------------------------------------------------------------
         Approval of the first PLA filed by GI its Affiliates or                                        $***
         sublicensees, in the U.S., a European country or Japan for each
         Additional Collaborative Factor
         ---------------------------------------------------------------------------------------------------

</TABLE>

Schedule 7.2A -- Page 2 of 2

<PAGE>

                                  SCHEDULE 7.2B

                      ADDITIONAL LICENSE FEES PAYABLE BY GI
                             FOR METAMORPHIX FACTORS
<TABLE>
<CAPTION>
         ---------------------------------------------------------------------------------------------------
                           ADDITIONAL LICENSE FEES FOR
             GI'S DEVELOPMENT OF METAMORPHIX FACTORS IN THE GI FIELD
         ---------------------------------------------------------------------------------------------------
                                                                                     LICENSE FEE

              EVENT                                                            PAYABLE TO     PAYABLE TO
                                                                                  JHU         METAMORPHIX
         ---------------------------------------------------------------------------------------------------
         ---------------------------------------------------------------------------------------------------
         <S>                                                                          <C>          <C>

         Filing, by GI, its Affiliates or sublicensees of the first IND           $***                  $***
         for the MetaMorphix Factor known as GDF-8
         ---------------------------------------------------------------------------------------------------
         Filing, by GI, its Affiliates or sublicensees of the first IND           $***                  $***
         for each MetaMorphix Factor, other than the MetaMorphix Factor
         known as GDF-8, which is a GDF
         ---------------------------------------------------------------------------------------------------
         Commencement of the first Phase III clinical trial in the U.S., a        $***                  $***
         European country or Japan sponsored by GI or its Affiliates or
         Sublicensees. for the MetaMorphix Factor known as GDF-8
         ---------------------------------------------------------------------------------------------------
         Commencement of the first Phase III clinical trial in the U.S., a        $***                  $***
         European country or Japan sponsored by GI or its Affiliates or
         sublicensees, for each MetaMorphix Factor, other than the
         MetaMorphi.x Factor known as GDF-8 which is a GDF Discovered
         byJHU
         ---------------------------------------------------------------------------------------------------
         Commencement of the first Phase III clinical trial in the U.S.,          $***                  $***
         a European country or Japan sponsored by GI or its Affiliates
         or sublicensees, for each MetaMorphix Factor, other than the
         MetaMorphix Factor known as GDF-8 which is a GDF Discovered
         by MetaMorphix
         ---------------------------------------------------------------------------------------------------
         Commencement of the first Phase III clinical trial in the U.S.,          $***                  $***
         a European country or Japan sponsored by GI or its Affiliates
         or Sublicenisees for each MetaMorphix Factor, other than the
         MetaMorphix Factor known as GDF-8 which is a Collaborative
         Factor of JHU and MetaMorphix
         ---------------------------------------------------------------------------------------------------
         Commencement of the first Phase III clinical trial in the U.S.,          $***                  $***
         a European country or Japan sponsored by GI or its Affiliates
         or sublicensees, for each MetaMorphix Factor other than the
         MetaMorphix Factor known as GDF-8 which is a Collaborative
         Factor OF JHU and GI
         ---------------------------------------------------------------------------------------------------
         Commencement of the first Phase Ill clinical trial in the U.S.,          $***                  $***
         a European country or Japan sponsored by GI or its Affiliates
         or sublicensees, for each MetaMorphix Factor, other than the
         MetaMorphix Factor known as GDF-8, which is a Collaborative
         Factor of MetaMorphix and GI
         ---------------------------------------------------------------------------------------------------
</TABLE>

Schedule 7.2B -- Page 1 of 2

<PAGE>

<TABLE>
     <S>                                                                       <C>                   <C>
        ----------------------------------------------------------------------------------------------------
        Filing by GI, its Affiliates or sublicensees, and acceptance for          $***                  $***
        review By the applicable Regulatory Authorities in the U.S., a
        European country or Japan. of the first PLA for the MetaMorphix
        Factor known as GDF-8
        ----------------------------------------------------------------------------------------------------
        Filing by GI, its Affiliates or sublicensees. and acceptance for          $***                  $***
        review by the applicable Regulatory Authorities in the U.S.. a
        European country or Japan. of the first PLA for each Met.aMorphix
        Factor other than the MetaMorphix Factor known as GDF-8
        ----------------------------------------------------------------------------------------------------
           Receipt of Regulatory Approval of the first PLA filed by GI,           $***                  $***
           Factor known Affiliates or sublicensees in the U.S., a
           European country or Japan for the MetaMorphix Factor known
           as GDF-8
        ----------------------------------------------------------------------------------------------------
           Receipt of Regulatory Approval of the first PLA filed by GI its        $***                  $***
           Affiliates or sublicensees in the U.S., a European country or
           Japan for each MetaMorphix Factor, other than the MetaMorphix
           Factor known as GDF-8 which is a GDF Discovered by JHU
        ----------------------------------------------------------------------------------------------------
           Receipt of Regulatory Approval of the first PLA filed by CI,           $***                  $***
        its Affiliates or sublicensees in the U.S.. a European country
        or Japan for each MetaMorphix Factor, other than the MetaMorphix
        Factor known as GDF-8, which is a GDF Discovered by MetaMorphix
        ----------------------------------------------------------------------------------------------------
        Receipt of Regulatory Approval of the first PLA filed by GI its           $***                  $***
        Affiliates or sublicensees in the U.S., a European country or
        Japan for each MetaMorphi.x Factor, other than the MetaMorphtx
        Factor known as GDF-8, which is a Collaborative Factor of JHU
        and MetaMorphix
        ----------------------------------------------------------------------------------------------------
        Receipt of Regulatory Approval of the first PLA filed by GI,              $***                  $***
        its Affiliates or sublicensees in the U.S. a European country
        or Japan for each MetaMorphix Factor, other than the MetaMorphix
        Factor known as GDF.8 which is a Collaborative Factor of JHU
        and GI
        ----------------------------------------------------------------------------------------------------
        Receipt of Regulatory Approval of the first PLA filed by GI               $***                  $***
        its Affiliates or sublicensees in the U.S.. a European country
        or Japan for each MetaMorphix Factor, other than the MetaMorphix
        Factor known as GDF-8, which is a Collaborative Factor of
        MetaMorphix and GI
        ----------------------------------------------------------------------------------------------------
</TABLE>

Schedule 7.2B -- Page 2 of 2

<PAGE>

                                  SCHEDULE 8.IA

                          FORM FOR ASSIGNMENT OF SHARES

                              ASSIGNMENT AGREEMENT

           For value received (as set forth in that Amended and Restated
  Collaboration Agreement of even date herewith among Genetics Institute Inc.,
  The Johns Hopkins University and MetaMorphix. Inc. Genetics Institute, Inc.
  does hereby sell, assign, transfer, and permit the redemption unto
  MetaMorphix. Inc. Three Million Six Hundred Thousand (3,600,000) of its shares
  of Convertible Preferred Stock of MetaMorphix, Inc., i.e. Two Million Seven
  Hundred Thousand (2,700,000) shares of its Series A Convertible Preferred
  Stock and Nine Hundred Thousand (900,000) shares (or all) of its Series B
  Convertible Preferred Stock, standing in the name of Genetics Institute, Inc.
  on the books of MetaMorphix. Inc., represented by stock certificate nos. A-102
  arid A-104 through A-111 (collectively representing Two Million Seven Hundred
  Thirty-eight Thousand Nine Hundred (2,738,900) shares of Series A Convertible
  Preferred Stock, there having been A stock split of 50-to-1 on May 27, 1997)
  and certificate no. B-101 (representing Nine Hundred Thousand (900,000)
  shares of Series B Convertible Preferred Stock, there having been a stock
  split of 50-to-1 on May 27, 1997), the originals of which are attached hereto
  as EXHIBIT A.

          An opinion of counsel under Section 3 of the April 18, 1995
Registration Agreement is not being provided as MetaMorphix, Inc. has waived
such requirement for this sale and redemption.

          In consideration for such sale and redemption. MetaMorphix. Inc. shall
issue, in the name of Genetics Institute, Inc., a replacement stock certificate
no. A-112, for Thirty-eight Thousand Nine Hundred (38,900) shares of Series A
Convertible Preferred Stock owned by Genetics Institute, Inc. formerly
represented by stock certificate no. A-111 (leaving Genetics Institute, Inc.
with a total of Two Hundred Thousand (200,000) shares of Series A Convertible
Preferred Stock). Such remaining shares. i.e., as represented by stock
certificate nos. A-103 and A-111, shall continue to benefit from and be subject
to the terms of the April 18, 1995 Registration Agreement and the replacement
stock certificate shall be legended in accordance with such Agreement.

Dated:  January ____, 1999
ATTEST:                               GENETICS INSTITUTE, INC.
       -------------------            By:                                 (SEAL)
                                         ---------------------------------
                                      Name:
                                      Date:

ACCEPTED THIS -- DAY OF JANUARY. 1999
BY METAMORPHIX, INC.

By:
   --------------------------------------------------------------
Edwin C. Quattlebaum  Ph.D. President and Chief Executive Officer

Schedule 8.lA -- Page l of l

<PAGE>

                                  SCHEDULE 8.1B

                              FORM FOR STOCK POWER

                                   STOCK POWER

          FOR VALUED RECEIVED, Genetics Institute Inc.. a Delaware corporation
("GI"). hereby sells. assigns, transfers and conveys to MetaMorphix, Inc., a
Delaware corporation, _______________ shares of __________________________ stock
[which have not been surrendered to permit an adjustment for a prior stock
split], ______  par value per share, of MetaMorphix. Inc. a Delaware corporation
(the "Corporation") registered in the name of GI on the books of the
Corporation, represented by Certificate No. and does hereby irrevocably
constitute and appoint William E. Carlson as attorney to transfer such shares on
the books of the Corporation, with full power of substitution in the premises.

Dated:                                     GENETICS INSTITUTE, INC.
January,            , 1999
        -----------
                                          By:
                                             -----------------------------------
                                          Name:
                                          Title:

In the presence of:

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

Schedule 8.1B -- Page 1 of 1

<PAGE>

                                  SCHEDULE 8.2

                    FORM FOR THIRD ALLONGE TO PROMISSORY NOTE

          THIS THIRD ALLONGE TO PROMISSORY NOTE ("Third Allonge"). is effective
the ________ day of January, 1999, by and between METAMORHIX. INC.. a Delaware
Corporation (the "Maker") and GENETICS INSTITIUTE. INC. a Delaware Corporation
(the "Lender').

          WHEREAS, on or about February 9, 1998 the Maker executed and delivered
a Promissory Note (the "Original Note") to Lender in the original principal sum
of Two Million Dollars ($2,000,000) which is repayable by the Maker to the
Lender on demand at any time after December 31, 1998 ("Original Demand Date")
and which, in the event certain conditions are met provides for the conversion
of the debt represented by the Note to equity on or before December 31. 1998
("Original Conversion Date"): and

         WHEREAS, on or about August 18, 1998 the Maker executed and delivered a
First Allonge to Promissory Note ("First Allonge") to Lender modifying the Note
such that the principal sum due and owing on account of the Note as of the date
of the First Allonge was, and is, Two Million Two Hundred Thousand Dollars
($2,200,000), plus any and all interest that has accrued in accordance with the
terms of the Note:
and

          WHEREAS, on or about October 30, 1998 the Maker executed and delivered
a Second Allonge to Promissory Note ("Second Allonge") to Lender modifying the
Nate, as modified by the First Allonge, such that: (I) the principal sum, plus
any and all interest, was to be paid by Maker to Lender on demand at any time on
or after June 30, 1999 (the "Second Demand Date"); (2) the debt created by the
Note, and the payment of principal and interest thereunder, was, and is, to be
subordinate to any new debt incurred by Maker up to One Million Dollars
($1,000,000) provided that certain conditions were. arid are, met; and (3) if
Maker closed an equity financing such that it raised Two Million Dollars
($2,000,000) from investors other than the Lender on or before June 30. 1999
(the "Second Conversion Date") in a transaction approved by Maker's Board of
Directors. the unpaid principal balance of the Note, plus any and all interest,
was to be converted into fully paid and non-assessable shares of the capital
stock of Maker issued in connection with such equity financing, concurrently
with the first closing of such equity financing, at the same price as is paid by
the investors in such financing: and

         WHEREAS, as of December 31. 1998. Two Million Two Hundred Thousand
Dollars ($2,200,000) remains unpaid and One Hundred Fifty-Three Thousand Six
Hundred Ninety-Two Dollars arid Seventy-Four Cents ($153,692.74) of interest has
accrued and remains unpaid: and

          WHEREAS, the Maker has requested. and Lender has agreed, to extend the
Second Demand Date and, in effect, to eliminate the Second Conversion Date,
provided that the Maker agrees to the execution of this Third Allonge; wherefore
Maker and Lender now agree to modify the Original Note, as modified by the First
and Second Allonges and now this Third Allonge (hereinafter collectively the
"Note"), as follows:

         1.   The Maker may prepay the principal sum, plus any and all interest
that has accrued in accordance with the terms of the Note, in pan or in whole,
at any time without penalty; and

         2.   The principal sum, plus any and all interest that has accrued in
accordance with the terms of the Note, shall be paid by Maker to Lender. without
any notice or demand on January 1, 2005 ("Third Due Date"), if not sooner paid;
and

         3.   Upon the Third Due Date, in lieu of a payment of cash, the Maker
may pay the principal balance of the Note, plus any and all interest that has
accrued in accordance with the terms of the Note, by issuing to Lender fully
paid and non-assessable shares of the common stock of Maker, if such stock is
then publicly traded, at the then market price of such stock, calculated at the
average closing price for the ten (10) trading days up to and including the
fifth trading day preceding the Third Due Date.

Schedule 8.2 -- Page 1 of 2

<PAGE>

         4.   At the Lender's sole election, on or before December 31, 2004.
provided that the Lender has provided the Maker with at least ninety (90) days
prior written notice of such election, the Lender may convert the outstanding
principal and interest under this Note into fully paid and non-assessable shares
of common stock of the Maker, at a per-share price valued at either (a) one
hundred twenty-five percent (125%) of the IPO price if the stock is then
publicly traded, or (b) a price to be negotiated in good faith by the Maker and
the Lender if the stock is not then publicly traded. This right of conversion is
personal to Genetics, Institute, Inc. and may not be assigned except upon full
transfer and assignment of this Note, to American Home Products Corporation or
other affiliate of Genetics Institute. Inc.

         5.   In the event of a stock issuance under either Paragraphs 3 or 4 of
this Third Allonge. no fractional shares of the common stock shall be issuable
upon conversion of this Note but an adjustment in cash shall be made in respect
of any fraction of a share which would otherwise be issuable upon the surrender
of this Note for conversion.

         6.   The third and fourth paragraphs of this Original Note, i.e. the
provisions for automatic conversion upon a certain equity financing, are
hereafter null and void and of no effect.

         7.   The parties hereto do not intend that a novation of the loan
shall be created or effectuated because of the modifications described in this
Third Allonge. The parties in this Third Allonge do not intend that the
execution of this Third Allonge and the transaction described herein shall
affect the validity or priority of any indebtedness created by the Note. This
Third Allonge (a) is being physically attached to the Note simultaneously with
the entry into this Third Allonge by the parties hereto to evidence the
modification of the provisions of the Note and (b) shall upon such attachment be
deemed to be apart of the Note as fully and completely as if the provisions were
set forth at length in the body of the Note.

         8.   All other terms, covenants, and conditions contained in the Note,
except as herein modified, shall remain in full force and effect and the Maker
by the execution hereof hereby ratifies and confirms each and every other term,
covenant, and condition of the Note.

         IN WITNESS WHEREOF, the Maker and the Lender have set their hands and
seals to this Third Allonge to Promissory Note upon the day hereinabove first
written.

[SEAL]
ATTEST:                                 METAMORPHIX. INC.
                                        By:                               (SEAL)
-------------------------                  ------------------------------
William E. Carlson                      Edwin C. Quattlebaum, Ph.D
Secretary                               President and Chief Executive Officer

ATTEST:                                        GENETICS INSTITUTE, INC.
--------------------------------        By.                               (SEAL)
                                           -------------------------------
                                        Name:
                                        Title:

Schedule 8.2 -- Page 2 of 2

<PAGE>

                                  SCHEDULE 8.3

                         FORM FOR PUT OPTION AGREEMENTS

                              PUT OPTION AGREEMENT

          THIS PUT OPTION AGREEMENT (the "Agreement") is made and entered into
this day of _________________+, (the "Effective Date") by and between Genetics
Institute. Inc., a Delaware corporation, with a business address at 87
Carnbridge Park Drive, Cambridge, Massachusetts 02140 ("GI") and
________________________, a ________________ having an address at
___________________ ([collectively,] the "Investor[s]"). GI and the Investor[s]
may each be referred to herein individually as a Party and collectively as the
Parties. MetaMorphix, Inc., a Delaware corporation, having offices at 1450 South
Rolling Road, Baltimore, Maryland 21227 ("MetaMorphix") joins in this Agreement
to evidence its approval of the terms and conditions contained herein.

                                    RECITALS

         WHEREAS, MetaMorphix, GI and the Johns Hopkins University entered into
an .Amended and Restated Collaboration Agreement on January 26, 1999 (the "1999
Collaboration Agreement") pursuant to which GI agreed, INTER ALIA, to provide
put options to certain accredited investors who each purchase one hundred
thousand dollars ($100,000) or more of the capital stock of MetaMorphix, which
options would permit such investors, upon certain conditions, to require GI to
purchase up to two million dollars ($2,000,000), in the aggregate, of such
capital stock purchased by such investors from MetaMorphix;

         WHEREAS, simultaneously herewith, Investor is purchasing from
MetaMorphix ____________ shares of _________________ capital stock of
MetaMorphix (together with all other securities issued as a dividend upon, in
exchange for or otherwise in connection with such shares, the "Purchased Stock")
for a total cash purchase price of ________________ dollars ($________) (the
"Investor Purchase Price"), which amount equates to a per share purchase price
of _______________ dollars ($_______ (the "Per Share Purchase Price") which
purchase is conditioned upon the execution and delivery by GI of this Agreement
on the terms and conditions set forth herein; and

          WHEREAS, GI and Investor desire to enter into this Agreement to set
forth the terms and conditions under which the Investor may require to purchase
the Purchased Stock, or a portion thereof.

         NOW THEREFORE, in consideration of the premises set forth above and the
respective covenants and agreements of the Parties contained herein, and
intending to be legally bound, the Parties hereby agree as follows:

1.      Grant of Put Option. Subject to the terms and conditions of this
        Agreement, GI hereby grants to Investor a put option (the "Put Option")
        pursuant to which the Investor may require Gl to purchase from such
        Investor, the Purchased Stock [or X% of the Purchased Stock, if the Put
        Option is being granted only with respect to a portion of the Purchased
        Stock purchased by such Investor] at the price calculated in accordance
        with Section 3 below, provided, however, that the grant of this Put
        Option is conditioned upon GI

Schedule 8.3 -- Page 1 of 9

<PAGE>

          receiving, from MetaMorphix's attorneys, a written opinion to the
          effect that the sale of' the Purchased Stock and the issuance of this
          Put Option. each are exempt from registration under applicable federal
          and state securities laws.

2.        EXERCISE OF PUT OPTION.

          2.1     Exercise Period. This Put Option may be exercised b submission
                  to and receipt by GI of a BONAFIDE Exercise Notice (made in
                  accordance with Sections 2.4 and 7.4 hereof) on or after
                  January 1, 2000 and before December 31, 2001 only in the event
                  that MetaMorphix (a) has voluntarily filed for Bankruptcy
                  under Chapter 7 of the United States Bankruptcy Code (the
                  "Bankruptcy Code") or (b) is placed into bankruptcy under
                  Chapter 7 of the Bankruptcy Code by a petition of a third
                  party and such proceeding is not lifted within sixty (60) days
                  of the filing of such petition for bankruptcy, in either event
                  prior to December 31, 2001. GI shall have no obligation to
                  purchase any such Purchased Shares prior to January I. 2000 or
                  after December 31, 2001.

          2.2     AUTOMATIC EXPIRATION. Notwithstanding Section 2.I above, the
                  Put Option shall automatically expire prior to December 31,
                  2001 in the event that MetaMorphix has raised an aggregate of
                  Eight Million Dollars ($8,000,000) or more, in cash and/or
                  non-cash consideration. through(a) an equity financing or
                  equity financings or (b) the transfer to Investor and/or one
                  or more third parties of any rights or assets relating to one
                  or more MetaMorphix Factors (as that term is defined in the
                  1999 Collaboration Agreement). Only consideration actually
                  received by MetaMorphix on or before December 31, 2001 shall
                  be considered in determining whether such Eight Million
                  Dollars ($8,000,000) has been raised. Any consideration
                  received by MetaMorphix in a form other than cash shall, for
                  purposes of this Agreement. be considered to have been
                  received as cash in an amount equivalent to the fair market
                  value, as determined in good faith by GI and MetaMorphix'
                  Board of Directors, of such non-cash consideration at the time
                  received. MetaMorphix shall promptly notify, in writing,
                  Investor and GI upon the occurrence of any events which result
                  in the expiration of this Put Option, PROVIDED, HOWEVER, that
                  any failure to give or delay in giving such notice shall have
                  no effect upon the expiration of the Put Option. Upon notice
                  of expiration of the Put Option pursuant to this Agreement.
                  Investor shall promptly surrender and return this original
                  Agreement to CI for cancellation.

          2.3     PURCHASE LIMIT. The obligation of GI to purchase the Purchased
                  Stock [or X% of the Purchased Stock if the Put Option is being
                  granted only with respect to a portion of the Purchased Stock
                  purchased by such Investor], when aggregated with the shares
                  of capital stock that GI is or may be obligated to purchase
                  from other investors who have purchased the capital stock of
                  MetaMorphix, shall be limited to Two Million Dollars
                  ($2,000,000) in the aggregate.

          2.4     EXERCISE NOTICE. In the event that the Investor elects to
                  exercise this Put Option as permitted under this Article 2.
                  Investor shall give written notice (the "Exercise Notice") to
                  GI of its intention to exercise the Put Option, specifying the
                  time and date, not earlier than thirty (30) business days from
                  the date such Exercise Notice is given, for the closing of
                  such sale (the "Closing"), which written notice shall be
                  substantially in the form that is attached hereto as
                  Exhibit A.

Schedule 8.3 -- Page 2 of 9

<PAGE>

3.        PURCHASE PRICE. In the event that the Investor exercises the Put
          Option as permitted hereunder. the purchase price payable by Cl to the
          Investor for the purchase of the Purchased Stock [or X% of such
          Purchased Stock the Put Option is being granted only with respect to a
          portion of the Purchased Stock purchased by such Investor] shall be
          calculated by multiplying the number of shares of the Purchased Stock
          to be purchased by GI from such Investor hereunder by the Per Share
          Purchase Price paid by such Investor for the purchase of the Purchased
          Stock (the "Option Price").

4.        CLOSING. The Closing shall be held at 10:00 am. (local time) on the
          date specified in the Exercise Notice, or at such other time as may be
          mutually agreed by the Parties, at the offices of Genetics Institute
          in Cambridge, Massachusetts, or such other location in the United
          States as may be designated by Genetics Institute, unless, on such
          date, there shall be any preliminary or permanent injunction or other
          order by any court of competent jurisdiction or any other legal
          restraint or prohibition preventing the consummation of such sale, in
          which event such Closing shall be held as soon as practicable
          following the lifting, termination or suspension of such injunction,
          order, restraint or prohibition (each Party agreeing to use its
          reasonable efforts to have such injunction, order, restraint or
          prohibition lifted, terminated or suspended), but in any event within
          five (5) business days thereof. At the Closing. Investor shall deliver
          an original certificate or certificates representing the Purchased
          Stock duly endorsed for transfer or with duly endorsed stock powers
          (which in form and substance are acceptable to GI) in blank and Gl
          shall deliver cash, by certified check or wire transfer in immediately
          available funds, to an account specified in writing by the investor,
          in the amount equal to the Option Price.

5.        FEES AND EXPENSES. Except as expressly provided otherwise in this
          Agreement, all costs and expenses incurred in connection with this
          Agreement and the consummation of the transactions contemplated
          hereby. including, without limitation, the legal fees and expenses of
          the investor and any taxes that may be imposed upon the Investor as a
          result of the purchase of such Purchased Stock from MetaMorpkiix or
          the transfer of such Purchased Stock to GI shall be paid by the Party
          incurring such expenses.

6.        Representations and Warranties.

          6.1     GI. GI hereby represents, warrants and covenants to the
                  Investor that, as of the Effective Date:

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

                  (b)     the execution, delivery and performance of this
                          Agreement by GI 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 GI of this
                          Agreement and its compliance with the terms and
                          provisions hereof does not and will not conflict with
                          or result in a material breach of any of the terms and
                          provisions of or constitute a material default under
                          (i) any material loan agreement. guaranty, financing
                          agreement, agreement affecting a product

Schedule 8.3 -- Page 3 of  9

<PAGE>

                          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
                          material 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 shall at all times comply with all applicable
                          material laws and regulations relating to its
                          activities under this Agreement.

                  IT IS EXPRESSLY UNDERSTOOD BY ALL PARTIES THAT GI IS MAKING NO
                  REPRESENTATIONS OR WARRANTIES OF ANY KIND. EXPRESS OR IMPLIED.
                  WITH RESPECT TO ANY OF THE PURCHASED STOCK.

          6.2     INVESTOR. Investor hereby represents. warrants and covenants
                  to GI that, as of the Effective Date, during the term of this
                  Agreement and, as of the Closing:

                  (a)     it is an "accredited investor" as that term is defined
                          in Rule 501(a) of Regulation D, promulgated under the
                          Securities Act of 1933. as amended:

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

                  (c)     the execution. delivery and performance by Investor 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) any
                          MATERIAL 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, if applicable, or (iii)
                          any material order, writ, injunction or decree of any
                          court or governmental authority entered against it or
                          by which any of its property is bound:

                  (d)     it has good and marketable title to each of the shares
                          of the Purchased Stock to be purchased by GI pursuant
                          to this Agreement, free and clear of all securities
                          interests, options, or rights of any nature;

                  (e)     [insert reciprocal reps and warranties 6.1(a) and
                          6.1(b) if Investor is an entity]

7.        MISCELLANEOUS,

          7.1     APPLICABLE LAW. This Agreement shall in all events and for all
                  purposes be governed by and construed in accordance with the
                  laws of the State of Delaware without regard to any choice of
                  law principle that would dictate the application of the law of
                  another jurisdiction.

Schedule 8.3 -- Page 4 of 9

<PAGE>

          7.2     AMENDMENT; MODIFICATION. Subject to applicable law, this
                  Agreement may be amended, modified and supplemented IN any and
                  all respects only in a writing signed by each of the Parties.

          7.3     ASSIGNMENT. Neither this Agreement nor any of the rights,
                  interests or obligations hereunder shall be assigned by any of
                  the Parties hereto without the other Party's prior written
                  consent, Subject to the preceding sentence, this Agreement
                  shall be binding upon and inure to the benefit of the Parties
                  hereto and their successors and permitted assigns: provided,
                  however, that any permitted assignee of Investor shall agree
                  to be bound to the terms and conditions of this Agreement and
                  a notice of assignment. in the form attached hereto as Exhibit
                  B. shall be duly executed by Investor and his assignee and
                  provided to GI promptly after such assignment. Notwithstanding
                  the foregoing, GI shall not require the prior consent of
                  Investor in the event that it assigns this Agreement or any or
                  its rights, interests or obligations hereunder to any of its
                  affiliated or subsidiary companies or to another entity in
                  connection with a merger, consolidation or acquisition of all
                  or substantially all of GI's assets, provided, however, that
                  GI shall provide Investor with written notice of such
                  assignment promptly after IT is made, Any assignment not made
                  in accordance with the provisions of this Section 7.3 shall be
                  null, void and of no effect.

          7.4     NOTICES. All notices and other communications required or
                  permitted to be given hereunder by one Party to any other
                  Party shall be in writing and shall be deemed given upon
                  personal delivery, facsimile transmission (with receipt
                  confirmed). telex or delivery by an overnight express courier
                  service (delivery, postage or freight charges prepaid). or on
                  the fourth day following deposit in the United States mail (if
                  sent by registered or certified mail, return RECEIPT
                  REQUESTED. delivery, postage and/or freight charges prepaid),
                  addressed to the Party to whom the notice is to be given at
                  the following addresses (or at such other address for a Party
                  as shall be specified by like notice):

                  If to GI to:

                                 Genetics Institute, Inc.
                                 87 Cambridge Park Drive
                                 Cambridge. Massachusetts 02140
                                 Attn:  Legal Department
                                 Fax:  (617)876-5851

                                 with a copy to:

                                 American Home Products Corporation
                                 Five Giralda Farms
                                 Madison, New Jersey 07940
                                 Attn: Senior Vice President and General Counsel
                                 Fax:  (973) 660.7156

Schedule 8.3 -- Page 5 of  9

<PAGE>

                  If to Investor, to:
                                 [Investor]
                                 [Address]
                                 [City. State. Zip code]
                                 Attn:
                                 FAX:

                                 with a copy to:

                                 [Name] [Address] [City, State, Zip code]
                                 Attn:
                                 Fax:

                  WITH COPIES OF all notices to:

                                 MetaMorphix, Inc.
                                 1450 South Rolling Road
                                 Baltimore, Maryland 21227
                                 Attn: President
                                 Fax: (410) 455-5885

                                                    and

                                 Shapiro and 0lander
                                 2000 Charles Center South
                                 36 South Charles Street
                                 Baltimore, Maryland 21201
                                 Attn: William E. Carlson, Esquire
                                 Fax:  (410) 539-7611

          7.5     SEVERABILITY, In the event that one or more of the provisions
                  contained in this Agreement shall, for any reason, be held to
                  be invalid, illegal or unenforceable in any respect. such
                  invalidity, illegality or unenforceability shall not affect
                  any other provision of this Agreement, and all other
                  provisions shall remain in full force and effect.

                                 (remainder of page intentionally LEFT BLANK)

Schedule 8.3 -- Page 6 of 9

<PAGE>

          7.6     ENTIRE AGREEMENT. This Agreement, the Exhibits, and Schedules,
                  if any hereto. constitute the entire agreement of the Parties
                  with regard to the subject matter hereof, and supersedes and
                  replaces all previous written or oral representations.
                  agreements and understandings between the Parties.

            IN WITNESS WHEREOF. GI and Investor have caused this Agreement to be
  executed by their duly authorized representatives as of the date first written
  above.

WTTNESS/ATTEST:                                      GENETICS INSTITUTE. INC.
Name:                                                Name:
Title:                                               Title:

WITNESS/ATTEST                                       [INVESTOR]
Name:                                                Name:
Title:                                               [Title:]
                                    Address:

                      ACKNOWLEDGEMENT OF METAMORPHIX, INC.

         MetaMorphix, Inc. hereby acknowledges the entering into of this
Agreement and its agreement with the terms and conditions contained herein.

WITNESS/ATTEST                          METAMORPHIX, INC.
                                        By:                               [SEAL]
                                           -------------------------------
William E. Carlson                      Edwin C. Quattlebaum, Ph.D.
Secretary                               President and Chief Executive Officer

Schedule 8.3 -- Page 7 of 9

<PAGE>

                                    EXHIBIT A

                             FORM OF EXERCISE NOTICE

                           PUT OPTION EXERCISE NOTICE
                                  Dated [______]

          THE UNDERSIGNED Investor, pursuant to that certain Put Option
Agreement made by and between Investor and Genetics Institute. Inc. ("GI") on
_____________ (the "Agreement") hereby notifies GI. pursuant to Section 2 of the
Agreement, of its election to exercise the Put Option granted by GI to such
Investor under the Agreement and hereby requests that on the day of ___________
(the "Closing Date"), GI pay to Investor _______________ dollars ($___________),
which amount represents the Option Price pursuant to Section 3 of the Agreement,
in exchange for which Investor, on the Closing Date, will deliver to GI an
original certificate or certificates representing _______________ shares of the
Purchased Stock (as defined in the Agreement) of MetaMorphix, Inc., duly
endorsed for transfer or with duly endorsed stock powers (which in form and
substance are acceptable to GI) in blank.

                                    INVESTOR

                                      Name:
                                    Address:

                                      Date:

Schedule 8.3 -- Page 8 of 9

<PAGE>

                                    EXHIBIT B

                            FORM OF ASSIGNMENT NOTICE

          THE UNDERSIGNED Investor (the "Investor"), hereby notifies Genetics
Institute, Inc. ("GI"), that, pursuant to Section 7.3 of the Put Option
Agreement (the "Agreement") entered into by GI and the Investor on
_______________. Investor, on the -- day of ______________________ has
transferred and assigned the Agreement and all of its rights and obligations
thereunder to ____________________________ ("Assignee"), having an address at
____________________________________.

          THE UNDERSIGNED Assignee, hereby acknowledges that it has received and
accepts from Investor, the transfer and assignment of the Agreement and all of
Investor's rights and obligations thereunder and agrees to be bound by all of
the terms and conditions set forth in the Agreement.

                                    INVESTOR

                                    --------------------------------------------
                                    Name:
                                    Address:

                                    ASSIGNEE

                                    --------------------------------------------
                                    Name:
                                    Address:

ACKNOWLEGED AND ACCEPTED
THIS ________ DAY OF ___________

BY GENETICS, INSTITUTE. INC.

By: ---------------------------------------------------------

Date: -------------------------------------------------------

Schedule 8.3 -- Page 9 of 9

<PAGE>

                                  SCHEDULE 8.4A

                        FORM OF ASSET PURCHASE AGREEMENT

                            ASSET PURCHASE AGREEMENT

          THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made as of January
--, 1999, by and between MetaMorphix. Inc.. a Delaware corporation ("Seller")
and Genetics Institute, Inc.. a Delaware corporation ("Buyer").

          WHEREAS, pursuant to that Master Lease Agreement dated as of October
14, 1997 (the "Master Lease Agreement") by and between the Seller and
Transamerica Business Credit Corporation ("Transamerica"), Seller is the
leasehold owner of the equipment more particularly described on Exhibit A
attached hereto and incorporated by reference (the "Equipment");

          WHEREAS, pursuant to the Letter Agreement dated January 25, 1999 by
and between Seller and Transamerica (a copy of which is attached hereto as
Exhibit B). Transamerica provided Seller an option to purchase the Equipment for
Two Hundred Seventy-Six Thousand Three Hundred Seven Dollars ($276,307) (the
"Option").

         WHEREAS, in accordance with that Amended and Restated Collaboration
Agreement entered into on January 26. 1999 by and among Seller. Buyer and the
Johns Hopkins University (the "1999 Collaboration Agreement") Buyer is desirous
of buying the Equipment and Seller is desirous of selling the Equipment, once
Seller has exercised its Option and received legal title to the Equipment.

         NOW, THEREFORE. in consideration of the premises herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

                 SECTION 1.  AMOUNT AND TERMS OF PURCHASE.

                          (a)   Subject to the terms and conditions of this
Agreement, and in reliance upon the representations and warranties of the Seller
herein set forth, the Buyer agrees to purchase and Seller agrees to sell all of
the Seller's right, title and interest in and to the Equipment (including.
without limitation, all manuals, documentation, specifications and spare parts
in Seller's possession that relate to such Equipment) such that the Buyer will
become the owner of all such Equipment for all purposes whatsoever.

                          (b)   The price to be paid by the Buyer with respect
to the purchase of the Equipment (the "Purchase Price") is Two Hundred
Seventy-Six Thousand Three Hundred Seven Dollars ($276,307). The Purchase Price
shall be payable to the Seller in cash or by certified check on the date
hereinabove first written.

Schedule 8.4 -- Page 1 of 10

<PAGE>

                          (c)   The Buyer shall pay any and all applicable
federal, slate. county or local taxes and any and all present or future taxes or
other governments charges arising in Connection with the sale of the Equipment
hereunder, including sales. use or occupation taxes due upon the purchase, but
EXCLUDING any income tax realized by Seller as a result of the Sale.

                          (d)   The Buyer shall select a carrier and arrange for
such carrier to deliver the Equipment to the location(s) designated by the Buyer
within thirty (30) days of this Agreement arid shall prepay all freight,
packing. Shipping, and insurance costs associated with the delivery of the
Equipment to Buyer.

                 SECTION 2.  APPLICATION OF PURCHASE PRICE, TRANSFER OF TITLE,
AND DELIVERY.

                          (a)   Within one (I) business day of the date upon
which Seller receives the Purchase Price, the Seller shall deliver the same to
Transamerica, as payment toward the Option to purchase the Equipment, and legal
title shall be transferred to Seller from Transamerica and the Equipment shall
be free and clear of the Master Lease Agreement and any right, title, or
interest that Transarnerica has therein to the Equipment.

                          (b)   Seller shall transfer legal title to the
Equipment to the Buyer within one (I) business day of receiving same. Transfer
of title to Buyer shall be evidenced by a Bill of Sale. in substantially the
form as is attached hereto as Exhibit "C". The Bill of Sale shall be dated the
day upon which title to the Equipment is transferred (the "Date of Purchase").

                          (c)   Buyer shall assume the risk of loss with respect
to the Equipment as of the later of (i) the date legal title is transferred to
Buyer as provided in Section 2(b) above or (ii) the date the Equipment is
delivered to Buyer's carrier. Buyer shall cause its carrier to promptly remove,
or cause to be removed, from Seller's possession, the Equipment (and all
manuals, documents, specifications, and spare parts provided to it by the
Seller) within thirty (30) days of the Date of Purchase.

                          (d)   In the event that Seller has delivered the
Purchase Price to Transamerjca and Transamerica is unable, for whatever reason
(other than an act or omission which is in Seller's control). to transfer title
to the Equipment to Seller within thirty (30) days of the date hereinabove first
written, and therefore Seller is unable to transfer title to the Equipment as
contemplated by this Agreement, Buyer, prior to exercising any other remedies it
may have at law or in equity, shall reasonably cooperate with Seller's efforts
to transfer title, including bringing legal action, at Seller's expense, if
necessary, to obtain legal title to the Equipment.

                 SECTION 3.  REPRESENTATION AND WARRANTIES OF SELLER. To induce
the Buyer to enter into this Agreement. the Seller represents and warrants to
the Buyer that:

Schedule 8.4 -- Page 2 of 10

<PAGE>

                          (a)   The Seller is duly authorized to execute,
deliver and perform its obligations under this Agreement and all corporate.
action required on its pan for the due execution. delivery and performance of
the transactions contemplated herein have been duly and effectively taken.

                          (b)   The execution, delivery and performance by the
Seller of this Agreement and the consummation of the transactions contemplated
herein does not and will not violate any provision of. or result in a default
under, the Seller's Certificate of Incorporation, as amended or By-laws. as
amended, or any indenture or agreement to which the Seller is a party or to
which its assets are bound or any order, permit, law, statute, code, ordinance,
rule, regulation, certificate or any other requirement of any governmental
authority or regulatory body to which the Seller is subject.

                          (c)   To the best of Buyer's knowledge, no
authorization or approval or other action by, and no notice to or filing with,
any governmental authority or regulatory body is required for the due execution,
delivery and performance by the Seller of this Agreement.

                          (d)   This Agreement constitutes or will constitute,
when delivered hereunder, the legal, valid and binding obligation of the Seller
enforceable against the Seller in accordance with its respective terms, except
as such enforceability may be (i) limited by the effect of applicable
bankruptcy, insolvency, reorganization or similar laws affecting the enforcement
of creditors' rights generally or (ii) subject to the effect of general
principles of equity (regardless of whether such enforceability is considered in
a proceeding at equity or at law).

                          (e)   There are no actions, suits, or proceedings
pending, threatened against or affecting the Seller which seek to enjoin,
prohibit or restrain the consummation of any of the transactions contemplated
hereby.

                          (f)   Seller shall use all reasonable and good faith
efforts to ensure that title to the Equipment is promptly passed from
Transamerica to Seller.

                          (g)   All representations and warranties herein shall
survive the execution of this Agreement and the purchase of the Equipment.

                          (h)   Upon payment of the Purchase Price to
Transamerica, the Equipment shall be owned by Seller and no third party shall
have any right, title, or interest in the Equipment.

                          (i)   THE EQUIPMENT IS PROVIDED BY SELLER "AS IS"; AND
WITHOUT WARRANTY. EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE: provided. however, that the Seller shall
use all reasonable efforts to maintain such Equipment in the condition as it was
at the time of the inspection by Buyer.

Schedule 8.4 -- Page 3 of 10

<PAGE>

                 SECTION 4. REPRESENTATION AND WARRANTIES OF BUYER. To induce
the Seller to enter into this Agreement. the Buyer represents and warrants to
the Seller that:

                          (a)   The Buyer is duly authorized to execute, deliver
and perform its obligations under this Agreement and all corporate action
required on its pan for the due execution, delivery and performance of the
transactions contemplated herein have been duly and effectively taken.

                          (b)   The execution, delivery and performance by the
Buyer of this Agreement and the consummation of the transactions contemplated
herein does not and will not violate any provision of. or result in a default
under, the Buyers's Articles or Certificate of Incorporation or By-laws or any
indenture or agreement to which the Buyer is a party or to which its assets are
bound or any order, permit, law, statute, code. ordinance, rule, regulation,
certificate or any other requirement of any governmental authority or regulatory
body to which the Buyer is subject.

                          (c)   To the best of Buyer's knowledge, no
authorization or approval or other action by. and no notice to or filing with,
any governmental authority or regulatory body is required for the due execution,
delivery and performance by the Buyer of this Agreement.

                          (d)   This Agreement constitutes or will constitute,
when delivered hereunder, the legal, valid and binding obligation of the Buyer
enforceable against the Buyer in accordance with its respective terms, except as
such enforceability may be (i) limited by the effect of applicable bankruptcy,
insolvency, reorganization or similar laws affecting the enforcement of
creditors' rights generally or (ii) subject to the effect of general principles
of equity (regardless of whether such enforceability is considered in a
proceeding at equity or at law).

                          (e)   To the best of Buyer's knowledge, there are no
actions. suits, or proceedings pending. threatened against or affecting the
Buyer which seek to enjoin, prohibit or restrain the consummation of any of the
transactions contemplated hereby.

                          (f)   All representations and warranties herein shall
survive the execution of this Agreement and the purchase of the Equipment.

                 SECTION 5. AMENDMENTS. No amendment or waiver of any provision
of this Agreement. nor consent to any departure therefrom shall in any event be
effective unless the same shall be in writing and signed by the Buyer, and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.

                 SECTION 6. NOTICES. All notices and other communications
provided for hereunder shall be in writing and sent:

Schedule 8.4 -- Page 4  of 10

<PAGE>

                          if to the Seller. at its address at:

                          MetaMorphix. Inc.
                          1450 South Rolling Road
                          Baltimore, MD 21227
                          Attention:   President
                          Telephone No.: 410-455-5880
                          Telecopy No.: 410-465-4836

                          with a copy to:

                          Shapiro and Olander
                          2000 Charles Center South
                          36 South Charles Street
                          Baltimore. Maryland 21201-3 147
                          Attention: William E. Carlson. Esquire
                          Telecopy No.: 410-539-7611~

                          if to the Buyer, at its address at:

                          Genetics Institute, Inc.
                          87 Cambridge Park Drive
                          Cambridge. Massachusetts 02140
                          Attention:   Legal Department
                          Telecopy No.: 617-876-5851

                          with a copy to:

                          American Home Products Corporation
                          Five Giraida Farms
                          Madison, New Jersey 07940
                          Attention:  Senior Vice President and General Counsel
                          Telecopy No.: 973-660-7156

or to such other address as shall be designated by such party in a written
notice to the other party. All such notices shall be deemed given (i) if sent by
certified or registered mail, three days after being postmarked. (ii) If sent by
overnight delivery service, when received at the above stated addresses or when
delivery is refused and (iii) if sent by facsimile transmission, when receipt of
such transmission is confirmed by the sender.

                 Section 7. NO WAIVER/REMEDIES. No failure on the part of the
Buyer to exercise and no delay in exercising, any right hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.

Schedule 8.4 -- Page 5 of 10

<PAGE>

                 SECTION 8. BENEFIT. Without the prior written consent of the
other party hereto. this Agreement may not be transferred, assigned or.
delegated any of its rights, duties or obligations hereunder.

                 SECTION 9. BINDING EFFECT. This Agreement shall be binding upon
and inure to the benefit of the Seller and the Buyer and their respective
successors and assigns.

                 SECTION 10. GOVERNING LAW. This Agreement shall be governed by,
and shall be construed in accordance with, the laws of the state of Maryland
without giving effect to the conflicts of law principles thereof.

                 SECTION 11. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts, each of which shall constitute an
original and all of which taken together shall constitute one and the same
agreement.

                 SECTION 12. SEVERABILITY. If one or more of the provisions
contained in this Agreement shall be invalid, illegal, or unenforceable in any
respect, the validity. legality, and enforceability of the remaining provisions
contained herein, and any other application thereof shall not in any way be
affected or impaired thereby.

                 SECTION 13. JURY TRIAL. The parties hereto each hereby waive to
the fullest extent permitted by law any right to a trial by jury in any action
or proceeding arising under or in connection with this Agreement.

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

                                METAMORPHIX INC.

                                By:
                                  ----------------------------------------------
                                Edwin C. Quattlebaum, President

                                GENETICS INSTITUTE, INC.

                                By:
                                   ---------------------------------------------
                                   Name:
                                   Title:

Schedule 8.4 -- Page 6 of 10

<PAGE>

                                    EXHIBIT A

                                    EQUIPMENT

                               See attached pages.

Schedule 8.4 -- Page 7 of 10

<PAGE>

                                    EXHIBIT B

                                LETTER AGREEMENT
                                     BETWEEN
                                METAMORPHIX, INC.
                                       AND
                    TRANSAMERICA BUSINESS CREDIT CORPORATION

                               See attached pages.

Schedule 8.4 -- Page 8 of 10

<PAGE>

SHAPIRO and OLANDER

           January 25,1999

          SENT VIA TELECOPIER

         Mr. Gregory Clark
         Transamerica Business Credit
         Technology Finance Division
         76 Batterson Park Road
         Farmington, CT 06032.2571

                 Re: Sale of equipment by MetaMorphix, Inc. Pursuant to Master
                     LEASE AGREEMENT WITH TRANSAMERICA BUSINESS CREDIT
                     CORPORATION

Dear Greg:

                 As we discussed on Friday, MetaMorphix, inc. ("MMI") is in the
        process of licensing certain human pharmaceutical and therapeutic
        applications OF its Growth Differentiation Factors to Genetics Institute
        Inc. ("GI"), We anticipate closing this transaction by Monday, January
        25, 1999 or as soon thereafter as practicable (THE "Closing"). In
        connection with that transaction GI desires to purchase equipment that
        it subject to the Master Lease Agreement dated October 24, 1997 and
        attached Lease Schedules between Transamerica Business Credit
        Corporation ("TBCC") and MMI (the "Master Lease"), as act forth on the
        attached List of Equipment (the "Equipment).

                Because there is no pre-purchase right contained in the Master
        Lease, we hereby request that TBCC confirm its agreement to consent to
        the transaction and agree to sell and transfer the Equipment to MMI,
        free and clear of all liens and encumbrances, contingent upon receipt of
        payment to MMI in the amount of $276,307 and the payment by MMI to TBCC
        of such amount as prepayment for the Equipment under the Master Lease.
        We need this a consent prior to Closing. Following our payment to TBCC,
        will need to amend the Lease Schedules and file a partial release of
        TBCC's UCC-1 filing for the Equipment.

                 To evidence the consent and agreement of TBCC to the sale of
        the Equipment as described herein, please sign below and return a signed
        original of this letter via facsimile and Federal Express, to my
        attention at your earliest Convenience I have enclosed a federal express
        envelope for your convenience.

                Additionally, given the tight time schedule on this transaction
        I would appreciate your promptly adjusting the equipment schedules on
        the remaining Lease and preparing the partial

<PAGE>

SHAPIRO AND OLANER
Mr. Gregory Clark
January 25. 1999
Page 2

                releases of the UCC's on the Equipment. In the event I can be of
                any assistance to you in preparing the above described
                documents, please advise me. I will happy to assist. I have
                assumed, given that the documents are on your system, that you
                would prefer controlling the revisions of the documents.

                     Many thanks In advance for your assistance.

                                               Very truly yours,
                                               /s/ A. Lynne Puckett
                                               A. Lynne Puckett

ALP/mms
Enclosures
Cc: Frederick Cobb, Controller and Director of Operations (via facsimile)
    William E. Carlson. Esquire

          ACKNOWLEDGED AND AGREED TO
          THIS ________ DAY OF JANUARY, 1999

TRANSAMERICA BUSINESS
CREDIT CORPORATION

BY:  /S/ GARY P. MORO
GARY S. MORO

TITLE: VICE President

<PAGE>

                                    EXHIBIT C

                                  BILL OF SALE

                 KNOW ALL PERSONS BY THESE PRESENTS METAMORPHIX INC. (the
"Seller"), for Two Hundred Seventy-Six Thousand Three Hundred Seven Dollars
($276,307) and other valuable consideration to it in hand paid receipt of which
is hereby acknowledged, does unconditionally, absolutely and irrevocably grant
sell assign, transfer and convey unto GENETICS INSTITUTE. INC. and its assignees
or successors (collectively, the "Buyer"), all of the Seller's right, title and
interest in and to the equipment described on SCHEDULE I hereto (collectively,
the "Equipment").

                 TO HAVE AND TO HOLD said Equipment unto the said Buyer to and
for its use forever.

                 AND, the Seller hereby warrants. covenants and agrees that it
(a) has good and marketable title to the Equipment, free and clear of any liens
and other encumbrances: and (b) will warrant and defend the sale of the
Equipment against any and all persons claiming against such title.

                  IN WITNESS WHEREOF the Seller has caused this instrument to be
duly executed and delivered as of this ___________ day of _____________________,
1999.
                                METAMORPHIX, INC.

                                By:
                                   ---------------------------------------------
                                Edwin C. Quattlebaum, President

Schedule 8.4 -- Page 9 of 10

<PAGE>

                                   SCHEDULE I
                                 to Bill of Sale

                                    EQUIPMENT

                               See attached pages.

<PAGE>

                                  SCHEDULE 8.4B

                   METAMORPHIX EQUIPMENT TO BE PURCHASED BY GI

                               See attached pages.

<PAGE>

<TABLE>
<CAPTION>
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
ID      Qty   Vendor             Manufacturer           Equipment                    Model        Serial          Cost
                                                                                                  Number
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
<C>     <C>   <C>                <C>                    <C>                          <C>                     <C>
1       1     APPLIED            PERKIN ELMER           GENE AMP 1000                PCR I 00                $9,000.00
              BIOSYSTEMS
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
2             BARBERA BUSINESS   PANASONIC              FAX MACHINE                  Uf-550                  $1,200.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
3             SYSTEM SOURCE      LEXMARK                PRINTER                      OPRTA                   $1,588.65
              LEXMARK
              PRINT~ P - CPRTA
              P N 4:9820
              5:
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
4             BELL ATLANTIC      MOTOROLA               PAGER                        BRAVO                     $100.02
                                                                                     FLX/SKYTEL
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
5             BEST BUY                                  CARRYING CASE                                           $62.99
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
6             BEST BUY           COMPAQ                 Laptop-Compaq                1210                    $2,414.99
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
7             BEST BUY           MC                     MOUSE-Compaq                                            $31.49
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
8             BEST BUY           TOSHIBA                POLICY-COMPAQ                                          $129.99
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
9             BIO RAD            BIO RAD                PROTEAN GEL CELL             PROTEAN II                $841.50
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
10            BIO RAD            BIO RAD                SUB-CELL                     GT BASIC                  $391.50
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
11            BIO RAD            BIO RAD                SUB-CELL                     GT MINI                   $664.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
12            BIO RAD            BIO RAD                CAPACITIANCE EXTENDER II     25-1075MFD                $873.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
13            BIO RAD            BIO RAD                GENE PULSE CONTROLLER        MODEL                      $634.5
                                                                                     165-2109
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
14            BIO RAD            BIO RAD                GENE PULSER II                                       $2,932.75
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
15            BIO RAD            BIO RAD                MINI PROTEAN II 2-D CELL                               $580.50
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
16            BIO RAD            BIO RAD                READY GEL CELL/MINI TRANS                            $1,098.00
                                    BLOT MOD
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
17            BIO RAD            BIO RAD                READY GEL CELL/MINI TRANS                            $1,098.00
                                    BLOT MOD
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
18            CELERIUS           HITACHI                LAPTOP PENTIUM 133 HITACHI   M133T                   $3,984.75
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
19            CELERIUS           3COM                   100 BASE T NETWORK CARD                                $115.50
                                     HITACHI
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
20            CELERIUS                                  COMPUTER BATTERY HITACHI     2ND LI+ MX                $183.75
                                                                                     SERIES
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
21            OXFORD MOLECULAR   OMIGA 1 0              SOFTWARE LICENSE (HITACHI)                           $1,605.50
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
22            COMP USA           MAC                    6400/200 16/2 4 MMMT                                 $2,288.97
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
23            COMP USA           CANON                  PRINTER BUBBLEJET            CANO                      $524.97
                                                                                     BJC-4550
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
24            IMAGE SYSTEMS      SMZ-1B                 BINO HEAD                    SMZ-18                  $1,696.48
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
25            IMAGE SYSTEMS      NIKON                  MICROSCOPE                   ALPHAPHOT               $1,519.80
                                                                                     BODY
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
26            LABREPCO           SANYO                  CENTRIFUGE (TABLE TOP)       HARIER                  $2,750.00
                                                                                     15/80
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
27            LABREPCO                                  24X2ML FIXED ANGLE ROTOR     43117-611                 $550.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
28            LABREPCO                                  MICROTITRE CARRIER           41159-1322                $635.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
29            LABREPCO                                  BLUE ADAPTER 37X12MM (2PK)   43155-1322                $600.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
30            LABREPCO                                  YELLOW ADAPTER 37X12MM       43155-1369                $600.00
                                      (2PK)
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
31            LABREPCO                                  GREEN ADAPTER 37X12MM (2PK)  43155-134A                $600.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
32            LABREPCO           BIOMETRA               HYBRIDIZATION                OV4                     $1,667.55
                                                        OVEN/INCUBATORS
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
33            LABREPCO           BARNSTEAD/THERMO       NONPURE INFINITY UV/UF       MODEL D8991             $4,045.83
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
34            LABREPCO           JENWAY                 PH METER                     MODEL 3305                $350.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
35            OFFICE DEPOT       EPSON                  PRINTER                      STYLUS                    $480.88
                                                                                     COLOR 800
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
36
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
37            BARBERA            MITA DC-1560           PHOTO COPIER                 DC-1560                 $3,100.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
38            BAMANT COMPANY     PUMP EASY LOAD         MASTER FLEX                                            $395.73
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
39            BAMANT COMPANY     PUMP EASY LOAD         MASTER FLEX                  PUMP HEAD                 $395.73
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
40
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
41            BECTON-DICKINSON   BECTON-DICKINSON       FACSCAN AND FAC STATION      FACSCAN                 $17,583.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
42            BECTON-DICKINSON   BECTON-DICKINSON       FACSCAN AND FAC STATION      FAC STATION             $20,350.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
43            BIO-RAD            BIO-RAD                MINI-TRANSBIO                                          $991.45
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
44            COMPUTER MASTERS   DAEWOO                 SCGA MONITORS 15"            15" VGA                   $290.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
45            COMPUTER MASTERS   DAEWOO                 SCGA MONITORS 15"            15" VGA                   $290.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
46            COMPUTER MASTERS   DAEWOO                 SCGA MONITORS 15"            15" VGA                   $290.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
47            COMPUTER MASTERS   DAEWOO                 SCGA MONITORS 15"            15" VGA                   $290.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
48            COMPUTER MASTERS   DAEWOO                 SCGA MONITORS 15"            15" VGA                   $290.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
49            COMPUTER MASTERS   DAEWOO                 SCGA MONITORS 17"            17" VGA                    500.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
50            COMPUTER MASTERS   DAEWOO                 SCGA MONITORS 17"            17" VGA                   $500.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
51            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,704.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
52            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,650.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
53            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,610.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
54            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,610.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
55            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,610.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
56            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,704.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
57            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,704.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
58            COMPUTER MASTERS   COMPUTER MASTERS       200 PENTIUM MMX COMPUTERS    PENTIUM 200             $1,705.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
59            DORN & HART        MICROEDGE              ROTARY MICTOTOME             AO 820                  $1,370.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
60            EDVOTEK            EDVOTEK                VAR DUPLEX POWER PACK        EDV105                    $280.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
61            FERMTECH           FERNTECH               INCUBATOR/OVEN                                         $300.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
62            FERMTECH           FERNTECH               WATER BATH WITH LID                                    $100.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
63            FERMTECH           LABCONO                PUNTYER CLEAN BENCH                                  $1,100.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
64            FISHER SCIENTIFIC  FISHER SCIENTIFIC      TISSUE FLOAT BATH 120V                                 $678.82
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
65            FISHER SCIENTIFIC  FISHER SCIENTIFIC      PH ELECTRODE                                           $468.25
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
66            LEICA              LEICA                  HISTOEMBEDDER                120.60HZ                $4,000.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
67            LEICA              LEICA                  TISSUE PROCESSOR             95-125 VAC              $36,538.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
68            LIFE TECHNOLOGIES  LIFE TECHNOLOGIES      SEG GEL ELECTRO APPAR        S2                        $908.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
69            MCMASTER CARR      MCMASTER CARR          TABLE TOP HUMIDIFIER         5 GALLON                  $100.38
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
70            MJ RESEARCH INC    PELTBER THERMAL CYCLE  HOT BONNET                   96V                     $4,347.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
71            MJ RESEARCH INC    PELTBER THERMAL CYCLE  HOT BONNET                   96V                     $4,347.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
72            PGC SCIENTIFIC     PGC SCIENTIFIC         POLY HEAT SEALER                                       $118.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
73            REES SCIENTIFIC    MICRO                  MICRO 4000 MON SYS                                   $3,396.75
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
74            SCANALYTICS INC    SCANALYTICS INC        ONE-DSCAN (SOFTWARE)                                 $1,510.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
75
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
76            VWR SCIENTIFIC     VWR SCIENTIFIC         ONE-TOUCH HOLDER/ACCESS      ACCU-EDGE                 $598.50
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
77            VWR SCIENTIFIC     BIOFUGE                MICROCENTNFUGE & ROTOR                               $1,357.25
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
78            VWR SCIENTIFIC     FALCON                 PIPET AID                    PORTABLE                  $219.07
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
79            VWR SCIENTIFIC     FALCON                 PIPET AID                    PORTABLE                  $219.07
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
80            VWR SCIENTIFIC     FALCON                 PIPET AID                    PORTABLE                  $219.07
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
81            VWR SCIENTIFIC     FALCON                 PIPET AID                    PORTABLE                  $219.07
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
82            SORVALL            SORVALL                ULTRA CENTRAFUGE                                     $38,900.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
83            SORVALL            SORVALL                ULTRA CENTRAFUGE W ROUTER                            $10,460.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
84            SORVALL            SORVALL                ULTRACRIMP ROOTER                                    $9,550.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
85            SORVALL            SORVALL                CRIMPER TOOL                                           $945.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
86            IMAGE SYSTEMS      NIKON                  MICROSCOPE                                           $25,284.10
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
87            IMAGE SYSTEMS      NIKON                  MICROSCOPE                                           $3,391.20
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
88            RAININ             GILSON                 PIPET                        MODEL P1000               $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
89            RAININ             GILSON                 PIPET                        MODEL P1000               $240.46
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
90            RAININ             GILSON                 PIPET                        MODEL P1000               $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
91            RAININ             GILSON                 PIPET                        MODEL P1000               $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
92            RAININ             GILSON                 PIPET                        MODEL P1000               $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
93            RAININ             RAININ                 PIPET                        MODEL P200                $209.87
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
94            RANIN              GILSON                 PIPET                        MODEL P100                $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
</TABLE>

<PAGE>

<TABLE>
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
<S>           <C>                <C>                    <C>                          <C>                      <C>
95            RAININ             RAININ                 PIPET                        MODEL P200                $209.87
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
96            RAININ             RAININ                 PIPET                        P-10                      $246.18
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
97            RAININ             RAININ                 PIPETMAN 10ML                P-10ML                    $238.97
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
98            RAININ             RAININ                 PIPETMAN 200UL               P-200                     $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
99            RAININ             RAININ                 PIPETMAN 200UL               P-200                     $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
100           RAININ             RAININ                 PIPETMAN 200UL               P-200                     $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
101           RAININ             RAININ                 PIPETMAN                     P-20                      $252.05
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
102           RAININ             RAININ                 PIPET                        P-20                      $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
103           RAININ             RAININ                 PIPET                        P-1000                    $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
104           SORVALL            SORVALL                SWIGING BUCKET ROTOR         TH-660                  $8,185.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
105           VWR SCIENTIFIC     VWR SCIENTIFIC         SHALLOW WATER BATH                                     $321.35
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
106
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
107           LABREPCO           AIRFILTRONIX           MINI CLEAN ROOM              RF-1000                 $1,995.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
108           LABREPCO           AIRFILTRONIX           MINI CLEAN ROOM              RF-1000                 $1,995.00
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
109           RAININ             RAININ                 PIPETMAN 1000UL              P-1000                    $209.04
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
110           RAININ             RAININ                 PIPETMAN 20UL                P-20                      $210.53
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
111           VWR SCIENTIFIC     VWR SCIENTIFIC         BIOFUGE MICROCENTERFUGE                              $1,318.42
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
112
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
113           RAININ             RAININ                 PIPETMAN 20UL                P-20                      $210.53
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
114           COMP USA           HP MAC                 SCANJET 4C                   4C                        $892.49
------- ----- ------------------ ---------------------- ---------------------------- ------------ ---------- ----------
</TABLE>

<PAGE>

                                  SCHEDULE 8.5

               FORM OF INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT

                   INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT

         THIS INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT (this "Assignment") is
made this day of January, 1999, by and between MetaMorphix, Inc., a Delaware
corporation (hereinafter referred to as "the Assignor"), and Genetics Institute,
a Delaware corporation (hereinafter referred to as "the Assignee').

                              EXPLANATORY STATEMENT

         WHEREAS, on February 1, 1998 the Assignor and Baylor College of
Medicine, a Texas non-profit corporation ("Baylor"), entered into a Research
Collaboration Agreement, a copy of which is attached hereto as EXHIBIT A and
incorporated herein by reference (the "Agreement").

         WHEREAS, in accordance with the provisions of that certain Amended and
Restated Collaboration Agreement entered into on January 26, 1999 by and among
Assignor, Assignee and the Johns Hopkins University (the "1999 Collaboration
Agreement"), Assignor desires by this Assignment to assign to the Assignee its
rights and licenses, if any, arising under the Agreement afler August 1, 1998
and prior to February 1, 1999, in consideration of the payment of Forty-eight
Thousand Dollars ($48,000) to Assignee, which amount is equal to the amount owed
by Assignor to Baylor under the terms of the Agreement; and

         WHEREAS, the Assignee desires to accept such assignment, all upon the
terms and subject to the conditions which are hereinafter set forth.

                                    AGREEMENT

         NOW, THEREFORE. FOR AND IN CONSIDERATION of the mutual ently into this
Assignment by the parties hereto. and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged by each party hereto,
the parties hereto hereby agree as follows:

         Section 1. ASSIGNMENT. The Assignor hereby assigns to the Assignee, and
the Assignee hereby accepts from the Assignor. all of the Assignors right,
title, interest and licenses, if any, in and to any data, information, or
intellectual property arising after August 1, 1998 and prior to February 1.
1999, including, without limitation, the right to require Baylor to grant to
Assignee an exclusive license to Baylor's interest in any such data,

Schedule 8.5 -- Page 1 of 4

<PAGE>

information and intellectual property. (collectively, the "Assigned Rights")
under the provisions of the Agreement upon receipt of Forty-eight Thousand
Dollars ($48,000) from Assignee, by check or wire transfer. Notwithstanding the
foregoing. Assignor is not assigning to Assignee and Assignee is not assuming
any obligations Assignor may have to Baylor under the Agreement with respect to
the Assigned Rights or otherwise.

            SECTION 2. REPRESENTATIONS, WARRANTIES, AND COVENANTS.

            2.1. BY ASSIGNOR. The Assignor hereby represents, warrants and
covenants to the Assignee that,

                   2.1.1. the Assignor has not heretofore assigned, transferred,
or encumbered any or all, of its rights under the provisions of the Agreement;
and

                   2.1.2. as of the date of this Assignment. the Assignor has
paid to Baylor Forty-eight Thousand Dollars ($48,000) and shall remit the
balance of the amount it owes Baylor promptly after the execution of this
Assignment.

                   2.2. BY EACH PARTY'. Each party hereto hereby represents and
warrants to the other that it has been duly authorized to execute and deliver
this Assignment. and to perform its obligations hereunder.

            SECTION 3. NOTICES. All notices and other communications provided
for hereunder shall be in writing and sent:

                          if to the Assignor, at its address at:

                          MetaMorphix. Inc. 1450 South Rolling Road Baltimore.
                          MD 21227 Attention: President Telephone No.:
                          410-455-5880 Telecopy No.: 410-465-4836

                          with a copy to:

                          Shapiro and Olander
                          2000 Charles Center South
                          36 South Charles Street
                          Baltimore. Maryland 21201-3147
                          Attention: William E. Carlson. Esquire

Schedule 8.5 -- Page 2 of 4

<PAGE>

                          if to the Assignee. at its address at:

                          Genetics Institute. Inc.
                          87 CambridgePark Drive
                          Cambridge, Massachusetts 02140
                          Attention: Legal Department
                          Telecopy No.: 617-876-5851

                          with a copy to:

                          American Home Products Corporation
                          Five Giralda Farms
                          Madison. New Jersey 07940
                          Attention:   Senior Vice President and General Counsel
                          Telecopy No.: 973-660-7156

or to such other address as shall be designated by such party in a written
notice to the other party. All such notices shall be deemed given (i) if sent by
certified or registered mail, three days after being postmarked, (ii) if sent by
overnight `delivery service, when received at the above stated addresses or when
delivery is refused and (iii) if sent by facsimile transmission. when receipt of
such transmission is confirmed by the sender.

            SECTION 4. GENERAL.

            4.1. EFFECTIVENESS. This Assignment shall become effective on and
only on its execution and delivery by each party hereto.

            4.2. AMENDMENT. This Assignment may be amended by and only by an
instrument executed and delivered by each party, hereto.

            4.3. WAIVER. No party hereto shall be deemed to have waived the
exercise of any right which it holds hereunder unless such waiver is made
expressly and in writing (and. without limiting the generality olthe foregoing.
no delay or omission by any party hereto in exercising any such right shall be
deemed a waiver of its future exercise). No such waiver made in any instance
involving the exercise of any such right shall be deemed a waiver as to any
other such instance, or arty other such right.

            4.4.APPLICABLE LAW. This Assignment shall be given effect and
construed by application of the law of Maryland except in regard to its choice
of law provisions.

            4.5. ASSIGNMENT. This Assignment shall be binding upon and shall
inure to the benefit of the parties hereto and their successors and assigns
hereunder.

            4.6. SEVERABILITY. No determination b any court, governmental body
or otherwise that any provision of this Assignment or any amendment hereof is
invalid or unenforceable in any instance shall affect the validity or
enforceability of (a) any other provision thereof, or

Schedule 8.5 -- Page 3 of 4

<PAGE>

(b) such provision in any circumstance not controlled by such determination.
Each such provision shall be valid and enforceable to the fullest extent allowed
by and shall be construed wherever possible as being consistent with. applicable
law.

            4.6. ENTIRE AGREEMENT. This Assignment. together with the Agreement
constitutes the entire agreement of the parties with regard to its subject
matter. and supercedes all previous written or oral agreements and
understandings. other than the 1999 Collaboration Agreement, between Assignor
and Assignee.

            IN WITNESS WHEREOF. each party hereto has executed and sealed this
Assignment or caused it to be executed and sealed on its behalf by its duly
authorized representatives, the day and year first above written.

(SEAL)
ATTEST:                                METAMORPHIX. INC.
-----------------------------          By:
(SEAL)                                    --------------------------------------
William E. Carlson, Secretary          Edwin C. Quattlebaum, President

WITNESS/ATTEST:                        GENETICS INSTITUTE. INC.

------------------------------         By:
(SEAL)                                    --------------------------------------
                                       Name:
                                       Title:

Schedule 8.5 -- Page 4 of 4

<PAGE>

                                  SCHEDULE 8.6

                          FORM OF TERMINATION AGREEMENT

                              TERMINATION AGREEMENT

            THIS TERMINATION AGREEMENT is made this _______ day of January, 1999
by and among MetaMorphix Inc. a Delaware corporation (the Corporation"). The
Johns Hopkins University ("JHU"). Genetics Institute. Inc. ("GI"). *** and the
*** 1997 Irrevocable Trust (the "Trust").

                              Explanatory Statement

            WHEREAS, as of April 18, 1995, JHU, GI, and *** (collectively the
"Stockholders") entered into a Voting Agreement (the "1995 Voting Agreement")
which provided for among other matters, the method by which the Stockholders
would vote their securities to elect persons as members of the Board of
Directors of the Corporation.

            WHEREAS, as of April 18, 1995, the Corporation. JHU, GI, and ***
entered into a Stock Restriction Agreement (the "1995 Stock Restriction
Agreement") and a Right of First Refusal Agreement (the "1995 Right of First
Refusal Agreement"). both of which provided for, among other matters, the
Corporation or JHU and GI to have the right to purchase a portion of Dr. Lee's
shares in certain circumstances:

            WHEREAS, in 1997. *** transferred 80,000 shares of his stock to the
Trust, which Trust agreed to be bound by the 1995 Voting Agreement, the 1995
Stock Restriction Agreement, and the 1995 Right of First Refusal Agreement:

            WHEREAS, on January _________, 1999, in connection with the
Corporation's sale of certain human and diagnostic rights in certain Growth and
Differentiation Factors, the Corporation has purchased and redeemed from GI
Three Million Six Hundred Thousand (3,600,000) shares of the Corporation's
Convertible Preferred Stock, leaving GI with Two Hundred Thousand (200,000)
shares of Series A Convertible Preferred Stock and no shares of Series B
Convertible Preferred Stock:

            WHEREAS. as a result of such redemption. and as a condition thereto,
the Corporation. JHU, GI. *** and the Trust desire to terminate the Voting
Agreement and to modify the 1995 Stock Restriction Agreement and the 1995 Right
of First Refusal Agreement.

                                    AGREEMENT

NOW, THEREFORE in consideration of the Explanatory Statement, which is hereby
made a substantive part of this Termination Agreement and other good and
valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

Schedule 8.6 -- Page 1 of 3

<PAGE>

            1. TERMINATION OF VOTING AGREEMENT. Pursuant to Section 1 0 of the
Voting Agreement. the 1995 Voting Agreement is hereby terminated and shall be of
no further force and effect. The Corporation shall promptly give written notice
of such termination to ***.

            2. WAIVER OF RIGHT TO PURCHASE STOCK UNDER 1995 STOCK RESTRICTION
AGREEMENT AND 1995 RIGHT OF FIRST REFUSAL AGREEMENT. GI hereby waives any and
all rights to purchase any shares under the 1995 Stock Restriction Agreement and
the 1995 Right of First Refusal Agreement and for all intents and purposes the
1995 Stock Restriction Agreement and the 1995 Right of First Refusal Agreement
shall be amended to the effect that GI is no longer a "Purchaser" and/or a party
to such 1995 Stock Restriction Agreement or 1995 Right of First Refusal
Agreement.

            3. EFFECTIVE DATE. The Effective Date for the termination of the
Voting Agreement and the amendments of the 1995 Stock Restriction Agreement and
the 1995 Right of First Refusal Agreement shall be the date as of which this
Termination Agreement is executed and delivered.

            4. STOCK CERTIFICATES. Any stock certificates evidencing voting
securities hereafter returned to the Corporation by the Stockholders shall have
the legend placed upon such certificates in accordance with Section 8 of the
Voting Agreement removed.

            5. GOVERNING LAW. This Termination Agreement shall be governed in
accordance with the laws of the State of Delaware.

            6. COUNTERPARTS. This Termination Agreement may be executed in
counterparts. each of which shall be deemed and original, but all of which
together shall constitute one and the same instrument.

            7. ENTIRE AGREEMENT. This Termination Agreement constitutes the
entire agreement of the parties with respect to the subject matter contained
herein.

            WITNESS the hands and seals of the parties.

[SEAL]
ATTEST:                                           METAMORPHIX. INC.

William E. Carlson, Esq.                     Edwin C. Quattlebaum, Ph.D.
Secretary                                      President

                       (signatures continued on next page)

Schedule 8.6 -- Page 2 of 3

<PAGE>

   WITNESS:                            THE JOHNS HOPKINS UNIVERSITY

------------------------------         By:                                (SEAL)
                                          --------------------------------
                                       Howard W. Califano. Esq.
                                       Director. The Johns Hopkins University
                                       Office of Technology Licensing

WITNESS/ATTEST:                        GENETICS INSTITUTE. INC.

                                       By:                                (SEAL)
---------------------------------         --------------------------------
                                       Name:
                                       Title:

WITNESS:                               SE-JIN LEE, M.D. PH.D.

---------------------------------      -----------------------------------------
                                       Se-Jin Lee. M.D., Ph.D.

WITNESS:                               ***

                                       By:
---------------------------------         --------------------------------------
                                       William E. Carlson
                                       Trustee

Schedule 8.6 -- Page 3 of 3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}]]