Document:

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                            RESEARCH, DEVELOPMENT AND
                         COMMERCIALIZATION AGREEMENT/1/

                                  by and among

                        ELAN PHARMA INTERNATIONAL LIMITED

                                       and

                      CAMBRIDGE ANTIBODY TECHNOLOGY LIMITED

                                January 24, 2001

_______________________
/1/ [***] indicates that text has been deleted which is the subject of a
confidential treatment request. This text has been filed separately with the
SEC.

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                                TABLE OF CONTENTS

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1.    DEFINITIONS......................................................    1

2.    SCOPE OF THE COLLABORATION.......................................   18

      2.1    Collaboration Goals.......................................   18

      2.2    Exclusive Working Relationship............................   19

      2.3    Further Exclusions........................................   22

      2.4    Safeguard Procedures......................................   22

3.    LICENSES.........................................................   23

      3.1    Licenses to CAT...........................................   23

      3.2    Licenses to ELAN..........................................   24

      3.3    Licensing and Sublicensing to Third Parties...............   25

      3.4    No Other Rights...........................................   26

4.    MANAGEMENT OF COLLABORATION......................................   26

      4.1    Joint Steering Committee..................................   26

      4.2    Project Coordinators......................................   30

      4.3    Compliance with Laws......................................   30

5.    RESEARCH AND DEVELOPMENT.........................................   30

      5.1    The Research and Development Programs.....................   30
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    5.2    The Research and Development Plans.............................   31

    5.3    Funding of the Annual Research Plan and the Annual
           Development Plan...............................................   33

    5.4    Reporting and Disclosure.......................................   37

    5.5    Disclosure and Cooperation.....................................   37

    5.6    CAT Exclusive Antibody.........................................   38

    5.7    Hybrid R&D Candidates..........................................   40

6.  MANUFACTURING AND REGULATORY MATTERS..................................   41

    6.1    Manufacture and Supply.........................................   41

    6.2    Regulatory Matters.............................................   42

7.  COMMERCIALIZATION OF PRODUCTS.........................................   44

    7.1    Commercialization in the Territory.............................   44

    7.2    Reports and Payments...........................................   49

    7.3    Maintenance of Records; Audits.................................   49

    7.4    Interest.......................................................   51

    7.5    GAAP...........................................................   51

8.  INTELLECTUAL PROPERTY.................................................   51

    8.1    Ownership......................................................   51

    8.2    Joint Patent Committee.........................................   52

    8.3    Prosecution and Maintenance of Patent Rights...................   52
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    8.4   Trademarks .........................................................       53

    8.5   Enforcement of Jointly Owned or Controlled Patent Rights ...........       53

    8.6   Enforcement of Individually Owned or Controlled Patent Rights ......       55

    8.7   Third Party Claims .................................................       55

    8.8   Third Party Licenses ...............................................       56

    8.9   Patent Marking .....................................................       57

    8.10  Patent Certifications ..............................................       57

    8.11  Limitation .........................................................       57

    8.12  Patent Attorneys ...................................................       58

9.  CONFIDENTIALITY ..........................................................       58

    9.1   Confidentiality ....................................................       58

    9.2   Terms of Agreement .................................................       58

    9.3   Permitted Disclosures ..............................................       59

    9.4   Publications .......................................................       59

10. REPRESENTATIONS AND WARRANTIES ...........................................       60

    10.1  Representations and Warranties of Each Party .......................       60

    10.2  Additional Representations and Warranties of CAT ...................       60

    10.3  Additional Representations and Warranties of ELAN ..................       61

    10.4  Representation by Legal Counsel ....................................       62
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     10.5     No Inconsistent Agreements ....................................     62

     10.6     Disclaimer ....................................................     62

11.  GOVERNMENT APPROVALS ...................................................     63

     11.1     ELAN's and CAT's Obligations ..................................     63

     11.2     Additional Approvals ..........................................     63

12.  TERM AND TERMINATION ...................................................     63

     12.1     Term ..........................................................     63

     12.2     Termination for Cause .........................................     63

     12.3     Effect of a Termination for Cause on Licenses .................     64

     12.4     Termination Pursuant to Section 12.2 ..........................     66

     12.5     Provisions For Change Of Control ..............................     67

     12.6     Provision for Insolvency ......................................     67

13.  WITHDRAWAL TO A ROYALTY POSITION .......................................     70

     13.1     Right to Terminate ............................................     70

     13.2     Effect of Termination for Convenience by ELAN .................     71

     13.3     Effect of Termination for Convenience by CAT ..................     73

     13.4     Payments ......................................................     75

     13.5     Royalty Cost Adjustment .......................................     78

     13.6     Survival of Obligations .......................................     78
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     13.7  Net Profit .......................................................       79

     13.8  Withdrawal Royalty Stacking Provision ............................       79

14.  PRODUCT LIABILITY, INDEMNIFICATION AND INSURANCE .......................       79

     14.1  Sharing of Collaboration Product Liability Expenses ..............       79

     14.2  Indemnification by CAT ...........................................       79

     14.3  Indemnification by ELAN ..........................................       80

     14.4  Procedure ........................................................       81

     14.5  Insurance ........................................................       81

15.  DISPUTE RESOLUTION .....................................................       82

     15.1  Disputes .........................................................       82

     15.2  Discretionary Dispute Resolution .................................       82

     15.3  Discretionary Dispute Resolution .................................       82

     15.4  Determination of Patent Disputes .................................       82

16.  ASSIGNMENTS; CHANGES OF CONTROL ........................................       83

     16.1  Assignments ......................................................       83

17.  MISCELLANEOUS ..........................................................       83

     17.1  Further Actions ..................................................       83

     17.2  Force Majeure ....................................................       83

     17.3  Notices ..........................................................       83
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     17.4   Amendment ......................................................    84

     17.5   Waiver .........................................................    84

     17.6   Severability ...................................................    84

     17.7   Descriptive Headings ...........................................    85

     17.8   Governing Law; Venue and Jurisdiction ..........................    85

     17.9   Entire Agreement of the Parties ................................    85

     17.10  Independent Contractors ........................................    85

     17.11  Debarment ......................................................    85

     17.12  Counterparts ...................................................    86

     17.13  NO CONSEQUENTIAL DAMAGES .......................................    86
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EXHIBITS

     1.10         CAT Gatekeeping Procedure
     1.11         CAT In-Licenses
     1.15         CAT Patent Rights
     1.17         CAT Technology
     1.41         ELAN Patent Rights
     1.43         ELAN Technology
     1.95         Specific Targets
     2.2(a)(ii)   Specified Antibody Companies
     2.2(d)(ii)   CAT Preexisting Obligations
     5.2.1        Elements of Annual Research Plan
     5.3.5        Third Party License Fees
     10.2.6       CAT Third Party Claims
     10.3.4       ELAN Third Party Claims

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              RESEARCH, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT

     THIS RESEARCH, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (the
     "Agreement") is entered into on this 24th day of January, 2001, by and
     among Cambridge Antibody Technology Limited, a corporation formed under the
     laws of England and Wales on behalf of itself and its Affiliates,
     (collectively, "CAT"), and Elan Pharma International Limited, an Irish
     Corporation having offices at WIL House, Shannon Business Park, Shannon,
     Country Clare, Ireland, on behalf of itself and its Affiliates. CAT and
     ELAN (as defined below) may each be referred to herein individually as a
     "Party" and collectively as the "Parties".

                                   BACKGROUND

1.   CAT is engaged in research, discovery and development of antibodies for use
     as human pharmaceutical products.

2.   ELAN has expertise in research, development and commercialization of human
     pharmaceutical products.

3.   CAT and ELAN have agreed to collaborate, on the terms and conditions set
     forth in this Agreement, on the discovery, research, development and
     commercialization of antibodies for the diagnosis, treatment and/or
     prevention of human diseases.

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

1.   DEFINITIONS.

1.1  "Affiliate(s)". Affiliate(s) shall mean, with respect to any person or
     entity, any other person or entity which controls, is controlled by or is
     under common control with such person or entity. A person or entity shall
     be regarded as being in control of another entity if it owns or controls at
     least fifty percent (50%) of the equity securities of the subject entity
     entitled to vote in the election of directors (or, in the case of an entity
     that is not a corporation, for the election of the corresponding managing
     authority). Specifically excluded from the definition of "Affiliate" shall
     be any Third Party subject to an Elan Acquisition or CAT Acquisition.

1.2  "Antibody". Antibody shall mean a molecule or a gene encoding a molecule
     with a molecular weight greater than [***] and which comprises one or more
     immunoglobu-

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     lin variable domains or parts of such domains or any existing or future
     fragments, variants, modifications or derivatives thereof; provided,
     however, that such fragments, variants, modifications or derivatives retain
     at least a functional portion of an immunoglobulin variable domain.

1.3  "BLA". BLA shall mean a Biologics License Application or similar
     application filed with the FDA after completion of one or more human
     clinical trials to obtain Regulatory Approval for a Collaboration Product.

1.4  "Blocking Third Party Intellectual Property". With respect to any country
     in the Territory, on a country-by-country basis, Blocking Third Party
     Intellectual Property shall mean valid Patent Rights in such country which
     are owned or otherwise controlled by a Third Party, in the absence of a
     license to which the Research and/or Development of an R&D Candidate and/or
     the Manufacture and/or Commercialization of a Collaboration Product would
     infringe such valid Patent Rights.

1.5  "Calendar Quarter". Calendar Quarter shall mean the respective periods of
     three (3) consecutive calendar months ending on March 31, June 30,
     September 30 or December 31.

1.6  "CAT Antibody Library". CAT Antibody Library shall mean the collection of
     bacteriophages each of which displays an Antibody or a collection of host
     cells containing such collections of bacteriophages which is Controlled by
     CAT at the Effective Date. CAT Antibody Library shall include all updates,
     additions and improvements to any CAT Antibody Library Controlled by CAT
     during the term of this Agreement.

1.7  "CAT Collaboration Know How". CAT Collaboration Know How shall mean Know
     How discovered, made or conceived solely by employees of, or others acting
     on behalf of, CAT in performing its obligations under the Research Program,
     the Development Program, Manufacturing or in performing any Post Approval
     Research.

1.8  "CAT Collaboration Patent Rights". CAT Collaboration Patent Rights shall
     mean Patent Rights which claim CAT Inventions and (i) which are made during
     the term of this Agreement or (ii) which come into the Control of CAT
     during the term of this Agreement.

1.9  "CAT Exclusive Antibody". CAT Exclusive Antibody shall mean any Antibody
     which was identified, isolated and/or discovered as a result of Research
     conducted pursuant to this Agreement and which binds to a Specific Target
     in a manner defined by written criteria agreed to, from time to time, by
     the JSC and which (a) within [***] after its identification, isolation or
     discovery has not been designated by the JSC as an

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      R&D Candidate, or (b) within [***] of its designation as an R&D Candidate
      has not been selected by the JSC for Development, or (c) having been
      identified on an Annual Development Plan, ceases, for a period of [***],
      to be identified on any subsequent Annual Development Plan.

1.10  "CAT Gatekeeping Procedure". CAT Gatekeeping Procedure shall mean such
      procedures which prevent any Target from being a Specific Target unless
      and until CAT can grant to ELAN the licenses contemplated under this
      Agreement in accordance with those procedures identified in Exhibit 1.10
                                                                  ------------
      hereto.

1.11  "CAT In-License". CAT In-License shall mean any agreement between CAT and
      any Third Party pursuant to which CAT Controls those CAT Patent Rights
      which claim CAT Technology, R&D Candidates or Collaboration Products or
      any Patent Rights which are used in the Research conducted under this
      Agreement, and/or the Development, Manufacture or Commercialization of any
      R&D Candidate or Collaboration Product. Annexed hereto as Exhibit 1.11 is
                                                                ------------
      a list of each CAT In-License and the royalty obligations thereof.

1.12  "CAT Intellectual Property". CAT Intellectual Property shall mean (a) the
      CAT Know How, (b) the CAT Patent Rights, (c) the CAT Collaboration Know
      How, (d) the CAT Collaboration Patent Rights and (e) CAT's interest in the
      Joint Collaboration Know How, the Joint Collaboration Patent Rights, the
      Patent Rights and Know How subject to Section 8.1.3, the Copyrights and
      the Trademark.

1.13  "CAT Inventions". CAT Inventions shall mean all Inventions which are made
      or conceived solely by CAT's employees, agents or subcontractors in the
      performance of CAT's obligations under the Research Program and the
      Development Program, Manufacturing or in performing any Post-Approval
      Research.

1.14  "CAT Know How". CAT Know How shall mean Know How, other than CAT
      Collaboration Know How, that CAT Controls as of the Effective Date or that
      comes into the Control of CAT during the term of this Agreement.

1.15  "CAT Patent Rights". CAT Patent Rights shall mean Patent Rights, other
      than CAT Collaboration Patent Rights, that CAT Controls as of the
      Effective Date or that come into the Control of CAT during the term of
      this Agreement and which claim any Invention or CAT Prior Invention. Those
      CAT Patent Rights known to be existing as of the Effective Date are listed
      on Exhibit 1.15 attached hereto, which Exhibit 1.15 shall be updated from
         ------------                        ------------
      time to time.

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1.16  "CAT Prior Invention". CAT Prior Invention shall mean a Prior Invention
      Controlled by CAT.

1.17  "CAT Technology". CAT Technology shall mean the CAT Antibody Library and
      associated technologies, including, without limitation, the assays
      described in Exhibit 1.17, as amended from time to time by the JSC.
                   ------------

1.18  "Change of Control". Change of Control shall mean any of the following:
      (a) the sale or disposition of all or substantially all of the assets of a
      Party to a Third Party, (b) the acquisition by a Third Party, other than
      an employee benefit plan (or related trust) sponsored or maintained by a
      Party or any of its Affiliates, of more than [***] of such Party's
      outstanding shares of voting capital stock, or (c) the merger or
      consolidation of a Party with or into another corporation, other than, in
      the case of (b) or (c) of this Section, an acquisition or a merger or
      consolidation of a Party in which holders of shares of such Party's voting
      capital stock immediately prior to the acquisition, merger or
      consolidation will have at least [***]of the ownership of voting capital
      stock of the acquiring Third Party or the surviving corporation in such
      merger or consolidation, as the case may be, immediately after the merger
      or consolidation.

1.19  "Clinical Supplies". Clinical Supplies shall mean supplies of R&D
      Candidate(s) in packaged form, Manufactured in compliance with GMP, ready
      to be used for the conduct of pre-clinical and/or human clinical trials by
      the Parties pursuant to the applicable Annual Development Plan.

1.20  "Collaboration Product". Collaboration Product shall mean any
      pharmaceutical, diagnostic, therapeutic or medicinal agent, item, product
      or formulation sold or offered for sale in the Territory and in the Field
      which contains an R&D Candidate as an active ingredient and for which
      Regulatory Approval has been received.

1.21  "Combination Product". Combination Product shall mean a product that
      contains a Collaboration Product as active component and at least one
      other active component.

1.22  "Commercialization". Commercialization shall mean any and all activities
      of using, importing, marketing, promoting, distributing, offering for sale
      and selling a Collaboration Product in the Field. When used as a verb,
      "Commercialize" shall mean to engage in Commercialization.

1.23  "Commercially Reasonable Efforts". Commercially Reasonable Efforts shall
      mean, in the conduct of the Research Program and the Development Program,
      application of those scientific, technical and other efforts or resources
      normally used by a Party in the conduct of discovery, research and
      development of a product or compound owned by

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         it or to which it has rights, which is of similar market potential at a
         similar stage in its research, development or product life, taking into
         account, without limitation, issues of safety and efficacy, product
         profile, the proprietary position of, the applicable Specific Target,
         R&D Candidate, CAT Exclusive Antibody, Non-Antibody or Product, and the
         then current regulatory environment and status of the applicable R&D
         Candidate, CAT Exclusive Antibody, Non-Antibody or Product, as well as
         other relevant scientific factors. Without limiting the foregoing,
         Commercially Reasonable Efforts as it applies to the clinical
         development of any Specific Targets, R&D Candidates and/or
         Collaboration Product hereunder shall mean adherence to the activities
         and time lines (to the extent adherence to such activities and time
         lines is controllable by the Party responsible for performing such
         activities) set forth in the applicable Annual Research Plan and or
         Annual Development Plans prepared by the JSC, as may be amended from
         time to time based on the results of studies conducted with such
         Specific Target, R&D Candidate or Collaboration Product, and regulatory
         factors. To the extent that the performance of a Party's obligations
         hereunder is adversely affected by the other Party's failure to perform
         its obligations hereunder, such Party shall not be deemed to have
         failed to use its Commercially Reasonable Efforts in performing such
         obligations.

1.24     "Confidential Information". Confidential Information shall mean, with
         respect to a Party, all information (and all tangible and intangible
         embodiments thereof), which is Controlled by such Party, is disclosed
         by such Party to the other Party pursuant to this Agreement, and is
         designated as confidential in writing by the disclosing Party whether
         by letter or by use of an appropriate stamp or legend, prior to or at
         the time any such information is disclosed by the disclosing Party to
         the other Party. In addition, any information which is orally,
         electronically or visually disclosed by a Party, or is disclosed in
         writing without an appropriate letter, stamp or legend, shall
         constitute Confidential Information if the disclosing Party, within
         thirty (30) days after such disclosure, delivers to the receiving Party
         a written document or documents describing the information disclosed
         and referencing the place and date of such oral, visual, electronic or
         written disclosure and the names of the person(s) to whom such
         disclosure was made; provided, however, that any technical information
         disclosed at a meeting of the JSC shall constitute Confidential
         Information unless otherwise specified. Notwithstanding the foregoing,
         Confidential Information of a Party shall not include information
         which, and only to the extent, the receiving Party can establish by
         written documentation (a) has been publicly known prior to disclosure
         of such information by the disclosing Party to the receiving Party, (b)
         has become publicly known, without breach of this Agreement on the part
         of the receiving Party, subsequent to disclosure of such information by
         the disclosing Party to the receiving Party, (c) has been received by
         the receiving Party at any time from a source, other than the
         disclosing Party, rightfully having possession of and the right to
         disclose such information free of confidentiality

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         obligations, (d) has been otherwise known by the receiving Party free
         of confidentiality obligations to the disclosing Party prior to
         disclosure of such information by the disclosing Party to the receiving
         Party, or (e) has been independently developed by employees or others
         on behalf of the receiving Party without the aid, application or use of
         such information disclosed by the disclosing Party to the receiving
         Party.

1.25     "Control" or "Controlled". Control or Controlled shall mean with
         respect to any (a) item of information, including, without limitation,
         Know How, or (b) intellectual property right, the possession (whether
         by ownership or license, other than pursuant to this Agreement) by a
         Party of the ability to grant to the other Party access 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
         existing before or after the Effective Date.

1.26     "Copyright". Copyright shall mean any copyright Controlled by a Party
         or by both Parties, which copyright pertains to the promotional
         materials and literature that is selected for use by the JSC in
         connection with the promotion of Collaboration Products in the
         Territory.

1.27     "Cost of Goods Manufactured for Clinical Supplies". Cost of Goods
         Manufactured for Clinical Supplies shall mean a Party's costs to
         Manufacture Clinical Supplies, but solely to the extent that such costs
         could be included as an inventory cost under U.S. GAAP and shall
         include, but not be limited to, [***].

1.28     "Cost of Goods Manufactured for Commercialization". Cost of Goods
         Manufactured for Commercialization shall mean a Party's costs to
         Manufacture Collaboration Products, but solely to the extent that such
         costs could be included as an inventory cost under U.S. GAAP and shall
         include, but not be limited to, [***].

1.29     "Development". Development shall mean, on an R&D Candidate-by-R&D
         Candidate and country-by-country basis, all activities performed by or
         on behalf of either Party pursuant to the Annual Research Plan and the
         Annual Development Plan on such R&D Candidate in the Field, and, solely
         with respect to a Hybrid R&D Candidate, outside of the Field, from the
         date on which the JSC designates such R&D Candidate for further
         pre-clinical development toward IND filing until Regulatory Approval of
         a Collaboration Product containing such R&D Candidate is obtained in
         such country for the indication under study. Development shall include,
         without limitation, all activities related to [***]. When used as a
         verb, "Develop" shall mean to engage in Development.

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                                      -7-

1.30     "Development Costs". Development Costs shall mean the costs and
         expenses associated with Development activities actually incurred by
         either Party from the Effective Date through the later of (a) the date
         of the last Regulatory Approval obtained (including thereafter costs to
         maintain or expand such Regulatory Approval) in the Territory, or (b)
         the date of termination of Development of the final indication for
         which Regulatory Approval is to be sought in the Territory. The costs
         and expenses associated with Development activities shall include those
         costs required to obtain, maintain and/or expand the authorization
         and/or ability to Manufacture, formulate, fill, and/or ship Clinical
         Supplies and, for the avoidance of doubt, no cost or expenses
         associated with the Manufacture or preparation to Manufacture
         commercial supplies of a Collaboration Product shall be deemed to be a
         "Development Cost". "Development Costs" shall also include, but are not
         limited to, [***]. "Development Costs" shall also include [***]. In
         determining "Development Costs" chargeable under this Agreement, each
         Party will use its respective project accounting systems, and will
         review and approve its respective project accounting systems and
         methodologies with the other Party. The Parties hereby agree that
         efforts of the employees of a Party or its Affiliates in performing its
         activities hereunder shall be charged as Development Costs at the
         applicable FTE Rate. Notwithstanding anything in this Section 1.30 to
         the contrary [***]. All payments made by a Party to a Third Party in
         connection with the performance of its activities under the Annual
         Development Plan and an Annual Development Budget shall be charged as
         Development Costs at such Party's actual out-of-pocket cost. The costs
         of Manufacturing Clinical Supplies shall be charged as Development Cost
         in an amount equal to one hundred percent (100%) of the Cost of Goods
         Manufactured for Clinical Supplies. Except to the extent included in
         Cost of Goods Manufactured for Clinical Supplies under the preceding
         sentence such expenses incurred by each Party for equipment, materials
         and supplies utilized in performing its activities under the Annual
         Research Plan and the Annual Development Plan and an Annual Development
         Budget shall not be separately charged as Developments Costs, except
         for those expenses incurred by a Party, with the prior written consent
         of the JSC as set forth in the Annual Research Plan and the Annual
         Development Plan and Annual Development Budget, [***], which expenses
         shall be charged as Development Costs at such Party's actual
         out-of-pocket expense incurred in purchasing or making such equipment,
         materials or supplies.

1.31     "Distribution Costs". Distribution Costs shall mean the FTE costs and
         other costs specifically identifiable or allocable to the distribution
         of a Collaboration Product by a Party and described in an Annual
         Commercialization Plan including [***]. For purposes of this
         definition, FTE costs shall be charged at the applicable FTE Rate.

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1.32     "Drug Delivery Technology". Drug Delivery Technology shall mean
         formulation, delivery and/or excipient systems and technologies which
         are proprietary to or subject to Patent Rights within the Control of
         ELAN, its licensees, licensors, and joint venture partners which are
         used for or related to delivery of pharmaceutical, diagnostic,
         therapeutic or medicinal agent, item or product, including without
         limitation an Antibody or Non-Antibody, to an animal and which is
         primarily intended to allow such agent, item or product to be
         administered on an optimized schedule and/or superior diagnostic
         utility and/or to be administered with reduced side effects and/or to
         be administered with enhanced efficacy and/or to be administered with
         better patient compliance and/or to be administered in reduced dosages.
         Drug Delivery Technologies shall expressly not include non-proprietary
         injection or infusion means of delivering an Antibody.

1.33     "Day" or "day". Day or day shall mean 9:00 a.m. to 6:00 p.m. on any day
         other than Saturday, Sunday, bank or other holiday or other public
         holiday in England and Wales, Ireland or the United States.

1.34     "Effective Date". Effective Date shall mean the execution date hereof.

1.35     "ELAN". ELAN shall mean Elan Pharma International Limited, an Irish
         Corporation, and those Affiliates which, in particular jurisdictions,
         Elan Pharma International Limited specifies to carry out its
         obligations under this Agreement.

1.36     "ELAN Collaboration Know How". ELAN Collaboration Know How shall mean
         Know How discovered, made or conceived solely by employees of, or
         others acting on behalf of, ELAN in performing its obligations under
         the Research Program, the Development Program, Manufacturing, or in
         performing any Post-Approval Research.

1.37     "ELAN Collaboration Patent Rights". ELAN Collaboration Patent Rights
         shall mean Patent Rights which claim ELAN Inventions and which are (i)
         made during the term of this Agreement or (ii) which come into the
         Control of ELAN during the term of this Agreement.

1.38     "ELAN Intellectual Property". ELAN Intellectual Property shall mean (a)
         the ELAN Know How, (b) the ELAN Patent Rights, (c) the ELAN
         Collaboration Know How, (d) the ELAN Collaboration Patent Rights and
         (e) ELAN's interest in the Joint Collaboration Know How, the Joint
         Collaboration Patent Rights, the Patent Rights and Know How subject to
         Section 8.1.3, the Copyrights and the Trademark.

1.39     "ELAN Inventions". ELAN Inventions shall mean all Inventions which are
         made or conceived solely by ELAN's employees, agents or subcontractors
         in the performance

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      of ELAN's obligations under the Research Program, the Development Program,
      Manufacturing or in performing any Post-Approval Research.

1.40  "ELAN Know How". ELAN Know How shall mean Know How other than ELAN
      Collaboration Know How that ELAN Controls as of the Effective Date or that
      comes into the Control of ELAN during the term of this Agreement.

1.41  "ELAN Patent Rights". ELAN Patent Rights shall mean Patent Rights, other
      than ELAN Collaboration Patent Rights, that ELAN Controls as of the
      Effective Date or that come into the Control of ELAN during the term of
      this Agreement and which claim any Invention or ELAN Prior Invention.
      Those ELAN Patent Rights known to be existing as of the Effective Date are
      listed on Exhibit 1.41 attached hereto.
                ------------

1.42  "ELAN Prior Invention". ELAN Prior Invention shall mean a Prior Invention
      Controlled by ELAN excluding any ELAN Technology.

1.43  "ELAN Technology". ELAN Technology shall mean those assays described in
      Exhibit 1.43.
      ------------

1.44  "Enhancing Third Party Intellectual Property". Enhancing Third Party
      Intellectual Property shall mean, with respect to any country in the
      Territory, on a country-by-country basis, valid Patent Rights in such
      country owned or otherwise controlled by a Third Party that cover an
      invention which, if utilized by the Parties under this Agreement would
      facilitate Research conducted under this Agreement, and/or Development
      and/or Manufacture of an R&D Candidate or Collaboration Product, as the
      case may be, and/or if included in a Collaboration Product would
      materially enhance the commercial value of such Collaboration Product. For
      purposes of clarity, Enhancing Third Party Intellectual Property shall not
      include Blocking Third Party Intellectual Property.

1.45  "FDA". FDA shall mean the United States Food and Drug Administration or
      any successor agency thereto or the equivalent Regulatory Authority in any
      other country.

1.46  "FD&C Act". FD&C Act shall mean the United States Federal Food, Drug, and
      Cosmetic Act, as amended, and the regulations promulgated thereunder.

1.47  "Excepted Antibody". Excepted Antibody shall mean [***].

1.48  "Field". Field shall mean the discovery, isolation, characterization,
      research, development, and/or commercialization of an Antibody useful for
      the diagnosis, treatment and/or prevention of one or more of the following
      disease conditions [***].

<PAGE>

                                      -10-

      (a) neurodegenerative conditions [***].

      For the purpose of this Agreement, the term "Field" shall exclude
      antagonists of [***] and antagonists of those [***] Targets which are
      identified in a sealed and dated envelope provided by CAT to the [***] on
      or before the Effective Date. The London office of Arnold & Porter shall
      keep such envelope in a safe and secure manner until such time as
      instructed in a written document signed by both Parties to open such
      envelope or to release such envelope as may be directed in such document.

1.49  "First Commercial Sale". First Commercial Sale shall mean, with respect to
      any Product and any country in the Territory, the first sale of Product
      under this Agreement to a Third Party in such country, after such Product
      has been granted Regulatory Approval under this Agreement by the competent
      Regulatory Authorities in such country.

1.50  "Full Time Equivalent" or "FTE". Full Time Equivalent or FTE shall mean a
      total of [***] each, as applicable, on the Research to be conducted under
      this Agreement, and/or the Development or Manufacturing of an R&D
      Candidate or Collaboration Product carried out by employees of a Party
      having the appropriate scientific expertise to conduct such activities.
      From the date hereof and for two (2) years thereafter, the "applicable FTE
      rate" shall mean [***]. The FTE rate for the period commencing [***] from
      date hereof, shall be negotiated in good faith by and between the Parties,
      proposed by the Joint Project Team and approved or ratified by the JSC.
      The FTE rate for the initial period shall not be taken as indicative of
      the FTE rate for periods after the [***] period identified. The Parties
      shall include within the determination of FTE rate only [***].

1.51  "Good Clinical Practice" or "GCP". Good Clinical Practice or GCP shall
      mean the then current standards for clinical trials for pharmaceuticals,
      as set forth in the FD&C Act and applicable regulations promulgated
      thereunder, as amended from time to time, and such standards of good
      clinical practice as are required by the European Union and other
      organizations and governmental agencies in countries in which the
      applicable Product is intended to be sold, to the extent such standards
      are not less stringent than United States GCP.

1.52  "Good Laboratory Practice" or "GLP". Good Laboratory Practice or GLP shall
      mean the then current standards for laboratory activities for
      pharmaceuticals, as set forth in the FD&C Act and applicable regulations
      promulgated thereunder, as amended from time to time, and such standards
      of good laboratory practice as are required by the European Union and
      other organizations and governmental agencies in countries in which the
      applicable Product is intended to be sold, to the extent such standards
      are not less stringent than United States GLP.

<PAGE>

                                      -11-

1.53  "Good Manufacturing Practice" or "GMP". Good Manufacturing Practice or GMP
      shall mean the then current standards for manufacturing activities for
      pharmaceuticals, as set forth in the FD&C Act and applicable regulations
      promulgated thereunder, as amended from time to time, and such standards
      of good manufacturing practice as are required by the European Union and
      other organizations and governmental agencies in countries in which the
      applicable Product is intended to be manufactured or sold, to the extent
      such standards are not less stringent than United States GMP.

1.54  "Gross Sales". Gross Sales shall mean the gross amount invoiced by either
      Party, their Affiliates or permitted sublicensees for sales of a Product
      to Third Parties in each country of the Territory.

1.55  "IND". IND shall mean an Investigational New Drug Application, as defined
      in the FD&C Act, that is required to be filed with the FDA before
      beginning clinical testing of an R&D Candidate in human subjects, or an
      equivalent foreign filing.

1.56  "Invention". Invention shall mean any process, method, composition of
      matter, article of manufacture, discovery or finding which is necessary
      for the Research conducted under this Agreement and/or which is necessary
      to the Research, Development, Manufacture or Commercialization of any
      Antibody, CAT Exclusive Antibody, Non-Antibody, R&D Candidate or Product.

1.57  "Joint Collaboration Inventions". Joint Collaboration Inventions shall
      mean all Inventions discovered, made or conceived jointly by employees of
      CAT and ELAN, or others acting jointly on their behalf, in performing
      their obligations under the Research Program, the Development Program,
      Manufacturing or in performing any Post-Approval Research.

1.58  "Joint Collaboration Know How". Joint Collaboration Know How shall mean
      Know How discovered, made or conceived jointly by employees of CAT and
      ELAN, or others acting jointly on their behalf, in performing their
      obligations under the Research Program or Development Program,
      Manufacturing or in performing any Post-Approval Research.

1.59  "Joint Collaboration Patent Rights". Joint Collaboration Patent Rights
      shall mean Patent Rights that claim Joint Collaboration Inventions.

1.60  "Know How". Know How shall mean all Inventions, discoveries, data,
      information, processes, methods, techniques, materials, technology,
      results or other know how, whether or not patentable but which are not
      generally known, that are useful for the Research conducted under this
      Agreement and/or the Development, Commercializa-

<PAGE>

                                      -12-

      tion or Manufacture of any Antibody, R&D Candidate, CAT Exclusive
      Antibody, Non-Antibody and/or Product and/or any method of making an
      Antibody, R&D Candidate, CAT Exclusive Antibody, Non-Antibody and/or
      Product.

1.61  "Major Market Country". Major Market Country shall mean any of the [***].

1.62  "Manufacture", "Manufactured" or "Manufacturing". Manufacture,
      Manufactured or Manufacturing shall mean all activities involved in the
      production of an R&D Candidate or Collaboration Product to be Developed
      and/or Commercialized under this Agreement.

1.63  "Marketing Costs". Marketing Costs shall mean the FTE costs and other
      costs of marketing, promotion and advertising [***]. Such costs will
      include both internal FTE costs and outside services and expenses (e.g.,
      consultants, agency fees, meeting costs, etc.). "Marketing Costs" shall
      also include [***]. "Marketing Costs" will specifically exclude [***]. For
      purposes of this definition, FTE costs shall be charged at the applicable
      FTE Rate.

1.64  "Mild Cognitive Impairment" or "MCI". Mild Cognitive Impairment or MCI
      shall mean a state in which memory and/or cognition has declined and is
      abnormal for age and education, but the severity of which is insufficient
      to be consistent with dementia and/or Alzheimer's disease.

1.65  "Net Commercialization Revenues". Net Commercialization Revenues shall
      mean any signature fees, upfront, lump sum and milestone payments which
      either Party receives from Third Party sublicensees of such Party in
      respect of an applicable CAT Exclusive Antibody, Party Exclusive Product
      and/or Collaboration Product in consideration for the rights granted to
      such Third Party sublicensees.

1.66  "Net Sales". Net Sales shall mean Gross Sales of a Product less applicable
      Sales Returns and Allowances. In the case of Combination Products, Net
      Sales means the Gross Sales billed or invoiced on sales of such a
      Combination Product less applicable Sales Returns and Allowances
      multiplied by a proration factor. The prorated component value shall be
      mutually agreed upon by the Parties in writing prior to product launch of
      such a Combination Product. If all components of the Combination Product
      were sold separately during the same or immediately preceding royalty
      period, the proration factor shall be determined by the formula [***].

1.67  "Non-Antibody". Non-Antibody shall mean any molecule other than an
      Antibody which interacts with a Specific Target.

<PAGE>

                                      -13-

1.68  "Non-Antibody Product". Non-Antibody Product shall mean any
      pharmaceutical, therapeutic or medicinal agent, item, product or
      formulation sold or offered for sale in the Territory which contains a
      Non-Antibody as an active ingredient; provided, however, that such
      Non-Antibody interacts with a Specific Target which (a) as a direct result
      of the Research conducted by the Parties under this Agreement resulted in
      the selection of an Antibody that binds to that Specific Target in a
      manner set out in written criteria agreed from time to time by the JSC and
      (b) satisfies clause (iv) of the definition of Specific Targets.

1.69  "Ongoing Development Costs". Ongoing Development Costs shall mean FTE
      costs and other costs and expenses borne by either Party with respect to
      Post Approval Research approved by the JSC and other expenses approved by
      the JSC associated with market positioning of a Collaboration Product to
      the extent not otherwise included within Development Costs, Marketing
      Costs or Sales Costs. For purposes of this definition, FTE costs shall be
      charged at the applicable FTE Rate.

1.70  "Other Out-Of-Pocket Costs". Other Out-Of-Pocket Costs shall mean the
      following:

      .  Third Party License Fees (other than those related to the Manufacture
         of Clinical Supplies or Collaboration Products);

      .  Patent Costs and trademark costs;

      .  product liability insurance to the extent the Parties obtain a joint
         policy; and

      .  such other costs and expenses identified and approved to be Other
         Out-Of-Pocket Costs by the JSC.

1.71  "Party Exclusive Product". Party Exclusive Product shall mean any
      pharmaceutical, diagnostic, therapeutic, or medicinal agent, item or
      product sold or offered for sale in the Territory, both within and without
      the Field, which is subject to the provisions of Section 5.6 and which
      contains as an active ingredient a CAT Exclusive Antibody.

1.72  "Patent Costs". Patent Costs shall mean the fees and expenses paid to
      outside legal counsel and experts, and filing and maintenance expenses,
      incurred after the Effective Date, in connection with the establishment
      and maintenance of Joint Collaboration Patent Rights and under Patent
      Rights covering any Collaboration Product (to the extent to be shared by
      the Parties under the Agreement), including, to the extent specified

<PAGE>

                                      -14-

      in Section 8 of the Agreement, costs of patent interference,
      reexamination, reissue, opposition and revocation proceedings.

1.73  "Patent Rights". Patent Rights shall mean any and all (a) patents, (b)
      pending patent applications, including, without limitation, all
      provisional applications, substitutions, continuations,
      continuations-in-part, continued prosecution applications, requests for
      continued examination, divisions, renewals, and all patents granted
      thereon, and (c) all patents-of-addition, reissues, reexaminations and
      extensions or restorations by existing or future extension or restoration
      mechanisms, including, without limitation, supplementary protection
      certificates or the equivalent thereof.

1.74  "Phase I Clinical Trial". Phase I Clinical Trial shall mean studies in
      humans to obtain initial data regarding solely the safety of an R&D
      Candidate.

1.75  "Phase IIa Clinical Trial". Phase IIa Clinical Trial shall mean a clinical
      study in humans that provides sufficient efficacy data to support the
      validity of a therapeutic concept and adequate safety data in a relevant
      patient population to reasonably support further investigation of the
      safety and efficacy of the therapeutic candidate in further clinical
      studies. A Phase IIa trial may not include, except upon the approval of
      the Joint Project Team, fewer than [***] patients.

1.76  "Phase IIb Clinical Trial". Phase IIb Clinical Trial shall mean a clinical
      study in humans which provides for one or more definitive, well-controlled
      clinical trials in the relevant patient population for the purpose of
      determining the safe and effective dose range in the proposed therapeutic
      indications as more fully described in 21 C.F.R. 312.21 (b).

1.77  "Phase III Clinical Trial". Phase III Clinical Trial shall mean one or
      more controlled studies in humans of the efficacy and safety of an R&D
      Candidate, which is prospectively designed to demonstrate statistically
      whether the R&D Candidate is safe and effective for use in a particular
      indication, in a manner intended to be sufficient to obtain Regulatory
      Approval to market that R&D Candidate and which the Joint Project Team
      designates as a Phase III Clinical Trial.

1.78  "Phase IV Clinical Trial". Phase IV Clinical Trial shall mean any clinical
      trial in humans with a Collaboration Product in an indication to be
      conducted after a Regulatory Approval in such indication which was
      mandated by the applicable Regulatory Authority as a condition of such
      Regulatory Approval.

1.79  "Post-Approval Research". Post-Approval Research shall mean ongoing
      research and development of a Collaboration Product, pursuant to this
      Agreement, after such

<PAGE>

                                      -15-

      Collaboration Product has received Regulatory Approval in a country of the
      Territory, including, without limitation, Phase IV Clinical Trials and
      clinical studies in support of additional indications within the Field or
      label changes for such Collaboration Product in such country during the
      term of this Agreement.

1.80  "Pre-Marketing Costs". Pre-Marketing Costs shall mean FTE Costs and those
      out-of-pocket expenses incurred on a country-by-country basis and
      region-by-region basis, by either Party, other than Development Costs,
      before Regulatory Approval of a Collaboration Product, in such country,
      directly attributable to the carrying out of such Party's obligations
      under the Commercialization Plan or an Annual Commercialization Plan, as
      applicable, in preparation for Commercialization in such country. Such
      expenses may include, without limitation, [***]. For purposes of this
      definition, FTE costs shall be charged at the applicable FTE Rate.

1.81  "Primary Application". Primary Application shall mean a major application
      of an Antibody or Target as ascertained at the time of assessment using
      objective and reasonable scientific and/or commercial criteria, data
      and/or information . Primary Application shall not mean any minor or
      incidental application.

1.82  "Prior Invention". Prior Invention of a Party shall mean an Invention
      Controlled by either Party, which Invention is made by that Party's
      employees, agents or subcontractors before the Effective Date or which
      otherwise came into the Control of such Party before the Effective Date.

1.83  "Product". Product shall mean a Collaboration Product, Non-Antibody
      Product or Party Exclusive Product, as the case may be.

1.84  "Pro-Forma Net Profit". Pro-Forma Net Profit shall mean, on a
      Collaboration Product-by-Collaboration Product and country-by-country
      basis, the Net Sales obtained from the sale of such Collaboration Product
      in such country less, as applicable, in respect of such Collaboration
      Product (i) the Cost of Goods Manufactured for Commercialization or the
      Cost of Goods Manufactured for Clinical Supplies and (ii) Reimbursable
      Commercial Costs.

1.85  "Research Expenses". Research Expenses shall mean the expenses (other than
      Third Party License Fees) of the Parties incurred in performing Research
      and/or activities other than Development which support the Development
      Program and/or are useful in obtaining Regulatory Approval for an R&D
      Candidate pursuant to the Annual Research Plan or as expressly provided
      for in an Annual Development Plan.

<PAGE>

                                      -16-

1.86  "Regulatory Approval". Regulatory Approval shall mean the technical,
      medical and scientific licenses, registrations, authorizations and
      approvals (including, without limitation, approvals of BLAs or their
      foreign equivalents, supplements and amendments, pre- and post-approvals,
      pricing and third party reimbursement approvals, and labeling approvals)
      of any national, supra-national, regional, state or local regulatory
      agency, department, bureau, commission, council or other governmental
      entity, necessary for the commercial manufacture, distribution, marketing,
      promotion, offer for sale, use, import, export and sale of Collaboration
      Product(s) in a regulatory jurisdiction. For the sake of clarity,
      Regulatory Approval shall not be achieved for a Collaboration Product in a
      country until any applicable pricing and governmental third party
      reimbursement approvals (other than those required by Medicaid or
      Medicare) have also been obtained in such country.

1.87  "Regulatory Approval Filing". Regulatory Approval Filing shall mean, on a
      country by country basis, the submission of an application for Regulatory
      Approval of an R&D Candidate to the appropriate Regulatory Authorities in
      such country and the acceptance, by such Regulatory Authorities, of such
      application for review.

1.88  "Regulatory Authority". Regulatory Authority shall mean any national
      (e.g., the FDA), supra-national (e.g., the European Commission, the
      Council of the European Union, or the European Agency for the Evaluation
      of Medicinal Products), regional, state or local regulatory agency,
      department, bureau, commission, council or other governmental entity in
      each country of the world involved in the granting of Regulatory Approval
      for an R&D Candidate.

1.89  "Reimbursable Commercial Costs". Reimbursable Commercial Costs shall mean
      Distribution Costs, Marketing Costs, Sales Costs, Development Costs,
      Ongoing Development Costs, Other Out-of-Pocket Costs, Research Expenses
      and Pre-Marketing Costs and post-commercialisation Research Expenses.

1.90  "Research". Research shall mean, on a Specific Target-by-Specific-Target
      basis, any activity undertaken with respect to an Antibody, a Specific
      Target or a R&D Candidate or all activities undertaken by or on behalf of
      either Party under this Agreement, prior to Development, including,
      without limitation, identification of Specific Targets, use of the CAT
      Technology with respect to a Specific Target, immunochemistry, immunology,
      cell biology, pharmacology, preclinical toxicology, and formulation.

1.91  "Research Term". Research Term shall mean a four (4) year period
      commencing on the Effective Date and expiring on the fourth anniversary of
      the Effective Date, unless extended as otherwise provided by this
      Agreement or by mutual agreement of the Parties.

<PAGE>

                                      -17-

1.92  "R&D Candidate". Research and Development Candidate or R&D Candidate shall
      mean any Antibody to a Specific Target (other than a CAT Exclusive
      Antibody) that the Joint Steering Committee designates as a R&D Candidate
      by determining that such Antibody should proceed with GLP toxicology
      studies.

1.93  "Sales Costs". Sales Costs shall mean FTE costs and other costs submitted
      by ELAN as part of the Commercialization Plan and an Annual
      Commercialization Plan and specifically attributable to sales of
      Collaboration Product in the Territory and shall include, without
      limitation, [***]. Sales Costs will not include [***]. For purposes of
      this definition, FTE costs shall be charged at the applicable FTE Rate.

1.94  "Sales Returns and Allowances". Sales Returns and Allowances shall mean
      the sum of (a) and (b), where: (a) is a provision, determined by a Party
      under U.S. GAAP for sales of Products in the Territory for (i) trade, cash
      and quantity discounts on Products (other than price discounts granted at
      the time of invoicing and which are already included in the determination
      of Gross Sales), (ii) credits or allowances given or made for rejection or
      return of, and for uncollectible amounts on, previously sold Products or
      for rebates or retroactive price reductions (including Medicare, Medicaid
      and similar types of rebates and charge backs), (iii) taxes, duties or
      other governmental charges levied on or measured by the billing amount for
      Products, as adjusted for rebates and refunds, (iv) charges for freight
      and insurance directly related to the distribution of Products, to the
      extent included in Gross Sales, and (v) credits for allowances given or
      made for wastage replacement, indigent patient and any other sales
      programs agreed to by the Parties for Products; and (b) is a periodic
      adjustment of the provision determined in (a) to reflect amounts actually
      incurred by a Party in the Territory for items (i), (ii), (iii), (iv) and
      (v) in clause (a). For Collaboration Products, the provision allowed in
      clause (a) and adjustments made in clause (b) (if any) will be reviewed by
      the Joint Commercialization Team and approved by the JSC.

1.95  "Specific Target". Specific Targets shall mean (i) the Targets listed on
      Exhibit 1.95 as may be amended in writing by the Parties from time to time
      ------------
      during the term of this Agreement, [***]

1.96  "Sublicensee". Sublicensee shall mean a Third Party that is granted a
      license and/or sublicense under this Agreement pursuant to Section 3.3 to
      both make and sell Collaboration Products. "Sublicensee" shall also
      include a Third Party that is granted the right to distribute
      Collaboration Product; provided that such Third Party is also responsible
      for marketing and promotion of the Collaboration Product within the
      applicable territory. "Sublicense" shall mean an agreement or arrangement
      pursuant to which such a sublicense or distribution right has been
      granted.

<PAGE>

                                      -18-

1.97    "Target". Target shall mean[***].

1.98    "Territory". Territory shall mean the entire world.

1.99    "Third Part(y/ies)". Third Part(y/ies) shall mean any person(s) or
        entity(y/ies) other than CAT or ELAN.

1.100   "Third Party License". Third Party License shall mean any agreement with
        a Third Party for a license under intellectual property rights or
        technology necessary or useful for the Research, Development,
        Manufacture or Commercialization of an R&D Candidate or a Collaboration
        Product, which license is entered into, during the term of this
        Agreement, by a Party pursuant to Section 8.8.

1.101   "Third Party License Fee". Third Party License Fee shall mean license
        fees, royalties and other amounts paid to any Third Party under each
        Third Party License or CAT In-License specified pursuant to Exhibit
                                                                    -------
        1.11.
        ----

1.102   "Trademark". Trademark shall mean any trademark Controlled by ELAN that
        is selected for use by ELAN in connection with the Commercialization of
        any Collaboration Product hereunder; provided, however, that the term
        "Trademark" shall not include the tradename of either Party or any
        trademark or trade dress of either Party which is not used exclusively
        in connection with the Collaboration Products Commercialized under this
        Agreement.

2.      Scope of THE Collaboration.

2.1     Collaboration Goals. {TC "2.1 Collaboration Goals" \f C\1 "2"}. Pursuant
        and subject to the terms of this Agreement, the Parties agree to: (a)
        engage in discovery and Research activities with the goal of identifying
        one or more R&D Candidates in the Field, (b) engage in Development
        activities with the goal of obtaining Regulatory Approval for
        Collaboration Products in the Territory where it makes commercial sense
        to do so given the size of the potential market and the safety and
        efficacy profile of each Collaboration Product and (c) engage in
        Commercialization of Collaboration Products with the goal of optimizing
        the profit available to each Party. For purposes of clarity, it is
        understood by the Parties that the JSC may decide that it does not make
        commercial sense for the Parties to Develop or Commercialize a
        Collaboration Product in a particular country in the Territory. Each
        Party agrees to use Commercially Reasonable Efforts in performing its
        tasks and responsibilities and in conducting all activities ascribed or
        assigned to it under this Agreement, the then current Annual Research
        Plan, Annual Development Plan, any Annual Research Budget, Annual
        Development Budget, the then current Commercialization Plan and any
        Annual Commer-

<PAGE>

                                      -19-

        cialization Plan. Each Party shall cooperate with and provide reasonable
        support to the other Party in performing its activities with respect to
        the Research, Development and Commercialization work contemplated
        hereunder. Each Party agrees, during the term of this Agreement, to
        Develop, Manufacture, and Commercialize, as applicable, Collaboration
        Products, Party Exclusive Products and Non-Antibody Products, only under
        the terms of this Agreement.

2.2     Exclusive Working Relationship. {TC "2.2 Exclusive Working Relationship"
        \f C\1 "2"}. Except as expressly set forth in this Agreement and subject
        to the other terms and conditions of this Agreement, for separate and
        valuable consideration, it is understood and agreed by the Parties that:

        (a)   During the Research Term, with respect solely to Research and
              Development in the Field and subject to Section 13.1, each Party
              shall work exclusively with the other Party.

              (i)  In discharge of its obligations pursuant to this Section
                   2.2(a), but without limiting its obligations thereunder, CAT
                   shall refuse to permit, on a Target by Target basis, use of,
                   access to or grant a license for, as applicable, both the CAT
                   Technology and/or the CAT Intellectual Property to any Third
                   Party whom, having discharged its obligations under Section
                   2.4, [***]. Nothing in Section 2.2(a) shall preclude
                   incidental activities by CAT in the Field utilizing
                   technologies, including without limitation the CAT Technology
                   and any technology other than the ELAN Technology so long as
                   such activities are not pursuant to any arrangement, written
                   or otherwise, [***].

              (ii) In discharge of its obligations pursuant to this Section
                   2.2(a), but without limiting its obligations thereunder, ELAN
                   shall refuse to permit, on a Target by Target basis, use of,
                   access to or grant a license for, as applicable, both the
                   ELAN Technology and/or the ELAN Intellectual Property (other
                   than any ELAN Prior Invention and solely to the extent such
                   ELAN Intellectual Property directly claims a Specific Target
                   or the use thereof as a pharmaceutical, therapeutic or
                   medicinal agent, item, or product) to any Third Party whom
                   ELAN, having discharged its obligations under Section 2.4
                   [***] provided, however, that the provisions of this Section
                   2.2(a)(ii) shall only apply (unless CAT otherwise consents in
                   writing) to [***]. Nothing in Section 2.2(a) shall preclude
                   incidental activities by ELAN in the Field utilizing
                   technologies, including without limitation the ELAN
                   Technology and any tech-

<PAGE>

                                      -20-

                    nology other than the CAT Technology, so long as such
                    activities are not pursuant to any arrangement, written or
                    otherwise, [***].

        (b)   Except as otherwise provided for in Sections 2.2(d)(ii) through
              2.2(d)(iii), during the Research Term, the Parties shall work
              exclusively with each other on Specific Targets, R&D Candidates
              and Collaboration Products.

        (c)   Following the expiration of the Research Term, the Parties shall
              work exclusively with each other to Research, Develop, Manufacture
              and Commercialize R&D Candidates and Collaboration Products in the
              Territory.

        (d)   Notwithstanding anything in Sections 2.2(a) and (b) to the
              contrary:

              (i)   Throughout the term of the Agreement and thereafter ELAN
                    may:

                    (A)  either by itself or with a Third Party, discover,
                         research, develop, and commercialize any composition of
                         matter [***] without any obligations to CAT, other than
                         as expressly provided for Non-Antibodies, Non-Antibody
                         Products and Hybrid R&D Candidates in Sections 7.1.8,
                         5.7. and 12.4; and/or

                    (B)  either by itself or with a Third Party, utilize
                         filamentous bacteriophages for purposes [***];
                         provided, however, that such use shall not be deemed to
                         be licensed or free of any claims of infringement under
                         the CAT Intellectual Property;

                    (C)  except with respect to Specific Targets, enter into one
                         or more written contractual arrangements, including
                         joint ventures, with Third Parties wherein such
                         arrangements utilize technology other than CAT
                         Technology to [***] provided, however, that ELAN (i)
                         shall, if CAT provides significant material assistance
                         therewith, use commercially diligent efforts to
                         persuade the Third Party to use the CAT Technology on
                         the same terms as set forth in this Agreement in any
                         proposed arrangement relating to the [***] unless CAT
                         consents otherwise; and/or

              (ii)  Throughout the Research Term ELAN may:

                    (A)  permit use of, access to and/or grant a license to any
                         Third Party under, as applicable, the ELAN Technology
                         and/or the ELAN Intellectual Property provided always
                         that ELAN has discharged

<PAGE>

                                      -21-

                    its obligations under Section 2.4. It shall not be
                    considered a breach of Section 2.2(a)(ii) if subsequent to
                    its being subjected to the ELAN Technology it is determined
                    that any [***].

     (iii)   Throughout the Research Term CAT may:

             (A)    permit use of, access to and/or grant a license to any Third
                    Party under, as applicable, the CAT Technology and/or the
                    CAT Intellectual Property provided always that CAT has
                    discharged its obligations under Section 2.4 and provided
                    further that (i) CAT has drawn its obligations under this
                    Section 2 to the attention of such Third Party including
                    [***] and [***]. It shall not be considered a breach of
                    Section 2.2(a)(i) if (i) subsequent to its being subjected
                    to the CAT Technology it is determined [***] or (ii) if CAT
                    permits use of, access to and/or grants a license to a Third
                    Party to the CAT Technology and/or the CAT Intellectual
                    Property in accordance with this Section provided that [***]
                    and/or

             (B)    permit use of, access to and/or grant a license to a Third
                    Party under the CAT Technology and/or the CAT Intellectual
                    Property where [***]. Notwithstanding the foregoing, CAT
                    shall use reasonable efforts, to the extent it is legally
                    able to do so, not to grant any rights to a Target (save as
                    provided in Section 2.2(d)(iii)(A) above) if to do so would
                    breach the provisions of Section 2.2(a)(i). [***]. CAT shall
                    not solicit submission by the Third Party of such Target
                    where it knows or should reasonably know that such [***]. In
                    addition CAT shall, to the extent it is legally able to do
                    so on a regular basis but no less than once every [***], (i)
                    notify ELAN [***] and (ii) notify ELAN when a Target is
                    rejected because it has been [***] and accepted by CAT due
                    to [***] and/or

     (iv)    Throughout the term of this Agreement and thereafter:

             (A)    Other than with respect to Specific Targets and subject to
                    the CAT Gatekeeping Procedure, throughout the term of the
                    Agreement and thereafter, CAT, either by itself or with a
                    Third Party, may use the assays listed in Exhibit 1.17,
                                                              ------------
                    [***].

<PAGE>

                                      -22-

                    (B)  On a Target by Target basis, either Party may be
                         excused from so much of its obligations to the other
                         Party pursuant to Section 2.2(a) through (c) as which
                         [***].

                    (C)  ELAN, at its option, shall be freed from any
                         obligations pursuant to Section 2.2(a) and 2.2(b) of
                         this Agreement if the activity at issue constitutes the
                         discovery, research, development, manufacturing,
                         commercialization or the other operations [***]
                         provided, however, that (i) ELAN shall use commercially
                         reasonable efforts to encompass any activities subject
                         to this Section 2.2(d)(iv)(C) within the terms and
                         conditions of this Agreement and [***] unless CAT
                         otherwise consents.

                    (D)  CAT, at its option, shall be freed from any obligations
                         pursuant to Section 2.2(a) and 2.2(b) of this Agreement
                         if the activity at issue constitutes the discovery,
                         research, development, manufacturing, commercialization
                         or the other operations [***] provided, however, that
                         CAT shall use commercially reasonable efforts to
                         encompass any activities subject to this Section
                         2.2(d)(iv)(D) within the terms and conditions of this
                         Agreement [***].

2.3      Further Exclusions{TC "2.3      Further Exclusions" \f C \1 "2"}.
         Notwithstanding any other provision of this Agreement, nothing herein
         shall be deemed to extend to or include any Drug Delivery Technology or
         an Excepted Antibody. Each of the rights and licenses granted by each
         Party and each of the obligations placed upon each Party hereby shall
         be deemed to exclude and shall not extend to Drug Delivery Technology,
         any Excepted Antibody and/or the use of Drug Delivery Technology or any
         Excepted Antibody, within and without the Field, and/or any research,
         development and/or commercialization activities, including those
         conducted by ELAN or CAT with a Third Party relating solely to the use
         or potential use of Drug Delivery Technology or an Excepted Antibody;
         provided, however, [***].

2.4      Safeguard Procedures{TC "2.4   Safeguard Procedures" \f C \1 "2"}. Each
         Party will exercise reasonable diligence in the discharge of its
         obligations under this Article 2, including, without limitation,
         undertaking such investigations and initiating such inquiries of Third
         Parties as are commercially reasonable in order to obtain sufficient
         information regarding the intended or actual use of any Patent Rights,
         Know How or ELAN Technology or CAT Technology to be licensed, used
         internally or shared with or licensed to a Third Party so as to permit
         a reasonable assessment of the intended or

<PAGE>

                                      -23-

         actual use thereof. [***]. In the discharge of its obligations under
         this Section 2.4, CAT shall subject any Target [***] to such family,
         motif, sequence analyses or other customary or scientifically
         established techniques as may reasonably be used to determine whether
         such Target should be subject to the restrictions of Article 2.2(a) of
         this Agreement.

3.       LICENSES.

3.1      Licenses to CAT{TC "3.1   Licenses to CAT" \f C \1 "2"}.

         (a)  Subject to the terms and conditions of this Agreement, including,
              without limitation, Section 3.4, ELAN hereby grants to CAT:

              (i)   a world-wide, non-exclusive license or sublicense, as the
                    case may be, without the right to grant sublicenses (except
                    pursuant to the terms set forth in Section 3.3) under the
                    ELAN Intellectual Property solely to the extent necessary
                    for CAT to exercise its rights and perform its activities,
                    under this Agreement, in the conduct of the Research
                    Program, the Development Program and any Post-Approval
                    Research;

              (ii)  a worldwide, exclusive (except to the extent necessary for
                    ELAN or its Sublicensees to Manufacture Collaboration
                    Products and/or Commercialize Collaboration Products
                    pursuant to this Agreement) license or sublicense, as the
                    case may be, without the right to grant sublicenses (except
                    pursuant to the terms set forth in Section 3.3) under the
                    ELAN Intellectual Property solely as is necessary for the
                    Manufacture of Clinical Supplies and, as may be required by
                    the JSC, the Manufacture of Collaboration Products; and

              (iii) subject to the provisions of Section 5.6, an exclusive,
                    worldwide license or sublicense, as the case may be, with a
                    limited right to grant sublicenses pursuant to the terms set
                    forth in Section 3.3, under the Joint Collaboration Know
                    How, the Joint Collaboration Patent Rights and the Patent
                    Rights and Know How subject to Section 8.1.3 to research,
                    develop, manufacture and commercialize, both within and
                    without the Field, each CAT Exclusive Antibody and Party
                    Exclusive Products.

         (b)  Subject to the other provisions of this Agreement, in the event
              that, during the applicable term of this Agreement, the Research
              to be conducted under this Agreement and/or the Development of R&D
              Candidates under this Agreement

<PAGE>

                                      -24-

              and/or the Manufacture of, as applicable, Clinical Supplies or
              Collaboration Products in the Territory by CAT, and/or the
              enjoyment of CAT's rights pursuant to Section 5.6 to research,
              develop and commercialize any CAT Exclusive Antibody and Party
              Exclusive Products would misappropriate any Know How and/or
              infringe any Patent Rights Controlled by ELAN that are not covered
              by the licenses and sublicenses granted to CAT in Section
              3.1(a)(i) through (a)(iii), ELAN hereby grants to CAT, to the
              extent ELAN is legally able to do so, a worldwide, non-exclusive
              license (subject to the provisions of Sections 13 (Withdraw to
              Royalty Position) and 5.6 (CAT Exclusive Antibodies) under such
              Know How and Patent Rights, to enable CAT and/or its Sublicensees
              to conduct Research and/or Develop R&D Candidates under the terms
              of this Agreement and/or Manufacture of, as applicable, Clinical
              Supplies or Collaboration Products in the Territory and/or
              research, develop and commercialize any CAT Exclusive Antibody and
              Party Exclusive Product in accordance with the licenses and
              sublicenses granted in Section 3.1(a)(i) through (a)(iii).

3.2      Licenses to ELAN{TC "3.2  Licenses to ELAN" \f C \1 "2"}.

         (a)  Subject to the terms and conditions of this Agreement, including,
              without limitation, Section 3.4, CAT hereby grants to ELAN:

              (i)   a worldwide, non-exclusive license or sublicense, as the
                    case may be, without the right to grant sublicenses (except
                    pursuant to the terms set forth in Section 3.3) under the
                    CAT Intellectual Property solely to the extent necessary for
                    ELAN to exercise its rights and perform its activities,
                    under this Agreement, in the conduct of the Research
                    Program, the Development Program and any Post-Approval
                    Research;

              (ii)  a worldwide, exclusive (except to the extent necessary for
                    CAT to conduct Research under this Agreement and/or Develop
                    R&D Candidates and/or to Manufacture, as applicable Clinical
                    Supplies or Collaboration Products pursuant to this
                    Agreement) license or sublicense, as the case may be,
                    without the right to grant sublicenses (except pursuant to
                    the terms set forth in Section 3.3) under the CAT
                    Intellectual Property to conduct Research and/or Develop R&D
                    Candidates and/or Manufacture or Commercialize Collaboration
                    Products in the Field and, as required, a grant of such
                    license rights outside of the Field with respect to Hybrid
                    R&D Candidates and Collaboration Product containing Hybrid
                    R&D Candidates which are also being Commercialized within
                    the Field by ELAN; and

<PAGE>

                                      -25-

            (iii)  Subject to the provisions of Sections 5.6 and 7.1.8, an
                   exclusive, worldwide license or sublicense, as the case may
                   be, with a limited right to grant sublicenses pursuant to the
                   terms set forth in Section 3.3, under the CAT Intellectual
                   Property, Joint Collaboration Know How and the Joint
                   Collaboration Patent Rights to research, develop, manufacture
                   and commercialize any Non-Antibody and/or Non-Antibody
                   Product within the Territory and, where applicable, CAT
                   Exclusive Antibodies and Party Exclusive Products which are
                   subject to the provisions of Section 5.6.2.

      (b)   Subject to the other provisions of this Agreement and during its
            term, in the event that the Research to be conducted under this
            Agreement and/or the Development of R&D Candidates under this
            Agreement and/or the Manufacture of, as applicable, Collaboration
            Products in the Territory by ELAN would, and/or the enjoyment of
            ELAN's rights pursuant to Sections 3.2(a)(ii), 5.6, 7.1.8, 12.3 and
            13.2.5 to research, develop and commercialize any Non-Antibody or
            Non-Antibody Product or, as applicable, CAT Exclusive Antibodies and
            Party Exclusive Products subject to Section 5.6, would
            misappropriate any Know How and/or infringe any Patent Rights
            Controlled by CAT that are not covered by the licenses and
            sublicenses granted to ELAN in Section 3.2(a)(i) through (a)(iii),
            CAT hereby grants to ELAN, to the extent CAT is legally able to do
            so, a worldwide, non-exclusive license (subject to the provisions of
            Sections 7.1.8, 5.6 and 13) under such Know How and Patent Rights,
            to enable ELAN and/or its Sublicensees to conduct Research and/or
            Develop R&D Candidates under the terms of this Agreement and/or
            Manufacture of, as applicable, Clinical Supplies or Collaboration
            Products in the Territory and/or research, develop and commercialize
            any Non-Antibody or Non-Antibody Product and/or, as applicable, CAT
            Exclusive Antibodies and Party Exclusive Products subject to Section
            5.6, in accordance with the licenses and sublicenses granted in
            Section 3.2(a)(i) through (a)(iii).

3.3  Licensing and Sublicensing to Third Parties{TC "3.3    Licensing and
     Sublicensing to Third Parties" \f C \1 "2"}. If pursuant to Section 5.2.2,
     the JSC approves the utilization of one or more Third Parties to perform
     certain tasks in the conduct of the Research Program, the Development
     Program or any Post-Approval Research, the Party entering into a contract
     with such Third Party for the performance of such services, may, as part of
     such contract, grant to such Third Party a nonexclusive, nontransferable
     license or sublicense, as applicable, without the right to grant
     sublicenses, under the CAT Intellectual Property or the ELAN Intellectual
     Property, as applicable, only to the extent and only for so long as such
     license or sublicense is necessary for

<PAGE>

                                      -26-

       such Third Party to perform such tasks. All such contracts and
       sublicenses entered into by either Party with any such Third Party shall:

              (a)   be subject to the prior written approval of the JSC with the
                    prior review of each Party's legal department, which
                    approval shall not be unreasonably withheld or delayed;

              (b)   provide that as between the appointing Party and the Third
                    Party all results emerging from such work and any related
                    intellectual property shall, as provided for under this
                    Agreement, be owned jointly by ELAN and CAT;

              (c)   provide that, where applicable, such Third Party shall
                    permit the appointing Party to access all data required to
                    be disclosed to any applicable Regulatory Authority with
                    respect to any proposed Regulatory Approval.

3.4    No Other Rights{TC "3.4   No Other Rights" \f C \1 "2"}. No rights, other
       than those expressly set forth in this Agreement are granted to either
       Party hereunder, and no additional rights shall be deemed granted to
       either Party by implication, estoppel or otherwise.

4.     MANAGEMENT OF COLLABORATION.

4.1    Joint Steering Committee{TC "4.1  Joint Steering Committee" \f C \1 "2"}.

       4.1.1  Formation, Membership. Within [***] after the date first written
              above, ELAN and CAT shall establish a "Joint Steering Committee"
              or "JSC" to oversee and direct the conduct of Research and the
              Development of each Specific Target and R&D Candidate and to
              oversee and coordinate those activities that are necessary for the
              successful Commercialization for a Collaboration Product in the
              Territory, as further described below in this Agreement. The JSC
              shall be comprised of [***] representatives from each Party as
              appointed by such Party, which representatives shall be senior
              representatives of each Party and shall have expertise suitable to
              the then-current activities of the collaboration. The JSC may
              change its size from time to time by mutual consent of its
              members. A Party may replace one (1) or more of its
              representatives from time to time upon written notice to the other
              Party. The JSC will exist until the termination of this Agreement
              unless the Parties otherwise agree in writing.

<PAGE>

                                      -27-

      4.1.2    Chairperson; Secretary. The chairperson and secretary of the JSC
               shall rotate on an annual basis between the Parties. The
               chairperson and secretary shall not be from the same Party at the
               same time. The first chairperson shall be designated by ELAN. The
               first secretary shall be designated by CAT. The chairperson will
               be responsible for scheduling meetings of the JSC, preparing
               agendas for meetings, sending to all JSC members notices of all
               regular meetings and agendas for such meetings at least [***]
               before such meetings. The secretary shall record the minutes of
               the meeting, circulate copies of meeting minutes to the Parties
               and each JSC member promptly following the meeting for review,
               comment and approval, and shall finalize approved meeting
               minutes. The chairperson shall be a member of the JSC but the
               secretary need not be a member of the JSC.

      4.1.3    Meetings. The JSC shall meet at least once each Calendar Quarter
               during the term of this Agreement, unless otherwise mutually
               agreed by the Parties. Either Party may call a special meeting of
               the JSC on [***] written notice to the other Party and each of
               the JSC members. Such written notice shall include an agenda for
               the special meeting. Meetings, including, without limitation,
               special meetings, of the JSC will alternate between the offices
               of the Parties, unless otherwise agreed by the members of the
               JSC, or may be held telephonically or by video-conference.
               Meetings of the JSC shall be effective only if at least one (1)
               representative of each Party is in attendance or participating in
               the meeting. Members of the JSC shall have the right to
               participate in and vote at meetings by telephone. The most senior
               attending representative of each Party on the JSC shall have the
               right to vote on behalf of any members of the JSC from such Party
               not attending a JSC meeting in person or by telephone. Each Party
               shall be responsible for expenses incurred by its employees and
               its members of the JSC in attending or otherwise participating in
               JSC meetings and, for the avoidance of doubt, such expenses shall
               not be considered Research Expenses, Development Costs or
               Reimbursable Commercial Costs.

      4.1.4    Responsibilities of the JSC. In addition to its general
               responsibility to oversee and coordinate the conduct of Research
               under this Agreement and the Development according to the
               Research Program and the Development Program, ensure a regular
               flow of Research and Development information between the Parties
               and to oversee and coordinate the Commercialization of
               Collaboration Products in the Territory, the JSC shall in
               particular:

               (a)   [***];

<PAGE>

                                      -28-

      (b)      [***];

      (c)      [***];

      (d)      approve the Annual Research Plan for the period from Effective
               Date first written above through calendar year 2001 in accordance
               with Section 5.2.1, and prepare and approve an updated Annual
               Research Plan during each subsequent year in which the Parties
               engage in Research activities;

      (e)      review, update and/or approve, as necessary, each applicable and
               subsequent Annual Research Plan, Annual Research Budget, Annual
               Development Plan and Annual Development Budget;

      (f)      review and approve any substantive departure from any Annual
               Research Plan or Annual Research Budget pursuant to Sections
               5.2.2 and 5.3.3;

      (g)      approve, as necessary, the Annual Development Plan for the period
               from the Effective Date through calendar year 2001 in accordance
               with Section 5.2.1, and prepare and approve an updated Annual
               Development Plan and Annual Development Budget during each
               subsequent year in which the Parties engage in Development
               activities;

      (h)      review and approve any substantive departure from any Annual
               Development Plan or Annual Development Budget pursuant to
               Sections 5.2.2 and 5.3.3;

      (i)      oversee the activities of the project team(s) that is/are
               performing the Party's activities under the Research Program and
               the Development Program;

      (j)      facilitate the flow of information between the Parties with
               respect to all Research and Development work being conducted for
               each R&D Candidate in the Field and in the Territory;

      (k)      [***];

      (l)      review and approve any recommendations by the Joint Patent
               Committee that a Third Party License should be entered pursuant
               to Section 8.8;

      (m)      [***];

<PAGE>

                                      -29-

               (n)  review and approve all scientific and clinical protocols,
                    which shall provide that, where appropriate, all preclinical
                    and clinical Development work under this Agreement shall be
                    conducted in accordance with GLPs and GCPs;

               (o)  review and approve the contents and filings of INDs,
                    applications for Regulatory Approval, and related and
                    supporting submissions to Regulatory Authorities;

               (p)  review and approve the Commercialization Plan pursuant to
                    Section 7.1.4;

               (q)  review and approve a Post BLA Filing Plan pursuant to
                    Section 7.1.4; and

               (r)  at least [***] prior to the beginning of each calendar year,
                    prepare an estimate of Pro-Forma Net Profits on a
                    Collaboration Product-by-Collaboration Product and
                    country-by-country basis.

        4.1.5  Authority. The Parties agree that, in voting on matters pursuant
               to the procedures, it shall be conclusively presumed that each
               voting member of the JSC has the authority and approval of such
               member's respective senior management in casting his or her vote
               and that decisions of the JSC made in accordance with this
               Article 4 shall be binding upon each of the Parties; provided,
               however, that the JSC shall not have the authority to amend or
               modify this Agreement.

        4.1.6  Appointment of Subteams or Subcommittees. In addition to the
               creation of the Joint Project Team, the JSC shall be empowered
               to create such subteams or subcommittees of itself as it may
               deem appropriate or necessary. Each such subteam or
               subcommittee shall report to the JSC, who shall have authority
               to approve all recommendations or actions proposed thereby.
               Each Party, unless the JSC determines to the contrary, shall
               have equal representation on any such subteam or subcommittee.

        4.1.7  Voting and Dispute Resolution. Any approval decision or other
               action of the JSC shall be by the unanimous consent of the
               JSC. Issues coming before the JSC that require action,
               approval or resolution and for which the JSC is unable to
               reach agreement on a mutually acceptable action, approval or
               resolution shall be resolved by the Parties under the terms of
               Article 15 below.

<PAGE>
                                      -30-

4.2  Project Coordinators{TC "4.2 Project Coordinators" \f C \1 "2"}. Each Party
     shall designate [***] of its employees as project coordinator(s) for all of
     the activities contemplated under this Agreement. Such project coordinators
     will be responsible for the day-to-day coordination of the collaboration
     contemplated by this Agreement and will serve to facilitate communication
     between the Parties. A Party may, from time to time, replace its designated
     project coordinator(s) upon providing the other Party with written notice
     to that effect.

4.3  Compliance with Laws{TC "4.3 Project Coordinators" \f C \1 "2"}. Each Party
     agrees that, in conducting its activities under this Agreement, it shall at
     all times comply with all applicable laws, rules and regulations.

5.   RESEARCH AND DEVELOPMENT.

5.1  The Research and Development Programs{TC "5.1 The Research and Development
     Programs" \f C \1 "2"}.

     5.1.1  Conduct of the Research and Development Programs. CAT and ELAN shall
            collaborate through a Joint Project Team ("JPT") in the conduct of a
            collaborative research program (the "Research Program") and a
            collaborative development program (the "Development Program")
            intended for and directed to the discovery, characterization,
            isolation, Research and potential Development in the Field of any
            Antibody which binds to a Specific Target, for the identification
            of R&D Candidates, and for the pre-clinical and clinical Research
            and Development of R&D Candidates in the Field. The JSC shall
            have the authority to specify [***]. If the JSC declines to
            approve a Target as a Specific Target for the collaboration, then
            such Target shall not be part of the collaboration and shall
            revert to the Party that first identified such Target for
            inclusion in the Research Program. Each R&D Candidate shall be
            advanced from the Research Program into the Development Program
            on the date that the JSC designates such R&D Candidate for GLP
            toxicology studies. An R&D Candidate shall remain in the
            Development Program until such time as (i) the JSC determines
            that such R&D Candidate should be returned to the Research
            Program for the conduct of further Research, (ii) such R&D
            Candidate is dropped from the Development Program or (iii) such
            R&D Candidate becomes a Collaboration Product. [***] In the event
            either Party proposes that a Target be a Specific Target and the
            JSC declines to accept such a nomination, then the Parties shall
            enter into such written acknowledgments as may be required to
            maintain each Party's rights with respect to such Target as if
            the Target had never been submitted. All decisions of the JSC
            hereunder in respect of any Target shall be

<PAGE>

                                      -31-

               unanimous and no provisions of either Article 4.1.7 or Article 15
               shall apply in respect thereof.

      5.1.2    The Research Program. The Research Program shall be conducted
               for the Research Term. Subject to the other terms of this
               Agreement, the Research Term shall automatically be extended for
               an additional period of one (1) year unless, within [***] prior
               to the expiration of the Research Term, the JSC determines that
               additional Specific Targets should not be evaluated using the CAT
               Technology. The Research Term or any extensions thereof may also
               be extended upon mutual agreement of the Parties, which extension
               must be agreed upon at least ***] in advance of the end of the
               Research Term or the then current extension. At the first meeting
               of the JSC, on a regular basis thereafter, but in no event less
               than once every [***], and [***] after the end of the Research
               Term, the JSC shall [***]. Each list provided for by the
               proceeding shall be transmitted by reliable means to each member
               of the JSC who shall, at either the next meeting of the JSC or
               [***] after receipt thereof, confirm the accuracy of the content
               of each applicable list. No Specific Target on any list provided
               for under this Section 5.1.2 shall continue to be deemed a
               Specific Target under this Agreement if within [***] of
               designation by a Party such Party has not provided quantities of
               suitable materials sufficient to permit such Specific Target to
               be subjected to the CAT Technology.

      5.1.3    The Development Program. The Development Program shall have a
               term (the "Development Term") which commences upon the date an
               R&D Candidate is selected for Development and shall continue
               until the JSC agrees to cease the Development of the last
               remaining R&D Candidate or until all Regulatory Approvals for
               all R&D Candidates have been received in the Territory.

5.2  The Research and Development Plans{TC "5.2   The Research and Development
     Plans" \f C \1 "2"}.

      5.2.1    Annual Research Plan and Annual Development Plan. Within [***]
               after the date first written above, the Parties shall prepare a
               written annual research plan (the "Annual Research Plan") for the
               Research activities to be conducted with respect to each Specific
               Target, any Antibody candidate which bind thereto and each R&D
               Candidate. The Annual Research Plan shall be updated and
               maintained by the JPT and ratified by the JSC on an annual basis
               during the Term of this Agreement. Furthermore, within [***] of
               the first specification of an R&D Candidate for potential
               Development, the JSC shall prepare a written annual development
               plan (the "Annual Development Plan")

<PAGE>

                                      -32-

                  setting forth, for each applicable R&D Candidate in the
                  Development Program the details of the specific Research
                  and/or Development activities of the Parties to be conducted
                  during each calendar year from the date of such Annual
                  Development Plan through to the end of the [***] from the
                  commencement of the applicable Annual Development Plan. As
                  determined and approved by the JSC, each Annual Research
                  Plan and/or Annual Development Plan may include activities
                  which extend beyond the applicable calendar year. The
                  initial Annual Research Plan shall address the elements set
                  forth in Exhibit 5.2.1 to this Agreement, as well as other
                           -------------
                  elements that may be appropriate for inclusion therein.
                  Within [***] following the provision of the initial draft
                  thereof, the JSC shall review and approve, as applicable,
                  the initial Annual Research Plan or Annual Development Plan.
                  Thereafter, on or before August 31 of each year (commencing
                  in 2001), the JSC shall prepare and approve, as applicable,
                  a revised Annual Research Plan and/or Annual Development
                  Plan addressing the collaborative Research and Development
                  activities (as applicable) to be undertaken by the Parties
                  during the following calendar year. Each Annual Research
                  Plan and each Annual Development Plan shall include, without
                  limitation, [***] (the "Annual Research Budget" and the
                  "Annual Development Budget"). During the Research Term all
                  decisions of the JSC in respect of any Annual Research
                  Budget or Annual Development Budget for each R&D Candidate
                  shall be unanimous and no provisions of either Article 4.1.7
                  or Article 15 shall apply in respect thereof until the
                  filing of an IND for such R&D Candidate. Following the
                  filing of an IND for each R&D Candidate Sections 4.1.7 and
                  15 shall apply in respect of the Annual Research Budget or
                  Annual Development Budget for that R&D Candidate. Subject to
                  Section 3.3, should the JSC determine that a specific
                  activity would best be undertaken by a Third Party
                  contractor, the JSC shall indicate which Party shall manage
                  such Third Party contractor. The Annual Research Plan and
                  Annual Development Plan may only be modified or amended upon
                  written approval of the JSC.

          5.2.2   Conduct of the Annual Research Plan and Annual Development
                  Plans. ELAN and CAT shall each use Commercially Reasonable
                  Efforts to perform its respective activities under the then
                  current Annual Research Plan and Annual Development Plan and
                  each Party shall, where appropriate, perform such activities
                  in accordance with applicable GLPs and GCPs. All activities to
                  be undertaken in the performance of an Annual Research Plan or
                  Annual Development Plan shall be carried out by employees of
                  the Parties and/or their respective Affiliates; provided,
                  however, that if either Party is able to reasonably
                  demonstrate, and the JSC agrees, that (a) it would be in the
                  best interests of both Parties to contract with one (1) or
                  more Third Parties to perform certain

<PAGE>

                                      -33-

             tasks under either an Annual Research Plan or Annual Development
             Plan, and (b) any such Third Party is capable of performing such
             tasks in a manner competitive with the Parties in terms of cost
             and quality, then, the Party responsible for such task may enter
             into a contract meeting the requirements of Section 3.3 with a
             Third Party to perform such task, which contract shall be subject
             to the prior written approval of the JSC. In determining whether
             to utilize the services of any Third Party in conducting
             activities under an Annual Research Plan or Annual Development
             Plan, the Parties shall consider, inter alia, [***]. The
             responsibility for performing clinical studies of each R&D
             Candidate will be assigned to CAT, ELAN and/or Third Party
             contractors selected by the JSC in accordance with this Section.

     5.2.3   Periodic Inspections. With respect to any facility or site at which
             a Party conducts Research, Development or Manufacturing pursuant
             to this Agreement, including, where commercially reasonable and
             within the control of the other Party, Third Party facilities or
             sites, each Party and any relevant Regulatory Authority shall
             have the right, at its expense, upon reasonable written notice
             and during normal business hours, to inspect such site and
             facility and any records relating thereto as is reasonably
             necessary to verify the other Party's compliance with the terms
             of this Agreement relating to GLP, GCP and GMP. Such inspection
             shall be subject to the confidentiality provisions of this
             Agreement. Each Party agrees, to the maximum extent possible, to
             include in any agreement with a Third Party relating to such
             facilities and sites a clause permitting the other Party and any
             relevant Regulatory Authority to exercise its rights under this
             Section. Each Party shall, upon the request of the other Party or
             a relevant Regulatory Authority, cause appropriate individuals
             working on its or any Third Party's behalf on the Research
             Program and/or Development Program, on reasonable terms and
             timing, to be available for meetings and to answer questions at
             the facilities or sites where such individuals are employed
             during normal business hours and on days mutually convenient to
             the Party or the Third Party in question. The requesting Party
             shall be responsible for all costs and expenses relating to the
             exercise of any right granted pursuant to the preceding sentence.

5.3  Funding of the Annual Research Plan and the Annual Development Plan{TC "5.3
     Funding of the Annual Research Plan and the Annual Development Plan" \f C
     \1 "2"}.

<PAGE>

                                      -34-

5.3.1    Research and Development Expenses. From the Effective Date forward, the
         Parties shall be obligated to and shall fund all Research Expenses and
         Development Costs on an equal basis, subject to the limitations of
         Section 5.3.3.

5.3.2    Payment of Expenses; R&D Accounts. Subject to reconciliation as
         provided in Section 5.3.4, each Party shall be responsible and pay for
         all Research Expenses and Development Costs incurred by it in
         performing its activities under the Research Program and the
         Development Program. Subject to the limitations set forth in Section
         5.3.3, each Party shall charge all such expenses so incurred by it or
         its Affiliates to a separate account created by such Party on its books
         and records solely for the purpose of tracking expenses incurred in
         connection with the Research Program and Development Program (each, an
         "R&D Account"). Within [***] after the end of each Calendar Quarter,
         each Party shall submit to the other Party a written summary of all
         expenses charged to its R&D Account during such Calendar Quarter, which
         summary shall be accompanied by reasonable supporting documentation for
         such expenses. The Parties will work together to report to each other
         estimates of the amounts to be included in such reports prior to the
         expiration of the reporting period provided for in this Section 5.3.2.

5.3.3    Expense Limitations. The expenses charged by either Party to its R&D
         Account in accordance with Section 5.3.2 shall not, subject to Section
         7.1.4, be an amount in excess of [***] the amount included for such
         expenses in the then current Annual Research Budget, Annual Development
         Budget or Post BLA Filing Annual Budget, as appropriate, unless the JSC
         recommends and each Party approves such excess expenses. Additionally,
         the Parties hereby agree that efforts of the employees of a Party or
         its Affiliates in performing its activities hereunder shall be charged
         to such Party's R&D Account at the applicable FTE rate set forth in the
         applicable Annual Research Budget or Annual Development Budget;
         provided, however, that only those efforts that are contemplated by the
         Annual Research Plan and the Annual Development Plan shall be
         chargeable by a Party to its R&D Account, except as otherwise approved
         in writing by the JSC. The FTE rates set forth in any Annual Research
         Budget or Annual Development Budget shall be based upon [***]. All
         payments made by a Party to a Third Party in connection with the
         performance of its activities under an Annual Research Plan or Annual
         Development Plan shall be charged to such Party's R&D Account at such
         Party's actual out-of-pocket cost. Expenses incurred by each Party for
         equipment, materials and supplies utilized in performing its activities
         under an Annual Research Plan or Annual Development Plan shall not be
         separately charged to such Party's R&D Account, ex-

<PAGE>

                                      -35-

         cept for those expenses incurred by a Party, with the prior written
         consent of the JSC, [***], which expenses shall be charged to such
         Party's R&D Account at such Party's actual out-of-pocket expense
         incurred in purchasing or making such equipment, materials or supplies.
         Notwithstanding the foregoing, in the case of materials supplied to the
         Parties by either Party for use in clinical trials of R&D Candidates or
         Collaboration Products, the supplying Party shall charge to its R&D
         Account its Cost of Goods Manufactured for Clinical Supplies for such
         materials, as adjusted to account for customary and usual manufacturing
         cost variances allocable to such materials.

5.3.4    Reconciliation of Expenses. Within [***] after the end of each Calendar
         Quarter, ELAN shall prepare a reconciliation report, accompanied by
         reasonable supporting documents and calculations, which reconciles the
         amounts charged to each Party's R&D Account during such Calendar
         Quarter pursuant to Section 5.3.2, including, without limitation,
         making any necessary adjustments for prior period Manufacturing cost
         variances allocable to R&D Candidates utilized in Development, and the
         share of the Parties' aggregate Research Expenses to be allocated to
         each of the Parties for such Calendar Quarter in accordance with
         Section 5.3.1. Within [***] after ELAN delivers such reconciliation
         report to CAT, the net amount shown as being due either to CAT or to
         ELAN will be paid via same day wire transfer by the Party owing such
         amount.

5.3.5    Third Party License Fees. A description of each Party's Third Party
         License obligations with respect to Know How or Patent Rights
         Controlled by such Party and to be used during the course of the
         collaboration is set forth on Exhibit 1.11. Until such date as an R&D
                                       ------------
         Candidate becomes a Collaboration Product the Parties shall equally
         share in the costs of any Third Party License Fees relating to the
         Research and/or Development under this Agreement of each R&D Candidate
         subject to a Third Party License Fee obligation disclosed upon Exhibit
                                                                        -------
         1.11; provided, however, that CAT shall be solely responsible for any
         ----
         Third Party License Fee (other than any Third Party License Fee
         attributable to antigens being screened as part of the Operation of the
         CAT Antibody Library which shall be shared equally in accordance with
         this Section) arising out of the Operation of the CAT Antibody Library
         which is in excess of [***], individually or in the aggregate. Third
         Party License Fees to be shared equally in accordance with this Section
         5.3.5 should be charged by the relevant Party to its R&D Account. For
         the purposes of this Section 5.3.5, "Operation of the CAT Antibody
         Library" shall mean the screening of antigens against the CAT Antibody
         Library and the isolation of single-chain Fv fragments (and Antibodies
         derived therefrom) from the CAT Antibody Library.

<PAGE>

                                      -36-

5.3.6    Records and Audits. During the term of this Agreement, each Party shall
         keep and maintain accurate and complete records showing the expenses
         incurred by it in performing its activities under the Annual Research
         Plans and Annual Development Plans during the [***] preceding calendar
         years, which books and records shall be in sufficient detail such that
         Research Expenses and Development Costs can accurately be determined.
         Upon [***] prior written notice from a Party (the "Auditing Party"),
         the other Party (the "Audited Party") shall permit an independent
         certified public accounting firm of nationally recognized standing
         selected by the Auditing Party and reasonably acceptable to the Audited
         Party, to examine the relevant books and records of the Audited Party
         and its Affiliates as may be reasonably necessary to verify the reports
         submitted by the Audited Party in accordance with Section 5.3.2 and the
         accuracy of the reconciliation report prepared in accordance with
         Section 5.3.4. An examination by a Party under this Section 5.3.6 shall
         occur not more than once in any calendar year during the term of this
         Agreement and not more than once during the [***] following the
         termination of this Agreement and shall be limited to the pertinent
         books and records for any calendar year ending not more than [***]
         before the date of the request. The accounting firm shall be provided
         access to such books and records at the Audited Party's facility(ies)
         where such books and records are normally kept and such examination
         shall be conducted during the Audited Party's normal business hours.
         The Audited Party may require the accounting firm to sign a
         non-disclosure agreement before providing the accounting firm access to
         the Audited Party's facilities or records. Upon completion of the
         audit, the accounting firm shall provide both CAT and ELAN a written
         report disclosing whether the reports submitted by the Audited Party
         are correct or incorrect and the specific details concerning any
         discrepancies. No other information shall be provided to the Auditing
         Party. If the accountant determines that, based on errors in the
         reports so submitted, the reconciliation report prepared in accordance
         with Section 5.3.4 is incorrect, the Parties shall promptly revise the
         reconciliation report and any additional amount owed by one Party to
         the other shall be paid within [***] after receipt of the accountant's
         report, along with interest at the annual interest rate of [***],
         compounded monthly from the date that such additional amount should
         have first been paid; provided, however, that no such interest shall be
         payable if the errors leading to the reconciliation report being
         incorrect were in the reports provided by the Party to receive such
         additional amount. Additionally, if the accountant determines that the
         reports submitted by the Audited Party overstate the Audited Party's
         expenses by more than [***], the Audited Party shall reimburse the
         Auditing Party for the reasonable expenses incurred by the Auditing
         Party in conducting the audit, including, without limitation,

<PAGE>

                                      -37-

                 those arising out of the retention of the reputable and
                 internationally recognized independent accounting firm
                 undertaking the audit.

5.4     Reporting and Disclosure{TC "5.4 Reporting and Disclosure"\f C\1 "2"}.

        5.4.1    Reports. Before each quarterly meeting of the JSC, ELAN and CAT
                 will each provide the other with written copies of all
                 materials they intend to present at the JSC meeting plus, to
                 the extent not set forth in the JSC materials, a written report
                 summarizing any other material data and information arising out
                 of the conduct of the Research Program and/or Development
                 Program including, without limitation, data and information
                 relating to any Inventions made by such Party. If after receipt
                 of any such report, either Party shall request additional data
                 or information relating to an Annual Research Plan or Annual
                 Development Plan or the intellectual property licensed
                 hereunder, the Party to whom such request is made shall
                 promptly provide to the other Party such data or information
                 that such Party reasonably believes is necessary for the
                 continued conduct of the Research Program or the Development
                 Program.

        5.4.2    Quarterly Meeting. At the quarterly meeting of the JSC, CAT and
                 ELAN will review in reasonable detail (i) all data and
                 information generated in the conduct of the applicable Annual
                 Research Plan and Annual Development Plan by each Party, and
                 (ii) all matters arising out of or relating to the Joint
                 Collaboration Patent Rights, the Joint Collaboration Know How,
                 the Elan Collaboration Patent Rights, the Elan Collaboration
                 Know How, the CAT Collaboration Patent Rights and the CAT
                 Collaboration Know How.

5.5     Disclosure and Cooperation{TC "5.5 Disclosure and Cooperation"\f
        C\1 "2"}. During the term of this Agreement, the Parties will promptly
        disclose to one another all data, information, Inventions, techniques
        and discoveries (whether patentable or not) arising out of the conduct
        of the Research Program and the Development Program, and all Inventions,
        techniques and discoveries (whether patentable or not) included within
        the Joint Collaboration Patent Rights, the Joint Collaboration Know How,
        the Elan Collaboration Patent Rights, the Elan Collaboration Know How,
        the CAT Collaboration Patent Rights and the CAT Collaboration Know How,
        the Patent Rights and Know How subject to the Section 8.1.3 and any
        other rights licensed hereunder. Such disclosures may include the form
        of limited visits by ELAN and CAT personnel to the facilities being
        utilized for the Research Program and the Development Program to permit
        observation of the procedures being employed. The Parties agree to
        cooperate with each other to protect all matters arising out of or
        relating to the Patent Rights and Know How licensed or utilized pursuant
        to this Agreement and to

<PAGE>

                                      -38-

         prepare and execute whatever documents and instruments may be
         reasonably necessary or desirable to effect such protection.

5.6      CAT Exclusive Antibody{TC "5.6 CAT Exclusive Antibody" \f C\1 "2"}.

         5.6.1    CAT Obligation To Research And Develop. During the term of
                  this Agreement CAT shall, on a regular basis, but not less
                  than every [***] or upon ELAN's reasonable written request,
                  create and transmit to ELAN a written summary providing the
                  identity of each CAT Exclusive Antibody as to which
                  Commercially Reasonable Efforts have been undertaken by CAT to
                  research, develop, manufacture and commercialize such CAT
                  Exclusive Antibody both inside and outside the Field and
                  specifying, with a reasonable level of detail, the exact scope
                  and nature of all activities undertaken by CAT with respect to
                  each CAT Exclusive Antibody so identified. Notwithstanding the
                  foregoing, CAT shall, upon [***] written notice, provide to
                  ELAN reasonable access to all information, materials or other
                  items as may be necessary or sufficient to permit ELAN to
                  review and analyze each Antibody identified, isolated and/or
                  discovered as a result of Research conducted pursuant to this
                  Agreement. CAT covenants to and shall maintain any materials
                  or information relating to any CAT Exclusive Antibody for a
                  period of [***] from the creation of such materials or
                  information. From time to time, either Party may request an
                  affirmation from the other Party of the status of an Antibody
                  as either an CAT Exclusive Antibody or an R&D Candidate. For
                  the avoidance of doubt, nothing herein shall oblige CAT to
                  research, develop, manufacture or commercialize any CAT
                  Exclusive Antibody in respect of which CAT reasonably believes
                  it cannot or should not exercise Commercially Reasonable
                  Efforts.

         5.6.2    ELAN Right To Research And Develop. If, after the later of
                  either [***] after the discovery thereof or its obtaining the
                  status of a CAT Exclusive Antibody, an Antibody has neither
                  been identified in the reports provided for in Section 5.6.1
                  nor has it been the subject of the Commercially Reasonable
                  Efforts required by that Section, ELAN may, upon written
                  notice and at is option, require CAT to enter into an
                  exclusive license, both within and without the Field, to all
                  of CAT's right, title, and interest in each such CAT Exclusive
                  Antibody; provided, however, that ELAN must first, in a
                  written offer, grant to CAT the right, at CAT's sole option,
                  to enter into a mutually exclusive collaboration arrangement,
                  upon the same financial and other terms provided for in this
                  Agreement, to complete, as applicable, the research,
                  development, manufacture, and/or commercialization of each
                  Antibody identified therein. If CAT fails to respond in
                  writing to ELAN's written offer within [***] after re

<PAGE>

                                      -39-

         ceipt thereof, ELAN's sole remaining obligation to CAT with respect to
         each Antibody identified in any such initial offer to CAT under this
         Section 5.6.2 shall be to pay to CAT on a country by country basis, a
         royalty of [***] of the Net Sales of any Party Exclusive Product
         containing such a CAT Exclusive Antibody until the later of either ten
         (10) years following First Commercial Sale of such Party Exclusive
         Product in such country or until the expiry in such country of the last
         to expire Patent Right comprised in the CAT Patent Rights in existence
         as of the Effective Date. ELAN shall exercise Commercially Reasonable
         Efforts to research, develop, manufacture and commercialize each CAT
         Exclusive Antibody and Party Exclusive Product as to which it obtains
         any rights pursuant to this Section 5.6.2.

5.6.3    ELAN Exclusivity Provisions. Up to, but no later than [***] prior to
         the submission under CAT's sponsorship of any written clinical protocol
         to a Regulatory Authority for a Phase III Clinical Trial relating to a
         CAT Exclusive Antibody, CAT must provide written notice to ELAN which
         shall contain a detailed offer of all the material terms and conditions
         upon which CAT would be willing to enter into a mutually exclusive
         arrangement respecting, as applicable, the further research,
         development, manufacturing and/or commercialization of the applicable
         CAT Exclusive Antibody. With transmittal of its written offer and
         during the evaluation period provided for below, CAT shall provide to
         ELAN all relevant scientific, regulatory, and commercial information
         reasonably necessary for ELAN to evaluate the offer. ELAN shall have
         [***] to accept or refuse such offer; provided, however, that ELAN
         shall, [***] prior to such date, be provided by CAT with sufficient
         information as ELAN may reasonably request concerning the applicable
         CAT Exclusive Antibody. CAT may not enter into any discussions or
         commercial negotiations respecting the CAT Exclusive Antibody which
         will be the subject of a written offer to ELAN prior to the submission
         of the written offer to ELAN, but shall thereafter be free to enter
         into such discussions and negotiations; provided, however, [***]. Upon
         acceptance of CAT's offer by ELAN, any additional terms and conditions
         of the arrangement shall be determined solely by reference to the
         written offer or, as applicable, good faith negotiation and shall be
         documented in a written agreement signed by authorized representatives
         of the Parties. Failure by ELAN to accept CAT's written offer in regard
         to a CAT Exclusive Antibody within the applicable review period shall
         constitute a refusal of such offer. If ELAN refuses CAT's offer, then,
         within [***] after such refusal, CAT may enter into an arrangement with
         a Third Party; provided, however, that such arrangement is not on
         economic terms and conditions better for CAT than those offered to
         ELAN. If CAT does not enter into such an arrangement within

<PAGE>

                                      -40-

               the time period provided in the proceeding sentence, then CAT
               shall again be obligated to make a written offer to ELAN under
               the terms of this Section 5.6.3 prior to entering into any
               arrangement with a Third Party to, as applicable, conduct further
               research, development, manufacturing and/or commercialization of
               the applicable CAT Exclusive Antibody. In the event that CAT does
               not enter into an arrangement with ELAN with respect to any CAT
               Exclusive Antibody under this Section 5.6.3, then CAT shall pay
               to ELAN for ten (10) years following First Commercial Sale of a
               Party Exclusive Product containing such a CAT Exclusive Antibody,
               a royalty of [***] of the Net Sales of such Party Exclusive
               Product.

5.7      Hybrid R&D Candidates{TC "5.7 Hybrid R&D Candidates" \f C\1 "2"}.

         5.7.1 Duty To Develop Hybrid R&D Candidates. On a regular basis the
               JSC shall determine whether any R&D Candidate which binds to a
               Specific Target and was discovered, isolated and/or characterized
               by a Party under this Agreement should be the subject of Research
               and/or Development activities outside of the Field. Each Party
               shall be obligated to provide the JSC with such scientific,
               technical and other information within its Control which is
               reasonably related to the determinations to be made under this
               Section 5.7.1. [***]. In the event that the JSC determines a
               reasonable scientific rationale exists for Research and/or
               Development of an Antibody outside the Field, the JSC shall have
               the authority to designate such an Antibody an R&D Candidate
               notwithstanding the fact that the applicable Research and/or
               Activities will be outside of the Field; provided, however, that
               such R&D Candidate was also selected for such activities within
               the Field. Each R&D Candidate so designated for Research and/or
               Development activities outside of the Field shall be known as a
               "Hybrid R&D Candidate". As applicable, each Annual Research Plan,
               Annual Research Budget, Development Plan and/or Development
               Budget shall make provisions for activities outside the Field for
               the Research, Development and/or Manufacture of Clinical Supplies
               of any Hybrid R&D Candidate. For all other purposes, except as
               otherwise provided for, each Hybrid R&D Candidate shall be
               subject to the same terms, conditions and other obligations
               applicable to any other R&D Candidate.

         5.7.2 Commercialization of Certain Hybrid R&D Candidates. The JSC
               shall, on a regular basis, but no less than once a year or as
               frequently as may be reasonably requested to by either Party,
               determine whether to continue any Research and/or Development of
               a Hybrid R&D Candidate outside of the Field. If the JSC
               determines, taking into account all relevant commercial,
               scientific and/or

<PAGE>

                                      -41-

                  other information, not to continue either the Research and/or
                  Development outside of the Field of a Hybrid R&D Candidate,
                  then one of the Parties shall be appointed on behalf of both
                  the Parties to arrange for the commercial disposition of both
                  Parties' interest and rights thereto; provided, however, that
                  no rights to Research, Develop, Manufacture or Commercialize
                  such an Hybrid R&D Candidate in the Field may be granted
                  unless both Parties execute a written acknowledgement and the
                  Party proposing such a disposition can, using objective
                  scientific and commercial data, establish that the primary
                  economic value of the applicable Hybrid R&D Candidate is
                  outside of the Field. The appointments under this Section
                  5.7.2 shall rotate with first appointment being CAT. The Party
                  appointed shall have discretion, subject to final approval by
                  the JSC, to arrange for the license of each Hybrid R&D
                  Candidate, but shall at all time act in the best interests of
                  both Parties. No disposition or license provided for under
                  this Section 5.7.2 shall be on terms permitting the payment of
                  a royalty which is less than the Third Party License Fees
                  payable by the Parties with respect to such Hybrid R&D
                  Candidate. The Parties shall share equally in any monetary
                  consideration received from any license or grant of rights
                  encompassing a Hybrid R&D Candidate, including, without
                  limitation, sharing all Net Commercialization Revenues.

6.       MANUFACTURING AND REGULATORY MATTERS.

6.1      Manufacture and Supply{TC "6.1 Manufacture and Supply" \f C\1 "2"}. For
         the purposes of this Article 6 and Article 13, "Collaboration Product"
         shall mean Collaboration Product in bulk active ingredient and finished
         dosage form.

         6.1.1    Responsible Party. CAT shall be responsible for the
                  Manufacture and supply of Clinical Supplies. The JSC shall
                  determine whether CAT, ELAN or a Third Party shall be
                  responsible for the Manufacture and supply of Collaboration
                  Product for Commercialization. As applicable, and subject to
                  the provisions of Section 6.1.2, the Parties shall negotiate
                  and enter into separate written agreements pertaining to the
                  provision of Clinical Supplies or Collaboration Products
                  consistent with the other terms of this Agreement. In the
                  event that CAT is not competitive with Third Parties with
                  respect to price, quality, and capacity of Collaboration
                  Product, then ELAN shall, upon written notice to CAT, have the
                  right to either (a) retain a Third Party contract manufacturer
                  to Manufacture and supply such Collaboration Products to ELAN
                  on commercially reasonable terms, or (b) optimally, to
                  Manufacture such Collaboration Products itself; provided that,
                  ELAN is competitive with Third Parties in Cost of Goods
                  Manufactured for Commercialization with respect to price,
                  quality and capacity

<PAGE>

                                      -42-

           of Collaboration Product. Notwithstanding the foregoing, immediately
           following Regulatory Approval, a mutually agreed upon secondary
           manufacturer shall be qualified for the back-up Manufacture and
           supply of each Collaboration Product.

     6.1.2 Agreement for Supply of Collaboration Product to ELAN. If the JSC
           determines that CAT shall Manufacture and supply Collaboration
           Products to ELAN, then at least [***] prior to the date of any
           anticipated Regulatory Approval of such a Collaboration Product, ELAN
           and CAT shall negotiate, in good faith, and enter into a written
           supply agreement which sets forth the rights and obligations of the
           Parties in connection with CAT's supply of Collaboration Product to
           ELAN for worldwid e sale and distribution by ELAN (each one a "Supply
           Agreement"). Such Supply Agreement shall not be inconsistent with the
           terms and conditions of this Agreement and shall include [***]. The
           purchase price, on a country-by-country basis, to be paid to CAT by
           ELAN for each unit of Collaboration Product delivered to ELAN under
           such supply agreement for distribution in such country shall be equal
           to [***]. The purchase price shall be payable within [***] after such
           Collaboration Product is delivered to ELAN.

6.2  Regulatory Matters{TC "6.2    Regulatory Matters" \f C\1 "2"}.

     6.2.1 Clinical Trials.  ELAN shall own all clinical trial data accumulated
           from all clinical trials of R&D Candidates conducted as part of the
           Development Program or otherwise funded or partially funded by the
           Parties. Each Party shall use, and shall cause its permitted Third
           Party Sublicensees to use, commercially reasonable and diligent
           efforts to disclose to the other Party all material information
           relating to any R&D Candidate or Collaboration Product promptly after
           it is learned or its materiality appreciated. ELAN shall maintain,
           and shall cause its permitted Third Party Sublicensees to maintain,
           the database of clinical trial data accumulated from all clinical
           trials of R&D Candidate and of adverse reaction information for all
           such R&D Candidate or Collaboration Products. Such database shall be
           maintained in accordance with the Medical Dictionary for Regulatory
           Activities standard, as in effect from time to time. Each Party shall
           also keep the JSC informed as to its or its permitted Third Party
           Sublicensees' progress in the Development Program. [***]. Within
           [***] following the end of each Calendar Quarter during the
           Development Program, each Party shall provide the other Party with a
           reasonably detailed written report which shall describe the progress
           to date of all activities for which such

<PAGE>

                                      -43-

          Party and its Affiliates were allocated responsibility during such
          Calendar Quarter under the Development Program.

    6.2.2 Regulatory Approvals. ELAN shall file, in its own name, all
          applications for Regulatory Approval for Collaboration Products in all
          countries of the Territory other than those applications relating to
          the facilities to be used by CAT to Manufacture Collaboration Product
          which shall be filed in the name of CAT. ELAN shall have the primary
          responsibility for communicating with any Regulatory Authority
          regarding any such application for Regulatory Approval or any
          Regulatory Approval once granted; provided, however, that the Parties
          shall, through the JSC, consult and cooperate in (i) developing a
          Regulatory Approval filing strategy for R&D Candidates, (ii) reviewing
          study reports from clinical trials on R&D Candidates, (iii) preparing
          applications for Regulatory Approval for Collaboration Products, (iv)
          preparing supplements to applications for Regulatory Approval for
          Collaboration Products, (v) responding to questions from Regulatory
          Authorities regarding applications for Regulatory Approval or any
          supplement thereto and (vi) participating in interactions with
          Regulatory Authorities concerning the Collaboration Products.

    6.2.3 Regulatory Reporting. ELAN shall be responsible for filing all
          reports required to be filed in order to maintain any Regulatory
          Approvals granted for Collaboration Products in all countries of the
          Territory, including, without limitation, adverse drug experience
          reports. CAT shall cooperate with ELAN in preparing and filing all
          such reports and, upon ELAN's request, provide ELAN with any
          information in CAT's possession or Control which ELAN reasonably deems
          to be relevant to any such reports. Notwithstanding the foregoing, to
          the extent CAT has or receives any information regarding any adverse
          drug experience which may be related to the use of any R&D Candidate
          or Collaboration Product, CAT shall promptly provide ELAN with all
          such information in accordance with the adverse event reporting
          procedures to be established by the JSC no later than [***] (as may be
          amended from time to time upon mutual agreement of the Parties).
          Expenses (both internal expenses and out-of-pocket costs paid to a
          Third Party) incurred by a Party in performing its regulatory
          reporting obligations under this Section in connection with Regulatory
          Approvals in the Territory shall be charged by such Party to such
          Party's Marketing Account for such Collaboration Product as an Ongoing
          Development Cost.

<PAGE>

                                      -44-

7.       COMMERCIALIZATION OF PRODUCTS.

7.1      Commercialization in the Territory{TC "7.1   Commercialization in the
         Territory" \f C\1"2"}.

         7.1.1 [***]:

               (a)      [***]

               (b)      [***].

               Each Party, in exchange for the licenses granted to the entity
               provided for under this Section 7.1.1 and pursuant to Article 3
               of this Agreement, upon their mutual consent, shall receive equal
               royalty payments in an amount ranging between [***] of the Gross
               Sales of any Collaboration Products.

         7.1.2 Share of Pro-Forma Net Profits. From the First Commercial Sale
               of each Collaboration Product, the Parties shall, subject to the
               deductions provided for in Section 7.1.10, share equally all
               Pro-Forma Net Profits in respect of such Collaboration Product.

         7.1.3 Responsibility. ELAN shall (a) have the exclusive right to
               undertake the Commercialization of Collaboration Product(s) in
               the Territory, and (b) use Commercially Reasonable Efforts to
               Commercialize each Collaboration Product, promptly and in such a
               manner, subject to the royalty provisions of Section 7.1.1, as to
               maximize the overall profitability of each such Collaboration
               Product. CAT shall provide such support as may be reasonably
               requested by ELAN in connection with such Commercialization.
               Except as otherwise set forth in this Article 7, all activities
               shall be undertaken by the Parties in accordance with the
               Commercialization Plan.

         7.1.4 Commercialization Plan. On a Collaboration
               Product-by-Collaboration Product basis, not later than [***]
               after commencement of the first Phase III Clinical Trial of a R&D
               Candidate in the Territory, ELAN shall prepare and the JSC shall
               review, and after due consideration by ELAN of any suggestions or
               comments, accept ELAN's rolling multi-year (being not less
               than[***]) plan for Commercializing the Collaboration Product in
               the Territory (the "Commercialization Plan"), which plan shall
               include without limitation [***]. The Commercialization Plan
               shall be updated by the ELAN at least once each calendar year.
               Not later than [***] after the filing of the first BLA for an R&D
               Candidate in the Territory and thereafter on or before August 31
               of each calen

<PAGE>

                                      -45-

               dar year, ELAN shall prepare and the JSC shall review, and after
               due consideration by ELAN of any suggestions or comments, accept
               a long term plan (the "Post BLA Filing Plan"), which plan shall
               be based on and shall supersede the then current
               Commercialization Plan and which shall include [***]. The Post
               BLA Filing Budget shall be based on and shall supersede the
               relevant Commercialization Budget. The Post BLA Filing Plan will
               specify [***]. In preparing and updating the Commercialization
               Plan, Commercialization Budget, each Post BLA Filing Plan and
               each Post BLA Filing Budget, ELAN will take into consideration
               factors such as market conditions, regulatory issues and
               competition. If in any year of a Post BLA Filing Plan the
               aggregate expenses incurred by the Parties are in excess of [***]
               of the amounts set out in the Post BLA Filing Budget for that
               year (a "Post BLA Excess Year") then each Party shall charge to
               its R&D Account [***] of such [***] and, in addition, ELAN shall
               charge to its R&D Account any amounts in excess of such [***]
               (the "Post BLA Excess Charge"). All expenses incurred by the
               Parties in respect of any Post BLA Filing Budget and charged to
               their respective R&D Accounts shall be shared equally by the
               Parties in accordance with Section 5.3.1 and Section 5.3.4;
               provided, however, in any years following a Post BLA Excess Year
               CAT shall, in addition to any sums which may be due to ELAN under
               Section 5.3.4 for that year in respect of the then current Post
               BLA Filing Budget, pay to ELAN [***] of any Post BLA Excess
               Charges charged by ELAN to is R&D Account in each Post BLA Excess
               Year provided always that CAT's liability hereunder in any year
               shall not exceed [***] of [***] of the relevant Post BLA Filing
               Budget. If CAT's liability hereunder in any year does exceed
               [***] of [***] of the relevant Post BLA Filing Budget then this
               Section shall apply mutatis mutandis thereto.

         7.1.5 Pricing and Commercial Diligence. ELAN, as the exclusive
               distributing party within the Territory, shall have the sole
               decision-making authority and discretion with respect to all
               pricing decisions in such Territory on a country by country
               basis; provided, however, that such pricing strategy shall be
               commercially reasonable in light of commercially relevant factors
               relating to such Collaboration Product including market,
               competition, indication, reimbursement and related issues.

         7.1.6 ELAN's Responsibilities. In Commercializing Collaboration
               Products ELAN shall comply with all applicable rules and
               regulations related thereto including but not limited to those
               related to "off-label" promotion of biopharmaceutical products;
               provided, however, that nothing shall preclude ELAN from
               conducting lawful promotional activities directed to such
               "off-label" uses.

<PAGE>

                                      -46-

         7.1.7    CAT's Responsibilities. CAT shall not, and shall cause its
                  Affiliates not to, solicit for its, or their, own account,
                  sales of Collaboration Products. Any solicitations or requests
                  to purchase Collaboration Products received by CAT or any of
                  its Affiliates from any customer or prospective customer shall
                  be immediately referred to ELAN. In Commercializing Party
                  Exclusive Products CAT shall comply with all applicable rules
                  and regulations related thereto including but not limited to
                  those related to "off-label" promotion of biopharmaceutical
                  products; provided, however, that nothing shall preclude CAT
                  from conducting lawful promotional activities directed to such
                  "off-label" uses.

         7.1.8    Non-Antibody Product Royalty Obligation. For a period of ten
                  (10) years following the First Commercial Sale of any
                  Non-Antibody Product in any Major Market Country, ELAN shall
                  pay to CAT a royalty of [***] of Net Sales of Non-Antibody
                  Products.

         7.1.9    Recalls; Customer Support.

                  (a)    Recalls. The determination of whether a Product recall
                         is required shall be made by the Party distributing
                         such Product, in its sole discretion; provided that,
                         each Party shall promptly notify the other Party in
                         writing of such a recall decision. During the term of
                         this Agreement, ELAN shall be responsible for handling
                         and implementing all recalls and market withdrawals of
                         any Collaboration Product in the Territory. CAT will
                         make available to ELAN, upon request, all of CAT's
                         records that ELAN may reasonably request to assist it
                         in effecting any recall or market withdrawals. The
                         Parties shall share equally all costs of a recall or
                         marketing withdrawal of a Collaboration Product in the
                         Territory. Neither Party shall have the obligation to
                         reimburse or otherwise compensate the other Party for
                         any lost profits or income that may arise in connection
                         with any such recall or market withdrawal of a Product.

                  (b)    Customer Support. Each Party shall, using Commercially
                         Reasonable Efforts, perform, and in consultation with
                         the other Party, be responsible for all customer
                         support services necessary to discharge its obligations
                         to Commercialize Products hereunder. For the avoidance
                         of any doubt, any customer support services which
                         require regulatory approval, acquiescence or oversight,
                         including, without limitation, pharmacovigilance,
                         responding to physician inquiries, or professional
                         education, relating to Collaboration Product shall be
                         conducted solely by ELAN and shall constitute a
                         Reimbursable Commercial Cost.

<PAGE>

                                      -47-

         7.1.10   Commercialization Expenses.

                  (a)    Premarketing Expenses. On a Collaboration Product by
                         Collaboration Product and country by country basis,
                         before Regulatory Approval of such Collaboration
                         Product in such country of the Territory, the
                         Pre-Marketing Costs incurred by ELAN with respect to
                         such Collaboration Product in anticipation of obtaining
                         Regulatory Approval of such Collaboration Product in
                         such country shall be shared equally by the Parties,
                         consistent with plans and budgets established in the
                         applicable Annual Development Plan. As such
                         Pre-Marketing Costs are incurred they shall be paid for
                         by ELAN, subject to reimbursement as set forth in
                         Section 7.1.10(d).

                  (b)    Payment of Expenses; ELAN Marketing Accounts. Subject
                         to reconciliation as provided in Section 7.1.10(c) and
                         (d), as applicable, ELAN shall be responsible and pay
                         for all Reimbursable Commercial Costs incurred by it in
                         performing its activities in connection with the
                         Commercialization of Collaboration Products in the
                         Territory. Subject to the limitations set forth in
                         Section 7.1.10(d), ELAN shall charge all such expenses
                         so incurred by it or its Affiliates to a separate
                         account created on its books and records solely for the
                         purpose of tracking expenses incurred in connection
                         with the Commercialization of Collaboration Products in
                         the Territory (each, a "Marketing Account"). Within
                         [***] after the end of each Calendar Quarter, ELAN
                         shall submit to CAT a written summary of all
                         Reimbursable Commercial Costs incurred by it in
                         performing its activities in connection with the
                         Commercialization of Collaboration Products in the
                         Territory, charged to its Marketing Account during such
                         Calendar Quarter, which summary shall be accompanied,
                         upon prior written request, by reasonable supporting
                         documentation for such expenses. The report provided
                         for in this Section 7.1.10(b) shall include a
                         reasonable estimate of the Sales Returns and Allowances
                         charged to ELAN's Marketing Account.

                  (c)    Expense Limitations. Reimbursable Commercial Costs
                         charged by ELAN to its Marketing Account in accordance
                         shall not be in an amount in excess of [***] of the
                         amount included for such expenses in the then current
                         Annual Commercialization Plan, unless the JSC approves
                         such excess expenses. All payments made by ELAN to any
                         Third Party in connection with the performance of its
                         activities in connection with the Commercialization of
                         a Product in the Territory shall

<PAGE>

                                      -48-

                         be charged to ELAN's Marketing Account at ELAN's actual
                         out-of-pocket cost incurred in connection with such
                         Third Party relationships.

                  (d)    Reimbursement of Certain Expenses. At the time ELAN or
                         the entity provided for in Section 7.1.1 distributes to
                         CAT CAT's share of the Pro-Forma Net Profits obtained
                         from the sale of a Collaboration Product in a country
                         of the Territory during any Calendar Quarter, ELAN
                         shall be reimbursed for those Reimbursable Commercial
                         Costs that are (i) directly allocable to the
                         Commercialization of such Product in such country
                         during such Calendar Quarter, (ii) properly charged by
                         ELAN to its Marketing Account in accordance with
                         Section 7.1.10 (b) and (iii) reported to CAT in
                         accordance with this Section. If the amount obtained
                         from sales of Collaboration Products are insufficient
                         in any Calendar Quarter to fully reimburse ELAN as set
                         forth above, reimbursement payments shall be made in a
                         sequential manner first for the Cost of Goods
                         Manufactured for Clinical Supplies and the Cost of
                         Goods Manufactured for Commercialization, second for
                         the Third Party License Fees and third for the Sales
                         Costs, Marketing Costs, Distribution Costs,
                         Post-Approval Research and Regulatory Expenses charged
                         to ELAN's Marketing Account with respect to such
                         Calendar Quarter. After such sequential reimbursement
                         payments have been made, CAT shall pay to ELAN an
                         amount equal to fifty percent (50%) of any remaining
                         shortfall except to the extent that the reimbursement
                         of such shortfall is limited by the provisions of
                         Section 7.1.4.

         7.1.11   Marketing and Promotional Materials. ELAN shall, in its sole
                  discretion, determine the content, quantity and method of
                  distribution of any promotional materials related to the
                  Collaboration Product in the Territory. All Copyright and
                  other intellectual property rights in said promotional
                  materials shall remain vested in ELAN.

         7.1.12   Promotional Claims. ELAN shall limit the claims of safety and
                  efficacy that ELAN or its sales force makes for a
                  Collaboration Product in the Territory to those that are
                  consistent with the approved labeling for such Collaboration
                  Product in such country of the Territory. ELAN's detailing and
                  promotion of a Collaboration Product in the Territory shall be
                  in strict adherence to all regulatory, professional and legal
                  requirements including, without limitation, FDA's regulations
                  and guidelines concerning the advertising of prescription drug
                  products and any updates thereto.

<PAGE>

                                      -49-

7.2      Reports and Payments{TC "7.2  Reports and Payments" \f C \1 "2"}.

         7.2.1    Pre-tax Profit Statements and Payments. After the First
                  Commercial Sale of a Product in the Territory, each Party
                  shall, within [***] after the end of each Calendar Quarter,
                  deliver to the other Party a report setting forth, on a
                  Product-by-Product and country-by-country basis, for such
                  Calendar Quarter the following information, (i) the Gross
                  Sales and Net Sales of each Product in each country of the
                  Territory and (ii) solely in the case of Collaboration
                  Products, the Pro-Forma Net Profit obtained from the sale of
                  such Product in each country of the Territory and the
                  deductions made from Net Sales in calculating such Pro-Forma
                  Net Profit, including, without limitation, [***]. The report
                  provided in (ii) above shall identify for each Collaboration
                  Product [***]. No such reports shall be due with respect to
                  any Product before the First Commercial Sale of such Product
                  in the Territory. Without prejudice to either Party's audit
                  rights under Section 7.3.2, a reasonable degree of reporting
                  error which does not result in an underpayment to either Party
                  shall not constitute a material breach of this Section 7.2.1.

         7.2.2    Currency. All amounts payable and calculations hereunder shall
                  be in United States dollars and all references to "dollars" or
                  to "$" shall refer to United States dollars. As applicable,
                  Gross Sales, Sales Returns and Allowances, Net Sales,
                  Reimbursable Commercial Costs incurred by ELAN shall be
                  translated into United States dollars in accordance with
                  ELAN's customary and usual currency conversion procedures,
                  consistently applied. If, due to restrictions or prohibitions
                  imposed by national or international authority, payments
                  cannot be made as provided in this Article 7, the Parties
                  shall consult with a view to finding a prompt and acceptable
                  solution, and the paying Party will deal with such monies as
                  the other Party may lawfully direct at no additional
                  out-of-pocket expense to the paying Party.

7.3      Maintenance of Records; Audits{TC "7.3   Maintenance of Records;
         Audits" \f C \1 "2"}.

         7.3.1    Record Keeping for the Territory. Each Party shall keep and
                  maintain accurate and complete records in connection with the
                  sale of Products in the Territory and each Party shall keep
                  and maintain accurate and complete records showing the
                  expenses incurred and efforts employed by or on behalf of it
                  with respect to Products hereunder, which books and records
                  shall be in sufficient detail to permit the accurate
                  determination of Gross Sales, Net Sales, Pro-Forma Net Profits
                  and all other figures necessary for the verification of the
                  al-

<PAGE>

                                      -50-

               location of Pro-Forma Net Profits or royalties to be paid
               under this Agreement. Each Party shall maintain and cause its
               Affiliates to maintain such records for a period of at least
               [***] after the end of the calendar year in which they were
               generated.

       7.3.2   Audits. With [***] prior written notice from a Party (the
               "Auditing Party"), the other Party (the "Audited Party") shall
               permit an independent certified public accounting firm of
               internationally recognized standing selected by the Auditing
               Party and reasonably acceptable to the Audited Party, to examine,
               at the Auditing Party's sole expense, the relevant books and
               records of the Audited Party as may be reasonably necessary to
               verify the accuracy of the reports submitted by the Audited Party
               in accordance with Section 7.2.1 and the calculation and
               allocation of Pro-Forma Net Profits and royalties to be paid
               under this Agreement. An examination by a Party under this
               Section 7.3.2 shall occur not more than once in any calendar year
               during the term of this Agreement and not more than once during
               each successive calendar year thereafter and shall be limited to
               the pertinent books and records for any calendar year ending not
               more than [***] before the date of the request. The accounting
               firm shall be provided access to such books and records at the
               Audited Party's facility(ies) where such books and records are
               normally kept and such examination shall be conducted during the
               Audited Party's normal business hours. The Audited Party may
               require the accounting firm to sign a standard non-disclosure
               agreement before providing the accounting firm access to the
               Audited Party's facilities or records. Upon completion of the
               audit, the accounting firm shall provide both CAT and ELAN a
               written report disclosing whether the reports submitted by the
               Audited Party are correct or incorrect, whether the calculation
               and allocation of Pro-Forma Net Profits or royalties to be paid
               under this Agreement are correct or incorrect, and, in each case,
               the specific details concerning any discrepancies. No other
               information shall be provided to the Auditing Party.

       7.3.3   Underpayments/Overpayments. If such accounting firm correctly
               concludes that additional Pro-Forma Net Profits or royalties
               were due to a Party, the other Party shall pay to such Party
               such additional Pro-Forma Net Profits or royalties together
               with any interest that may be due thereon as provided for
               within [***] of the date the Parties receives such
               accountant's written report so correctly concluding. If an
               underpayment to an Auditing Party exceeds [***] of the
               Pro-Forma Net Profits or royalties to be paid under this
               Agreement that were to be distributed to such Auditing Party,
               the other Party also shall reimburse the Auditing Party for
               the out-of-pocket expenses incurred in conducting the audit,

<PAGE>

                                      -51-

                  except in the event that such underpayment was due to any
                  inaccurate information provided by the Auditing Party in
                  conducting the audit, including, without limitation, those
                  arising out of the retention of the reputable and
                  internationally recognized independent accounting firm
                  undertaking the audit.

         7.3.4    Confidentiality. All financial information of a Party which is
                  subject to review under this Section 7.3 shall be deemed to be
                  Confidential Information subject to the provisions of Article
                  9, and such Confidential Information shall not be disclosed to
                  any Third Party or used for any purpose other than verifying
                  payments to be made by one Party to the other hereunder;
                  provided, however, that such Confidential Information may be
                  disclosed to Third Parties only to the extent necessary to
                  enforce a Party's rights under this Agreement.

7.4      Interest{TC "7.4   Interest"\f C\1 "2"}. Any payment under this
         Article 7 that is more than [***] past due shall thereafter be subject
         to interest at [***]. Likewise, any overpayment that is not refunded
         within [***] after the date such overpayment was identified shall
         thereafter be subject to interest at an annual percentage rate [***]
         compounded monthly; provided, however, that if the overpayment is due
         to errors in reports provided by the overpaid Party, such interest
         shall accrue from the date the overpayment was made.

7.5      GAAP{TC "7.5  GAAP"\f C\1 "2"}. The calculation of all expenditures,
         payments and reimbursements made by either Party under this Agreement
         shall be made in accordance with United States generally accepted
         accounting procedures.

8.       INTELLECTUAL PROPERTY.

8.1      Ownership{TC "8.1  Ownership"\f C\1 "2"}.

         8.1.1    Sole Ownership By CAT. Subject to the provisions of Section 3
                  and Section 8.1.3, CAT shall have sole and exclusive ownership
                  of the CAT Patent Rights, the CAT Know How, the CAT Antibody
                  Library, CAT Technology, the CAT Inventions, the CAT
                  Collaboration Know How and the CAT Collaboration Patent
                  Rights.

         8.1.2    Sole Ownership By ELAN. Subject to the provisions of Section 3
                  and Section 8.1.3, ELAN shall have sole and exclusive
                  ownership of the ELAN Patent Rights, the ELAN Technology, the
                  ELAN Know How, the ELAN Inventions, the ELAN Collaboration
                  Know How and the ELAN Collaboration Patent Rights.

<PAGE>

                                      -52-

         8.1.3    Joint Ownership. Ownership of all of the Joint Collaboration
                  Inventions, the Joint Collaboration Know How and the Joint
                  Collaboration Patent Rights shall vest in and be owned by the
                  Parties jointly in equal and undivided shares. To the extent
                  any CAT Collaboration Know How, CAT Collaboration Patent
                  Rights, ELAN Collaboration Know How and/or ELAN Collaboration
                  Patent Rights claims, or covers any Antibody discovered,
                  isolated or identified by the Parties pursuant to the Research
                  Program or Development Program or any use, medicinal or
                  otherwise, thereof, and/or any Collaboration Product or Party
                  Exclusive Product, it shall vest in and be owned by the
                  Parties jointly in equal and undivided shares. Any Patent
                  Rights subject to the provisions of this Section 8.1.3 shall
                  be filed for jointly in the name of both Parties and each
                  Party covenants to file with the appropriate entity such
                  recordation of the other Party's equal and undivided interest
                  in such Patent Rights as may be reasonably requested.

         8.1.4    Prior Inventions. Nothing in this Agreement shall affect the
                  ownership of Prior Inventions.

8.2      Joint Patent Committee{TC "8.2   Joint Patent Committee"\f C\1 "2"}.

         8.2.1    Membership. Within [***] after the Effective Date, ELAN and
                  CAT shall establish a "Joint Patent Committee" or "JPC" to
                  oversee and direct the clearance of Specific Targets and the
                  review and analysis of Enhancing Third Party Intellectual
                  Property or Blocking Third Party Intellectual Property. The
                  JPC shall be comprised of one (1) senior patent attorney from
                  each Party as appointed by such Party. A Party may replace its
                  representative from time to time upon written notice to the
                  other Party. The JPC shall exist until the termination of this
                  Agreement.

         8.2.2    Decisions. All decisions of the JPC shall be unanimous, and in
                  the event that a decision cannot be reached by the JPC, the
                  matter shall be first referred to the highest level officer of
                  ELAN and CAT with day to day responsibility for oversight of
                  intellectual property matters. In the event that such officers
                  are unable to reach a decision with respect to any such
                  matter, then such matter shall be resolved in accordance with
                  the provisions of Section 15.

8.3      Prosecution and Maintenance of Patent Rights{TC "8.3   Prosecution and
         Maintenance of Patent Rights"\f C\1 "2"}.

         8.3.1    Joint Prosecution. Decisions as to whether to file, prosecute
                  and maintain, and in which countries to do so, Patent Rights
                  subject to the provisions of Sec-

<PAGE>

                                      -53-

                  tion 8.1.3, along with other strategic decisions relating
                  thereto, shall be made by the JPC; provided, however, [***].
                  Any disputes regarding the prosecution of Patent Rights
                  subject to this Section 8.3.1 shall be resolved in accordance
                  with the provisions of Section 15, but shall not be subject to
                  the first sentence of Section 15.4.

         8.3.2    Patent Term Extensions. The Parties shall cooperate, if
                  necessary and appropriate, with each other in gaining patent
                  term extension, including without limitation, supplementary
                  protection certificates and any other extensions that are now
                  or become available in the future wherever applicable to
                  Patent Rights covering Collaboration Products. The Parties
                  shall, if necessary and appropriate, use reasonable efforts to
                  agree upon a joint strategy relating to patent term
                  extensions, but, in the absence of mutual agreement with
                  respect to any extension issue, a patent shall be extended if
                  either Party elects to extend such patent. All filings for
                  such extension shall be made by the Party which controls the
                  patent or patent application in question; provided, however,
                  that in the event that the Party whom controls the patent in
                  question elects not to file for an extension, such Party shall
                  (i) inform the other Party of its intention not to file and
                  (ii) grant the other Party the right to file for such
                  extension.

         8.3.3    Costs and Expenses. The Parties shall [bear equally] all costs
                  and expenses of filing, prosecuting, maintaining and extending
                  the Joint Collaboration Patent Rights, the CAT Collaboration
                  Patent Rights, the ELAN Collaboration Patent Rights and/or any
                  other Patent Rights subject to the provisions of Section
                  8.1.3.

8.4      Trademarks{TC "8.4   Trademarks"\f C\1 "2"}. All Collaboration Products
         shall be sold in the Territory under Trademarks selected by ELAN. ELAN
         shall own such Trademarks and shall be responsible for the filing,
         prosecution and maintenance of such Trademarks in each country of the
         Territory. ELAN shall use Commercially Reasonable Efforts to select a
         world-wide Trademark for each Collaboration Product. The costs of
         obtaining and maintaining said Trademarks shall be shared equally by
         the Parties.

8.5      Enforcement of Jointly Owned or Controlled Patent Rights{TC "8.5
         Enforcement of Jointly Owned or Controlled Patent Rights"\f C\1 "2"}.

         8.5.1    Notice. If ELAN or CAT becomes aware that any ELAN
                  Intellectual Property, CAT Intellectual Property, Joint
                  Collaboration Patent Rights and/or Joint Collaboration Know
                  How relating to the Research Program, the Development Program
                  and/or any Product upon which a royalty may be due to the
                  other Party is

<PAGE>

                                      -54-

          being infringed or misappropriated by a Third Party or is subject to a
          declaratory judgment action arising from such infringement, ELAN or
          CAT, as the case may be, shall promptly notify the other Party.

    8.5.2 Enforcement by ELAN. ELAN shall have the first right (but not the
          obligation), at its sole expense, to enforce any the Joint
          Collaboration Patent Rights, the Joint Collaboration Know How, the
          Patent Rights or Know How either jointly owned by the Parties pursuant
          to Section 8.1.3 or exclusively licensed to the other Party within the
          Field, CAT shall, at CAT's own expense, cooperate with ELAN as may be
          reasonably necessary in ELAN `s enforcement activities. ELAN shall
          keep CAT reasonably informed on a quarterly basis, in person or by
          telephone, prior to and during any such enforcement. CAT shall execute
          such additional instruments, including, without limitation, assignment
          of causes of actions, as may be reasonably required under this Section
          8.5.2.

    8.5.3 Enforcement by CAT. If ELAN fails to abate an infringement of any the
          Joint Collaboration Patent Rights, the Joint Collaboration Know How,
          Patent Rights or Know How either jointly owned by the Parties pursuant
          to Section 8.1.3 or exclusively licensed to the other Party within the
          Field, or to file an action to abate such infringement, within [***]
          after a written request from CAT to do so, or if ELAN discontinues the
          prosecution of any such action, CAT at its expense may, in its
          discretion, undertake such action as it determines appropriate (other
          than the grant of a license to the allegedly infringing Third Party)
          to enforce any such Joint Collaboration Patent Rights, Joint
          Collaboration Know How, Patent Rights or Know How either jointly owned
          by the Parties pursuant to Section 8.1.3 or exclusively licensed to
          the other Party within the Field. CAT shall keep ELAN reasonably
          informed on a quarterly basis, in person or by telephone, prior to and
          during any such enforcement. In such case, ELAN shall assist CAT, upon
          request and [at ELAN's sole expense,] in taking any action to enforce
          any Patent Rights or Know How either jointly owned by the Parties
          pursuant to Section 8.1.3 or exclusively licensed to the other Party
          within the Field. ELAN shall execute such additional instruments,
          including, without limitation, assignment of causes of actions, as may
          be reasonably required under this Section 8.5.3.

    8.5.4 Recoveries. All monies recovered upon the final judgment or
          settlement of any such action shall be used first, to reimburse the
          costs and expenses (including reasonable attorneys' fees and costs) of
          CAT and ELAN and thereafter the Parties shall share in any remaining
          recovery as follows: the Party enforcing Jointly Owned or Controlled
          Patent Rights under either Section 8.5.2 or 8.5.3

<PAGE>

                                      -55-

               shall receive [***] of any remaining recovery and the other Party
               shall receive [***] of any remaining recovery.

8.6      Enforcement of Individually Owned or Controlled Patent Rights{TC "8.6
         Enforcement of Individually Owned or Controlled Patent Rights"/f C\1
         "2"}. Neither Party shall have any obligation to the other Party to
         abate or prevent infringement of any Patent Right or Know How neither
         jointly owned nor exclusively licensed to the other Party in the Field
         under this Agreement.

8.7      Third Party Claims{TC "8.7  Third Party Claims" \f C\1 "2"}.

         8.7.1 Third Party Claims - Course of Action. If the Research to be
               conducted under this Agreement, the Development of any R&D
               Candidate, Manufacture of Clinical Supplies or Collaboration
               Products and/or Commercialization of any Collaboration Product is
               alleged by a Third Party to infringe a Third Party's patent or
               misappropriate a Third Party's Know How, the Party becoming aware
               of such allegation shall promptly notify the other Party thereof,
               in writing, reasonably detailing the claim.

         8.7.2 Negotiation with Third Party. The JSC shall determine which
               Party shall negotiate with said Third Party for a suitable
               license or assignment and execute such license or assignment;
               provided, however, that such Party shall enter into no such
               agreement unless it has first obtained the other Party's written
               approval of the terms of such agreement, including the amounts of
               any royalties or payments, which approval shall not be
               unreasonably withheld. If such negotiation results in a
               consummated agreement, such Party shall make all payments to the
               Third Party and such payments shall be deemed Third Party License
               Fees for purposes of this Agreement and such Party shall be
               reimbursed for payment of such fees in accordance with Section
               5.3.5, 7.1 and 8.8, as applicable.

         8.7.3 Third Party Suit. If a Third Party sues a Party (the "Sued
               Party") alleging that the Sued Party's or the Sued Party's
               Sublicensees' Research to be conducted under this Agreement,
               Development of any R&D Candidate, Manufacture of Clinical
               Supplies or Collaboration Products and/or Commercialization of
               any Collaboration Product infringes or will infringe said Third
               Party's patent or misappropriates said Third Party's Know How,
               then upon the Sued Party's request and in connection with the
               Sued Party's defense of any such Third Party suit, the other
               Party shall provide reasonable assistance to the Sued Party for
               such defense and shall join such suit if deemed a necessary
               party. The Sued Party shall keep the other Party, if such other
               Party has not joined in such suit, reasonably informed on a
               quarterly basis, in person or by telephone, prior to

<PAGE>

                                      -56-

               and during the pendency of any such suit. The Sued Party shall
               not admit the invalidity of any Patent Rights within the CAT
               Patent Rights, the CAT Collaboration Patent Rights, the ELAN
               Collaboration Patent Rights, the ELAN Patent Rights and/or the
               Joint Collaboration Patent Rights, nor settle any such suit,
               without written consent of the other Party. [***].

8.8      Third Party Licenses{TC "8.8   Third Party Licenses" \f C \1 "2"}.

         8.8.1 General. If either Party believes that there exists Third Party
               intellectual property that constitutes Blocking Third Party
               Intellectual Property or Enhancing Third Party Intellectual
               Property, as the case may be, it shall notify the JSC and the
               JPC. The JPC shall then determine whether or not such Third Party
               Intellectual Property constitutes Blocking Third Party
               Intellectual Property or Enhancing Third Party Intellectual
               Property, as the case may be. If the determination of the JPC is
               affirmative, the JSC shall determine whether, on what terms
               (economic or otherwise), and by which Party (the "Licensing
               Party") such Blocking Third Party Intellectual Property or
               Enhancing Third Party Intellectual Property, as the case may be,
               shall be licensed for the purposes of this Agreement. Prior to
               entering into a license agreement with respect to such Blocking
               Third Party Intellectual Property or Enhancing Third Party
               Intellectual Property, as the case may be, the Licensing Party
               shall submit the proposed license agreement to the JSC for
               approval. If the JSC approves the proposed license agreement, the
               Licensing Party shall enter into such license agreement and shall
               pay the Third Party License Fees due thereunder, subject to
               reimbursement in accordance with and subject to Section 5.3.5 or
               7.1.10(d), as applicable. Any agreement entered into pursuant to
               this Section 8.8.1 shall not be amended without the prior written
               consent of the JSC.

         8.8.2 Failure to Obtain a Third Party License. If, within [***], or
               such other period as may be agreed to by the JSC, after a
               Licensing Party has been instructed by the JSC, pursuant to
               Section 8.8.1, to attempt to enter into a license agreement with
               respect to Blocking Third Party Intellectual Property or
               Enhancing Third Party Intellectual Property, as the case may be,
               it is determined by the JSC that no license is obtainable on
               commercially reasonably terms despite a good faith attempt by
               such Licensing Party to obtain such license, then (a) neither
               Party shall practice Blocking Third Party Intellectual Property
               that was the subject of the proposed license agreement and (b) in
               the case of Blocking Third Party Intellectual Property only,
               neither Party shall proceed with the Research to be conducted
               under this Agreement, and/or the Development, Manufacture and/or
               Commercialization of an R&D Candidate or Collaboration Product,
               as

<PAGE>

                                      -57-

                the case may be, to the extent doing so would infringe such
                Blocking Third Party Intellectual Property.

         8.8.3  Resolution of Disputes. If the JPC is unable to reach a
                determination under Section 8.8.1 with respect to whether Third
                Party intellectual property constitutes either Blocking Third
                Party Intellectual Property or Enhancing Third Party
                Intellectual Property, as the case may be, then such issue shall
                be presented to Vice President, Intellectual Property ELAN for
                determination and resolution. In the event CAT does not agree
                with the determination made by that person, [***]. In the case
                of Blocking Third Party Intellectual Property only: (a) neither
                Party shall proceed with the Research to be conducted under this
                Agreement, and/or the Development of an R&D Candidate, the
                Manufacture of Clinical Supplies or Commercialization Supplies
                or the Commercialization of a Collaboration Product, as the case
                may be, to the extent the Parties believes such activities would
                infringe such Blocking Third Party Intellectual Property or (b)
                a Party may suspend its performance under this Agreement in the
                event it provides an opinion of a nationally recognized patent
                counsel that such performance constitutes infringement, direct
                or otherwise, of one or more claims of the applicable Blocking
                Intellectual Property.

8.9      Patent Marking{TC "8.9  Patent Marking" \f C \1 "2"}. Each Party agrees
         to mark and have its Affiliates and all Sublicensees mark all
         Collaboration Products (or their containers or labels) sold pursuant to
         this Agreement in accordance with the applicable statutes or
         regulations in the country or countries of manufacture and sale
         thereof.

8.10     Patent Certifications{TC "8.10   Patent Certifications" \f C \1 "2"}.
         Each Party shall immediately give written notice to the other of any
         certification of which it becomes aware filed pursuant to 21 U.S.C.
         (S)355(b)(2)(A), or (S)355(j)(2)(A)(vii) (or any amendment or successor
         statute thereto) claiming that the CAT Patent Rights, CAT Collaboration
         Patent Rights, ELAN Collaboration Patent Rights, ELAN Patent Rights or
         Joint Collaboration Patent Rights covering any Collaboration Product
         are invalid or that infringement will not arise from the manufacture,
         use or sale of such Collaboration Product by a Third Party.

8.11     Limitation{TC "8.11   Limitation" \f C \1 "2"}. Notwithstanding any
         other provision in this Article 8, the Parties acknowledge and
         understand that neither ELAN nor CAT shall not be obligated to prepare,
         file, prosecute, and maintain patents and patent applications, or to
         bring or pursue enforcement proceedings or defend declaratory judgment
         actions regarding the ELAN Patent Rights or CAT Patent Rights, as the
         case may

<PAGE>

                                      -58-

         be, if, and to the extent that, ELAN or CAT is not entitled to do so
         under applicable agreements with Third Parties.

8.12     Patent Attorneys{TC "8.12   Patent Attorneys" \f C \1 "2"}. The Parties
         shall cause their patent attorneys to liaise so far as is necessary and
         reasonably practicable on all issues relating to the filing,
         prosecution, maintenance and enforcement of the Joint Collaboration
         Patent Rights. The patent attorneys may be invited to JPC meetings and
         each party shall be responsible for the costs of its own patent
         attorney incurred hereunder.

9.       CONFIDENTIALITY.

9.1      Confidentiality{TC "9.1   Confidentiality" \f C \1 "2"}. During the
         term of this Agreement and for a period of [***] following the
         expiration or earlier termination thereof, each Party shall maintain in
         confidence the Confidential Information of the other Party, and shall
         not disclose, use or grant to a Third Party the right to use any of the
         Confidential Information of the other Party except on a need-to-know
         basis to such Party's directors, officers and employees, and to such
         Party's consultants working on such Party's premises, to the extent
         such disclosure is reasonably necessary in connection with such Party's
         activities as expressly authorized by this Agreement. To the extent
         that disclosure to any person is authorized by this Agreement, prior to
         disclosure, a Party shall obtain written agreement of such person to
         hold in confidence and not disclose, use or grant the use of the
         Confidential Information of the other Party except as expressly
         permitted under this Agreement. Each Party shall notify the other Party
         promptly upon discovery of any unauthorized use or disclosure of the
         other Party's Confidential Information.

9.2      Terms of Agreement{TC "9.2   Terms of Agreement" \f C \1 "2"}. Neither
         Party shall disclose any terms or conditions of this Agreement to any
         Third Party without the prior written consent of the other Party;
         provided, however, that a Party may disclose the terms or conditions of
         this Agreement, (a) on a need-to-know basis to its legal and financial
         advisors, who are obligated to maintain such information in confidence,
         and (b) to a Third Party (who is obligated to maintain such information
         in confidence) in connection with (i) an equity investment in ELAN or
         CAT by such Third Party, which investment is in excess of [***] of
         ELAN's or CAT's market capitalization at such time, (ii) a merger,
         consolidation or similar transaction by such Party, or (iii) the sale
         of all or substantially all of the assets of such Party relating to the
         subject matter of this Agreement. Notwithstanding the foregoing, prior
         to execution of this Agreement, the Parties have agreed upon the
         substance of information (including a form of press release) that can
         be used to describe the terms and conditions of this

<PAGE>

                                      -59-

         transaction, and each Party may disclose such information, as modified
         by mutual written agreement the Parties, without the consent of the
         other Party.

9.3      Permitted Disclosures{TC "9.3   Permitted Disclosures" \f C \1 "2"}.
         The confidentiality obligations under this Article 9 shall not apply
         (a) to the extent that a Party is required to disclose information by
         applicable law, regulation or order of a governmental agency or a court
         of competent jurisdiction, or (b) to the extent necessary or desirable
         to allow either Party (where possible, with adequate safeguards for
         confidentiality) to defend against litigation or to file and prosecute
         Patent Rights; provided, however, in either such case that such Party
         shall provide written notice thereof to the other Party, consult with
         the other Party with respect to such disclosure and provide the other
         Party sufficient opportunity to object to any such disclosure or to
         request that the disclosing Party seek confidential treatment thereof,
         in which event, the disclosing Party shall use all reasonable efforts
         to accommodate the other Party's requests.

9.4      Publications{TC "9.4    Publications" \f C \1 "2"}. During the term of
         this Agreement, each Party will submit to the other Party for review
         and approval all proposed academic, scientific and medical publications
         and public presentations relating to Joint Collaboration Patent Rights,
         Joint Collaboration Know How, ELAN Collaboration Patent Rights, CAT
         Collaboration Patent Rights, ELAN Collaboration Know How, CAT
         Collaboration Know How, the Research Program, Development Program, R&D
         Candidates, and/or Collaboration Products for review in connection with
         preservation of exclusive Patent Rights and/or to determine whether
         Confidential Information should be modified or deleted; provided,
         however, that after the approval of an academic, scientific or medical
         publication and/or public presentation has been given, then such Party
         shall not have to resubmit any such information for re-approval should
         it be republished or publicly disclosed in another form. Written copies
         of such proposed publications and presentations shall be submitted to
         the other Party no later than [***] before submission for publication
         or presentation and such other Party shall provide its comments with
         respect to such publications and presentations within [***] following
         its receipt of such written copy. Notwithstanding the foregoing, no
         such publication or presentation shall be made until such publication
         or presentation has been approved by each Party's respective patent
         counsel. ELAN and CAT will each comply with standard academic practice
         regarding authorship of scientific publications and recognition of
         contribution of other parties in any publications relating to the Joint
         Collaboration Patent Rights, Joint Collaboration Know How, ELAN
         Collaboration Patent Rights, CAT Collaboration Patent Rights, ELAN
         Collaboration Know How, CAT Collaboration Know How, Research Program,
         the Development Program, R&D Candidates, and/or Collaboration Products.

<PAGE>

                                      -60-

10.      REPRESENTATIONS AND WARRANTIES.

10.1     Representations and Warranties of Each Party{TC "10.1   Representations
         and Warranties of Each Party" \f C \1 "2"}. As of the Effective Date,
         each of ELAN and CAT hereby represents and warrants to the other Party
         hereto as follows:

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

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

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

         10.1.4   the execution, delivery and performance by such Party of this
                  Agreement and its compliance with the terms and provisions
                  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;

         10.1.5   its Patent Rights and Know How are existing and, to its
                  knowledge, are not invalid or unenforceable, in whole or in
                  part; and

         10.1.6   it has the full right, power and authority to grant all of the
                  right, title and interest in the licenses granted to the other
                  Party under this Agreement.

10.2     Additional Representations and Warranties of CAT{TC "10.2 Additional
         Representations and Warranties of CAT" \f C \1 "2"}. CAT hereby
         represents and warrants to ELAN that as of the Effective Date:

         10.2.1   Other than as provided for on Exhibit 1.15, CAT has the sole
                                                ------------
                  right, title and interest in and to the CAT Patents Rights
                  listed on such Exhibit 1.15;
                                 ------------

         10.2.2   no CAT Patent Rights are subject to, or were developed
                  pursuant to, any funding agreement with any government or
                  government agency, except as provided on Exhibit 1.15;
                                                           ------------

<PAGE>

                                      -61-

         10.2.3   CAT has disclosed to ELAN all patents owned or controlled by
                  Third Parties (except as licensed to CAT by such Third Parties
                  and except any such patents relating to antigens which are
                  screened as part of the Operation of the CAT Antibody Library)
                  of which CAT is aware and for which it may be necessary to
                  obtain Third Party Licenses for the Operation of the CAT
                  Antibody Library in accordance with Section 8.8. For the
                  purposes of this Section 10.2.3 "Operation of the CAT Antibody
                  Library" shall mean the screening of antigens against the CAT
                  Antibody Library and the isolation of single-chain Fv
                  fragments from the CAT Antibody Libary;

         10.2.4   CAT is not in breach of any material provisions of any
                  agreements with Third Parties (including without limitation
                  the CAT In-Licenses) relating to the CAT Patent Rights;

         10.2.5   to CAT's knowledge, as of the Effective Date, the total fees
                  due under the CAT In-Licenses for the activities currently
                  contemplated to be conducted by the Parties under this
                  Agreement is no more than [***] of the Net Sales of any
                  Collaboration Products;

         10.2.6   Except as scheduled on Exhibit 10.2.6, there is no claim,
                                         --------------
                  investigation, suit or proceeding pending or to the CAT's
                  knowledge there is no claim, investigation, suit, action or
                  proceeding pending or, to CAT's knowledge, expressly
                  threatened, against CAT or any Third Party before or by any
                  governmental entity, court or arbitrator that, individually or
                  in the aggregate, could reasonably be expected to (i)
                  materially impair the ability of CAT to perform any obligation
                  under this Agreement; (ii) prevent or materially delay or
                  alter the consummation of any or all of transactions
                  contemplated hereby or (iii) result in the payment of a
                  material sum by either CAT or ELAN as a result of any of the
                  activities contemplated under this Agreement;

         10.2.7   [***];

         10.2.8   Operation of the CAT Antibody Library is and shall be [***].

10.3     Additional Representations and Warranties of ELAN{TC "10.3 Additional
         Representations and Warranties of ELAN" \f C \1 "2"}. ELAN hereby
         represents and warrants to CAT that as of the Effective Date:

         10.3.1   ELAN has the sole right, title and interest in and to the ELAN
                  Patent Rights listed in Exhibit 1.41 to this Agreement;
                                          ------------

<PAGE>

                                      -62-

         10.3.2   No ELAN Patent Rights are subject to, or were developed
                  pursuant to any funding agreement with any government or
                  government agency, except as provided in Exhibit 1.41, to this
                                                           ------------
                  Agreement;

         10.3.3   ELAN is not in breach of any material provisions of any
                  agreements with Third Parties relating to the ELAN Patent
                  Rights; and

         10.3.4   Except as scheduled on Exhibit 10.3.4, there is no claim,
                                         --------------
                  investigation, suit or proceeding pending or to ELAN's
                  knowledge there is no claim, investigation, suit, action or
                  proceeding pending before or by any governmental entity, court
                  or arbitrator that, individually or in the aggregate, could
                  reasonably be expected to (i) materially impair the ability of
                  ELAN to perform any obligation under this Agreement; (ii)
                  prevent or materially delay or alter the consummation of any
                  or all of transactions contemplated hereby or (iii) result in
                  the payment of a material sum by either CAT or ELAN as a
                  result of any of the activities contemplated under this
                  Agreement.

         10.3.5   to ELAN's knowledge, the use of the ELAN Technology in the
                  Field does not infringe any patents owned or controlled by any
                  Third Party (except as licensed to ELAN by such Third Party);.

10.4     Representation by Legal Counsel{TC "10.4 Representation by Legal
         Counsel" \f C \1 "2"}. 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. 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.

10.5     No Inconsistent Agreements{TC "10.5 No Inconsistent Agreements" \f C \1
         "2"}. Neither Party has in effect and after the Effective Date neither
         Party shall enter into any oral or written agreement or arrangement
         that would be inconsistent with its obligations under this Agreement.

10.6     Disclaimer{TC "10.6 Disclaimer" \f C \1 "2"}. THE FOREGOING WARRANTIES
         OF EACH PARTY ARE IN LIEU OF ANY OTHER WARRANTIES, EXPRESS OR IMPLIED,
         INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF
         NON-INFRINGEMENT, ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR ANY
         IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE ALL OF WHICH ARE
         HEREBY SPECIFICALLY EXCLUDED AND DISCLAIMED.

<PAGE>

                                      -63-

11.      GOVERNMENT APPROVALS.

11.1     ELAN's and CAT's Obligations{TC "11.1 ELAN's and CAT's Obligations" \f
         C \1 "2"}. Each of ELAN and CAT 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.

11.2     Additional Approvals{TC "11.2 Additional Approvals" \f C \1 "2"}. ELAN
         and CAT 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 or
         out-license products or assets or materially change its business if
         doing so is a condition of obtaining governmental approvals of the
         transactions contemplated by this Agreement.

12.      TERM AND TERMINATION.

12.1     Term{TC "12.1 Term" \f C \1 "2"}. The term of this Agreement will
         commence on the Effective Date and, unless earlier terminated as
         provided in Article 13 or this Article 12, shall continue in full force
         and effect on a Collaboration Product-by-Collaboration Product and
         country-by-country basis for so long as any R&D Candidate is being
         Developed or any Collaboration Product is being sold under this
         Agreement. Notwithstanding the foregoing, the Research Term shall be as
         set forth in Section 5.1.2, unless this Agreement is properly
         terminated as provided for herein.

12.2     Termination for Cause{TC "12.2 Termination for Cause" \f C \1 "2"}.
         This Agreement may be terminated effective immediately by written
         notice by either Party at any time during the term of this Agreement
         for a continuing material breach or recurring material breaches by the
         other Party, which breach or breaches remain uncured for [***] in the
         case of nonpayment of any amount due (unless there exists a bona fide
         dispute as to whether such payment is owing, in which case the [***]
         period shall be tolled pending resolution of such dispute) and [***]
         for all other breaches, each measured from the date written notice of
         such breach is given to the breaching Party; pro-

<PAGE>

                                      -64-

         vided, however, that if such breach is not susceptible of cure within
         the stated period and the breaching Party uses diligent good faith
         efforts to cure such breach, the stated period will be extended by an
         additional [***]; provided, however, that there shall be no such
         extension in the case of any nonpayment of material amounts due except
         in the case of bona fide dispute as set out above. It is expressly
         understood and agreed that the failure by a Third Party Sublicensee to
         materially perform its obligations to a Party or the Parties, as the
         case may be, shall not relieve either Party from any obligations
         sublicensed to such Third Party. Either Party may exercise its rights
         pursuant to this Section 12.2 upon the failure of any permitted Third
         Party Sublicensee to perform any material duty subcontracted to it in
         accordance with the terms of Section 3.3. No failure by a Party to pay
         any sums due under Sections [***] shall constitute a basis for
         termination of this Agreement; provided, however, that such breach
         shall remain actionable as a breach of this Agreement or the applicable
         common law and the breaching Party shall be liable for the costs and
         expenses, including attorney's fees, of the non-breaching Party if a
         successful recovery or settlement is obtained for any breach.

12.3     Effect of a Termination for Cause on Licenses. {TC "12.3 Effect of a
         Termination for Cause on Licenses" \f C\1 "2"} If a Party (the
         "Terminating Party") terminates this Agreement pursuant to Section 12.2
         (for cause):

         12.3.1   all licenses granted by the Terminating Party to the other
                  Party hereunder, other than those with respect to any
                  Non-Antibody, Non-Antibody Product, CAT Exclusive Antibody
                  and/or Party Exclusive Product, will automatically terminate;
                  and

         12.3.2   all licenses granted by the other Party to the Terminating
                  Party will become fully paid up, irrevocable, perpetual,
                  royalty-free (other than royalties which may be due to Third
                  Parties in respect thereof which shall be borne by the
                  Terminating Party or such royalties as may be due with respect
                  to any Non-Antibody Product and/or Party Exclusive Product)
                  licenses; and

         12.3.3   the other Party will:

                  (a)   deliver up to the Terminating  Party any Know How and/or
                        materials  covering or directly related to the R&D
                        Candidates and Collaboration Products; and

                  (b)   deliver up to the Terminating Party any and all
                        quantities of Collaboration Product in its possession,
                        power, custody or control subject always to ELAN's right
                        to dispose of Collaboration Product which is the subject
                        of pre-termination date orders; and

<PAGE>

                                      -65-

         (c)     ensure that its patent attorneys transfer to the Terminating
                 Party the patent files relating to the Joint Collaboration
                 Patent Rights in respect of R&D Candidates and Collaboration
                 Products; and

         (d)     commensurate with legislative and regulatory requirements,
                 transfer to the Terminating Party or its nominee all Regulatory
                 Approvals and other regulatory filings for any Collaboration
                 Product. In the event that in any country such a transfer is
                 not possible, the other Party shall use reasonable endeavours
                 to ensure that the Terminating Party has the benefit of the
                 relevant regulatory filings and Regulatory Approvals and, to
                 this end, consents to any Regulatory Authority
                 cross-referencing to the data and information on file with any
                 Regulatory Authority as may be necessary to facilitate the
                 granting of second Regulatory Approvals or other filings and
                 approvals to the Terminating Party, and the other agrees to
                 complete whatever other procedures are reasonably necessary in
                 relation to the same to enable the Terminating Party (either
                 itself or in conjunction with a Third Party) freely to develop
                 and sell the Collaboration Product in substitution for the
                 other Party; and

         (e)     use its reasonable endeavors to assign to the Terminating Party
                 the benefit and burden of any agreement made between the other
                 Party and a Sublicensee in relation to Collaboration Product;
                 and

         (f)     assign all of the other Party's interest in any Trademarks
                 including the goodwill symbolized by such Trademark used for
                 Collaboration Product; and

         (g)     after the date of termination, cease to Develop, Manufacture,
                 have Manufactured, use, market, Distribute or sell R&D
                 Candidates or Collaboration Products during the life of the
                 Joint Collaboration Patent Rights except that where ELAN is the
                 other Party ELAN shall have the right to dispose of that part
                 of its inventory of Collaboration Product on hand as of the
                 effective date of termination which is the subject of orders
                 for Collaboration Product accepted prior to the effective date
                 of termination for a period of [***] after the effective date
                 of termination, and, within [***] after disposition of such
                 inventory pursuant to the fulfilment of such orders, ELAN will
                 forward to CAT a final report and pay CAT's share of Pro-Forma
                 Net Profits due to CAT for such period; and

         (h)     provide the Terminating Party with all reasonable assistance in
                 relation

<PAGE>

                                      -66-

                           to the appointment of a Third Party Manufacturer of
                           Collaboration Product; and

                  (i)      assign all of the other Party's interest in any
                           Copyrights necessary or useful for Commercializing
                           Collaboration Products; and

                  (j)      except as otherwise provided in Section 12.3.2, the
                           other Party will grant to the Terminating Party a
                           worldwide, non-exclusive license to those Patent
                           Rights within the Control of such other Party
                           necessary to Research, Develop, Manufacture or
                           Commercialize an R&D Candidate or Collaboration
                           Product; and

                  (k)      agree that, and, at the Terminating Party's option,
                           execute a release confirming such agreement, the
                           other Party will have no right to receive a share of
                           Pro-Forma Profits or any other payments which may
                           result from the sale of any Collaboration Product,
                           the occurrence of any event or the conduct of any
                           activity after the effective date of such
                           termination; provided, however, that the other Party
                           shall remain entitled to receive any payments that
                           accrued before the effective date of such
                           termination.

            Nothing in this Section 12.3, but subject to the other provisions of
            this Agreement, shall impact ELAN's exclusive ownership or, or
            exclusive right to, research, develop, manufacture, or commercialize
            any composition of matter other than an Antibody in the Field,
            including, without limitation, a Non-Antibody or CAT's exclusive
            ownership or, or exclusive right to, research, develop, manufacture,
            or commercialize CAT Exclusive Antibodies.

      12.4  Termination Pursuant to Section 12.2. {TC "12.4 Termination
            Pursuant to Section 12.2" \f C \1 "2"}. In the event of a
            termination under Section 12.2, then, notwithstanding any provision
            of this Agreement to the contrary, neither Party shall have any
            further obligation to the other Party with respect to the subject
            matter of this Agreement except for the obligations set forth in
            Articles 9, 14, 12 and 15 which obligations shall survive any
            termination of this Agreement. Notwithstanding the foregoing, if CAT
            shall be the Terminating Party, (i) the [***] sentence of Section
            [***] shall not be operative, (ii) ELAN shall not be obligated under
            [***] (iii) all of the provisions of Section 5.6.3 shall be stricken
            and replaced with the following provision: "For a period of ten (10)
            years after the first Commercial Sale of any CAT Exclusive Antibody,
            CAT shall be obligated to pay to ELAN a royalty of [***] of any
            Party Exclusive Product containing such a CAT Exclusive Antibody;
            provided, however, that ELAN shall have no rights pursuant to this
            Section 5.6.3 unless the applicable Anti

<PAGE>

                                      -67-

       body was previously identified upon the list required pursuant to Section
       5.6.1 and the other conditions of this Section are met." If ELAN is the
       Terminating Party, then ELAN shall not be obligated to offer to CAT the
       right to enter into a mutually exclusive collaboration arrangement under
       Section 5.6.2 and the royalty due to CAT under that provision shall be
       increased to [***].

12.5   Provisions For Change Of Control{TC "12.5      Provisions For Change Of
       Control" \f C \1 "2"}.

       12.5.1  Change Of Control Notice. A Party subject to a Change of Control
               (the "Acquired Party") shall provide written notice to the other
               Party (the "Non-Acquired Party") as soon as the impending Change
               of Control can be disclosed to the Non-Acquired Party. For the
               purposes of this Section 12.5, CAT shall mean only Cambridge
               Antibody Technology Group plc or Cambridge Antibody Technology
               Limited and ELAN shall mean Elan Corporation plc.

       12.5.2  Certain Rights Upon Change Of Control of CAT. Upon the receipt of
               the written notice required pursuant to Section 12.5.1 by ELAN,
               this Agreement may be terminated, effective immediately, upon the
               provision of written notice to CAT by ELAN; provided, however,
               that such written notice must be made within [***] of the receipt
               of notice of the Change of Control; and provided, further that
               termination for a Change of Control shall not apply to any [***]
               at the effective date of such termination unless the [***]. If
               ELAN elects to terminate this Agreement pursuant to this Section
               12.5.2, then ELAN shall have no further obligations to CAT and
               its obligations under this Agreement will discontinue (except in
               respect of any [***].

       12.5.3  Certain Rights Upon Change Of Control of ELAN. Upon the receipt
               of the written notice required pursuant to Section 12.5.1 by ELAN
               this Agreement may be terminated, effective immediately if within
               [***] of the receipt of notice of the Change of Control by CAT,
               ELAN and its Third Party successor in title does not provide a
               written confirmation reasonably satisfactory to CAT to the effect
               that: [***]. If CAT makes a proper election to terminate this
               Agreement pursuant to this Section 12.5.3 then this Agreement
               shall terminate (except in respect of any [***] at the effective
               date of such termination which shall continue unless [***], CAT
               shall have no further obligations to ELAN under this Agreement
               (except in respect of any R&D Candidates[***].

       12.5.4  [***]

12.6   Provision for Insolvency {TC "12.6 Provisions for Insolvency" \f C \1
       "2"}. .

<PAGE>

                                      -68-

      12.6.1   Termination. This Agreement may be terminated by notice by either
               Party at any time during the term of this Agreement upon the
               filing or institution of bankruptcy, reorganization, liquidation
               or receivership proceedings, or upon an assignment of a
               substantial portion of the assets for the benefit of creditors by
               the other Party, or in the event a receiver or custodian is
               appointed for such Party's business, or if a substantial portion
               of such Party's business is subject to attachment or similar
               process; provided, however, that in the case of any involuntary
               bankruptcy proceeding such right to terminate shall only become
               effective if the proceeding is not dismissed within [***] after
               the filing thereof.

      12.6.2   Effect of Termination for Insolvency. In the event either Party
               terminates this Agreement under Section 12.6.1 (the "Terminating
               Party") the Parties agree that the Terminating Party, as a
               licensee of rights to intellectual property under this Agreement,
               shall retain and may fully exercise all of its rights and
               obligations under this Agreement, including as set forth in
               Section 12.6.3

               (a)  Effect on Licenses. In the event of an insolvency of either
                    Party (the "Insolvent Party") under any applicable
                    insolvency statute (the "Insolvency Statute"), the Insolvent
                    Party agrees that the Terminating Party, as licensee of
                    intellectual property rights under this Agreement, shall
                    retain and may fully exercise all of its rights and
                    elections under this Section 12.6.2. The Insolvent Party
                    agrees that all rights and licenses granted under or
                    pursuant to this Agreement by the Insolvent Party to the
                    Terminating Party are licenses of rights to patents, patent
                    applications, copyrights, trade secrets and other
                    "intellectual property" within the meaning of such term or
                    its equivalent under any Insolvency Statute. The Insolvent
                    Party agrees during the term of this Agreement to create and
                    maintain current copies or, if not amenable to copying,
                    detailed descriptions or other appropriate embodiments, to
                    the extent feasible, of all such intellectual property. If a
                    case is commenced by or against the Insolvent Party under
                    the Insolvency Statute, unless and until this Agreement is
                    rejected by the Insolvency Statute trustee, the Insolvent
                    Party (in any capacity, including debtor-in-possession) and
                    its successors and assigns (including without limitation, a
                    trustee or examiner appointed pursuant to the Insolvency
                    Statutes) shall, as the Terminating Party may elect in a
                    written request, immediately upon such request:

                    (i)  perform all of the obligations provided in this
                         Agreement to be performed by the Insolvent Party
                         including, where applicable

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                                      -69-

                         and without limitation, providing the Terminating Party
                         portions of such intellectual property (including
                         embodiments thereof) held by the Insolvent Party and
                         such successors and assigns or otherwise available to
                         them; or

                    (ii) provide to the Terminating Party all such intellectual
                         property (including all embodiments thereof) held by
                         the Insolvent Party and such successors and assigns or
                         otherwise available to them.

        12.6.3 Rights to Intellectual Property.

               (a)  The Insolvent Party agrees that it will not (a) terminate or
                    reject this Agreement or (b) assign or sell the intellectual
                    property licensed hereunder without the Terminating Party's
                    written consent.

               (b)  If this Agreement is rejected or breached by the Insolvent
                    Party or any successor, and the Terminating Party elects to
                    retain its rights hereunder, then the Insolvent Party (in
                    any capacity, including debtor-in-possession) and its
                    successors and assigns (including, without limitation, an
                    Insolvency Statute trustee) shall provide to the Terminating
                    Party all such intellectual property (including all
                    embodiments thereof) held by the Terminating Party and such
                    successors and assigns, or otherwise available to them,
                    immediately upon the Terminating Party's written request.
                    Whenever the Insolvent Party or any of its successors or
                    assigns provides to the Terminating Party any of the
                    intellectual property licensed hereunder (or any embodiment
                    thereof) pursuant to this Section, the Terminating Party
                    shall have the right to perform the obligations of the
                    Insolvent Party hereunder with respect to such intellectual
                    property, but neither such provision nor such performance by
                    the Terminating Party shall release the Insolvent Party from
                    any such obligation or liability for failing to perform it.

        12.6.4 The Terminating Party's Rights. All rights, powers and remedies
               of the Terminating Party provided herein are in addition to and
               not in substitution for any and all other rights, powers and
               remedies now or hereafter existing at law or in equity
               (including, without limitation, the Insolvency Statute) in the
               event of the commencement of an Insolvency Statute case by or
               against the Insolvent Party. The Terminating Party, in addition
               to the rights, power and remedies expressly provided herein,
               shall be entitled to exercise all other such rights and powers
               and resort to all other such remedies as may now or hereafter
               exist at law or in equity (including, without limitation, the
               Insolvency Statute) in such

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                                      -70-

               event. The Parties agree that they intend the foregoing
               Terminating Party rights to extend to the maximum extent
               permitted by law, including, without limitation, for purposes of
               the Insolvency Statute:

               (a)  the right of access to any intellectual property (including
                    all embodiments thereof) of the Insolvent Party, or any
                    Third Party with whom the Insolvent Party contracts to
                    perform an obligation of the Insolvent Party under this
                    Agreement, and, in the case of the Third Party, which is
                    necessary for the Research, Development, Manufacture and
                    commercialization of Collaboration Products; and

               (b)  the right to contract directly with any Third Party
                    described in (a) to complete the contracted work.

        12.6.5 Deemed Grant of Rights. In the event of any insolvency of the
               Insolvent Party and if any statute and/or regulation in any
               country in the Territory requires that there be a specific grant
               or specific clause(s) in order for the Terminating Party to
               obtain the rights and benefits as licensee under this Agreement,
               then this Agreement shall be deemed to include any and all such
               required grant(s), clause(s) and/or requirements.

12.7    Survival of Certain Obligations. Expiration or termination of this
        Agreement shall not relieve the Parties of any obligation accruing
        before such expiration or termination, and the provisions of Articles 9,
        14, 12 and 15 shall survive the expiration of the Agreement. Any
        expiration or early termination of this Agreement shall be without
        prejudice to the rights of either Party against the other accrued or
        accruing under this Agreement before termination, including, without
        limitation, the obligation to distribute Pro-Forma Net Profits for
        Collaboration Product(s) sold before such termination.

13.     WITHDRAWAL TO A ROYALTY POSITION

13.1    Right to Terminate{TC "13.1 Right to Terminate" \f C\1 "2"}.

        13.1.1 ELAN may terminate this Agreement on sixty (60) days written
               notice to CAT at any time after the second anniversary of the
               commencement of the Research Term; or

        13.1.2 CAT may terminate this Agreement during the Research Term on
               sixty (60) days written notice to ELAN, such notice to be
               effective on the third anniversary of the commencement of the
               Research Term; or

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                                      -71-

        13.1.3 Notwithstanding Sections 13.1.1 and 13.1.2, either Party may
               terminate this Agreement on an R&D Candidate-by-R&D Candidate or
               a Collaboration Product-by-Collaboration Product basis (as the
               case may be) upon thirty (30) days prior written notice to the
               other Party;

        13.1.4 any termination under Sections 13.1.1, 13.1.2 or 13.1.3 shall be
               a "Termination for Convenience" and the provisions of Sections
               13.2 or 13.3, as applicable, and Section 13.4 shall apply.

13.2    Effect of Termination for Convenience by ELAN{TC "13.2" Effect of
        Termination for Convenience by ElAN"\f C\1 "2"}. If ELAN elects to
        effect a Termination for Convenience:

        13.2.1 A license under the ELAN Intellectual Property and the ELAN
               Technology, limited in scope so as to solely permit CAT to, as
               applicable, continue to Research, Develop, Manufacture and
               Commercialize the R&D Candidate and/or Collaboration Product
               subject to the ELAN Termination for Convenience shall be granted,
               and, as so limited, will become fully paid up, irrevocable,
               perpetual and royalty-free (other than royalties which may be due
               to Third Parties or under Section 13.4);

        13.2.2 all licenses, except as provided for in Section 13.6, with
               respect to the applicable R&D Candidate which have or are to be
               granted to ELAN will automatically terminate;

        13.2.3 ELAN will:

               (a)  deliver up to CAT any Know How and/or materials covering or
                    directly related to any R&D Candidate and Collaboration
                    Product which is the subject to the Termination for
                    Convenience; and

               (b)  deliver up to CAT any and all quantities of applicable
                    Collaboration Product in its possession, power, custody or
                    control, subject always to ELAN's right to dispose of
                    Collaboration Product which is the subject of
                    pre-termination date orders pursuant to Section 13.2.3(g);
                    and

               (c)  ensure that its patent attorneys transfer to the patent
                    files relating to the Joint Collaborating Patent Rights in
                    respect of any applicable R&D Candidates and Collaboration
                    Products; and

               (d)  commensurate with legislative and regulatory requirements,
                    transfer to

<PAGE>

                                      -72-

                    CAT or its nominee all Regulatory Approvals and other
                    regulatory filings for any Collaboration Product for which
                    an ELAN termination has been made. In the event that in any
                    country such a transfer is not possible, ELAN shall use
                    reasonable endeavours to ensure that CAT has the benefit of
                    the relevant regulatory filings and Regulatory Approvals
                    and, to this end, consents to any Regulatory Authority
                    cross-referencing to the data and information on file with
                    any Regulatory Authority as may be necessary to facilitate
                    the granting of second Regulatory Approvals or other filings
                    and approvals to CAT, and the other agrees to complete
                    whatever other procedures are reasonably necessary in
                    relation to the same to enable CAT (either itself or in
                    conjunction with a Third Party) freely to develop and sell
                    the applicable Collaboration Product in substitution for
                    ELAN; and

               (e)  use its reasonable endeavours to assign to CAT the benefit
                    and burden of any agreement made between ELAN and a
                    Sub-Licensee in relation to the applicable Collaboration
                    Product; and

               (f)  assign all of ELAN's interest in any Trademarks including
                    the goodwill symbolized by such Trademark used for any
                    applicable Collaboration Product; and

               (g)  after the date of termination, not Develop, Manufacture,
                    have manufactured, use, market, distribute or sell any R&D
                    Candidate or Collaboration Product subject to an ELAN
                    Termination for Convenience during the life of the Joint
                    Collaboration Patent Rights except that ELAN shall have the
                    right to dispose of that part of its inventory of any
                    applicable Collaboration Product on hand as of the effective
                    date of termination which is the subject of orders for such
                    Collaboration Product accepted prior to the effective date
                    of termination for a period of [***] after the effective
                    date of termination, and, within [***] after disposition of
                    such inventory pursuant to the fulfilment of such orders,
                    ELAN will forward to CAT a final report and pay CAT's share
                    of Pro Forma Net Profits due to CAT for such period; and

               (h)  provide CAT with all reasonable assistance in relation to
                    the appointment of a Third Party Manufacturer of applicable
                    Collaboration Product; and

               (i)  assign all of ELAN's interest in any Copyrights necessary or
                    useful or Commercializing such Collaboration Products; and

<PAGE>

                                      -73-

               (j)  execute such releases and waivers as may be required to
                    discharge CAT from its obligations to ELAN, other than as
                    otherwise provided for in this Section and Sections 13.4,
                    13.5 and 13.6, under this Agreement with respect to an R&D
                    Candidate or Collaboration Product subject to a Termination
                    for Convenience.

        13.2.4 ELAN will have no right to receive a share of Pro-Forma Net
               Profit which may result from the sale of any Collaboration
               Product as to which an ELAN Termination for Convenience has been
               made, the occurrence of any event or the conduct of any activity
               after the effective date of such termination; provided, however,
               that (i) ELAN shall remain entitled to receive any payments that
               accrued before the effective date of such termination, and (ii)
               CAT shall pay ELAN the sums set out in Section 13.4.

        13.2.5 For the avoidance of doubt, ELAN shall not be obligated to, and
               none of the licenses granted pursuant to this Section 13.2 shall
               include, a license to practice the ELAN Intellectual Property
               with respect to any composition of matter, including without
               limitation, a Non-Antibody, other than an Antibody inside or
               outside the Field.

13.3    Effect of Termination for Convenience by CAT{TC "13.3 Effect of
        Termination for Convenience by CAT"\f C\1 "2"}. If CAT elects to effect
        a Termination for Convenience:

        13.3.1 A license under the CAT Intellectual Property and to the CAT
               Technology, limited in scope so as to solely permit ELAN to, as
               applicable, continue to Research, Develop, Manufacture and
               Commercialize the R&D Candidate and/or Collaboration Product
               subject to the CAT Termination for Convenience shall be granted,
               and, as so limited, will become fully paid up, irrevocable,
               perpetual and royalty-free (other than royalties which may be due
               to Third Parties or under Section 13.4);

        13.3.2 all licenses, except as provided for in Section 13.6, with
               respect to the applicable R&D Candidate which have or are to be
               granted to CAT will automatically terminate;

        13.3.3 CAT will:

               (a)  deliver up to ELAN any Know How and/or materials covering or
                    directly related to the R&D Candidate and Collaboration
                    Product which is the subject of this Article 13; and

<PAGE>

                                      -74-

          (b)  deliver up to ELAN any and all quantities of applicable
               Collaboration Product in its possession, power, custody or
               control subject always to CAT's right to dispose of Collaboration
               Product which is the subject of pre-termination date orders
               pursuant to Section 13.3.3(g); and

          (c)  ensure that its patent attorneys transfer to the patent files
               relating to the Joint Collaborating Patent Rights in respect of
               any applicable R&D Candidates and Collaboration Products; and

          (d)  commensurate with legislative and regulatory requirements,
               transfer to ELAN or its nominee all Regulatory Approvals and
               other regulatory filings for any Collaboration Product for which
               a CAT termination has been made. In the event that in any country
               such a transfer is not possible, CAT shall use reasonable
               endeavours to ensure that ELAN has the benefit of the relevant
               regulatory filings and Regulatory Approvals and, to this end,
               consents to any Regulatory Authority cross-referencing to the
               data and information on file with any Regulatory Authority as may
               be necessary to facilitate the granting of second Regulatory
               Approvals or other filings and approvals to ELAN, and the other
               agrees to complete whatever other procedures are reasonably
               necessary in relation to the same to enable ELAN (either itself
               or in conjunction with a Third Party) freely to develop and sell
               the applicable Collaboration Product in substitution for CAT; and

          (e)  use its reasonable endeavours to assign to ELAN the benefit and
               burden of any agreement made between CAT and a Sub-Licensee in
               relation to the applicable Collaboration Product; and

          (f)  assign all of CAT's interest in any Trademarks including the
               goodwill symbolized by such Trademark used for any applicable
               Collaboration Product; and

          (g)  after the date of termination not Develop, Manufacture, have
               manufactured, use, market, distribute or sell any R&D Candidate
               or Collaboration Product subject to a CAT Termination for
               Convenience during the life of the Joint Collaboration Patent
               Rights except that CAT shall have the right to dispose of that
               part of its inventory of any applicable Collaboration Product on
               hand as of the effective date of termination which is the subject
               of orders for such Collaboration Product accepted prior to the
               effective date of termination for a period of [***] after the
               effective date of termination, and, within [***] after
               disposition of such inven-

<PAGE>

                                      -75-

                    tory pursuant to the fulfilment of such orders, CAT will
                    forward to ELAN a final report and pay ELAN's share of Pro
                    Forma Net Profits due to ELAN for such period; and

               (h)  provide ELAN with all reasonable assistance in relation to
                    the appointment of a Third Party Manufacturer of applicable
                    Collaboration Product; and

               (i)  assign all of CAT's interest in any Copyrights necessary or
                    useful or Commercializing such Collaboration Products; and

               (j)  execute such releases and waivers as may be required to
                    discharge CAT from its obligations to ELAN, other than as
                    otherwise provided for in this Section and Sections 13.4,
                    13.5 and 13.6, under this Agreement with respect to an R&D
                    Candidate or Collaboration Product subject to a Termination
                    for Convenience.

        13.3.4 CAT will have no right to receive a share of Pro-Forma Net
               Profit which may result from the sale of any Collaboration
               Product as to which a CAT Termination for Convenience has been
               made, the occurrence of any event or the conduct of any activity
               after the effective date of such termination; provided, however,
               that (i) CAT shall remain entitled to receive any payments that
               accrued before the effective date of such termination, and (ii)
               ELAN shall pay CAT the sums set out in Section 13.4.

        13.3.5 For the avoidance of doubt, CAT shall not be obligated to, and
               none of the licenses granted pursuant to this Section 13.3 shall
               include, a license to practice the CAT Intellectual Property with
               respect to any composition of matter, including without
               limitation, a Non-Antibody, other than an Antibody inside or
               outside the Field.

13.4    Payments{TC "13.4 Payments"\f C\1 "2"}. In the event that a Party elects
        to effect a Termination for Convenience pursuant to Section under
        Section 13.1 then Section 13.2 or Section 13.2, as applicable shall
        apply and the non-terminating Party shall thereafter pay the terminating
        Party the following sums (on a R&D Candidate-by-R&D Candidate or
        Collaboration Product-by-Collaboration Product basis) dependent upon the
        point of Research and/or Development and/or Commercialization of the R&D
        Candidate and/or Collaboration Product at the time of such termination,
        as follows:

        13.4.1 If such Termination for Convenience occurs during the Research
               Term or prior to the filing of an IND for the applicable R&D
               Candidate, then the non-

<PAGE>

                                      -76-

               terminating Party shall pay to the terminating Party a royalty of
               [***] of the Net Sales of any Collaboration Product containing
               such R&D Candidate until the tenth anniversary of the First
               Commercial Sale in the Field of such Collaboration Product in any
               Major Market Country.

        13.4.2 If such termination occurs after the filing of an IND for the
               relevant R&D Candidate but [***] the non-terminating Party shall
               pay the terminating Party (on an R&D Candidate-by-R&D Candidate
               basis):

               (a)  subject to the provisions of Section 13.5, a royalty of
                    [***] of the Net Sales of any Collaboration Product
                    containing such R&D Candidate until the tenth anniversary of
                    the First Commercial Sale in the Field of such Collaboration
                    Product in any Major Market Country; and

               (b)  [***] upon receipt of Regulatory Approval for any
                    Collaboration Product containing such R&D Candidate;
                    provided, however, that [***] of such milestone payments
                    shall be creditable by the non-terminating Party against the
                    royalty on Net Sales payable pursuant to Section 13.4.1 (a)
                    above.

        13.4.3 If such termination occurs at any time between [***] the
               non-terminating Party shall pay the terminating Party (on an R&D
               Candidate-by-R&D Candidate basis):

               (a)  subject to the provisions of Section 13.5, a royalty of
                    [***] of the Net Sales of any Collaboration Product
                    containing such R&D Candidate until the tenth anniversary of
                    the First Commercial Sale in the Field of such Collaboration
                    Product in any Major Market Country: and

               (b)  [***] upon receipt of Regulatory Approval for any
                    Collaboration Product containing such R&D Candidate;
                    provided, however, that [***] of the milestone payment
                    payable hereunder shall be creditable by the non-terminating
                    Party against the royalty on Net Sales payable pursuant to
                    the Section 13.4.3 (a) above.

        13.4.4 After [***] a Termination for Convenience may only be effected
               within sixty (60) days from the date on which:

               (i)  the JSC approves any increase to the budget for [***] in
                    excess of [***]; or

<PAGE>

                                      -77-

               (ii)  final data obtained from [***] becomes available to the
                     Parties following completion of [***]; or

               (iii) any increase to the post [***] budget in excess of [***] is
                     approved by the JSC following receipt of the data in
                     respect of such [***] as set out in (ii) above,

               and the non-terminating Party shall pay the terminating Party (on
               an R&D Candidate-by-R&D Candidate basis):

               (a)   until the [***] the point on which Net Profit (as defined
                     in Section 13.7) is attributable to the first Collaboration
                     Product containing such R&D Candidate (the "Profitability
                     Point") and subject to Section 13.5, a royalty of [***] of
                     the Net Sales of such Collaboration Product until the tenth
                     anniversary of the First Commercial Sale in the Field of
                     such Collaboration Product in any Major Market Country; and

               (b)   after the Profitability Point the repayment, in [***]
                     equal, annual tranches, of the sums expended by the
                     terminating Party on the [***] on the relevant R&D
                     Candidate in accordance with the applicable budget; and

               (c)   after the [***] of the Profitability Point (notwithstanding
                     the fact that Net Profit attributable to such Collaboration
                     Product may become negative thereafter in which case any
                     payments due hereunder shall be accrued) and subject to the
                     provisions of Section 13.5, a royalty of [***] of the Net
                     Sales of any Collaboration Product until the tenth
                     anniversary of the First Commercial Sale in the Field of
                     such Collaboration Product in any Major Market Country; and

               (d)   [***] upon receipt of Regulatory Approval for a
                     Collaboration Product containing such R&D Candidate;
                     provided, however, that such amount shall be reduced by any
                     amounts due under Section 13.4.4 (b) above and [***] of the
                     milestone payment payable hereunder shall be creditable by
                     the non-terminating Party against any royalty payable with
                     respect to Net Sales pursuant to Section 13.4.4 (a) or (c),
                     as the case may be; and

        13.4.5 A Termination for Convenience may only be effected after the
               first BLA filing for the relevant R&D Candidate within [***] of
               the JSC approving the first Post BLA Filing Plan containing a
               Post BLA Filing Budget for that R&D Can-

<PAGE>

                                      -78-

               didate and the non-terminating Party shall pay the terminating
               Party (on an R&D Candidate-by-R&D Candidate basis):

               (a)  until the first anniversary of the Profitability Point of
                    the Collaboration Product containing such R&D Candidate and
                    subject to the provisions of Section 13.5, a royalty of
                    [***] of the Net Sales of such Collaboration Product until
                    the tenth anniversary of the First Commercial Sale in the
                    Field of such Collaboration Product in any Major Market
                    Country; and

               (b)  after the Profitability Point the repayment, in [***] equal,
                    annual tranches, of the sums expended by the terminating
                    Party on the [***] on such R&D Candidate in accordance with
                    the applicable budget; and

               (c)  after the first anniversary of the Profitability Point
                    (notwithstanding the fact that Net Profit attributable to
                    such Collaboration Product may become negative thereafter in
                    which case any payments due hereunder shall be accrued) and
                    subject to the provisions of Section 13.5, a royalty of
                    [***] of the Net Sales of such Collaboration Product until
                    the tenth anniversary of the First Commercial Sale in the
                    Field of such Collaboration Product in any Major Market
                    Country.

13.5    Royalty Cost Adjustment{TC "13.5 Royalty Cost Adjustment" {f C\1 "2"}.
        For the purposes of Section 13.4, all payments due Third Parties in
        respect of Collaboration Products sold by the non-terminating Party
        shall be the responsibility of the non-terminating Party and shall be in
        addition to any payments made to the Terminating Party hereunder.

13.6    Survival of Obligations{TC "13.6 Survival of Obligations" \f C\1 "2"}.
        Upon a Termination for Convenience by either Party, except as provided
        for with respect to each specific R&D Candidate subject to such a
        termination, all of the other Party's obligations shall survive and
        shall not be modified in any manner. For the avoidance of doubt, all
        licenses, rights, grants and obligations granted to and among the
        Parties relating to R&D Candidates and Collaboration Products not
        subject to a Termination for Convenience, Non-Antibodies, Non-Antibody
        Products, CAT Exclusive Antibodies, Party Exclusive Products and Hybrid
        R&D Candidates shall remain in full force and effect. In addition, upon
        a Termination for Convenience by either Party as provided herein the
        Terminating Party shall be responsible for its share of the Third Party
        Development Costs contained in the then applicable Annual Research
        Budget, Annual Development Budget or Post BLA Filing Annual Budget and
        actually incurred by the non-terminating Party at any time following
        such termination.

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                                      -79-

13.7    Net Profit{TC "13.7 Net Profit" f C\1"2"}. For the purposes of Section
        13.4, Net Profit shall be calculated in the same way as Pro-Forma Net
        Profit (as set out in Section 1.82) except that Reimbursable Commercial
        Costs shall not include any Development Costs, Ongoing Development Costs
        or Research Expenses incurred by the non-terminating Party in respect of
        the relevant R&D Candidate prior to a Termination for Convenience.

13.8    Withdrawal Royalty Stacking Provision{TC "13.8 Withdrawal Royalty
        Stacking Provision" f C\1 "2"}. If the amount of Third Party License
        Fees or other obligations required to paid to a Third Party to
        Commercialize any Product subject to the provisions of Section 13.4 and
        13.5 and the amounts to be paid pursuant to Section 13.4 exceed an
        amount equal to [***] of the Net Sales of such Product, then the
        royalties payable under Section 13.4 shall be reduced by the dollar
        amount of the Third Party License Fees or other consideration paid to
        such a Third Party; provided, however, that the maximum amount of any
        such reduction shall not result in a reduction of any royalty due to the
        other Party to an amount below [***] of the Net Sales of any Product as
        to which such a royalty is due pursuant to Section 13.4. The provisions
        of this Section 13.8 shall not apply to the first [***] of the royalty
        payable under Section 13.4.4(c) or the first [***] of the royalty
        payable under Section 13.4.5(c) and such [***] shall always be payable,
        where applicable, in addition to the [***] royalty floor referred to
        herein.

14.     PRODUCT LIABILITY, INDEMNIFICATION AND INSURANCE.

14.1    Sharing of Collaboration Product Liability Expenses{TC "14.1 Sharing of
        Collaboration Product Liability Expenses" f C\1 "2"}. Except where
        proximately caused by the gross negligence or wilful misconduct of a
        Party seeking reimbursement, the Parties shall share, on an equal basis,
        all losses, damages, liabilities, settlements, penalties, fines and
        expenses (including, without limitation, reasonable attorneys' fees and
        expenses) arising out of or caused by (a) the Manufacture of a
        Collaboration Product; (b) the death or bodily injury of any person on
        account of the use of a Collaboration Product; and/or (c) any recall or
        withdrawal of a Collaboration Product (collectively, "Collaboration
        Product Liability Claims").

14.2    Indemnification by CAT{TC "14.2 Indemnification by CAT" f C\1 "2"}. CAT
        will indemnify, defend and hold harmless ELAN, its Affiliates,
        sublicensees, distributors, and each of its and their respective
        employees, officers, directors and agents (each, an "ELAN Indemnified
        Party") from and against any and all liability, loss, damage, expense
        (including reasonable attorneys' fees and expenses) and cost (collec-

<PAGE>

                                      -80-

         tively, a "Liability") that the ELAN Indemnified Party may be required
         to pay to one or more Third Parties resulting from or arising out of:

         (a)    any claims of any nature, other than Collaboration Product
                Liability Claims or claims by Third Parties asserting patent
                infringement unrelated to the CAT Technology and/or the CAT
                Intellectual Property, arising out of the conduct of the
                Research Program, the Development Program, or the
                Commercialization of Collaboration Products and/or Party
                Exclusive Products by, on behalf of, or under the authority of
                CAT (other than by ELAN);

         (b)    any CAT representation or warranty set forth herein being untrue
                in any material respect when made; and/or

         (c)    any Collaboration Product Liability Claims proximately caused
                [***];

         except in each case, to the extent caused by the gross negligence or
         wilful misconduct of ELAN or any ELAN Indemnified Party.
         Notwithstanding the foregoing, CAT shall have no obligation to defend,
         indemnify or hold harmless any ELAN Indemnified Party from and against
         any Liability arising out of or resulting from the infringement of a
         Third Party patent.

14.3     Indemnification by ELAN{TC "14.3 Indemnification by ELAN" \f C \1 "2"}.
         ELAN will indemnify, defend and hold harmless CAT, its Affiliates, and
         each of its and their respective employees, officers, directors and
         agents (each, a "CAT Indemnified Party") from and against any and all
         Liabilities that the CAT Indemnified Party may be required to pay to
         one or more Third Parties arising out of:

         (a)    any claims of any nature, other than Collaboration Product
                Liability Claims or claims by Third Parties asserting patent
                infringement unrelated to the ELAN Technology and/or the ELAN
                Intellectual Property, arising out of the conduct of the
                Research Program , the Development Program, or the
                Commercialization of Collaboration Products, Party Exclusive
                Products or a Non-Antibody Product by, on behalf of, or under
                the authority of ELAN (other than by CAT);

         (b)    any ELAN representation or warranty set forth herein being
                untrue in any material respect when made; and/or

         (c)    any Collaboration Product Liability Claims proximately caused by
                [***];

         except in each case, to the extent caused by the gross negligence or
         wilful misconduct of CAT or any CAT Indemnified Party. Notwithstanding
         the foregoing, ELAN shall

<PAGE>

                                      -81-

         have no obligation to defend, indemnify or hold harmless any CAT
         Indemnified Party from and against any Liability arising out of or
         resulting from the infringement of a Third Party patent.

14.4     Procedure{TC "14.4 Procedure" \f C \1 "2"}. Each Party will notify the
         other in the event it becomes aware of a claim for which
         indemnification may be sought hereunder. In case any proceeding
         (including any governmental investigation) shall be instituted
         involving any Party in respect of which indemnity may be sought
         pursuant to this Article 14, such Party (the "Indemnified Party") shall
         promptly notify the other Party (the "Indemnifying Party") in writing
         and the Indemnifying Party and Indemnified Party shall meet to discuss
         how to respond to any claims that are the subject matter of such
         proceeding. The Indemnifying Party, upon request of the Indemnified
         Party, shall retain counsel reasonably satisfactory to the Indemnified
         Party to represent the Indemnified Party and shall pay the fees and
         expenses of such counsel related to such proceeding. In any such
         proceeding, the Indemnified Party shall have the right to retain its
         own counsel, but the fees and expenses of such counsel shall be at the
         expense of the Indemnified Party unless (i) the Indemnifying Party and
         the Indemnified Party shall have mutually agreed to the retention of
         such counsel or (ii) the named parties to any such proceeding
         (including any impleaded parties) include both the Indemnifying Party
         and the Indemnified Party and representation of both Parties by the
         same counsel would be inappropriate due to actual or potential
         differing interests between them. All such fees and expenses shall be
         reimbursed as they are incurred. The Indemnifying Party shall not be
         liable for any settlement of any proceeding effected without its
         written consent, but if settled with such consent or if there be a
         final judgment for the plaintiff, the Indemnifying Party agrees to
         indemnify the Indemnified Party from and against any loss or liability
         by reason of such settlement or judgment. The Indemnifying Party shall
         not, without the written consent of the Indemnified Party, effect any
         settlement of any pending or threatened proceeding in respect of which
         the Indemnified Party is, or arising out of the same set of facts could
         have been, a party and indemnity could have been sought hereunder by
         the Indemnified Party, unless such settlement includes an unconditional
         release of the Indemnified Party from all liability on claims to which
         the indemnity relates that are the subject matter of such proceeding.

14.5     Insurance{TC "14.5 Procedure" \f C \1 "2"}. Each Party further agrees
         to use its reasonable efforts to obtain and maintain, during the term
         of this Agreement, Commercial General Liability Insurance, including
         Collaboration Products Liability Insurance, with reputable and
         financially secure insurance carriers to cover its indemnification
         obligations under Sections 14.2 or 14.3, as applicable, or
         self-insurance, with limits of not less than [***] per occurrence and
         in the aggregate.

<PAGE>

                                      -82-

15.      DISPUTE RESOLUTION.

15.1     Disputes{TC "15.1   Disputes" \f C \1 "2"}. The Parties recognize that
         disputes as to certain matters may from time to time arise during the
         term of this Agreement which relate to either Party's rights and/or
         obligations hereunder. Each Party shall continue to perform its
         obligations under this Agreement pending final resolution of any
         dispute arising out or relating to this Agreement. It is the objective
         of the Parties to establish procedures to facilitate the resolution of
         disputes arising under this Agreement in an expedient manner by mutual
         cooperation and without resort to litigation. To accomplish this
         objective, the Parties agree to follow the procedures set forth in this
         Article 15 if and when a dispute arises under this Agreement. Unless
         otherwise specifically recited in this Agreement, disputes among
         members of the Joint Project Team will be submitted [***]. Such
         submission shall occur within twenty (20) days of the date of the last
         meeting at which the Joint Project Team was unable to resolve the
         issue. [***]. Each Party shall be responsible for the expenses incurred
         by its decision-making individual in attending or otherwise
         participating in such meetings. If within [***] of any meeting between
         [***] a resolution of the deferred matter has not been reached, then
         the applicable provisions of Article 15.2 may be invoked.

15.2     Discretionary Dispute Resolution{TC "15.2   Discretionary Dispute
         Resolution" \f C \1 "2"}. For all disputed matters referred to the
         senior level decision-makers specified in Article 15.1 which are not
         resolved thereunder, [***]. A Party seeking to exercise its rights
         under this Article 15.2 shall provide written notice to the other Party
         within [***] of the date specified in the next to last sentence of
         Article 15.1, with the written resolution of such matter being provided
         to the other Party five (5) days thereafter

15.3     Discretionary Dispute Resolution{TC "15.3 Discretionary Dispute
         Resolution" \f C \1 "2"}. Jurisdiction. For the purposes of this
         Article 15, the Parties agree to accept the non-exclusive jurisdiction
         of the federal courts located in the Southern District of New York for
         the purposes of enforcing the agreements or resolutions of disputes
         reflected in this Article.

15.4     Determination of Patent Disputes{TC "15.4 Determination of Patent
         Disputes" \f C \1 "2"}. Where so indicated, a dispute between the
         Parties or arising out of operation of the JPC shall first be referred
         to the JSC who shall retain independent patent counsel with appropriate
         national specific expertise who shall render a binding determination of
         the dispute. All other disputes regarding matters arising out or
         relating to either Party's Patent Rights shall be subject solely to the
         jurisdiction of the applicable national court respecting the Patent
         Right as to which such a dispute exists.

<PAGE>

                                      -83-

16.      ASSIGNMENTS; CHANGES OF CONTROL.

16.1     Assignments{TC "16.1     Assignments" \f C \1 "2"}. Neither this
         Agreement nor any right or obligation hereunder may be assigned or
         delegated, in whole or part, by either Party without the prior express
         written consent of the other, except as expressly set forth below in
         this Section 15.1. Notwithstanding the foregoing, either Party may,
         without the written consent of the other Party, assign this Agreement
         and its rights and delegate its obligations hereunder to any of its
         Affiliates or to a Third Party in connection with the transfer or sale
         of all or substantially all of its business relating to the subject
         matter of this Agreement (provided that any such assignment to a Third
         Party shall be deemed a Change in Control of the assigning Party for
         purposes of Section 12.5).

17.      MISCELLANEOUS.

17.1     Further Actions{TC "17.1   Further Actions" \f C \1 "2"}. Each Party
         agrees to execute, acknowledge and deliver such further instruments,
         and to do all such other acts, as may be necessary or appropriate in
         order to carry out the purposes and intent of this Agreement.

17.2     Force Majeure{TC "17.2   Force Majeure" \f C \1 "2"}. Nonperformance of
         a Party (other than for the payment of money) shall be excused to the
         extent that performance is rendered impossible by strike, fire,
         earthquake, flood, governmental acts or orders or restrictions, failure
         of suppliers, or any other reason where failure to perform, is beyond
         the reasonable control and not caused by the negligence, intentional
         conduct or misconduct of the nonperforming Party. The nonperforming
         Party shall notify the other Party promptly should such circumstances
         arise, giving an indication of the likely extent and duration thereof,
         and shall use all reasonable efforts to resume performance of its
         obligations as soon as practicable; provided, however, that neither
         Party shall be required to settle any labor dispute or disturbance.

17.3     Notices{TC "17.3 Notices" \f C \1 "2"}. All requests and notices
         required or permitted to be given to the Parties hereto shall be given
         in writing, shall expressly reference the section(s) of this Agreement
         to which they pertain, and shall be delivered to the other Party, and
         shall be deemed given if delivered personally or by facsimile
         transmission (receipt verified), mailed by registered or certified mail
         (return receipt requested), postage prepaid, or sent by nationally
         recognized express courier service, to the Parties, at the appropriate
         address as set forth below or to such other addresses as may be
         designated in writing by the Parties from time to time during the term
         of this Agreement:

<PAGE>

                                      -84-

               All correspondence to CAT shall be addressed as follows:

               Cambridge Antibody Technology Limited
               The Science Park
               Melbourn SG8 6JJ
               Cambridgeshire, England
               Attention:  Company Secretary
               Fax: 44-1763-263413

               All correspondence to ELAN shall be addressed as follows:

               Elan Corporation, plc
               Lincoln House
               Lincoln Place
               Dublin 2, Ireland
               Attn:  Chief Executive Officer
               Fax: 011-35-31-709-4810

               with a copy to:

               Elan Pharmaceuticals, Inc.
               800 Gateway Blvd.
               South San Francisco, CA 94080
               Attn:  General Counsel
               Fax: (650) 875-3620

17.4     Amendment{TC "17.4 Amendment" \f C \1 "2"}. No amendment, modification
         or supplement of any provision of this Agreement shall be valid or
         effective unless made in writing and signed by a duly authorized
         officer of each Party.

17.5     Waiver{TC "17.5 Waiver" \f C \1 "2"}. No provision of this Agreement
         shall be waived by any act, omission or knowledge of a Party or its
         agents or employees except by an instrument in writing expressly
         waiving such provision and signed by a duly authorized officer of the
         waiving Party.

17.6     Severability{TC "17.6 Severability" \f C \1 "2"}. If any clause or
         portion thereof in this Agreement is for any reason held to be invalid,
         illegal or unenforceable, the same shall not affect any other portion
         of this Agreement, as it is the intent of the Parties that this
         Agreement shall be construed in such fashion as to maintain its
         existence, validity and enforceability to the greatest extent possible.
         In any such event, this Agreement shall be construed as if such clause
         or portion thereof had never been

<PAGE>

                                      -85-

         contained in this Agreement, and there shall be deemed substituted
         therefor such provision as will most nearly carry out the intent of the
         Parties as expressed in this Agreement to the fullest extent permitted
         by applicable law unless doing so would have the effect of materially
         altering the rights and obligations of the Parties in which event this
         Agreement shall terminate and all the rights and obligations granted to
         the Parties hereunder shall cease and be of no further force and
         effect.

17.7     Descriptive Headings{TC "17.7 Descriptive Headings" \f C \1 "2"}. The
         descriptive headings of this Agreement are for convenience only, and
         shall be of no force or effect in construing or interpreting any of the
         provisions of this Agreement.

17.8     Governing Law; Venue and Jurisdiction{TC "17.8 Governing Law; Venue and
         Jurisdiction" \f C \1 "2"}. This Agreement shall be governed by and
         interpreted in accordance with the substantive laws of the State of New
         York, except matters of intellectual property law, which shall be
         governed by and interpreted in accordance with the national
         intellectual property laws relevant to the intellectual property in
         question, without regard to conflict of law principles thereof. Venue
         and jurisdiction for any action brought under this Agreement by ELAN
         shall lie exclusively in England and Wales and for any action brought
         under this Agreement by CAT shall lie exclusively in New York and both
         Parties hereby consent to such venues.

17.9     Entire Agreement of the Parties{TC "17.9 Entire Agreement of the
         Parties" \f C \1 "2"}. This Agreement constitutes and contains the
         complete, final and exclusive understanding and agreement of the
         Parties and cancels and supersedes any and all prior negotiations,
         correspondence, understandings and agreements, whether oral or written,
         among the Parties respecting the subject matter hereof.

17.10    Independent Contractors{TC "17.10 Independent Contractors" \f C \1
         "2"}. Both Parties are independent contractors under this Agreement.
         Nothing herein contained shall be deemed to create an employment,
         agency, joint venture or partnership relationship between the Parties
         or any of their agents or employees, or any other legal arrangement
         that would impose liability upon one Party for the act or failure to
         act of the other Party. Neither Party shall have any express or implied
         power to enter into any contracts or commitments or to incur any
         liabilities in the name of, or on behalf of, the other Party, or to
         bind the other Party in any respect whatsoever.

17.11    Debarment{TC "17.11 Debarment" \f C \1 "2"}. Each Party agrees that it
         will not use, in any capacity, in connection with any of its
         obligations to be performed under the Research Program or the
         Development Program any individual who has been debarred under the FD&C
         Act or the Generic Drug Enforcement Act.

<PAGE>

                                      -86-

17.12    Counterparts{TC "17.12 Counterparts" \f C \1 "2"}. This Agreement may
         be executed in any number of counterparts, each of which need not
         contain the signature of more than one Party but all such counterparts
         taken together shall constitute one and the same agreement.

17.13    NO CONSEQUENTIAL DAMAGES{TC "17.12 NO CONSEQUENTIAL DAMAGES" \f C \1
         "2"}. IN NO EVENT SHALL A PARTY HERETO BE LIABLE FOR SPECIAL,
         INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THIS AGREEMENT OR
         THE EXERCISE OF ITS RIGHTS HEREUNDER, INCLUDING WITHOUT LIMITATION LOST
         PROFITS ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT,
         REGARDLESS OF ANY NOTICE OF SUCH DAMAGES. NOTHING IN THIS SECTION 17.13
         IS INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR
         OBLIGATIONS OF EITHER PARTY.

<PAGE>

                                      -87-

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

ELAN PHARMA INTERNATIONAL                  CAMBRIDGE ANTIBODY TECHNOLOGY
LIMITED                                    LIMITED (on its own behalf and on
                                           behalf of its Affiliates)

By:________________________________        By:_________________________________
   Name:                                      Name:
   Title:                                     Title:

<PAGE>

                                  EXHIBIT 1.10

                            CAT GATEKEEPING PROCEDURE

                                      [***]

<PAGE>

                                  EXHIBIT 1.11

                                 CAT IN-LICENSES

1.      License Agreement dated January 7, 1997 between CAT and MRC, with
        certain royalty rates, as may be amended from time to time, which shall
        include all royalty payments due to The Scripps Research Institute and
        Stratagene pursuant to an agreement dated June 25, 1999.

2.      Therapeutic Antibodies Agreement, dated December 31, 1997 between CAT
        and Dyax Corp., as such agreement may be amended from time to time.

3.      Diagnostic Antibodies Agreement dated December 31, 1997 between CAT and
        Dyax Corp., as such agreement may be amended from time to time.

<PAGE>

                                  EXHIBIT 1.15

                                CAT PATENT RIGHTS

                                      [***]

<PAGE>

                                  EXHIBIT 1.17

                                 CAT TECHNOLOGY

                                      [***]

<PAGE>

                                  EXHIBIT 1.41

                               ELAN PATENT RIGHTS

                                      [***]

<PAGE>

                                  EXHIBIT 1.43

                                 ELAN TECHNOLOGY

                                      [***]

<PAGE>

                                  EXHIBIT 1.95

                                SPECIFIC TARGETS

                                      [***]

<PAGE>

                               EXHIBIT 2.2(d)(iii)

                           CAT PREEXISTING OBLIGATIONS

                                      [***]

<PAGE>

                                  EXHIBIT 5.2.1

                        ELEMENTS OF ANNUAL RESEARCH PLAN

                                      [***]

<PAGE>

                                 EXHIBIT 10.2.6

                             CAT THIRD PARTY CLAIMS

                                      [***]

<PAGE>

                                 EXHIBIT 10.3.4

                             ELAN THIRD PARTY CLAIMS

                                     [NONE]<PAGE>

                                                                  EXHIBIT 10.176

                              EMPLOYMENT AGREEMENT

                  THIS AGREEMENT (the "Agreement"), is made and entered into
effective the 15th day of January, 2002, by and between Pharmaceutical Product
Development, Inc. (the "Company"), a North Carolina corporation whose mailing
address for notice purposes is 3151 South Seventeenth Street, Wilmington, North
Carolina 28412, Attention: Chief Executive Officer, and Fred B. Davenport, Jr.
("Employee"), an individual whose mailing address for notice purposes is 3151
South Seventeenth Street, Wilmington, North Carolina 28412.

                                    RECITALS

                  A.   The  Company is engaged in providing research and
development services to pharmaceutical and biotech companies and other entities
(the "Business").

                  B.   The Company desires to employ Employee and Employee
desires to be employed by the Company, all upon the terms and conditions set
forth herein.

                  NOW, THEREFORE, in consideration of the foregoing recitals,
the mutual covenants of the parties hereinafter set forth and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

                                    ARTICLE 1
                              EMPLOYMENT AND DUTIES
                              ---------------------

                  1.1  Engagement of Employee. The Company agrees to employ
                       ----------------------
Employee and Employee accepts such employment pursuant and subject to the terms
and conditions of this Agreement.

                  1.2. Duties and Powers. During the Employment Period (as
                       -----------------
defined herein), Employee shall serve as President of the Company and will have
such responsibilities, duties and authority, and will render such services for
and in connection with the Company and its affiliates as are customary in such
position and as the Board of Directors of the Company (the "Board") and the
Chief Executive Officer of the Company shall from time to time reasonably
direct. Employee shall devote Employee's full business time and attention
exclusively to the Business of the Company and shall use best efforts to
faithfully carry out Employee's duties and responsibilities hereunder. Employee
shall comply with all personnel policies and procedures of the Company as the
same now exist or may be hereafter implemented by the Company from time to time,
including those policies contained in the Company's employee manual or handbook
which sets forth policies and procedures generally for employees of the Compoany
and its subsidiaries and affiliates (the "Handbook") to the extent not
inconsistent with this Agreement.

<PAGE>

                                    ARTICLE 2
                               TERM OF EMPLOYMENT
                               ------------------

         Unless sooner terminated as provided elsewhere in this Agreement,
Employee's employment under this Agreement shall commence on January 15, 2002
and end on December 31, 2003 ("Initial Employment Period"). This Agreement then
automatically shall renew for successive one-year periods, unless either the
Company or Employee provides written notice to the other at least sixty (60)
days prior to the termination of any such period stating said party's desire to
terminate this Agreement. The Initial Employment Period and any extension or
renewal thereof shall be referred to herein together as the "Employment Period".
Notwithstanding anything to the contrary contained herein, the Employment Period
is subject to termination pursuant to Article 4 hereof.

                                    ARTICLE 3
                            COMPENSATION AND BENEFITS
                            -------------------------

                  3.1 Compensation. The Company will pay Employee a base salary
                      ------------
at a rate of $310,000.00 per annum (the "Base Salary"), payable in accordance
with the Company's regular payroll policy for salaried employees. The Base
Salary of Employee may be subject to increase annually during the Employment
Period by the Board of the Company. If the Employment Period is terminated
pursuant to Article 4 hereof, then the Base Salary for any partial year will be
prorated based on the number of days elapsed in such year during which services
were actually performed by Employee.

                  3.2 Benefits. During the Employment Period, Employee shall be
                      --------
eligible to participate in and/or receive benefits under such employee and
welfare benefit plans as may be established from time to time by the Company,
including any profit-sharing, stock purchase, stock option, bonus, pension,
disability, group-term life insurance, health insurance and flexible benefit
payroll deduction plans, subject in each instance to Employee meeting all
eligibility and qualification requirements of such plans.

                  3.3 Expenses. The Company will reimburse Employee, in
                      --------
accordance with and subject to Employee's compliance with the Company's policy,
for Employee's necessary and reasonable out-of-pocket expenses incurred in the
course of performance of Employee's duties hereunder. All reimbursement of
expenses to Employee hereunder shall be conditioned upon presentation of
sufficient documentation evidencing such expenses.

                  3.4 Vacation and Leave. Employee shall be entitled to the
                      ------------------
number of days of "Paid Time Off" ("PTO") and other leave as may be established
from time to time by the Company for the benefit of its employees (but not less
than that which he was

                                        2

<PAGE>

entitled to as an employee of the Company immediately prior to the commencement
of thisAgreement), subject to Employee's compliance with the guidelines set
forth in the Handbook.

                  3.5  Working Facilities. The Company shall furnish Employee
                       ------------------
with such office space, equipment, technical, secretarial and clerical
assistance and such other facilities, services and supplies as shall be
reasonably necessary to enable Employee to perform the duties required of
Employee hereunder in an efficient and professional manner.

                                    ARTICLE 4
                            TERMINATION OF EMPLOYMENT
                            -------------------------

                  4.1  Basis for Termination. Notwithstanding any other
                       ---------------------
provision in this Agreement to the contrary, the Employment Period and
Employee's employment hereunder shall terminate effective on the date indicated
upon the happening of any of the following events:

                       a.   Upon the death of Employee, effective immediately on
the date of death without any notice.

                       b.   A determination by the Chief Executive Officer of
the Company, acting in good faith but made in the sole discretion of the Chief
Executive Officer, that Employee has failed to substantially perform his duties
under or otherwise breached any of the material terms of this Agreement,
effective upon the date said determination is communicated to Employee or such
later date, if any, as specified by the Chief Executive Officer of the Company.

                       c.   A determination by the Chief Executive Officer of
the Company, acting in good faith but made in the sole discretion of the Chief
Executive Officer, that Employee (i) has become physically or mentally
incapacitated and is unable to perform his duties under this Agreement as a
result of such disability, which inability continues for a period of sixty (60)
days during any twelve-month period hereunder, (ii) has demonstrated gross
negligence or willful misconduct in the execution of his duties, or (iii) has
been convicted of a felony, effective upon the date said determination is
communicated to Employee or such later date, as specified by the Chief Executive
Officer of the Company.

                  4.2  Compensation After Termination During Employment Period.
                       -------------------------------------------------------
If the Company shall terminate Employee's employment during the Employment
Period pursuant to Section 4.1 hereof, the Company shall have no further
obligations hereunder or otherwise with respect to Employee's employment from
and after the termination or expiration date, except that the Company shall pay
Employee's Base Salary accrued through the date of termination or expiration and
shall provide such benefits as are

                                        3

<PAGE>

required by applicable law. From and after such termination or expiration date,
the Company shall continue to have all other rights available hereunder,
including without limitation all rights under Article 5 hereof, and at law or in
equity.

                                    ARTICLE 5
                             PROPRIETARY INFORMATION
                             -----------------------

         Prior to the commencement date hereof, Employee shall have executed in
favor of the Company its standard Proprietary Information and Inventions
Agreement (the "Proprietary Agreement").

                                    ARTICLE 6
                                  MISCELLANEOUS
                                  -------------

                  6.1 Withholding Taxes. All amounts payable under this
                      -----------------
Agreement, whether such payment is to be made in cash or other property, shall
be subject to withholding for Federal, state and local income taxes, employment
and payroll taxes, and other legally required withholding taxes and
contributions to the extent appropriate in the determination of the Company, and
Employee shall report all such amounts as ordinary income on Employee's personal
income returns and for all other purposes.

                  6.2 Assignment. No party hereto may assign or delegate any of
                      ----------
its rights or obligations hereunder without the prior written consent of the
other party hereto; provided, however, that the Company shall have the right to
assign all or any part of its rights and obligations under this Agreement (i)
any subsidiary or affiliate of the Company or any surviving entity following any
merger or consolidation of any of those entities with any entity other than the
Company, or (ii) in connection with the sale of the Business by the Company.

                  6.3 Binding Effect. Except as otherwise expressly provided
                      --------------
herein, all covenants and agreements contained in this Agreement by or on behalf
of any of the parties hereto shall be binding upon and inure to the benefit of
the respective legal representatives, heirs, successors and permitted assigns of
the parties hereto.

                  6.4 Entire Agreement. Except as otherwise expressly set forth
                      ----------------
herein, this Agreement sets forth the entire understanding of the parties and
supersedes and preempts all prior oral or written understandings and agreements
with respect to the subject matter hereof, specifically including but not
limited to that certain employment agreement dated September 26, 1996 between
the Company and Employee.

                  6.5 Severability. Whenever possible, each provision of this
                      ------------
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable

                                        4

<PAGE>

law,such provision shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating the remainder of this Agreement.

                  6.6  Amendment; Modification. No amendment or modification of
                       -----------------------
this Agreement and no waiver by any party of the breach of any covenant
contained herein shall be binding unless executed in writing by the party
against whom enforcement of such amendment, modification or waiver is sought. No
waiver shall be deemed a continuing waiver or a waiver in respect of any
subsequent breach or default, either of a similar or different nature, unless
expressly so stated in writing.

                  6.7  Governing Law. This Agreement shall be governed by and
                       -------------
construed and enforced in accordance with the laws of the State of North
Carolina, without giving effect to provisions thereof regarding conflict of
laws.

                  6.8  Arbitration. Any dispute, controversy or claim arising
                       -----------
out of or relating to this Agreement, including but not limited to its
existence, validity, interpretation, performance or non-performance or breach,
shall be decided by a single neutral arbitrator agreed upon by the parties
hereto in Wilmington, North Carolina in binding arbitration pursuant to the
commercial arbitration rules of the American Arbitration Association then in
effect. The parties to any such arbitration shall be limited to the parties to
this Agreement or any successor thereof. The written decision of the arbitrator
shall be final and binding and may be entered and enforced in any court of
competent jurisdiction. Each party waives any right to a jury trial in any such
forum. Each party to the arbitration shall pay its fees and expenses, unless
otherwise determined by the arbitrator.

                  6.9  Notices. All notices, demands or other communications to
                       -------
be given or delivered hereunder or by reason of the provisions of this Agreement
shall be in writing and shall be deemed to have been properly served if (a)
delivered personally, (b) delivered by a recognized overnight courier service,
(c) sent by certified mail, return receipt requested and first class postage
prepaid, or (d) sent by facsimile transmission followed by a confirmation copy
delivered by a recognized overnight courier service the next day. Such notices,
demands and other communications shall be sent to the address first set forth
above, or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party. Date
of service of such notice shall be (i) the date such notice is personally
delivered or sent by facsimile transmission (with issuance by the transmitting
machine of a confirmation of successful transmission), (ii) the date of receipt
if sent by certified mail, or (iii) the date of receipt if sent by overnight
courier.

                  6.10 Counterparts. This Agreement may be executed in multiple
                       ------------
counterparts, each of which shall be deemed an original and all of which taken
together shall constitute one and the same Agreement.

                                        5

<PAGE>

                  6.11 Descriptive Heading; Interpretation.  The descriptive
                       -----------------------------------
headings in this Agreement are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or interpretation of
this Agreement.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

               COMPANY:               Pharmaceutical Product
                                      Development, Inc.

                                      By: /s/Fred N. Eshelman
                                          -------------------
                                      Name:  Fred N. Eshelman
                                      Title: Chief Executive Officer

               EMPLOYEE:

                                      By: /s/Fred B. Davenport, Jr.
                                          ------------------------
                                      Name:  Fred B. Davenport, Jr.

                                        6

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