Document:

EXHIBIT 4.38
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                               Purchase Agreement
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         Purchase Agreement (the "Agreement"), effective as of November 28,
2001, by and between Scion Pharmaceuticals, Inc., a Delaware corporation with a
principal place of business at 200 Boston Avenue, Suite 3600, Medford,
Massachusetts 02155 USA ("Scion"), CeNeS Pharmaceuticals, Inc., a Delaware
corporation with its registered office at The Corporation Trust Company,
Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware ("CeNeS"),
and CeNeS Pharmaceuticals plc, a company formed under the laws of Scotland with
a principal place of business at Compass House, Vision Park, Chivers Way,
Histon, Cambridge CB4 9ZR, England ("CeNeS plc"). Scion and CeNeS are
collectively referred to as the "Parties".

         For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, and intending to be legally bound, Scion, CeNeS,
and CeNeS plc agree as follows.

Section 1.        Purchase; License and Assumption.
                  ---------------------------------

         (a) Purchased Assets and SBIR Grant. At the Closing and for the
consideration set forth in Section 2, below:

                  (i) Upon the terms and subject to the conditions set forth
         herein, Scion agrees to purchase and CeNeS agrees to sell all small
         organic molecules in CeNeS' compound library whether or not the same
         are reduced to practice (including but not limited to those compounds
         identified on Schedule A attached to this Agreement, in whatever
         quantities held by CeNeS, and including but not limited to all
         compounds encompassed by the Purchased Compounds Intellectual Property
         Rights, as defined below) (the "Purchased Compounds") and all
         Intellectual Property Rights relating to or arising from such
         compounds, including but not limited to all Intellectual Property
         Rights associated with NMDA and Sigma receptors, and Na and Ca ion
         channels, and specifically including but not limited to the tangible
         embodiments of the Intellectual Property Rights identified on Schedule
         B attached to this Agreement (the "Purchased Compounds Intellectual
         Property Rights"); provided, however, that the Purchased Compounds
         shall not include N-(3-methylthiophenyl)-N-methyl-N'-(2-chloro-5
         methylthiophenyl) guanidine and its salts ("CNS 5161"), and
         N-(m-ethylphenyl)-N-methyl-N'-(1-naphthyl) guanidine and its salts
         ("Aptiganel") or, for the avoidance of doubt, any compounds owned by
         affiliates of CeNeS identified on Schedule J attached to this Agreement
         (the "Excluded Compounds"); and provided further that the Purchased
         Compounds Intellectual Property Rights shall include lab notebooks
         containing any small organic molecules in CeNeS' compound library (to
         the extent they relate to the Purchased Compounds and the Purchased
         Compounds Intellectual Property Rights), and CeNeS plc shall retain, at
         CeNeS' expense (to the extent they relate to the Purchased Compounds
         Intellectual Property Rights), such notebooks in the greater Boston
         area for inspection and duplication (at Scion's expense) promptly upon
         the request of Scion;

                  (ii) Upon the terms and subject to the conditions set forth
         herein, to the extent permitted by the National Institutes of Health
         (the "NIH") after commercially reasonable effort on the part of Scion,
         Scion will assume the remainder of a certain Small Business Innovation

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         Research grant from the NIH for the Kv1.1 project for Symptomatic
         Treatment of Peripheral Neuropathies (the "SBIR Grant");

                  (iii) Upon the terms and subject to the conditions set forth
         herein, Scion agrees to purchase the equipment identified on Schedule C
         attached to this Agreement (the "SBIR Equipment") and all Intellectual
         Property Rights arising from the SBIR Grant (the "SBIR Intellectual
         Property Rights") subject only to the funding agreement pursuant to
         which the SBIR Grant is provided (the "Grant Agreement") and any rights
         held by the United States Government under the Grant Agreement or the
         Patent Rights In Inventions Made With Federal Assistance Act, 35 U.S.C.
         ss.ss. 200 to 212 ("Bayh-Dole Act"); and

                  (iv) Scion agrees to purchase, and CeNeS agrees to sell, the
         nuclear magnetic resonance spectroscopy equipment identified on
         Schedule I to this Agreement (the "NMR Equipment").

         (b) Limited Assumption of Liabilities. The Parties agree that Scion
shall assume no Liabilities of CeNeS other than the following Liabilities, which
upon the Closing, shall be assumed by Scion (i) those Liabilities identified on
Schedule E attached to this Agreement; (ii) Liabilities to the United States
Government under the Grant Agreement or under the Bayh-Dole Act with respect to
the SBIR Intellectual Property Rights; and (iii) Liabilities with respect to
patent filing and maintenance costs on the CeNeS Intellectual Property Rights
(other than the Patents Licensed to Scion and the patent embodiments of the
University Licensed Intellectual Property Rights) arising after the date of this
Agreement (the "Assumed Liabilities"). The Parties further agree that Scion
shall have no Liability (and CeNeS shall satisfy all Liabilities) for patent
costs and expenses (including patent filing and maintenance costs) arising or
due prior to the date of this Agreement. For the purpose of this Agreement, the
term "Liability" (and the plural, "Liabilities") means any liability (whether
known or unknown, asserted or unasserted, absolute or contingent, accrued or
unaccrued, liquidated or unliquidated, or due or to become due).

         (c) Exclusive License. At the Closing, CeNeS shall grant a worldwide,
exclusive (including as to CeNeS), perpetual, fully paid and royalty-free
license and right (the "License Grant to Scion") to the patents set forth on
Schedule K-1 to this Agreement (the "Patents Licensed to Scion"), and all
Intellectual Property Rights arising therefrom (hereafter, the "Intellectual
Property Rights Arising from the Patents Licensed to Scion"), for all fields of
use except for those required for the use, practice and manufacture of CNS 5161
and Aptiganel (the "Scion Field of Use"). For the purpose of this Agreement, the
Patents Licensed to Scion shall include all existing patents and patent
applications set forth on Schedule K-1 and all patent applications hereafter
filed which include the subject matter of such patents in the Scion Field of
Use, including any continuation, continuation-in-part, division, provisional or
any substitute applications, any patent issued with respect to any such patent
applications, any reissue, reexamination, renewal or extension (including any
supplementary protection certificate) of any such patent, and any confirmation
patent or registration patent or patent of addition based on any such patent,
and all foreign counterparts of any of the foregoing.

         (d)      Sublicenses.

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                  (i) At the Closing, CeNeS shall grant to Scion a worldwide,
         exclusive (including as to CeNeS), perpetual, fully paid and
         royalty-free sublicense and grant of all rights under the Virginia
         Commonwealth Agreement in the Scion Field of Use (the "Virginia
         Commonwealth Sublicense"). CeNeS agrees to use its best efforts (which
         shall not be construed to require payment of any compensation to
         Virginia Commonwealth) to promptly assign the Virginia Commonwealth
         Agreement to Scion (limited to the Scion Field of Use only) (the
         "Virginia Commonwealth Assignment").

                  (ii) At the Closing, CeNeS shall grant to Scion a worldwide,
         exclusive (including as to CeNeS), perpetual, fully paid and
         royalty-free sublicense and grant of all rights under the Oregon
         Agreement in the Scion Field of Use (the "Oregon Sublicense").

         (e)      Certain Definitions.

                  (i) For the purposes of this Agreement, the term "Intellectual
         Property Rights" means intellectual property rights arising from or in
         respect of the following: (A) all patents, patent applications,
         invention and patent disclosures and invention registrations
         (including, but not limited to, all divisionals, renewals, reissues,
         continuations-in-part, and continuations thereof); (B) all inventions
         and all applications, registrations, and renewals in connection
         therewith; (C) all trade secrets and proprietary information (including
         ideas, formulas, compositions, know-how, technical data, manufacturing
         and production processes and techniques, research and development
         information, designs, drawings, specifications, operating procedures
         and guidelines, quality assurance procedures and guidelines); (D) all
         trademarks (including all CeNeS designation numbers with respect to any
         of the Purchased Compounds), service marks, trade dress, slogans,
         logos, trade names; (E) all proprietary computer software, data,
         databases and documentation thereof, but specifically excluding any
         software and databases licensed by CeNeS from third parties; (F) all
         other proprietary rights (including but not limited to all
         copyrightable works, all trademarks including all goodwill associated
         therewith); (G) all copies and tangible embodiments thereof (in
         whatever form or medium); (H) any biological embodiments thereof; and
         (I) all the biological and chemical data associated with the compound
         library including, but not limited to, any and all documentation such
         as notebooks, memos, spectral data and figures and tables.

                  (ii)

                           (A) The Purchased Compounds, the Purchased Compounds
                  Intellectual Property Rights, the SBIR Equipment, the SBIR
                  Intellectual Property Rights, and the NMR Equipment are
                  referred to collectively as the "Purchased Assets."

                           (B) The Purchased Compounds Intellectual Property
                  Rights, the SBIR Intellectual Property Rights, and the
                  Intellectual Property Rights Arising from the Patents Licensed
                  to Scion are referred to collectively as the "CeNeS
                  Intellectual Property Rights".

                           (C) The Purchased Compounds, SBIR Equipment and NMR
                  Equipment are referred to collectively as the "Tangible
                  Assets."

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                           (D) For the purpose of this Agreement, the term
                  "University Licensed Intellectual Property" shall refer to all
                  Intellectual Property Licensed to CeNeS under either (or both)
                  University Licenses and shall include the tangible embodiments
                  of the University Licensed Intellectual Property set forth on
                  Schedule K-2.

                           (E) For the purpose of this Agreement, the term
                  "Licensed Patents" shall refer to the patent embodiments of
                  the University Licensed Intellectual Property and the Patents
                  Licensed to Scion; provided, however, that the patents
                  embodied in the Virginia Commonwealth Agreement shall cease to
                  be deemed Licensed Patents upon the assignment of the Virginia
                  Commonwealth Agreement to Scion.

                           (F) For the purpose of this Agreement, the term
                  "Sublicenses" shall mean the Virginia Commonwealth Sublicense
                  and the Oregon Sublicense, collectively, and the term
                  "University Licenses" shall mean the Virginia Commonwealth
                  Agreement and the Oregon Agreement, collectively.

                  (iii) For the purpose of this Agreement, the term "Virginia
         Commonwealth" shall mean Virginia Commonwealth University, and the term
         "Virginia Commonwealth Agreement" shall mean a certain License
         Agreement, dated April 4, 1994, by and between Virginia Commonwealth
         University and Cambridge Neuroscience Inc., as amended by Amendment No.
         1, dated April 3, 1997, and as further amended by an Amendment, dated
         January 22, 2001.

                  (iv) For the purpose of this Agreement, the term "Oregon"
         shall mean the State of Oregon, and "Oregon Agreement" shall mean a
         certain Research Agreement, dated June 6, 1987, by and between the
         State of Oregon (by and through the Oregon State Board of Higher
         Education on behalf of the University of Oregon) and Cambridge
         Neuroscience Research, Inc., as amended by Amendment No. 1, dated
         September 1, 1987, and further amended by Amendment No. 2, dated April
         2, 1990.

Section 2. Purchase Price. In consideration for CeNeS' obligations under this
Agreement, Scion shall make the following payments to CeNeS:

         (a) Up Front Payment. At the Closing (as defined in Section 5(b)),
Scion shall pay to CeNeS US$300,000.00, by wire transfer of immediately
available funds (the "Up Front Payment").

         (b) Subsequent Payment. Scion shall pay to CeNeS a total of
US$500,000.00 in 20 installments of $25,000.00 each, the first installment
commencing on the date that is one year from the date of the Closing, with each
subsequent installment every three months thereafter (each, a "Subsequent
Payment").

         (c) Milestone Payments. Scion agrees to pay to CeNeS milestone payments
as set forth below on the first instance of a CeNeS-numbered Purchased Compound
invented by CeNeS (or an employee of CeNeS) or to which CeNeS has an exclusive
license (as identified on Schedule G) or a compound invented by CeNeS (or an
employee of CeNeS) and disclosed as a species embodiment in a CeNeS patent or
patent application included on Schedule B attached to this Agreement, reaching

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the following stages of clinical development by Scion or a sub-licensee or
assignee of such compound by Scion:

         o        Upon the effectiveness of such party's filing of an
                  Investigational New Drug Application ("IND") with the U.S.
                  Food and Drug Administration (the "FDA"): $500,000.00;

         o        Upon the FDA's approval of commencement of Phase II clinical
                  trials: $500,000.00; and

         o        Upon the effectiveness of such party's filing of a New Drug
                  Application ("NDA") with the FDA: $1,000,000.00.

It is hereby agreed that evidence of invention by CeNeS of a compound set forth
in CeNeS' laboratory notebooks shall constitute a rebuttable presumption of
invention and manufacture of such compound by CeNeS.

         Scion agrees to provide prompt notice (as set forth herein) of the
filing of any IND, the commencement of Phase II clinical trials, or upon the
filing of an NDA, provided that such filing or the commencement of such clinical
trials would require a payment under the provisions of this Section 2(c). In the
event that a subsequent payment is not made within five Business Days of its due
date, such payment shall accrue interest at the rate of 14% per annum beginning
on the fifth Business Day after its due date. For the purpose of this Agreement,
the term "Business Day" shall mean a day, excluding Saturday, Sunday, or legal
holiday observed by the government of the Commonwealth of Massachusetts.

         (d) Maximum Obligation. In no event will more than US$2,800,000.00 be
paid by Scion to CeNeS under this Section 2. Other than as set forth in Section
1 and this Section 2, Scion shall have no further obligation or Liability to
CeNeS with respect to the Purchased Compounds or the CeNeS Intellectual Property
Rights, and Scion shall specifically have no obligation to pay any royalty on
any Purchased Compounds or CeNeS Intellectual Property Rights.

Section 3A. Representations and Warranties of CeNeS. Except as set forth on
Schedule H to this Agreement, CeNeS represents and warrants to Scion that the
statements contained in this Section 3A are correct and complete as of the date
of this Agreement and will be true and correct as of the Closing Date (as
defined in Section 5(b)).

         (a) Organization and Authority. CeNeS is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Delaware.
CeNeS has all necessary power and authority (corporate and other) to own and
sell the Purchased Assets and to execute and deliver this Agreement and carry
out the transactions contemplated by this Agreement.

         (b) Non-contravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby will:
(i) violate or conflict with any provision of CeNeS' Certificate of
Incorporation or By-laws, each as amended to date; (ii) violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge, or other restriction or require the consent or approval of any
government, governmental agency, or court to which CeNeS is subject; or (iii)
conflict with, result in a breach of, constitute a default under, result in the

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acceleration of, or create in any party the right to accelerate, terminate,
modify, or cancel, or require any notice or consent under any agreement,
contract, lease, license, instrument, or other arrangement to which CeNeS is a
party or is bound or to which any of its assets are subject (or result in the
imposition of any Security Interest upon any of its assets). For the purposes of
this Agreement, the term "Security Interest" means any mortgage, pledge, lien,
encumbrance, charge, or other security interest and will also include any
license or grant of rights.

         (c) Enforceability. When executed by the Parties, this Agreement will
constitute the valid and legally binding obligation of CeNeS enforceable in
accordance with its terms and conditions.

         (d) Title to Tangible Assets. CeNeS has good and marketable title to
the Tangible Assets, free and clear of all Security Interests. Upon the
consummation of the transactions contemplated by this Agreement, at the Closing,
all right, title and interest in the Tangible Assets will be transferred to
Scion, free and clear of any Security Interest. At the Closing, the SBIR
Equipment and NMR Equipment will function in the manner in which such equipment
was designed; provided, however, that CeNeS makes no representation as to the
functionality of such equipment after relocation of such equipment by Scion
following the Closing.

         (e) Intellectual Property.

                  (i) All tangible embodiments of the CeNeS Intellectual
         Property Rights are identified on Schedules B and D. Schedule B
         identifies all of the tangible embodiments of the Purchased Compounds
         Intellectual Property Rights. Schedule D identifies all of the tangible
         embodiments of the SBIR Intellectual Property Rights. CeNeS owns and
         possesses all right, title and interest in and to all of the CeNeS
         Intellectual Property Rights, free and clear of any Security Interest,
         and, upon the consummation of the transactions contemplated by this
         Agreement, at the Closing, all right, title and interest in the CeNeS
         Intellectual Property Rights will be transferred to Scion, free and
         clear of any Security Interest.

                  (ii) Schedules B and D identify the jurisdictions in which all
         such registrations and pending applications for registration of the
         Intellectual Property Rights were issued or registered or in which
         application was made, the date of issuance or registration or
         application and the identification number assigned thereto, as
         applicable.

                  (iii) University Licensed Intellectual Property Rights.

                           (A) A true and complete copy of the Virginia
                  Commonwealth Agreement is set forth on Schedule L-1. A true
                  and complete copy of the Oregon Agreement is set forth on
                  Schedule L-2. CeNeS is not in breach of either University
                  License, and CeNeS has not received any notice of any breach
                  of either University License by any third party.

                           (B) No Liability on the part of CeNeS under either
                  University License is currently due. CeNeS has no Knowledge of
                  any loss or expiration of any University Licensed Intellectual
                  Property Rights (including any loss resulting from the failure
                  to pay patent maintenance fees or to make any filing).

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                           (C) CeNeS has not received any notices of, nor to the
                  Knowledge of CeNeS or the directors or officers (and employees
                  with responsibility for Intellectual Property Rights matters
                  of CeNeS) do any facts exist which indicate a likelihood of
                  any infringement or misappropriation by, or conflict with, any
                  third party with respect to the University Licensed
                  Intellectual Property Rights (including, without limitation,
                  any demand or request that CeNeS, Virginia Commonwealth
                  University, or Oregon, as applicable, license any rights from
                  a third party).

                           (D) To the Knowledge of CeNeS, commercially
                  reasonable actions to maintain and protect each item of
                  University Licensed Intellectual Property Rights have been
                  taken.

                  (iv) CeNeS Intellectual Property.

                           (A) CeNeS has received no notice of and has no
                  Knowledge of any claim by any third party contesting the
                  validity, enforceability, use or ownership of any of the CeNeS
                  Intellectual Property Rights and CeNeS has no Knowledge of any
                  grounds for the same.

                           (B) CeNeS has no Knowledge of any loss or expiration
                  of any CeNeS Intellectual Property Rights (including any loss
                  resulting from the failure to pay patent maintenance fees or
                  to make any filing due prior to the date of this Agreement).

                           (C) CeNeS has not received any notices of, nor to the
                  Knowledge of CeNeS or the directors or officers (and employees
                  with responsibility for Intellectual Property Rights matters
                  of CeNeS) do any facts exist which indicate a likelihood of
                  any infringement or misappropriation by, or conflict with, any
                  third party with respect to the CeNeS Intellectual Property
                  Rights (including, without limitation, any demand or request
                  that CeNeS license any rights from a third party).

                           (D) CeNeS has not infringed, misappropriated or
                  otherwise conflicted with any Intellectual Property Rights or
                  other rights of any third parties.

                           (E) CeNeS has taken commercially reasonable actions
                  to maintain and protect each item of CeNeS Intellectual
                  Property Rights. For the purpose of this Agreement,
                  "Knowledge" means actual knowledge after reasonable
                  investigation.

                  (v) With respect to each item of CeNeS Intellectual Property
         Rights and University Licensed Intellectual Property Rights, as the
         case may be:

                           (A) the underlying item of CeNeS Intellectual
                  Property Rights (and, to the Knowledge of CeNeS, the
                  underlying item of University Licensed Intellectual Property
                  Rights) is not subject to any outstanding injunction,
                  judgment, order, decree, ruling, or charge;

                           (B) no action, suit, proceeding, hearing,
                  investigation, charge, complaint, claim, or demand is pending
                  or, to the Knowledge of CeNeS or the directors or officers
                  (and employees with responsibility for Intellectual Property
                  Rights matters) of CeNeS, is threatened which challenges the

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                  legality, validity, or enforceability of the underlying item
                  of CeNeS Intellectual Property Rights (or, to the Knowledge of
                  CeNeS, the University Licensed Intellectual Property Rights);
                  and

                           (C) CeNeS has not granted any license, sublicense or
                  similar right.

                  (vi) With respect to all CeNeS Intellectual Property Rights,
         each inventor, employee and consultant of CeNeS that participated in
         the development or discovery of such Intellectual Property Right has
         executed currently enforceable invention assignment or similar
         agreements with CeNeS or its predecessor assigning all right, title,
         and interest to such Intellectual Property Rights to CeNeS ("CeNeS
         Invention Assignment Agreements").

         (f) Power of Attorney. There are no outstanding powers of attorney
executed on behalf of CeNeS that would prevent or prohibit it from valid
performance of its obligations under this Agreement.

         (g) Brokers' Fees. CeNeS has no liability or obligation to pay any fees
or commissions to any broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which Scion could become liable.

         (h) Inventory. CeNeS' log of all Purchased Compounds, which sets forth
the approximate quantities of compounds in CeNeS' chemical library has been
provided to Scion on or prior to the Closing Date.

Section 3B. Representations and Warranties of CeNeS plc. CeNeS plc represents
and warrants to Scion that the statements contained in this Section 3B are
correct and complete as of the date of this Agreement and will be true and
correct as of the Closing Date.

         (a) Organization and Authority. CeNeS plc is a company duly organized
and validly existing under the laws of England and Wales. CeNeS plc has all
necessary power and authority (corporate and other) to execute and deliver this
Agreement and carry out its obligations under this Agreement.

         (b) Non-contravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby will:
(i) violate or conflict with any provision of CeNeS plc's Memorandum of
Association or Articles of Association; (ii) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction or require the consent or approval of any government, governmental
agency, or court to which CeNeS plc is subject; or (iii) conflict with, result
in a breach of, constitute a default under, result in the acceleration of, or
create in any party the right to accelerate, terminate, modify, or cancel, or
require any notice or consent under any agreement, contract, lease, license,
instrument, or other arrangement to which CeNeS plc is a party or is bound or to
which any of its assets are subject.

         (c) Enforceability. When executed by the Parties and CeNeS plc this
Agreement will constitute the valid and legally binding obligation of CeNeS plc
enforceable in accordance with its terms and conditions.

Section 4. Representations and Warranties of Scion. Scion represents and
warrants to CeNeS and CeNeS plc that the statements contained in this Section 4

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are correct and complete as of the date of this Agreement and will be true and
correct as of the Closing Date.

         (a) Organization and Authority. Scion is a corporation duly
incorporated, validly existing, and in good standing under the laws of the State
of Delaware. Scion has all necessary power and authority (corporate and other)
to execute and deliver this Agreement and carry out the transactions
contemplated by this Agreement.

         (b) Non-contravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby will:
(i) violate or conflict with any provision of Scion's Certificate of
Incorporation, as amended, or By-laws; (ii) violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
restriction or require the consent or approval of any government, governmental
agency, or court to which Scion is subject; or (iii) conflict with, result in a
breach of, constitute a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify, or cancel, or require any
notice or consent under any agreement, contract, lease, license, instrument, or
other arrangement to which Scion is a party or is bound or to which any of its
assets are subject (or result in the imposition of any Security Interest upon
any of its assets).

         (c) Enforceability. When executed by the Parties, this Agreement will
constitute the valid and legally binding obligation of Scion enforceable in
accordance with its terms and conditions.

         (d) Brokers' Fees. Scion has no liability or obligation to pay any fees
or commissions to any broker, finder, or agent with respect to the transactions
contemplated by this Agreement for which CeNeS could become liable.

Section 5.        Covenants; Closing.
                  -------------------

         (a) Further Assurances.

                  (i) In case at any time after date hereof any further action
         is necessary or desirable to carry out the purposes of this Agreement,
         each of the Parties will take such further action (including the
         execution and delivery of such further instruments and documents) as
         the other Party may reasonably request, all at the sole cost and
         expense of the requesting Party (unless the requesting Party is
         entitled to indemnification for such amount under Section 6, below).
         CeNeS shall cooperate with, assist and take all actions reasonably
         requested by Scion and its authorized representatives in order to
         provide, to the extent reasonably requested by Scion, an efficient
         transfer of control of the Purchased Assets and the SBIR Grant,
         including, but not limited to, any filings with respect to any CeNeS
         Intellectual Property any appropriate governmental authority or with
         the NIH. In addition to the foregoing, CeNeS hereby assigns to Scion
         rights under all CeNeS Invention Assignment Agreements to the extent
         they relate to the CeNeS Intellectual Property Rights, and agrees to
         assist Scion in the procurement and enforcement of such CeNeS Invention
         Assignment Agreements with respect to the CeNeS Intellectual Property
         Rights.

                  (ii) In the event Scion is unable, for any reason, after
         reasonable effort, to secure signatures on any document needed in
         connection with the actions specified in this Section 5(a), CeNeS
         hereby irrevocably designates and appoints Scion and its duly
         authorized agent and attorney in fact, which appointment is coupled

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         with an interest, to act for and in its behalf to execute, verify and
         file any such documents and to do all other lawfully permitted acts to
         further the purposes of Section 5(a)(i) with the same legal force and
         effect as if executed by CeNeS unless right to such Intellectual
         Property is subject to a good faith dispute between the parties. CeNeS
         hereby waives and quitclaims to Scion any and all claims, of any nature
         whatsoever, which CeNeS now or may hereafter have for infringement of
         any CeNeS Intellectual Property Rights assigned hereunder to Scion.

                  (iii) Use of CeNeS Intellectual Property Rights. From the date
         of this Agreement and indefinitely thereafter, CeNeS agrees not to
         disclose, use, or retain any CeNeS Intellectual Property Rights, it
         being acknowledged that worldwide exclusive, except as set forth on
         Schedule B, D, or H, right and title to such CeNeS Intellectual
         Property Rights (subject to the Grant Agreement and the Bayh-Dole Act,
         in the case of the SBIR Intellectual Property Rights) shall be assigned
         to Scion pursuant to this Agreement and will be thereafter referred to
         as Scion Intellectual Property.

                  (iv) Confidentiality. For the purpose of this Agreement,
         "Confidential Information" means any information concerning the
         businesses and affairs of Scion that is not already generally available
         to the public, and the term "Confidential Information" shall include
         all information and data concerning or related to the CeNeS
         Intellectual Property Rights and/or the Purchased Compounds. CeNeS will
         treat and hold as such all of the Confidential Information, refrain
         from using any of the Confidential Information except in connection
         with this Agreement, and deliver promptly to Scion or destroy, at the
         request and option of Scion, all tangible embodiments (and all copies)
         of the Confidential Information which are in its possession. In the
         event that CeNeS is requested or required (by oral question or request
         for information or documents in any legal proceeding, interrogatory,
         subpoena, civil investigative demand, or similar process) to disclose
         any Confidential Information, CeNeS will notify Scion promptly of the
         request or requirement so that Scion may seek an appropriate protective
         order or waive compliance with the provisions of this Section 5(a)(iv).
         If, in the absence of a protective order or the receipt of a waiver
         hereunder, CeNeS is, on the advice of counsel, compelled to disclose
         any Confidential Information to any tribunal or else stand liable for
         contempt, CeNeS may disclose the Confidential Information to the
         tribunal; provided, however, CeNeS shall use its best efforts to
         obtain, at the request of Scion, an order or other assurance that
         confidential treatment will be accorded to such portion of the
         Confidential Information required to be disclosed as Scion shall
         designate. The foregoing provisions shall not apply to any Confidential
         Information that is generally available to the public immediately prior
         to the time of disclosure.

                  (v) Employment of Dr. Jin Liang Sui. Scion represents that it
         has entered into a mutually acceptable employment agreement with Dr.
         Jin Liang Sui.

                  (vi) Maintenance of Patents; Infringement.

                           (A) Maintenance.

                                    (I) CeNeS agrees to maintain the Licensed
                           Patents for the life of each such patent, in each
                           jurisdiction in which such patent was issued as of

                                       10
<PAGE>

                           the date of this Agreement (the "Applicable
                           Jurisdictions") and without interruption, and CeNeS
                           shall be responsible for the preparation, filing,
                           prosecution and maintenance of the Licensed Patents
                           (including all payment obligations) and shall, on an
                           ongoing basis, promptly furnish copies of all related
                           documents to Scion within thirty days of receipt or
                           deposition.

                                    (II) CeNeS shall, subject to the prior
                           approval of Scion (not to be unreasonably withheld),
                           select registered patent attorneys or patent agents
                           to provide services for preparing, filing,
                           prosecuting and maintaining the Licensed Patents on
                           behalf of CeNeS (it being acknowledged that Edwards &
                           Angell, LLP is approved by Scion). CeNeS shall
                           directly pay such attorneys or agents and provide
                           Scion copies of each invoice associated with such
                           services, as well as documentation that such invoices
                           have been paid.

                                    (III) CeNeS and its attorneys or agents
                           shall consult with Scion in all aspects of the
                           preparation, filing, prosecution and maintenance of
                           the Licensed Patents and shall provide Scion
                           sufficient opportunity to comment on any document
                           that CeNeS intends to file or to cause to be filed
                           with the relevant intellectual property or patent
                           office.

                                    (IV) Each party shall promptly inform the
                           other as to all matters that come to such party's
                           attention that may affect the preparation, filing,
                           prosecution, or maintenance of the CeNeS Intellectual
                           Property Rights and the Licensed Patents, as
                           applicable, and to permit the other party to provide
                           comments and suggestions with respect to such
                           activities, which comments and suggestions shall be
                           reasonably considered by such party.

                           (V) In the event that CeNeS elects not to maintain
                  the Licensed Patents in any of the Applicable Jurisdictions,
                  then CeNeS shall give thirty days' written notice of such
                  election to Scion, and the Licensed Patent in such
                  jurisdiction shall thereupon be automatically assigned to
                  Scion, without further payment by or obligation on the part of
                  Scion to CeNeS or its successors or assigns. In such an event,
                  CeNeS agrees to cooperate fully with Scion, its attorneys, and
                  agents in the preparation, filing, prosecution and maintenance
                  related to such patents and, upon request, to provide Scion
                  with complete copies of any and all documents or other
                  materials that Scion deems necessary to undertake such
                  responsibilities. Scion shall thereupon assume responsibility
                  for all costs associated with the patents so assigned arising
                  after such assignment, including reasonable costs associated
                  with transferring patent prosecution responsibilities to an
                  attorney or agent of Scion's choice.

                           (B) Infringement by Third Parties.

                                    (I) Each Party shall promptly notify the
                           other in writing of any alleged infringement or
                           misappropriation by third parties of any Licensed

                                       11
<PAGE>

                           Patent and provide any information available to that
                           Party relating to such alleged infringement or
                           misappropriation.

                                    (II) CeNeS shall have the primary right, but
                           not the obligation, to take action in its own name to
                           secure the cessation of any infringement or
                           misappropriation or to enter suit against the
                           infringer. Any such action will be at CeNeS' expense,
                           employing counsel of its own choosing. If CeNeS
                           elects not to exercise its right to prosecute or take
                           other appropriate action in connection with an
                           infringement or misappropriation of the Licensed
                           Patents or fails to take any such action within sixty
                           days of first receiving of such infringement or
                           misappropriation, Scion may do so at its own expense,
                           controlling such action.

                                    (III) CeNeS and its attorneys or agents
                           shall consult and cooperate with Scion in all aspects
                           of any such litigation and shall provide Scion
                           sufficient opportunity to review any document
                           prepared, produced, or received by CeNeS in
                           conjunction with such dispute. Scion agrees to
                           provide comments and suggestions with respect to any
                           such matter, which comments and suggestions shall be
                           reasonably considered by the CeNeS.

                                    (IV) If CeNeS brings action, any damages or
                           other monetary awards recovered by CeNeS shall be
                           applied proportionately first to defray the
                           unreimbursed costs and expenses (including reasonable
                           attorneys' fees) incurred by either or both Parties
                           resulting from such action. If any balance remains
                           after such payment, then such balance shall be shared
                           by the Parties pro rata based upon the Parties'
                           respective documented Liabilities suffered. If CeNeS
                           fails to bring action and Scion brings action, any
                           damages or other monetary awards recovered by Scion
                           shall be applied first to defray the costs and
                           expenses (including reasonable attorneys' fees)
                           incurred in the action by either or both of the
                           Parties resulting from such action. If any balance
                           remains, such balance shall be the property of Scion.

                                    (V) No settlement, consent judgment or other
                           voluntary final disposition of a suit being
                           prosecuted by a Party under this Section 5(iv)(B) may
                           be entered into without the consent of the other
                           Party if such settlement, consent judgment or other
                           voluntary final disposition would alter, derogate or
                           diminish such other Party's rights under the
                           Agreement or otherwise materially adversely affect
                           such other Party, which consent shall not be
                           unreasonably withheld or delayed.

                           (C) Infringement of Third Parties' Rights. Except as
                  set forth in Section 6:

                                    (I) CeNeS shall promptly notify Scion in
                           writing of any alleged infringement or
                           misappropriation by CeNeS of any third party's
                           Intellectual Property Rights with respect to the
                           Licensed Patent and provide any information available

                                       12
<PAGE>

                           to CeNeS relating to such alleged infringement or
                           misappropriation.

                                    (II) CeNeS and its attorneys or agents shall
                           consult and cooperate with Scion in all aspects of
                           any such litigation and shall provide Scion
                           sufficient opportunity to review any document
                           prepared, produced, or received by CeNeS in
                           conjunction with such dispute. Scion agrees to
                           provide comments and suggestions with respect to any
                           such matter, which comments and suggestions shall be
                           reasonably considered by the CeNeS.

                                    (III) All fees, expenses, and costs
                           associated with the defense of such claim shall be
                           borne by CeNeS; provided, however, that upon CeNeS'
                           notice of its election not to defend any such third
                           party claim, Scion may, in its sole discretion,
                           assume responsibility and all costs associated with
                           the defense of such claim, and, upon written notice
                           of the same to CeNeS, the Licensed Patent in dispute
                           shall thereupon be assigned to Scion, without further
                           payment by or obligation on the part of Scion to
                           CeNeS or its successors or assigns. In such an event,
                           CeNeS agrees to cooperate fully with Scion, its
                           attorneys, and agents in the preparation, filing,
                           prosecution and maintenance related to such patents
                           and, upon request, to provide Scion with complete
                           copies of any and all documents or other materials
                           that Scion deems necessary to undertake such
                           responsibilities. Scion shall thereupon assume
                           responsibility for all costs associated with the
                           patents so assigned arising after such assignment,
                           including reasonable costs associated with
                           transferring patent prosecution responsibilities to
                           an attorney or agent of Scion's choice.

                  (vii) Bankruptcy. Until the last to occur of (A) the
         expiration of the last of the Patents Licensed to Scion; (B) the
         termination or expiration of this last Sublicense (insofar as such
         Sublicense has not been assigned to Scion), CeNeS agrees that is shall
         not cause or permit itself to be wound up or liquidated under the law
         of any state, or to cause or permit any Bankruptcy to occur. For the
         purpose of this Agreement, the term "Bankruptcy" shall mean any: (A)
         application for or consent to the appointment of, or the taking
         possession by, a receiver, custodian, trustee, examiner, liquidator or
         the like; (B) general assignment for the benefit of creditors; (C)
         commencement of a voluntary case under the United States Bankruptcy
         Code, as now or hereafter in effect ("Bankruptcy Code"); (D)
         institution of any proceeding or petition seeking to take advantage of
         any other law relating to bankruptcy, insolvency, reorganization,
         winding up, or composition or readjustment of debts; (E) failure to
         controvert in a timely and appropriate manner or agreement to any
         petition filed in an involuntary case filed under the Bankruptcy Code;
         (F) general inability to pay debts as they come due (or admission in
         writing to the same); or (G) any corporate action for the purpose of
         effecting the foregoing.

                  (viii) Maintenance of the University Licenses. CeNeS agrees to
         maintain each of the University Licenses in full force and effect for
         the duration of each such agreement and extensions thereto; provided,
         however, that this obligation will terminate with respect to the

                                       13
<PAGE>

         Virginia Commonwealth Agreement upon CeNeS' effective assignment of
         that agreement to Scion.

         (b) Closing.

                  (i) Closing Date. The closing of the purchase and sale (the
         "Closing") shall take place at the offices of Kirkpatrick & Lockhart
         LLP, 75 State Street, Boston, Massachusetts 02109, on November 29, 2001
         (the "Closing Date"), or at another time and place mutually agreed to
         by the parties. All actions to be taken, and all documents and
         instruments to be delivered at the Closing, shall be deemed to have
         been taken or delivered, as the case may be, simultaneously.

                  (ii) Deliveries by CeNeS. At the Closing, CeNeS shall deliver
         to Scion (A) a bill of Sale, Assignment and Assumption Agreement
         representing the transfer of the Purchased Assets; (B) a certificate
         signed by an executive officer of CeNeS dated as of the Closing Date,
         certifying as of the Closing Date that the representations and
         warranties of CeNeS are true and correct; and (C) Schedule G to this
         Agreement, setting forth a list of the Purchased Compounds with the
         CeNeS reference number of each Purchased Compounds and its associated
         structure.

                  (iii) Deliveries by CeNeS plc. At the Closing, CeNeS plc shall
         deliver to Scion a certificate signed by an executive officer of CeNeS
         plc dated as of the Closing Date, certifying as of the Closing Date
         that the representations and warranties of CeNeS plc are true and
         correct.

                  (iv) Payment by Scion. At the Closing, Scion shall (A) pay to
         CeNeS the Up Front Payment; and (B) deliver to CeNeS a certificate
         signed by an executive officer of Scion dated as of the Closing Date,
         certifying as of the Closing Date that the representations and
         warranties of Scion are true and correct.

Section 6.        Remedies for Breaches of this Agreement.
                  ----------------------------------------

         (a) Survival of Representations and Warranties. All of the
representations, warranties and covenants of the Parties contained in this
Agreement shall survive for a period of two years from the Closing Date and
terminate thereafter, except with respect to the covenants set forth in Section
5(a)(i) through 5(a)(iv), which will survive for a period of five years from the
Closing, and with respect to the covenants set forth in Section 5(a)(vi), which
shall survive for the life of the applicable Licensed Patents. Any Party
learning of a misrepresentation or breach of any of its representations and
warranties or covenants set forth in this Agreement shall immediately give
written notice thereof to the other Party.

         (b) Indemnification Generally. Each of the Parties agrees to indemnify
the other from and against the entirety of any Adverse Consequences such other
Party may suffer resulting from, arising out of, relating to, in the nature of,
or caused by: (i) the breach of any representation, warranty or covenant of such
Party or the inaccuracy of any certificate delivered pursuant to this Agreement;
or (ii) in the case of Scion, any Liability assumed or deemed to be assumed by
Scion other than the Assumed Liabilities. For the purpose of this Agreement,
"Adverse Consequences" means all actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,

                                       14
<PAGE>

orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid
in settlement, Liabilities, obligations, taxes, liens, losses, expenses, and
fees, including court costs and attorneys' fees and expenses.

         (c) Indemnification Matters Involving Third Parties.

                  (i) If any third party shall notify any Party (the
         "Indemnified Party") with respect to any matter (a "Third Party Claim")
         which may give rise to a claim for indemnification against the other
         Party (the "Indemnifying Party") under this Section 6, then the
         Indemnified Party shall promptly notify each Indemnifying Party thereof
         in writing; provided, however, that no delay on the part of the
         Indemnified Party in notifying any Indemnifying Party shall relieve the
         Indemnifying Party from any obligation hereunder unless (and then
         solely to the extent) the Indemnifying Party thereby is prejudiced.

                  (ii) Any Indemnifying Party will have the right to defend the
         Indemnified Party against the Third Party Claim with counsel of its
         choice satisfactory to the Indemnified Party so long as: (A) the
         Indemnifying Party notifies the Indemnified Party in writing within 15
         days after the Indemnified Party has given notice of the Third Party
         Claim that the Indemnifying Party will indemnify the Indemnified Party
         from and against the entirety of any Adverse Consequences the
         Indemnified Party may suffer resulting from, arising out of, relating
         to, in the nature of, or caused by the Third Party Claim; (B) the
         Indemnifying Party provides the Indemnified Party with evidence
         acceptable to the Indemnified Party that the Indemnifying Party will
         have the financial resources to defend against the Third Party Claim
         and fulfill its indemnification obligations hereunder; (C) the Third
         Party Claim involves only money damages and does not seek an injunction
         or other equitable relief; (D) settlement of, or an adverse judgment
         with respect to, the Third Party Claim is not, in the good faith
         judgment of the Indemnified Party, likely to establish a precedential
         custom or practice adverse to the continuing business interests of the
         Indemnified Party; and (E) the Indemnifying Party conducts the defense
         of the Third Party Claim actively and diligently.

                  (iii) So long as the Indemnifying Party is conducting the
         defense of the Third Party Claim in accordance with Section 6(c)(ii)
         above: (A) the Indemnified Party may retain separate co-counsel at its
         sole cost and expense and participate in the defense of the Third Party
         Claim; (B) the Indemnified Party will not consent to the entry of any
         judgment or enter into any settlement with respect to the Third Party
         Claim without the prior written consent of the Indemnifying Party; and
         (C) the Indemnifying Party will not consent to the entry of any
         judgment or enter into any settlement with respect to the Third Party
         Claim without the prior written consent of the Indemnified Party.

                  (iv) In the event any of the conditions in Section 6(c)(ii)
         above is or becomes unsatisfied, however: (A) the Indemnified Party may
         defend against, and consent to the entry of any judgment or enter into
         any settlement with respect to, the Third Party Claim in any manner it
         may deem appropriate (and the Indemnified Party need not consult with,
         or obtain any consent from, any Indemnifying Party in connection
         therewith); (B) the Indemnifying Parties will reimburse the Indemnified
         Party promptly and periodically for the costs of defending against the
         Third Party Claim (including attorneys' fees and expenses); and (C) the

                                       15
<PAGE>

         Indemnifying Parties will remain responsible for any Adverse
         Consequences the Indemnified Party may suffer resulting from, arising
         out of, relating to, in the nature of, or caused by the Third Party
         Claim to the fullest extent provided in this Section 6.

         (d) Set Off. Scion shall have the option of recouping all or any part
of any undisputed Adverse Consequences it may suffer (in lieu of seeking any
indemnification to which it is entitled under this Section 6) by notifying CeNeS
that Scion is reducing the remaining Subsequent Payments on a dollar for dollar
basis.

         (e) Other Indemnification Provisions. The foregoing indemnification
provisions are in addition to, and not in derogation of, any statutory,
equitable, or common law remedy any Party may have with respect to the
transactions contemplated by this Agreement.

Section 7.  Miscellaneous.
            --------------

         (a) Entire Agreement; Succession; Assignment. This Agreement (including
the Schedules referred to in this Agreement) constitutes the entire agreement
between the Parties and supersedes any prior understandings, agreements, or
representations by or between the Parties, written or oral, to the extent they
relate in any way to the subject matter hereof. This Agreement shall be binding
upon and inure to the benefit of the Parties named herein and their respective
successors and permitted assigns. No Party may assign either this Agreement or
any of its rights, interests, or obligations hereunder without the prior written
approval of the other Party; provided, however, that Scion may assign its rights
to indemnification hereunder to a third party in connection with the sale or
license of any of the Purchased Assets.

         (b) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument.

         (c) Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.

         (d) Amendments; Notices. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by the
Parties. No waiver by any Party of any default, misrepresentation, or breach of
warranty or covenant hereunder, whether intentional or not, shall be deemed to
extend to any prior or subsequent default, misrepresentation, or breach of
warranty or covenant hereunder or affect in any way any rights arising by virtue
of any prior or subsequent such occurrence. All notices, requests, demands,
claims, and other communications hereunder will be in writing. Any notice,
request, demand, claim, or other communication hereunder shall be deemed duly
given if it is sent by registered or certified mail, return receipt requested,
postage prepaid, and addressed to the intended recipient as set forth below:

         If to Scion, to:

         Scion Pharmaceuticals, Inc.
         200 Boston Avenue, Suite 3600
         Medford, MA 02155

                                       16
<PAGE>

                  Attn: Pravin R. Chaturvedi, President and Chief Executive
                        Officer

         with a required copy to:

         Kirkpatrick & Lockhart LLP
         75 State Street
         Boston, MA 02109
                  Attn: Jeffrey P. Donohue

         and

         Fish & Richardson P.C.
         225 Franklin Street
         Boston, MA 02110-2804
                  Attn: Jeffrey Hsi, Ph.D.

         If to CeNeS or CeNeS plc to:

                  CeNeS Pharmaceuticals plc
                  Compass House
                  Vision Park
                  Chivers Way
                  Histon
                  Cambridge CB4 9ZR
                  England

         with a required copy to:

                  Weil, Gotshal & Manges
                  One South Place
                  London EC2M 2WG
                  England
                           Attn: James Gubbins

         (e) Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the Commonwealth of Massachusetts without
giving effect to any choice or conflict of law provision or rule that would
cause the application of the laws of any jurisdiction other than the
Commonwealth of Massachusetts.

         (f) Submission to Jurisdiction. Each of the Parties submits to the
jurisdiction of any state or federal court sitting in Boston, Massachusetts in
any action or proceeding arising out of or relating to this Agreement and agrees
that all claims in respect of the action or proceeding may be heard and
determined in any such court. Each Party also agrees not to bring any action or
proceeding arising out of or relating to this Agreement in any other court. Each
of the Parties waives any defense of inconvenient forum to the maintenance of
any action or proceeding so brought and waives any bond, surety, or other
security that might be required of any other Party with respect thereto. Any
Party may make service on the other Party by sending or delivering a copy of the
process to the Party to be served at the address and in the manner provided for
the giving of notices in Section 7(d) above. Nothing in this Section 7(f),
however, shall affect the right of any Party to bring any action or proceeding
arising out of or relating to this Agreement in any other court or to serve
legal process in any other manner permitted by law or in equity. Each Party
agrees that a final judgment in any action or proceeding so brought shall be

                                       17
<PAGE>

conclusive and may be enforced by suit on the judgment or in any other manner
provided by law or in equity.

         (g) Specific Performance; Severability. Each of the Parties
acknowledges and agrees that the other Party would be damaged irreparably in the
event any of the provisions of this Agreement are not performed in accordance
with their specific terms or otherwise are breached. Accordingly, each of the
Parties agrees that the other Party shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of this Agreement and to
enforce specifically this Agreement and the terms and provisions hereof in any
action instituted in any court of the United States or any state thereof having
jurisdiction over the Parties and the matter (subject to the provisions set
forth in Section 7(f) above), in addition to any other remedy to which it may be
entitled, at law or in equity. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.

         (h) Guaranty. CeNeS plc agrees that if CeNeS voluntarily dissolves and
winds up its affairs, CeNeS plc will assume all obligations under this
Agreement, including the indemnification provisions in Section 6 of this
Agreement, provided however, that until CeNeS is wound up, CeNeS plc
unconditionally guarantees the obligations of CeNeS, up to maximum of the total
of the Up Front Payment and Subsequent Payments actually paid.

                                      * * *

                                       18
<PAGE>

         In witness whereof, the parties have set their hands and seals as of
the date first written above.

CENeS Pharmaceuticals plc           SCion pharmaceuticals, inc.

         /s/ Neil Clark                      /s/ Praum R. Chaturvedi

By: ____________________________    By: ____________________________

         Chief Operating Officer             President and CEO

Its: ____________________________   Its: ____________________________

CENES PHARMACEUTICALS, INC.

         /s/ Neil Clark

By: ____________________________

         Chief Operating Officer

Its: ____________________________

                                       19EXHIBIT 4.39
                                                                    ------------

                                  28 March 2002

                     BIOGLAN PHARMA PLC (In Administration)

                                       AND

                            CeNeS PHARMACEUTICALS PLC

                                       AND

                           CeNeS DRUG DELIVERY LIMITED

                                       AND

                                  CeNeS LIMITED

                                       AND

                              DAVID KENNETH DUGGINS

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

                       DEED OF SETTLEMENT AND TERMINATION

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

<PAGE>

THIS DEED is made the 28th day of March 2002 between:

(1)      BIOGLAN PHARMA PLC (In Administration), a Company incorporated in
         England and Wales (registered number (01779870)) whose registered
         office is c/o Arthur Andersen, 180 Strand, London WC2R 2NT ("Bioglan");

(2)      CeNeS PHARMACEUTICALS PLC a company incorporated in Scotland
         (registered number SC166791) whose registered office is at Riverside
         Way, Riverside Business Park, Irvine, Ayrshire, KA11 5DJ ("CeNeS Plc");

(3)      CeNeS DRUG DELIVERY LIMITED a company incorporated in Scotland
         (registered number SC131764) whose registered office is at Riverside
         Way, Riverside Business Park, Irvine, Ayrshire, KA11 5DJ of ("CDD");

(4)      CeNeS LIMITED a company incorporated in England and Wales (registered
         number (3078451)) whose registered office is at Compass House, Vision
         Park, Chivers Way, Histon, Cambridge CB4 82R ("CeNeS"); and

(5)      David Kenneth Duggins of Arthur Andersen, 180 Strand, London WC2R 2NT
         (the "Administrators")

WHEREAS

(A)      Bioglan for itself and on behalf of its Affiliates and CeNeS entered
         into a development and licence agreement dated 31 January 2000
         ("Fentanyl One") relating to the use of Bioglan's sublingual aerosol
         containing Fentanyl as extended in a licence agreement dated 17 April
         2000 ("Fentanyl Two");

(B)      CDD and Bioglan for itself and on behalf of its Affiliates entered into
         a development and licence agreement dated 17 April 2000 relating to
         CDD's product, Moraxen(TM), as extended in a variation letter dated 17
         August 2001 (together the "Moraxen Licence");

(C)      Bioglan for itself and on behalf of its Affiliates and CeNeS entered
         into a development and licence agreement dated 17 April 2000 relating
         to Bioglan's drug delivery systems Biosphere(TM), Dermastick(TM) and
         ES-Gel(TM) (the "Drug Delivery Licence");

(D)      CDD and Bioglan for itself and on behalf of its Affiliates entered into
         a development and licence agreement dated 17 April 2000 relating to
         CeNeS's drug delivery system, Depocore(TM), (the "Depocore Licence");

                                       1
<PAGE>

(E)      The Parties entered into subscription agreements dated 31 January and
         17 April 2000 under which Bioglan subscribed for a total of 8,965,866
         (eight million, nine hundred and sixty-five thousand, eight hundred and
         sixty-six) ordinary shares (the "Shares") in CeNeS (the "Subscription
         Agreements");

(F)      The respective parties now wish to terminate the Agreements (as defined
         below) upon the terms and subject to the conditions set out in this
         Deed;

(G)      On 21 February 2002 Bioglan was placed into Administration and the
         Administrators were appointed to manage its affairs, business and
         property pursuant to section 8 of the Insolvency Act 1986.

THIS DEED WITNESSETH AS FOLLOWS:

1        DEFINITIONS AND INTERPRETATION

1.1      "Agreements" shall mean the Fentanyl One Licence, the Fentanyl Two
         Licence, the Moraxen Licence, the Drug Delivery Licence, the Depocore
         Licence and the Subscription Agreements;

1.2      "Affiliate" shall mean a person, company or legal entity which is
         controlled by or controls either of the Parties (by majority ownership
         or otherwise). For the purposes hereof, "control" shall mean the power
         to direct or cause the direction of the management and the policies of
         an entity, whether through the ownership of a majority of the
         outstanding voting securities or by contract or otherwise;

1.3      "Code" shall mean the City Code on Takeovers and Mergers;

1.4      "Controlled Period" shall mean the period from the date of this Deed
         until 31 December 2002;

1.5      "Effective Date" shall mean 28 March 2002.

2        TERMINATION OF FENTANYL ONE LICENCE AND FENTANYL TWO LICENCE

2.1      The Fentanyl One Licence and the Fentanyl Two Licence are hereby
         terminated and notwithstanding article 12.6 of Fentanyl One and article
         12.6 of the Fentanyl Two Licence and save as set out below shall cease
         to have any further force or effect and all rights to the Product (as

                                       2
<PAGE>

         defined in the Fentanyl One Licence) shall revert absolutely and
         irrevocably to Bioglan. Bioglan and CeNeS hereby irrevocably waives any
         right each party may have against the other for breach of the terms of
         either the Fentanyl One Licence or the Fentanyl Two Licence. For the
         avoidance of doubt Bioglan hereby irrevocably waives any right it may
         have to receive payment of the sums set out in articles 7.1.2, 7.1.3
         and 7.1.4 of the Fentanyl One Licence and CeNeS shall cease to have the
         benefit of the licence grant set out in Clause 2.1 of the Fentanyl One
         Licence.

2.2      The provisions of articles 8.1 and 10 of the Fentanyl One Licence shall
         survive termination of the Fentanyl One Licence and articles 8.1 and 10
         of the Fentanyl Two Licence shall survive the termination of the
         Fentanyl Two Licence.

2.3      Both Parties shall return all confidential information received from
         the other party within 90 (ninety) days of the Effective Date in
         accordance with article 12.6 of the Fentanyl One Licence and article
         12.6 of the Fentanyl Two Licence.

3        TERMINATION OF THE MORAXEN LICENCE

3.1      The Moraxen Licence is hereby terminated and notwithstanding article
         12.6 of the Moraxen Licence and save as set out below, shall cease to
         have any further force or effect and all rights to the Product (as
         defined in the Moraxen Licence) shall revert absolutely and irrevocably
         to CDD. Bioglan and CDD hereby irrevocably waives any rights each party
         may have against the other for breach of the terms of the Moraxen
         Licence. For the avoidance of doubt the grant of the rights set out in
         paragraph 3 of the variation letter dated 17 April 2001 (the "Variation
         Letter") by CDD to Bioglan shall be unconditionally surrendered by
         Bioglan.

3.2      Bioglan shall comply with its obligations pursuant to article 12.5.1 of
         the Moraxen Licence which obligation shall survive termination of the
         Moraxen Licence and Bioglan shall cease to have the benefit of the
         licence grant set out in Clause 3.1 of the Moraxen Licence.

3.3      Bioglan shall immediately terminate any sub licence (to the extent not
         already terminated) granted pursuant to the Moraxen Licence.

3.4      The provisions of article 10 (for the period of 10 (ten) years from the
         Effective Date) of the Moraxen Licence shall survive the termination of
         the Moraxen Licence.

                                       3
<PAGE>

3.5      Both Parties shall return all confidential information received from
         the other party within 90 (ninety) days of the date of this Deed in
         accordance with article 12.6 of the Moraxen Licence.

4        TERMINATION OF THE DRUG DELIVERY LICENCE

4.1      The Drug Delivery Licence is hereby terminated and notwithstanding
         article 13.6 of the Drug Delivery Licence and save as set out below
         shall cease to have any further force or effect and all rights to the
         Product (as defined in the Drug Delivery Licence) shall revert
         absolutely and irrevocably to Bioglan. Bioglan and CeNeS hereby
         irrevocably waives any rights each party may have against the other for
         breach of the terms of the Drug Delivery Licence and CeNeS shall cease
         to have the benefit of the licence grant set out in Clause 3.1 of the
         Drug Delivery Licence.

4.2      The provisions of articles 9.1 and 11 of the Drug Delivery Licence
         shall survive the termination of the Drug Delivery Licence, where
         relevant, for the periods set out therein.

4.3      Both Parties shall return all confidential information received from
         the other party within 90 (ninety) days of the Effective Date in
         accordance with article 13.6 of the Drug Delivery Licence.

5        TERMINATION OF THE DEPOCORE LICENCE

5.1      The Depocore Licence is hereby terminated and notwithstanding article
         13.6 of the Depocore Licence and save as set out below shall cease to
         have any further force or effect and all rights of the Product (as
         defined in the Depocore Licence) shall revert absolutely and
         irrevocably to CDD. Bioglan and CDD hereby irrevocably waives any
         rights each party may have against the other for breach of the terms of
         the Depocore Licence and Bioglan shall cease to have the benefit of the
         licence grant set out in Clause 3.1 of the Depocore Licence.

5.2      The provisions of articles 9.1 and 11 of the Depocore Licence shall
         survive the termination of the Depocore Licence, where relevant, for
         the periods set out therein.

5.3      Both Parties shall return all confidential information received from
         the other party within 90 (ninety) days of the date of this Deed in
         accordance with article 13.6 of the Depocore Licence.

                                       4
<PAGE>

6        TERMINATION OF THE SUBSCRIPTION AGREEMENTS

6.1      The Subscription Agreements are hereby terminated and shall cease to
         have any further force and effect and Bioglan and CeNeS plc hereby
         irrevocably waives any rights each party may have against the other for
         breach of the terms of the Subscription Agreements.

6.2      The provisions of Clause 7 below shall apply to the Shares subscribed
         for pursuant to the Subscription Agreements.

7        RESTRICTION ON SALES OF THE SHARES

7.1      Bioglan undertakes and agrees with CeNeS plc that during the Controlled
         Period Bioglan will not dispose or agree to dispose of any interest in
         all or any of the Shares except by means of a sale or transfer of such
         Shares through CeNeS plc's stockbrokers as notified by CeNeS plc from
         time to time. If CeNeS plc's stockbrokers fail to offer competitive
         prices or commission rates within 5 business days of Bioglan notifying
         them of a desire to sell, Bioglan may sell via another bona fide
         stockbroker acting in good faith (the "Alternative Broker") upon
         notifying CeNeS plc of the price and quantity of Shares to be sold
         subject always to CeNeS's stockbroker electing to match the price and
         commission rate which Bioglan can achieve through the Alternative
         Broker.

7.2      The restriction contained in Clause 7.1 shall not apply to any of the
         following:-

         7.2.1    an acceptance by Bioglan of a general offer for the share
                  capital of CeNeS made in accordance with the Code or otherwise
                  where such offer relates to the entire issued share capital of
                  CeNeS other than any Shares held by the offeror or persons
                  acting in concert with the offeror for the purposes of the
                  Code in relation to such offer; or

         7.2.2    any compromise or arrangement under Section 425 of the
                  Companies Act 1985 providing for the acquisition by any person
                  (or group of persons acting in concert) of 50 per cent. or
                  more of the equity share capital of CeNeS; or

         7.2.3    any scheme of reconstruction under Section 110 of the
                  Insolvency Act 1986 in relation to CeNeS; or

         7.2.4    the execution by Bioglan of an irrevocable commitment to
                  accept a general offer for the whole of the issued equity
                  share capital of CeNeS plc (other than any equity share

                                       5
<PAGE>

                  capital held by the offeror or persons acting in concert with
                  the offeror for the purposes of the Code in relation to such
                  offer).

PROVIDED ALWAYS THAT any disposals pursuant to Clause 7.2 shall be notified in
advance to CeNeS plc in writing.

8        CAPACITY OF ADMINISTRATORS

8.1      This Deed is signed by the Administrators in their capacity as agents
         of Bioglan. The parties agree that the Administrators shall incur no
         personal liability whatsoever under the terms of this Deed.

9        NOTICES

9.1      Any notice or other document given under this Agreement shall be in
         writing in the English language and shall be given by hand or sent by
         prepaid airmail, by facsimile transmission or e-mail to the address of
         the receiving Party as set out in Clauses 20.3 below unless a different
         address or facsimile number has been notified to the other in writing
         for this purpose.

9.2      Each such notice or document shall:

         9.2.1    if sent by hand, be deemed to have been given when delivered
                  at the relevant address;

         9.2.2    if sent by prepaid airmail, be deemed to have been given seven
                  (7) days after posting; and

         9.2.3    if sent by facsimile transmission be deemed to have been given
                  when transmitted provided that a confirmatory copy of such
                  facsimile transmission shall have been sent by prepaid airmail
                  within 24 (twenty four) hours of such transmission.

9.3      CeNeS's address for services of notices and other documents shall be:

         Compass House
         Vision Park
         Chivers Way
         Cambs CB4 9ZR

         For the Attention of the Company Secretary

                                       6
<PAGE>

         Fax No:  01223 266467

         CeNeS Plc's address for services of notices and other documents shall
         be:

         Riverside Way
         Riverside Business Park
         Irvine
         Ayrshire
         KA11 5DJ

         For the Attention of the Company Secretary
         Fax No:  01223 266467

         CeNeS Drug Delivery Limited address for services of notices and other
         documents shall be:

         Riverside Way
         Riverside Business Park
         Irvine
         Ayrshire
         KA11 5DJ

         For the Attention of the Company Secretary
         Fax No:  01223 266467

         Bioglan's address for service of notices and other documents shall be:

         c/o David Kenneth Duggins
         Arthur Andersen
         180 Strand
         London WC2R 2NT

         Fax No:  020 7438 3771

         Administrators address for service of notices and other documents shall
         be:

         David Kenneth Duggins
         Arthur Andersen
         180 Strand
         London WC2R 2NT

         For the Attention of David Kenneth Duggins
         Fax No:  020 7438 3771

                                       7
<PAGE>

10       PUBLICITY

10.1     Each party agrees that the terms and conditions of this Deed shall be
         treated as confidential information and that no reference hereto shall
         be made without the prior written consent of the other Party (which
         consent shall not be unreasonably withheld or delayed) except (i) as
         required by applicable disclosure laws, including the rules and
         regulations of any Stock Exchange or regulatory body relevant to the
         disclosing party (ii) to its accountants, banks, financing sources,
         lawyers and other professional advisers in connection with this
         Agreement, provided that such party undertakes in writing (or is
         otherwise bound by rules of professional conduct) to keep such
         information strictly confidential, (iii) as necessary in connection
         with the enforcement of this Agreement between the parties, or (iv)
         pursuant to joint press releases of the parties prepared in good faith,
         or (v) as required by statute, or (vi) in the proper performance of the
         Administrators' duties and obligations as Administrators of Bioglan.

11       AMENDMENT

11.1     No modification or amendment of this Agreement shall be valid or
         binding upon the Parties unless made in writing and duly executed on
         behalf of the Parties.

12       GOVERNING LAW

12.1     This Deed shall be construed under and interpreted pursuant to the Laws
         of England.

12.2     The Parties hereto irrevocably submit to the exclusive jurisdiction of
         the Courts of England in relation to any dispute arising under or
         pursuant to the terms of this Deed.

AS WITNESS the words of the parties or their duly authorised representatives the
day and year first above written.

                                       8
<PAGE>

Executed as a DEED                 )
for and on behalf of               )        /s/ David Duggins
BIOGLAN PHARMA PLC                 )        David Duggins
(In Administration)                )
by its Administrators              )        /s/ Ian Best
                                            Ian Best

Executed as a DEED                 )
for and on behalf of               )        /s/ Neil Clark
CeNeS PHARMACEUTICALS PLC          )        Director

                                            /s/ Authorized Signatory
                                            Director / Secretary

Executed as a DEED                 )
for and on behalf of               )        /s/ Neil Clark
CeNeS DRUG DELIVERY LIMITED        )        Director

                                            /s/ Authorized Signatory
                                            Director / Secretary

Executed as a DEED                )
for and on behalf of              )        /s/ David Kenneth Duggins
CeNeS LIMITED                     )        Director

                                           /s/ Authorized Signatory
                                           Director / Secretary

SIGNED, SEALED AND DELIVERED      )
by David Kenneth Duggins          )        /s/ David Kenneth Duggins
                                  )        David Kenneth Duggins

                                       9

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