Document:

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                                                                    EXHIBIT 10.1

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                        DEVELOPMENT AND LICENSE AGREEMENT

                                      AMONG

                         SMITHKLINE BEECHAM CORPORATION,

                       DOING BUSINESS AS GLAXOSMITHKLINE,

                               GLAXO GROUP LIMITED

                                       AND

                           EPIX PHARMACEUTICALS, INC.

                                DECEMBER 11, 2006

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PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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                        DEVELOPMENT AND LICENSE AGREEMENT

     THIS DEVELOPMENT AND LICENSE AGREEMENT (this "Agreement") is made and
entered into as of December 11, 2006, among EPIX Pharmaceuticals, Inc., a
Delaware corporation headquartered at 4 Maguire Road, Lexington, MA ("EPIX"),
and SMITHKLINE BEECHAM CORPORATION, doing business as GlaxoSmithKline, a
Pennsylvania corporation having its principal place of business at One Franklin
Plaza, Philadelphia, PA ("SB") and GLAXO GROUP LIMITED, a company existing under
the laws of England and Wales, having its registered office at Glaxo Wellcome
House, Berkeley Avenue, Greenford, Middlesex, UB6 0NN, England ("GGL") (SB and
GGL together are referred to herein as "GSK"). EPIX and GSK are sometimes
referred to herein individually as a "Party" and collectively as the "Parties."

                                    RECITALS

     WHEREAS, EPIX has expertise in in silico modeling of biological receptors
and drug discovery and design technologies;

     WHEREAS, EPIX Controls (as defined herein) certain patent rights and
know-how rights relating to a compound designated PRX-03140 and certain related
compounds;

     WHEREAS, GSK has expertise in pharmaceutical research, Development (as
defined herein) and Commercialization (as defined herein);

     WHEREAS, GSK desires to engage in a collaborative effort with EPIX pursuant
to which EPIX shall carry out a research and Development program for PRX-03140
and 3 Program Targets (as defined herein) to discover and Develop Candidate
Compounds (as defined herein) through to Proof of Concept (as defined herein),
and for which EPIX Programs (as defined herein) GSK shall have the exclusive
Option (as defined herein), exercisable at GSK's sole discretion, to further
Develop and Commercialize Candidate Compounds within each such EPIX Program on
an exclusive basis for any and all uses in the Territory (as defined herein),
all on the terms and conditions set forth herein;

     WHEREAS, upon exercise by GSK of an Option to an EPIX Program, EPIX desires
to grant and will grant to GSK, and GSK desires to obtain and will obtain, an
exclusive license in the Territory under this Agreement to make, have made, use,
sell, offer for sale, and import certain Licensed Products (as defined herein)
throughout the Territory on the terms and conditions set forth herein;

     WHEREAS, GSK intends that rights acquired under this Agreement will be held
by SB and GGL in accordance with GSK intercompany intellectual property
agreements, effective from time to time, and that payments to EPIX hereunder
will be made by either SB or GGL, as appropriate; and

     WHEREAS, contemporaneously with the execution of this Agreement, the
Parties have executed a separate Stock Purchase Agreement (the "Stock Purchase
Agreement") pursuant to which GSK shall purchase shares of common stock of EPIX.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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     NOW, THEREFORE in consideration of the foregoing and the mutual agreements
set forth below, the Parties agree as follows:

                                    ARTICLE 1

                                   DEFINITIONS

     The terms in this Agreement with initial letters capitalized, whether used
in the singular or the plural, shall have the meaning set forth below or, if not
listed below, the meaning designated in places throughout this Agreement.

     1.1 "Act" means the United States Food, Drug and Cosmetic Act, as amended.

     1.2 "Additional Back-up Discovery Period" has the meaning set forth in
Section 3.5.5.

     1.3 "Affiliate" of a Party means any Person, whether de jure or de facto,
which directly or indirectly is controlled by, controls or is under common
control with a Party to this Agreement. For the purposes of this definition, the
term "control" (including, with correlative meanings, the terms "controlled by"
and "under common control with") as used with respect to a Person means (i) in
the case of a corporate entity, direct or indirect ownership of voting
securities entitled to cast at least fifty percent (50%) of the votes in the
election of directors or (ii) in the case of a non-corporate entity, direct or
indirect ownership of at least fifty percent (50%) of the equity interests with
the power to direct the management and policies of such entity, provided that if
local Law restricts foreign ownership, control shall be established by direct or
indirect ownership of the maximum ownership percentage that may, under such
local Law, be owned by foreign interests.

     1.4 "Agreement" means this Agreement, together with all attachments hereto,
as the same may be amended in accordance with Section 15.6.

     1.5 "Back-up Compound" means, with respect to a given EPIX Program, an EPIX
Program Compound, other than the Candidate Compound, that meets the Candidate
Selection Criteria as determined by the JSC, or that is designated as a Back-up
Compound by the JSC, in either case as more fully set forth in Section 3.5. A
Back-up Compound may be from the same chemical series as the Candidate Compound
or other Back-up Compounds for such EPIX Program. A Back-up compound may be
expected to address a known or potential shortcoming of the Candidate Compound
it may replace or supplement.

     1.6 "Business Day" or "business day" means a day other than Saturday,
Sunday or any day on which commercial banks located in New York, New York or
London, England are authorized or obligated by applicable Law to close.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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     1.7 "Calendar Quarter" means the respective periods of three (3)
consecutive calendar months ending on March 31, June 30, September 30 and
December 31.

     1.8 "Calendar Year" means each successive period of twelve (12) months
commencing on January 1 and ending on December 31.

     1.9 "Candidate Compound" means an EPIX Program Compound or Back-up Compound
that is identified as the lead compound within an EPIX Program and that meets
the Candidate Selection Criteria, or that is designated as a Candidate Compound
by the JSC, in either case as determined by the JSC as more fully set forth in
Section 3.5.

     1.10 "Candidate Selection Criteria" means the criteria established by the
JSC for determining whether to advance an EPIX Program Compound into
pre-clinical in vitro and in vivo toxicology or ADME studies and potentially
into clinical Development, as such Candidate Selection Criteria may be modified
by the JSC. The Candidate Selection Criteria generally will include some or all
of the following: (i) [********] characteristics of the compound, (ii) data
regarding the [********] and [********] in [********] with defined [********]
(if definable) and [********], (iii) an [********] assessment of potential
[********] ([********] inhibition), (iv) [********] assessment of [********]
potential, [********] and [********], (v) the compound's properties regarding
[********],[********] and [********] and similar [********] properties, and (vi)
an assessment of the consistency of the [********],[********] and availability
of [********].

     1.11 "Chairperson" has the meaning set forth in Section 2.2.1.

     1.12 "Change in Control Event" means a transaction in which EPIX merges,
consolidates or effects any other transaction or series of transactions with
[********] Company (other than an Affiliate of EPIX) such that the stockholders
of EPIX immediately prior thereto, in the aggregate, no longer own, directly or
indirectly, beneficially or legally, at least [********] of the outstanding
voting securities or capital stock of the surviving entity following the closing
of such merger or consolidation. As used herein, "[********] Company" means any
[********] that, together with its Affiliates, has annual worldwide [********]
of [********] or more.

     1.13 "Collaboration" means the Development and Commercialization activities
conducted by the Parties pursuant to this Agreement.

     1.14 "Combination Product" means a Licensed Product that includes at least
one (1) additional therapeutically active pharmaceutical ingredient other than
an EPIX Program Compound or GSK Development Compound. To be a Combination
Product, the Licensed Product and all its ingredients (including the drug
substance) must be sold together as a single product and invoiced as one (1)
product. Except for those drug delivery vehicles, adjuvants or excipients that
are recognized by the FDA as active ingredients, drug delivery vehicles,
adjuvants, and excipients are hereby deemed not to be "therapeutically active
pharmaceutical ingredients," and their presence shall not be deemed to create a
Combination Product for purposes of this Section 1.14.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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     1.15 "Commercialization" or "Commercialize" means activities directed to
commercial-scale manufacturing, obtaining pricing and reimbursement approvals,
carrying out Phase IV Trials, marketing, promoting, distributing, importing,
exporting, offering for sale or selling a human pharmaceutical product.

     1.16 "Commercially Reasonable Efforts" means, in reference to a Party's
obligation to perform or achieve a specified obligation or goal with respect to
a particular compound or product, efforts that are comparable in quality and
scope to those efforts that are generally used by such Party to perform or
achieve a comparable obligation or goal with respect to a pharmaceutical product
owned by such Party, which has the same regulatory requirements or status (for
example, requires a prescription or is available over-the-counter), is at a
comparable stage of development or product life to the relevant compound or
product, and that has similar market potential to the relevant compound or
product, taking into account relative safety and efficacy, product profile, the
competitiveness of the marketplace, the proprietary position of the compound or
product, relevant regulatory circumstances, the anticipated profitability of the
relevant compound or product, and other relevant factors, including without
limitation, comparative technical, legal, scientific and/or medical factors.
Without limiting the foregoing, Commercially Reasonable Efforts require that a
Party: (i) devote appropriate resources and personnel with an appropriate level
of education, experience and training for the relevant obligation; (ii) promptly
assign responsibility for the relevant obligation to specific employees who are
held accountable for progress and monitor such progress on an on-going basis,
(iii) set and consistently seek to achieve specific and meaningful objectives
and timelines for carrying out such obligation, and (iv) consistently make and
implement decisions and allocate resources designed to advance progress with
respect to relevant objectives and timelines.

     1.17 "Competitive Product" has the meaning set forth in Section 7.2.2.

     1.18 "Computational Lead" means a compound with [********] for its target
protein that was identified [********] or identified as a result of chemical
modifications of compounds identified through [********].

     1.19 "Confidential Information" means all trade secrets, processes,
formulae, data, know-how, improvements, inventions, chemical or biological
materials, chemical structures, techniques, marketing plans, strategies,
customer lists, or other information that has been created, discovered, or
developed by a Party, or has otherwise become known to a Party, or to which
rights have been assigned to a Party, as well as any other information and
materials that are deemed confidential or proprietary to or by a Party
(including, without limitation, all information and materials of a Party's
customers and any other Third Party and their consultants), in each case that
are disclosed by such Party to the other Party, regardless of whether any of the
foregoing are marked "confidential" or "proprietary" or communicated to the
other by the disclosing Party in oral, written, graphic, or electronic form. For
purposes of this Agreement, any know-how that is subject to a license granted
hereunder shall be treated as being Confidential Information of both the
licensor and the licensee.

     1.20 "Controlled" or "Controls", when used in reference to intellectual
property or intellectual property rights, means the legal authority or right of
a Party hereto (or any of its

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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Affiliates) to grant a license or sublicense of intellectual property rights to
another Party, or to otherwise disclose proprietary or trade secret information
to such other Party, without breaching the terms of any agreement with a Third
Party, or misappropriating the proprietary or trade secret information of a
Third Party.

     1.21 "Co-Promotion Option" means the option of EPIX to co-promote with GSK
in the United States a Licensed Product resulting from the 5-HT4 Partial Agonist
Program, as more fully set forth in Section 6.1.

     1.22 "Development" means pre-clinical and clinical drug development
activities reasonably related to the discovery and development of pharmaceutical
compounds and submission of information to a Regulatory Authority, including,
without limitation, toxicology, pharmacology and other discovery (including but
not limited to in silico protein modeling, in silico screening and drug design)
and pre-clinical efforts, test method development and stability testing,
manufacturing process development, formulation development, delivery system
development, quality assurance and quality control development, statistical
analysis, clinical studies (including, without limitation, pre- and
post-approval studies) and activities relating to obtaining Regulatory Approval
but excluding other Commercialization activities. When used as a verb, "Develop"
means to engage in Development.

     1.23 "Dollar" or "$" means the lawful currency of the United States.

     1.24 "Effective Date" means the date specified in the initial paragraph of
this Agreement.

     1.25 "EMEA" means the European Agency for the Evaluation of Medicinal
Products, or any successor agency thereto.

     1.26 "EPIX Development Plan" means with respect to any EPIX Program, a
summary of a multi-year plan specifying anticipated Development activities,
including those activities described in Section 3.5.1, for the lead EPIX Program
Compound and Back-up Compounds within an EPIX Program (including, without
limitation, the following anticipated activities or events: a description of the
indication targeted, timelines for starting and completing key activities,
phasing of Development, primary endpoints, study size, timelines for data
preparation and filing of regulatory submissions, toxicology and a plan for
selecting appropriate species for toxicology studies, ADME and pharmacology
studies and manufacturing process development and [********] for all Development
activities). The EPIX Development Plan will include drug design and Development
activities that are in keeping with EPIX's current drug design and Development
practices, and that are reasonably calculated to result in the discovery and
Development of Candidate Compounds and Back-up Compounds which may be progressed
through to the PoC Trial Package and may be reasonably expected to meet the PoC
Criteria. The EPIX Development Plan will be used to organize and guide EPIX's
Development efforts hereunder through the completion of a multi-dose Phase I
Trial and completion of the PoC Trial Package for a Candidate Compound.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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     1.27 "EPIX Know-How" means all technical information and know-how known to
and Controlled by EPIX or its Affiliates as of the Effective Date and during the
Term of this Agreement (including, without limitation, all biological, chemical,
pharmacological, toxicological, clinical, assay and related know-how and trade
secrets, and all manufacturing data, the specifications of ingredients, the
manufacturing processes, formulation, specifications, sourcing information,
quality control and testing procedures, and related know-how and trade secrets)
that is primarily and directly related to and/or reasonably necessary for the
manufacture, Development and/or Commercialization of the EPIX Program Compounds,
Candidate Compounds, Back-up Compounds, GSK Development Compounds, and/or
Licensed Products. For avoidance of doubt, EPIX Know-How does not include the
structure of any Program Target or other target, or any in silico technologies
used by EPIX in its performance hereunder. EPIX Know-How includes Confidential
Information of EPIX under Article 11.

     1.28 "EPIX Patent(s)" means all Patents in the Territory Controlled by EPIX
or its Affiliates as of the Effective Date as set forth on Appendix A attached
hereto and incorporated herein and any other Patents Controlled by EPIX or its
Affiliates during the Term (other than those Patents that are Controlled by EPIX
or its Affiliates solely by virtue of a license granted hereunder) that claim or
cover the research, Development, manufacture, use, composition of matter,
formulation, method of use, import, offer to sell or sale of any Back-up
Compounds, Candidate Compounds, EPIX Program Compounds, GSK Development
Compounds and/or Licensed Products. EPIX Patents include, without limitation,
EPIX's interest in Joint Patents. For avoidance of doubt, EPIX Patent(s) do not
include any Patents that claim or cover any in silico technologies used by EPIX
in its performance hereunder.

     1.29 "EPIX Program" means a program of drug design, discovery and
Development activities to be conducted by EPIX hereunder against Program
Targets. The first EPIX Program is the 5-HT4 Partial Agonist Program.

     1.30 "EPIX Program Compound(s)" means compounds, including Candidate
Compounds and Back-up Compounds, that meet the following three (3) requirements:
(i) [********] in the same manner as specified in the relevant [********], (ii)
have an [********] (as required by the relevant [********]) for the relevant
[********] of less than [********] regardless of the stage of development, and
(iii) were [********] in connection with [********] prior to the exercise by GSK
of the relevant Option, prior to GSK declining the relevant Option or prior to
the JSC's decision to terminate the relevant EPIX Program.

     1.31 "Europe" or EU" means the countries comprising the European Union as
it may be constituted from time to time, together with those additional
countries included in the European Economic Area as it may be constituted from
time to time, and any successors to, or new countries created from, any of the
foregoing.

     1.32 "Executive Officers" has the meaning set forth in Section 2.2.2.

     1.33 "FDA" means the U.S. Food and Drug Administration, or any successor
agency thereto.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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     1.34 "Field" means any use or purpose including, without limitation, the
treatment, prevention, or diagnosis of disease or a condition adverse to human
health with either or both prescription and over-the-counter medicines.

     1.35 "First Commercial Sale" means, with respect to any Licensed Product,
the first sale for which payment has been received for use or consumption by the
general public of such Licensed Product in any country in the Territory after
Regulatory Approval of such Licensed Product has been granted, or such marketing
and sale is otherwise permitted, by the Regulatory Authority of such country,
excluding registration samples, compassionate use, and use in Phase IV clinical
trials. So-called "treatment IND sales" and "named patient sales" shall also not
be construed as a First Commercial Sale.

     1.36 "Fourth EPIX Program" has the meaning set forth in Section 3.3.1.

     1.37 "Fourth Program Target" has the meaning set forth in Section 3.3.1.

     1.38 "FTE" means a full-time employee dedicated by EPIX to the EPIX Program
or in the case of a less than full-time dedicated employee, a full-time
equivalent person year, based upon a total of forty-seven (47) weeks (i.e., one
thousand eight hundred eighty (1880) hours) per year of technical work on or
directly related to the EPIX Program.

     1.39 "GAAP" means generally accepted accounting principles in the United
States.

     1.40 "GSK Commercialization Plan" has the meaning set forth in Section
4.3.1.

     1.41 "GSK Development Compound(s)" means the [********] that are within a
[********].

     1.42 "GSK Development Plan" has the meaning set forth in Section 4.3.1.

     1.43 "GSK Development Program" means a program of Development and
Commercialization activities to be conducted by GSK hereunder with respect to
the EPIX Program Compounds within an EPIX Program for which GSK exercises an
Option in accordance with Section 4.1, such EPIX Program Compounds thereafter
being referred to as GSK Development Compounds.

     1.44 "GSK Know-How" means all technical information and know-how known to
and Controlled by GSK or its Affiliates as of the Effective Date and during the
Term (including, without limitation, all biological, chemical, pharmacological,
toxicological, clinical, assay and related know-how and trade secrets, and all
manufacturing data, the specifications of ingredients, the manufacturing
processes, formulation, specifications, sourcing information, quality control
and testing procedures, and related know-how and trade secrets) that is
primarily and directly related to and/or reasonably necessary for the
manufacture, Development and/or Commercialization of the EPIX Program Compounds,
Candidate Compounds, Back-up Compounds, GSK Development Compounds and/or
Licensed Products. For avoidance of doubt,

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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GSK Know-How does not include any information or know-how of [********] as a
target or generated by GSK prior to or after the Effective Date relating to
[********]. GSK Know-How includes Confidential Information of GSK under Article
11.

     1.45 "GSK Patent(s)" means all Patents in the Territory Controlled by GSK
or its Affiliates as of the Effective Date and any other Patents Controlled by
GSK or its Affiliates during the Term (other than those Patents that are
Controlled by GSK or its Affiliates solely by virtue of a license granted
hereunder) that claim or cover the research, Development, manufacture, use,
composition of matter, formulation, method of use, import, offer to sell or sale
of any Back-up Compounds, Candidate Compounds, EPIX Program Compounds, GSK
Development Compounds and/or Licensed Products. GSK Patents include, without
limitation, GSK's interest in Joint Patents.

     1.46 "IFRS" means the International Financial Reporting Standards.

     1.47 "IND" means any Investigational New Drug Application, as defined in
the Act, filed with the FDA pursuant to Part 312 of Title 21 of the U.S. Code of
Federal Regulations, including any amendments thereto. References herein to IND
shall include, to the extent applicable, any comparable filing(s) outside the
U.S. (such as a CTA in the European Union).

     1.48 "Indemnification Claim" has the meaning set forth in Section 12.3.

     1.49 "Indemnitee" has the meaning set forth in Section 12.3.

     1.50 "Indemnitor" has the meaning set forth in Section 12.3.

     1.51 "Joint Invention" has the meaning set forth in Section 10.1.

     1.52 "Joint Patent(s)" has the meaning set forth in Section 10.1.

     1.53 "Joint Steering Committee" or "JSC" means the joint committee
established by the Parties under Section 2.2 charged with oversight of the
Collaboration.

     1.54 "Laws" means all laws, statutes, rules, regulations, ordinances and
other pronouncements having the effect of law of any federal, national,
multinational, state, provincial, county, city or other political subdivision,
domestic or foreign.

     1.55 "Licensed Product" means any pharmaceutical product containing
[********], or [********], as the case may be, or any metabolic precursors or
prodrugs, isomers, metabolites, hydrates, anhydrides, solvates, salt forms, free
acids or bases, esters, amides, ethers, complexes, conjugates or polymorphs of
such [********], or [********], in all forms, presentations, formulations and
dosage forms.

     1.56 "Losses and Claims" has the meaning set forth in Section 12.1.

     1.57 "MAA" means marketing authorization application filed with the EMEA or
Regulatory Authority in Europe.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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     1.58 "MAA Filing" means receipt by GSK of written notice of acceptance by
the EMEA of an MAA for filing under the centralized European procedure. If the
centralized EMEA filing procedure is not used, MAA Filing shall be deemed to be
achieved, for purposes of Section 8.2.2, upon the acceptance of a marketing
authorization application with the Regulatory Authority in a Major EU Country.

     1.59 "Major EU Country" means each of the [********].

     1.60 "Major Market Country" means each of the Major EU Countries and each
of the following countries: [********].

     1.61 "NDA" means a New Drug Application filed with the FDA required for
marketing approval for the applicable Licensed Product in the U.S.

     1.62 "NDA Approval" means the approval of an NDA by the FDA for the
applicable Licensed Product in the U.S.

     1.63 "NDA Filing" means receipt by GSK of written notice of acceptance by
the FDA of the filing of an NDA for the applicable Licensed Product.

     1.64 "Net Sales" shall mean, with respect to any Licensed Product, the
gross invoiced sales price of such Licensed Product sold by either (i) GSK, its
Affiliates or Sublicensees or (ii), as the case requires, EPIX, its Affiliates
or Sublicensees (in each case, the "Selling Party"), under this Agreement in
arm's length sales to Third Parties, less deductions allowed to the Third Party
customer by the Selling Party, to the extent actually taken by such Third Party
customer, on such sales of such Licensed Product for:

          (a) customary [********]; provided however, that where any such
[********] is based on sales of a [********] in which such Licensed Product is
included, the [********] shall be allocated to such Licensed Product on a
[********] basis based on the [********] (i.e., the [********] multiplied by the
[********]) of the Licensed Product relative to the [********] contributed by
the other [********] in the [********], with respect to such sale;

          (b) customary and reasonable [********] (including those to
managed-care entities and government agencies, including those in respect of any
state or federal Medicare, Medicaid or similar programs), and [********] to
customers on account of [********] (including, but not limited to, [********])
or on account of [********] affecting such Licensed Product;

          (c) freight, postage and duties, and [********] relating to such
Licensed Product, including [********] relating thereto;

          (d) sales (such as [********] or its equivalent) and excise taxes,
other consumption taxes, customs duties and compulsory payments to governmental
authorities and any other governmental charges imposed upon the importation, use
or sale of such Licensed Product to Third Parties (excluding any taxes paid on
the income from such sales) to the extent

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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the Selling Party is not otherwise entitled to a credit or a refund for such
taxes, duties or payments made; and

          (e) the [********] of: (i) [********] of the aggregate [********] or
[********] on sales of a Licensed Product in the relevant country or (ii) the
[********] of any [********] relating to such sales during the period in which a
Party has the obligation to pay a royalty under this Agreement.

Sales between GSK or EPIX and their respective Affiliates or Sublicensees shall
be excluded from the computation of Net Sales and no payments will be payable on
such sales, except where such Affiliates or Sublicensees are end-users, in which
case such sales shall be included in the computation of Net Sales and the Net
Sales therefrom shall be equal to the Net Sales resulting from arm's-length
sales of the same product to Third Parties in similar quantities. In addition,
Licensed Product provided free of charge to patients as samples or for
compassionate use or clinical trials will not be included in Net Sales.

     For purposes of determining royalties and sales milestones payable on
Combination Products, Net Sales will be calculated as follows, in each calendar
quarter:

          (i) If all therapeutically active pharmaceutical ingredients
comprising the Combination Product are marketed and sold separately in
commercially relevant quantities in a calendar quarter and the Net Selling Price
(as defined below) for each such therapeutically active pharmaceutical
ingredients can be separately determined for such quarter, Net Sales of each
Combination Product for determining the royalty payment and sales milestones
payable with respect to such Combination Product shall be calculated by
[********] of the single therapeutically active pharmaceutical ingredient in the
Licensed Product contained in the Combination Product sold during the relevant
payment period and B is the Net Selling Price of the other single
therapeutically active pharmaceutical ingredient contained in the Combination
Product sold during such payment period. All Net Selling Prices of the
therapeutically active pharmaceutical ingredients in the Combination Product
shall be calculated as the [********] of the prices (in effect with respect to
the period for which royalties and sales milestones are being calculated
hereunder) in effect in the countries representing the top [********] of the
Combination Product sales (the "Market Basket"). "Net Selling Price" means the
gross price at which a product is sold to a third party after discounts,
deductions, credits, taxes and allowances.

          (ii) If either A or B (but not both) cannot be determined because
separate sales in commercially relevant quantities of either the therapeutically
active pharmaceutical ingredient(s) other than the Licensed Product or the
Licensed Product have not occurred in the applicable calendar quarter in which
the sale of Combination Product was made or if the Net Selling Price for either
the therapeutically active pharmaceutical ingredient(s) other than the Licensed
Product or the Licensed Product cannot be determined for a calendar quarter,
then the Net Sales of the Combination Product in such country for determining
the royalty payment and sales milestones payable with respect to such
Combination Product for such period shall be calculated by [********], as
applicable: (a) [********] minus the result of [********], in which X is the
[********] in the [********] of the therapeutically active pharmaceutical
ingredient(s) other

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than the Licensed Product and Y is the [********] in the [********] of the
Combination Product sold in the applicable period, or (b) the quotient of
[********], in which X is the [********] in the [********] of the Licensed
Product and Y is the [********] in the [********] of the Combination Product
sold in the period in question.

          (iii) If: (a) neither of the therapeutically active pharmaceutical
ingredients of a Combination Product are sold separately in commercially
relevant quantities during a particular payment period, or (b) a [********] has
[********] or more therapeutically active pharmaceutical ingredients in addition
to the Licensed Product, then, in any such case, the Parties will meet and
negotiate an appropriate method for [********] resulting from sales of such
Combination Product, taking into account the [********] each therapeutically
active pharmaceutical ingredient makes to the [********] of such Combination
Product.

     1.65 "Option" has the meaning set forth in Section 4.1.

     1.66 "Option Period" has the meaning set forth in Section 4.1.

     1.67 "Option Period Extension" has the meaning set forth in Section 4.1.1.

     1.68 "Payor" has the meaning set forth in Section 8.12.

     1.69 "Payee" has the meaning set forth in Section 8.12.

     1.70 "Patents" means patents and patent applications and (a) any foreign
counterparts thereof, (b) all divisionals, continuations, continuations-in-part
thereof or any other patent application claiming priority directly or indirectly
to (i) any such specified patents or patent applications or (ii) any patent or
patent application from which such specified patents or patent applications
claim direct or indirect priority, and (c) all patents issuing on any of the
foregoing, and any foreign counterparts thereof, together with all
registrations, reissues, re-examinations, renewals, supplemental protection
certificates, or extensions of any of the foregoing, and any foreign
counterparts thereof.

     1.71 "Person" means any individual, firm, corporation, partnership, limited
liability company, trust, business trust, joint venture, governmental authority,
association or other entity.

     1.72 "Phase I Trial" means a human clinical trial of a compound, the
principal purpose of which is a preliminary determination of safety in healthy
individuals or patients, as described in 21 C.F.R. 312.21(a), or a similar
clinical study prescribed by the Regulatory Authorities in a foreign country.
For purposes of this Agreement, "start of Phase I Trial" means the dosing of the
first human with the first dose in a Phase I Trial.

     1.73 "Phase II Trial" means a human clinical trial of a compound in any
country that would satisfy the requirements of 21 C.F.R. 312.21(b) and is
intended to explore a variety of doses, dose response, and duration of effect,
and to generate initial evidence of clinical safety and activity in a target
patient population. For purposes of this Agreement, "start of Phase II Trial"
means the dosing of the first human patient with the first dose in a Phase II
Trial.

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     1.74 "Phase III Trial" means a human clinical trial of a compound,
performed after preliminary evidence of suggesting effectiveness of the compound
has been obtained, conducted for inclusion in: (i) that portion of an FDA
submission and approval process which provides for the continued trials of a
product on sufficient numbers of human patients to confirm with statistical
significance the safety and efficacy of a product sufficient to support a
Regulatory Approval for the proposed indication, as more fully described in 21
C.F.R. 312.21(c), or (ii) equivalent Regulatory Filings with similar
requirements in a country other than the United States. For purposes of this
Agreement, "start of Phase III Trial" means the dosing of the first human
patient with the first dose in a Phase III Trial.

     1.75 "Phase IV Trial" means a human clinical trial for a Licensed Product
commenced after receipt of Regulatory Approval in the country for which such
trial is being conducted and that is conducted within the parameters of the
Regulatory Approval for the Licensed Product. Phase IV Trials may include,
without limitation, epidemiological studies, modeling and pharmacoeconomic
studies, investigator sponsored clinical trials of Licensed Product and
post-marketing surveillance studies.

     1.76 "PoC Trial Package" has the meaning set forth in Section 3.6.

     1.77 "Program Target" means a G-Protein Coupled Receptor designated, as set
forth herein, to be the target of the activities of an EPIX Program with the
goal of modulating such G-Protein Coupled Receptor in a specific manner
[********] as further described in the Candidate Selection Criteria pertaining
to such Program Target.

     1.78 "Proof of Concept" or "PoC" means the stage of development at which a
Candidate Compound has completed the PoC Trial Package.

     1.79 "Proof of Concept Criteria" or "PoC Criteria" means criteria
established [********] for a particular Candidate Compound that will be used by
GSK after completion of the [********] to determine if the Candidate Compound
demonstrates a [********] in treating the applicable disorder. The PoC Criteria
may include some or all of the following criteria: (a) the [********] and
relevant [********] and [********] for the PoC Trial in such a manner that,
following the PoC Trial, a determination can reasonably be made as to whether
such [********] have been met; (b) a [********] that is reasonably
representative of the [********] for a single indication; (c) appropriate and
validated (if available) [********]; (d) PoC Trial dose(s) administered in a
dosage form in a PoC Trial which is/are (i) appropriate for a Phase II Trial and
as to which there is no [********] which would prevent the Candidate Compound
from being Developed into a commercializable dosage formulation and (ii) that
may show initial evidence of [********] with a reasonable [********] in view of
relevant clinical and regulatory considerations; (e) a drug substance which is
in a salt or other chemical form as to which there is no known impediment which
would prevent the Candidate Compound from being Developed into a
commercializable dosage formulation; and (f) other criteria [********] with
regard to ancillary preclinical and clinical trials or the manufacturing,
formulation and toxicology work included in the PoC Trial Package as further
detailed in Section 3.6 and, by way of example, [********].

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     1.80 "PoC Trial Report" has the meaning set forth in Section 3.7.

     1.81 "Proof of Concept Trial" or "PoC Trial" means a Phase II Trial for a
particular Candidate Compound that meets the requirements of 21 C.F.R. Section
312.21(b) that is included within the PoC Trial Package and shall be reasonably
designed to satisfy the PoC Criteria. A PoC Trial shall be designed to be
reasonably in keeping with industry practices in terms of number of
participants, number of sites, duration of the trial, number of arms in the
trial, and total anticipated cost of the trial, in each case, as compared to the
[********] for products being tested for the same indication and a similar
target population.

     1.82 "Project Leader(s)" has the meaning set forth in Section 2.3.

     1.83 "Regulatory Approvals" means, with respect to any Licensed Product in
any jurisdiction, all approvals from any Regulatory Authority necessary for the
sale of the Licensed Product in such jurisdiction in accordance with applicable
Laws, including receipt of pricing and reimbursement approvals, where required.

     1.84 "Regulatory Authority" means any national or supranational
governmental authority, including, without limitation, the FDA, EMEA or Koseisho
(i.e., the Japanese Ministry of Health and Welfare, or any successor agency
thereto), that has responsibility in countries in the Territory over the
Development and/or Commercialization of an EPIX Program Compound, a GSK
Development Compound or a Licensed Product.

     1.85 "Regulatory Filings" means all regulatory applications, filings,
approvals and associated correspondence required to Develop, manufacture,
market, sell and import Licensed Products in, or into, each country or
jurisdiction in the Territory.

     1.86 "Research Exclusivity Period" has the meaning set forth in Section
7.1.1.

     1.87 "Research Term" means the [********] period commencing with the
Effective Date, as such Research Term may be extended as provided in Section
3.4.1 and Section 3.8.1.

     1.88 "Returned Compounds and Products" shall mean all EPIX Program
Compounds, GSK Development Compounds and Licensed Products that are included
within: (i) an EPIX Program with respect to which GSK elects not or fails to
exercise its Option as described in Section 4.1.4; (ii) an EPIX Program that is
terminated by the JSC as described in Section 4.1.4; (iii) a terminated EPIX
Program or an EPIX Program that becomes a GSK Development Program and is
subsequently terminated by GSK, in each case, as described in Section
13.5.1(b)(iv); (iv) a GSK Development Program that GSK terminates in a region as
specified in Section 13.3.3; or (v) an EPIX Program, GSK Development Program, or
Licensed Product at the time the Agreement is terminated as described in Section
13.5.1(a)(iii).

     1.89 "Royalty Term" with respect to a Licensed Product means the period
commencing on the First Commercial Sale of such Licensed Product in a country
until the later of (i) twelve (12) years after the First Commercial Sale of such
Licensed Product in such country; and (ii) the expiration or termination of the
last to expire patent in such country within

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the EPIX Patents with a Valid Claim claiming the manufacture, use, sale, offer
to sell, export, import or other Commercialization of such Licensed Product in
such country.

     1.90 "Second EPIX Program" has the meaning set forth in Section 3.3.1.

     1.91 "Sublicense" means the written agreement pursuant to which a Third
Party became a Sublicensee.

     1.92 "Sublicensee" means any Third Party granted a sublicense by GSK of any
of the rights licensed to GSK by EPIX under Section 5.1. For avoidance of doubt,
a "Sublicensee" shall include a Third Party to whom GSK has granted the right to
promote or distribute a Licensed Product if such Third Party is principally
responsible for marketing and promotion of such Licensed Product within a
particular country or territory. "Sublicensee" shall also include the party to a
further sublicense as set forth in Section 5.2(b)(vi). "Sublicensee" shall also
include a Third Party granted a sublicense by EPIX of any of the rights granted
to it by GSK hereunder.

     1.93 "Surviving Sublicensee" has the meaning set forth in Section
5.2(b)(v).

     1.94 "Term" has the meaning set forth in Section 13.1.4.

     1.95 "Territory" means any country in the world.

     1.96 "Third EPIX Program" has the meaning set forth in Section 3.3.1.

     1.97 "Third Party" means any Person other than GSK, EPIX and their
respective Affiliates.

     1.98 "Transfer License" has the meaning set forth in Section 13.5.1(c)(ii).

     1.99 "United States" or "U.S." means the United States of America and all
its territories and possessions.

     1.100 "Valid Claim" means a claim within an issued United States or foreign
patent that has not expired, lapsed, or been cancelled or abandoned, and that
has not been dedicated to the public, disclaimed, or held unenforceable,
invalid, or been cancelled by a court or administrative agency of competent
jurisdiction in an order or decision from which no appeal has been or can be
taken, including without limitation, through opposition, reexamination, reissue
or disclaimer.

     1.101 "Value Added Tax (VAT) & Indirect Taxes" means the tax imposed by the
Sixth Council Directive of the European Community (77/388/EEC) and any national
legislation implementing that directive together with legislation supplemental
thereto or other tax of a similar nature, including sales taxes, and excise
duties imposed elsewhere instead of or in addition to value added tax.

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     1.102 "5-HT4 Partial Agonist Program" means EPIX's program to develop a
partial agonist to the 5-HT4 receptor.

                                    ARTICLE 2

                 COLLABORATION OVERVIEW; GOVERNANCE; DEVELOPMENT

     2.1 Goals of the Collaboration. Pursuant to this Agreement, EPIX will use
Commercially Reasonable Efforts to conduct the EPIX Programs with the goal of
bringing [********] from each EPIX Program to Proof of Concept and making each
such Candidate Compound (together with [********] at Candidate Compound stage
and all other EPIX Program Compounds) available to GSK under an exclusive
license as further provided in Article 5. If GSK exercises an Option to any such
EPIX Program at PoC in accordance with Section 4.1, such EPIX Program shall be
further Developed and Commercialized by GSK as set forth herein. Any Licensed
Product Developed and successfully Commercialized shall be marketed and sold by
GSK, its Affiliates and Sublicensees, and GSK shall pay milestones and royalties
to EPIX in connection therewith in accordance with Article 8. EPIX shall have an
option to undertake co-promotion activities with respect to any Licensed Product
that incorporates a GSK Development Compound from the 5-HT4 Partial Agonist
Program as and to the extent set forth in Article 6.

          2.1.1 General. Generally, except as otherwise expressly provided
herein, EPIX shall be [********] and shall [********] all research and
Development activities, and shall be [********] associated therewith, with
respect to the EPIX Programs and EPIX Program Compounds prior to exercise by GSK
of its Option with respect to any such EPIX Program and EPIX Program Compounds;
provided, that EPIX shall undertake all such Development activities with the
objective of Developing EPIX Program Compounds that meet the Candidate Selection
Criteria and PoC Criteria. EPIX shall have the right to engage Third Parties as
subcontractors to conduct certain Development activities to be undertaken
pursuant to the EPIX Development Plan, as further provided in Section 3.2.6.
Generally, except as otherwise expressly provided herein, GSK shall be
[********] for and [********] all Development and Commercialization activities,
and shall be [********] associated therewith, with respect to those GSK
Development Compounds and Licensed Products for which GSK has exercised its
Option.

     2.2 Joint Steering Committee. As soon as practicable after the Effective
Date, the Parties shall establish the JSC to oversee the Collaboration and to
make certain decisions regarding the Development activities of EPIX during the
Research Term as set forth herein. More specifically, the JSC shall have review
and oversight responsibilities for all research and Development activities
performed by EPIX with respect to each EPIX Program prior to the exercise of an
Option by GSK. The JSC shall monitor and have access to information, as provided
for herein, with respect to the activities to be conducted by each Party under
the Collaboration. The JSC shall also provide a forum for sharing advice,
progress and results relating to such activities and shall attempt to facilitate
the resolution of disputes between the Parties should any arise. More
specifically, the JSC shall:

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     (a) [********] the second and third [********] (and any [********]
     identified as [********] for either such [********]). The Parties
     acknowledge that the [********] has been identified by the Parties as of
     the Effective Date;

     (b) review, approve and modify the Candidate Selection Criteria;

     (c) review the progress of discovering Back-up Compounds, with the
     objective of the Back-up Compounds meeting Candidate Selection Criteria, as
     such Candidate Selection Criteria may be modified by the JSC;

     (d) review, provide comments relating to, and approve each EPIX Development
     Plan to ensure that the EPIX Development Plan is reasonably designed to
     meet the objectives of Developing EPIX Program Compounds that meet the
     Candidate Selection Criteria and PoC Criteria;

     (e) review and provide advice regarding the overall progress of EPIX's
     efforts to discover, identify, optimize and Develop EPIX Program Compounds
     in accordance with the Candidate Selection Criteria and each EPIX
     Development Plan;

     (f) for each EPIX Program Compound, determine if the Candidate Selection
     Criteria have been met as further described in Section 3.5.2;

     (g) review the Proof of Concept Criteria and provide comments as provided
     in Section 3.6;

     (h) review, provide comments and approve the Proof of Concept Trial Package
     as provided in Section 3.6;

     (i) approve [********] of Development by EPIX of any EPIX Program;

     (j) approve substitution of any Program Targets in accordance with Section
     3.3.3; and

     (k) review the overall progress of the GSK Development Programs and GSK
     Commercialization Plans.

The JSC shall have access to all EPIX Development Plans and GSK Development
Plans and GSK Commercialization Plans and shall be briefed by the Parties
regarding the content, execution and results achieved by the respective Parties
thereunder. Each Party, through its representatives on the JSC, shall be
permitted to provide advice and commentary with respect to the EPIX Development
Plans and GSK Development Plans and GSK Commercialization Plans. As provided in
Section 3.2, EPIX shall take such advice and commentary into good faith
consideration and shall [********] the EPIX Development Plan in accordance with
the recommendations of the JSC if the changes are necessary to enable the
Development of EPIX Program Compounds that meet the Candidate Selection Criteria
and PoC Criteria.

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Notwithstanding anything to the contrary herein, the JSC shall have no
decision-making authority in any respect over any aspect of GSK's Development or
Commercialization of GSK Development Compounds after [********].

          2.2.1 Membership. The JSC shall be comprised of three (3) employees
each from GSK and EPIX or such number as the Parties may agree and shall meet
quarterly, or more or less often as they shall determine, in person, by
teleconference or video-teleconference. In-person meetings shall alternate
between EPIX and GSK locations within the U.S. whenever possible unless
otherwise agreed by the Parties. The first such meeting shall be within sixty
(60) days after the Effective Date. Any member of the JSC may designate a
substitute to attend with prior written notice to the other Party. There will be
an annually rotating chairperson (the "Chairperson") during the Research Term
with the first Chairperson to be designated by EPIX. After the conclusion of the
Research Term, for the remainder of the Term, the JSC shall be chaired by a GSK
representative. The Chairperson shall designate a secretary for the JSC to be
responsible for calling meetings, preparing and circulating an agenda in advance
of each meeting, and preparing and issuing minutes of each meeting thereafter.
Ad hoc guests who are subject to written confidentiality obligations
commensurate in scope to the provisions in Article 11 hereof may be invited to
the JSC meetings. The JSC may set up any sub-committees, at its discretion, to
oversee any specific aspects of the Development activities (e.g., a
sub-committee may be formed to discuss and plan each Proof of Concept Trial
Package). Each Party may replace its JSC members with other of its employees, at
any time, upon written notice to the other Party.

          2.2.2 Decision-Making; Limitations of JSC. Except as otherwise
expressly provided herein, decisions of the JSC shall be made by consensus, with
each Party having collectively one (1) vote in all decisions. The JSC shall have
only such powers as are specifically delegated to it in this Agreement and such
powers shall be subject to the terms and conditions set forth herein. Without
limiting the generality of the foregoing, the JSC shall have (i) no power to
amend this Agreement; (ii) no decision-making authority with regard to the
[********], other than as set forth in Section 3.6; and (iii) no decision-making
authority over [********] and [********] activities [********] of [********] to
an EPIX Program. In the event that the JSC is unable to reach a consensus
decision on a matter which is within its decision-making authority within thirty
(30) days after it has met and attempted to reach such decision, then either
Party may, by written notice to the other, have such issue referred to the Chief
Executive Officer of EPIX, or such other person holding a similar position
designated by EPIX from time to time, and the Senior Vice President of the
Center of Excellence for External Drug Discovery ("CEEDD") of GSK if the matter
relates to an EPIX Program or to the Chairman, R&D of GSK if the matter relates
to a GSK Development Program, or such other person holding a similar position
designated by GSK from time to time (collectively, the "Executive Officers"),
for resolution. The Executive Officers shall meet promptly to discuss the matter
submitted and to determine a resolution. If the Executive Officers are unable to
resolve the dispute, except as otherwise provided in Section 3.5.2 (where an
independent expert is to be specified to be used to resolve disputes) or if the
matter is one over which GSK has sole discretion (for example, all issues
involving [********] activities and issues relating to

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establishment of the [********] and [********], as in [********]), the matter
will be resolved through arbitration under Section 14.2.

          2.2.3 Minutes. The Chairperson shall designate a secretary of the JSC
who will be responsible for preparing and circulating minutes within fifteen
(15) days after each meeting of the JSC setting forth, inter alia, a
description, in reasonable detail, of the discussions at the meeting and a list
of any actions, decisions or determinations approved by the JSC. Such minutes
shall be effective only after being approved by both Parties. Definitive minutes
of all JSC meetings shall be finalized no later than thirty (30) days after the
meeting to which the minutes pertain.

          2.2.4 Creation of Patent Subcommittee. Promptly after the Effective
Date, the JSC shall establish a Patent Subcommittee of the JSC (the "Patent
Subcommittee"). The Patent Subcommittee shall be comprised of an equal number of
representatives from each of EPIX and GSK. The Patent Subcommittee will report
to the JSC and will be responsible for the coordination of the Parties' efforts
in accordance with the provisions set forth in Article 10 of this Agreement,
including the review and filing of patent applications and assessments of
inventorship of inventions created during the Term. In the event of a dispute
within the Patent Subcommittee, such matter shall be submitted to the JSC for
resolution.

     2.3 Project Leaders/Alliance Managers. Promptly after the Effective Date,
each Party shall appoint an individual (other than an existing member of the
JSC) to act as the project leader/alliance manager for such Party (each, a
"Project Leader"). Each Project Leader shall thereafter be permitted to attend
meetings of the JSC as a nonvoting observer, subject to the confidentiality
provisions of Article 11. The Project Leaders shall be the primary point of
contact for the Parties regarding the Collaboration activities contemplated by
this Agreement and shall facilitate communication regarding all activities
hereunder. The name and contact information for such Project Leader, as well as
any replacement(s) chosen by EPIX or GSK, in their sole discretion, from time to
time, shall be promptly provided to the other Party in accordance with Section
15.2 of this Agreement.

                                    ARTICLE 3

              EPIX PROGRAMS; CANDIDATE COMPOUNDS; PROOF OF CONCEPT

     3.1 EPIX Development Efforts. During the Research Term, EPIX, at [********]
(except as expressly set forth herein, for example in Section 3.5.5), will use
Commercially Reasonable Efforts to research and Develop compounds that are
intended to meet specific Candidate Selection Criteria through to the completion
of a PoC Trial Package for the lead Candidate Compound within each EPIX Program.
Without limiting the foregoing, EPIX will use Commercially Reasonable Efforts to
perform the activities set forth in the EPIX Development Plans and will dedicate
to each EPIX Program appropriate resources and personnel with an appropriate
level of education, experience and training in order to achieve the objectives
of each

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EPIX Program. EPIX will use Commercially Reasonable Efforts to perform the
Development activities in each EPIX Development Plan in accordance with sound
scientific principles and practices, in accordance with the requirements of this
Agreement and the requirements of applicable Law. During the Research Term,
EPIX's Development activities under this Agreement will be focused on four (4)
EPIX Programs: the 5-HT4 Partial Agonist Program and three (3) additional EPIX
Programs against specified Program Targets selected in accordance with Section
3.3. For each EPIX Program, EPIX will use Commercially Reasonable Efforts to
identify [********] and [********] that meet the Candidate Selection Criteria.
EPIX's Development efforts will be conducted in accordance with the requirements
of Section 3.2.

     3.2 EPIX Development Generally.

          3.2.1 Development Plan. Within sixty (60) days after the JSC
determination of the Candidate Selection Criteria for a particular EPIX Program,
EPIX will develop a Development Plan for that EPIX Program. The JSC shall
provide any comments to the EPIX Development Plan to EPIX within thirty (30)
days of receipt of the EPIX Development Plan. EPIX shall take all such comments
into good faith consideration and [********]. Each EPIX Development Plan will be
devised to lead to the identification of compounds that meet the Candidate
Selection Criteria and that are suitable for further Development and
Commercialization. EPIX will periodically provide the JSC with any significant
updates and revisions to each EPIX Development Plan for the JSC's review and
approval. [********] all suggestions of the JSC into an EPIX Development Plan to
[********] the Development of EPIX Program Compounds that meet the Candidate
Selection Criteria and PoC Criteria.

          3.2.2 Development Reports. EPIX will provide the JSC with written
development reports or presentations at JSC meetings. Each report or
presentation shall present [********] of the Development activities accomplished
by EPIX through the end of such Calendar Quarter, including a summary of
significant results, information and data generated, any significant revisions
to the EPIX Development Plan going forward, significant challenges anticipated
and updates regarding significant intellectual property issues relating to each
EPIX Program Compound. Upon request by the JSC, EPIX shall provide the JSC with
summaries of clinical protocols, investigator brochures, non-clinical protocols
and reports (including activities relating to CMC), regulatory submissions and
correspondence from Regulatory Authorities with respect to EPIX Program
Compounds.

          3.2.3 Records. EPIX shall, and shall require its contractors and
Sublicensees, to maintain, complete and accurate records of all work conducted
in furtherance of the Development of EPIX Program Compounds and all results,
data and developments made in conducting such activities. Such records shall be
complete and accurate and shall fully and properly reflect all such work done
and results achieved in sufficient detail and in good scientific manner
appropriate for patent and regulatory purposes.

          3.2.4 Development Responsibilities and Costs. Except as otherwise
expressly set forth herein, including, for example, Section 3.6, EPIX shall have
[********], and shall [********] the [********] conducting, all Development
activities set forth in each EPIX

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
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OMISSIONS.

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Development Plan and for each PoC Trial Package. EPIX shall conduct all such
Development activities in compliance with all material applicable legal and
regulatory requirements, including, without limitation, all legal and regulatory
requirements pertaining to the design and conduct of clinical studies.

          3.2.5 Regulatory Responsibilities and Costs. EPIX shall prepare, file,
maintain and own all Regulatory Filings relating to each EPIX Program and all
EPIX Program Compounds, subject to [********] of such Regulatory Filings upon
exercise of an Option for an EPIX Program as provided in Section 4.3.5. Upon
request, EPIX will provide the JSC with copies of all Regulatory Filings and
related, material correspondence submitted to Regulatory Authorities or received
from Regulatory Authorities with respect to EPIX Programs and EPIX Program
Compounds. EPIX shall prepare all Regulatory Filings and related submissions
with respect to the EPIX Programs and the EPIX Program Compounds prior to GSK's
exercise of any Option for an EPIX Program and shall bear the cost of such
preparation.

          3.2.6 Subcontracting. EPIX may perform any activities in support of
its Development of EPIX Program Compounds through subcontracting to a Third
Party contractor or contract service organization, provided that: (a) none of
the rights of GSK hereunder are adversely affected as a result of such
subcontracting; (b) any such Third Party subcontractor to whom EPIX discloses
Confidential Information of GSK shall enter into an appropriate written
agreement obligating such Third Party to be bound by obligations of
confidentiality and restrictions on use of such GSK Confidential Information
that are no less restrictive than the obligations in this Agreement; (c) EPIX
will obligate such Third Party to agree in writing to assign or license (with
the right to grant sublicenses) to EPIX any inventions (and patent rights
covering such inventions) made by such Third Party in performing such services
for EPIX that are necessary to the Development or Commercialization of EPIX
Program Compounds; (d) EPIX shall at all times be responsible for the
performance of such subcontractor; (e) EPIX shall not subcontract the
performance of [********] activities; and (f) EPIX shall not subcontract the
conduct of clinical trials to be conducted for any of the EPIX Programs, except
through use of contract research organizations approved by the JSC. The Parties
agree to cooperate during the Research Term in identifying and implementing
opportunities to reduce the costs incurred by EPIX in the conduct of the EPIX
Programs, including the potential [********] and [********].

          3.2.7 Reporting; Confidential Information. Without limiting the
obligations of the Parties under Article 11, all proprietary and confidential
information received or obtained by GSK from EPIX (directly or through the JSC)
under this Article 3, including EPIX Know-How, shall be treated as EPIX
Confidential Information hereunder.

     3.3 Program Targets.

          3.3.1 Selection of Program Targets. The Parties acknowledge that the
first Program Target for the Collaboration is the 5-HT4 receptor that has been
the target of the 5-HT4 Partial Agonist Program. The Parties acknowledge that
the 5-HT4 Partial Agonist Program shall be the first EPIX Program (sometimes
referred to as the "EPIX 5-HT4 Program"). The second Program Target is
[********] (the corresponding EPIX Program is the "Second EPIX Program").

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Within [********] following the Effective Date, the JSC shall select the third
Program Target (the corresponding EPIX Program is the "Third EPIX Program").
Within [********] following the Effective Date, GSK [********] after
consultation with EPIX, will select the Fourth Program Target (the "Fourth
Program Target" and the corresponding EPIX Program is the "Fourth EPIX
Program"). If EPIX can demonstrate [********] that EPIX is (i) [********] in
silico receptor modeling, in silico drug design or screening, biology, chemistry
or Development efforts targeting a particular biological receptor; [********]
(ii) [********] with a Third Party towards an agreement that would [********] to
grant rights hereunder to GSK or otherwise to perform hereunder, for example,
with respect to rights in any compounds that [********] (iii) already is
[********] to such [********], in each case, at the time of such designation by
GSK, then such biological receptor shall [********]. Under such circumstances,
EPIX shall promptly provide such written documentation to a neutral third party,
identified jointly by the Parties, who will review such documentation and
determine whether this exception applies.

          3.3.2 Establishment of Candidate Selection Criteria. Within sixty (60)
days following selection of a Program Target for each EPIX Program other than
the EPIX 5-HT4 Program, [********] shall develop Candidate Selection Criteria to
be used to evaluate the EPIX Program Compounds identified and developed by EPIX
in EPIX Programs. The Candidate Selection Criteria are subject to revision by
[********]. The Candidate Selection Criteria may include several specific
criteria, and will identify for each such criterion a level, or range, of
results which shall be deemed to be acceptable, and for the various criteria,
those that are essential, and those that are desirable, in each case for
determining whether a compound satisfies the Candidate Selection Criteria. The
Candidate Selection Criteria shall be documented with sufficient specificity and
clarity to enable [********] whether a particular compound meets such criteria.
If the JSC cannot agree on Candidate Selection Criteria for any EPIX Program,
then the matter will be referred to the Senior Vice President of the CEEDD of
GSK and the CEO of EPIX for resolution.

          3.3.3 Substitution of Program Targets. If the JSC approves [********]
of Development by EPIX of either the Second EPIX Program or the Third EPIX
Program during the first [********] following initiation of Development efforts
for the Second EPIX Program or the Third EPIX Program, as applicable, then a new
Program Target will be selected by the JSC and a new EPIX Program will be
initiated against that new Program Target. No such substitution shall be
available for: (i) the [********], (ii) an EPIX Program if an EPIX Program
Compound from such EPIX Program has been tested in a human or (iii) the
[********]. [********] substitute Program Target shall be selected for any
single EPIX Program for which the right of substitution described in this
Section 3.3.3 is applicable, unless otherwise mutually agreed by the Parties.

     3.4 Commencement of EPIX Development Activities.

          3.4.1 Commencement of Development Activities. EPIX shall commence
Development efforts for the Second EPIX Program and the Third EPIX Program as
soon as reasonably practicable but no later than [********] after receipt by
EPIX of any comments from the JSC regarding the EPIX Development Plan. EPIX
shall commence Development efforts for

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the Fourth EPIX Program as soon as reasonably practicable but no later than
[********] after the Effective Date. If EPIX fails to commence Development of
any EPIX Program as set forth above, any [********] shall be [********] of the
Research Term for that EPIX Program, as provided in Section 3.8. EPIX shall
provide written notice to GSK promptly after commencing Development efforts on
each EPIX Program. The Parties hereby confirm that EPIX has initiated research
activities for the Second EPIX Program on the Effective Date.

          3.4.2 GSK Consultation. GSK will act in a consultative manner as
requested by EPIX and, on occasion, may perform, or assist in the performance,
of activities in an EPIX Development Plan, all as and to the extent agreed upon
by the Parties in their sole discretion.

     3.5 Selection of Candidate Compounds; Selection of Back-up Compounds.

          3.5.1. General; EPIX Development Efforts. EPIX Development efforts
will generally begin with [********], in silico drug discovery and design
efforts, the generation of Computational Leads, the synthesis of early
development compounds and the testing of such compounds in in vitro assays, and
using other analytical and evaluative tools and methods, to generate the data
required to evaluate such compounds against the Candidate Selection Criteria.
EPIX will use Commercially Reasonable Efforts to produce at least [********] for
each EPIX Program that satisfies the Candidate Selection Criteria, or that is
sufficiently promising that the JSC designates such compound as the Candidate
Compound for such EPIX Program (in either case, as applicable, such compound is
the "Candidate Compound" for such EPIX Program). For each EPIX Program, EPIX
will also use Commercially Reasonable Efforts to discover [********] prior to
the initiation of the first Phase I Trial with a Candidate Compound for such
EPIX Program; provided that EPIX shall [********] the initiation of any such
Phase I Trial solely for purposes of first discovering a Back-up Compound.

          3.5.2 Notification of Candidate Compounds; JSC Review. EPIX will
notify the JSC upon the discovery of a Candidate Compound or Back-up Compound
and will provide the JSC with [********] that the EPIX Program Compound has met
the Candidate Selection Criteria for that EPIX Program. The JSC may request
[********] from EPIX to determine whether the EPIX Program Compound has met the
Candidate Selection Criteria or whether it is otherwise [********] as a
Candidate Compound, and EPIX shall promptly provide the JSC with [********] in
EPIX's possession and control, and EPIX will use Commercially Reasonable Efforts
to obtain any such [********] that is not within its possession or control to
provide to the JSC; provided, however, that EPIX shall not be required to
generate [********] for these purposes. The JSC shall have a period of sixty
(60) days following the receipt of notice from EPIX and all requested data to
notify EPIX in writing whether it agrees with EPIX's designation of a compound
as a Candidate Compound or Back-up Compound. If there is a dispute regarding the
decision of the JSC, then GSK shall advise EPIX of the basis for its position
within such sixty (60) day period. If GSK does not notify EPIX of a dispute
within such sixty (60) day period, then such EPIX Program Compound will be
considered a Candidate Compound or Back-up Compound, as applicable, for the
purposes of this Agreement. In case of a dispute that cannot be resolved by the
JSC, the matter will be referred to the Senior Vice President of the CEEDD of
GSK and the CEO of EPIX for resolution. If such matter cannot be so resolved by
the two (2) executives

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OMISSIONS.

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<PAGE>

within thirty (30) days, then the matter shall be referred to an independent
expert who will be appointed by the Parties and act as an expert (and not an
arbitrator), and such expert's decision will be final and binding upon the
Parties. The Parties will share the cost and expenses of engaging such expert.

          3.5.3 Candidate Compound for 5-HT4 Partial Agonist Program. The
Parties agree that the compound designated PRX-03140 by EPIX is the Candidate
Compound for the 5-HT4 Partial Agonist Program.

          3.5.4 Back-up Compounds. The JSC shall agree with EPIX's designation,
or may designate on its own initiative, EPIX Program Compounds to be Back-up
Compounds as provided in Section 3.5.2. The JSC may agree at any time during the
Research Term and prior to the initiation of the PoC Trial Package for an EPIX
Program, to substitute for the Candidate Compound [********] Back-up Compounds
or any other EPIX Program Compounds for further Development, provided such
Back-up Compounds or other EPIX Program Compounds have met, or have been deemed
by the JSC to meet, the Candidate Selection Criteria. Upon such substitution,
such Back-up Compound will be the Candidate Compound for the relevant EPIX
Program.

          3.5.5 Additional Back-up Discovery Period.

               (a) If [********] Back-up Compounds for a specific EPIX Program
are not identified prior to the [********] for a Candidate Compound for such
EPIX Program, then GSK, at its sole discretion, shall have the right, to be
exercised, if at all, within thirty (30) days following the completion of the
[********] for the first EPIX Program Compound for such EPIX Program, to notify
EPIX that EPIX must continue discovery efforts for Back-up Compounds for such
EPIX Program until the earlier of: (i) [********] following the completion of
the [********] with a Candidate Compound from such EPIX Program or (ii) the
discovery of [********] Back-up Compound for the relevant EPIX Program
("Additional Back-up Discovery Period"); provided however, that with respect to
the 5-HT4 Partial Agonist Program, GSK must exercise such right, if at all,
within [********] following the Effective Date, and EPIX shall be permitted to
delay the commencement of the Additional Back-up Discovery Period for such
program for up to three (3) months following notification from GSK under this
Section. EPIX also shall have the right to delay the commencement of the
Additional Back-up Discovery Period for an EPIX Program other than the 5-HT4
Partial Agonist Program for up to three (3) months following notification from
GSK under this Section.

               (b) If GSK exercises the right to trigger an Additional Back-up
Discovery Period, [********], based on an annual rate of [********] to engage in
the Development work conducted during the Additional Back-up Discovery Period
and [********] incurred by EPIX for [********] to perform such services;
provided, however, that the Parties agree to cooperate to reduce the costs
incurred by EPIX in the conduct of the activities during the Additional Back-up
Discovery Period, including the potential [********] and [********]. In
addition, if GSK elects such right, GSK shall have the right to [********] and,
solely with respect to any amounts paid by GSK to EPIX pursuant to this Section
3.5.5 for work done for the 5-HT4

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OMISSIONS.

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<PAGE>

Partial Agonist Program, [********] for [********], all as provided in
[********]. GSK shall have the right to [********] for a particular EPIX Program
only [********] specified in the preceding sentence that become [********] after
the commencement of the relevant Additional Back-up Discovery Period and in
connection with activities or compounds within the [********]. All activities
conducted by EPIX during the Additional Back-up Discovery Period will be
directed to discovering Back-up Compounds to the Candidate Compound to which GSK
has an Option under Section 4.1.

          3.5.6 EPIX Program Compound Not Meeting Candidate Selection Criteria;
Rejection of EPIX Program Compound. The JSC shall have the discretion to accept
as a Candidate Compound or as a Back-up Compound an EPIX Program Compound that
does not meet the Candidate Selection Criteria, and upon such acceptance, the
EPIX Program Compound shall be a Candidate Compound or a Back-up Compound for
all purposes under this Agreement. A compound rejected by GSK or by an expert
under Section 3.5.2 shall no longer be considered an EPIX Program Compound,
shall no longer be included within an EPIX Program, shall not be a GSK
Development Compound, even if GSK exercises an Option for the relevant EPIX
Program, and shall not be further Developed by GSK or EPIX unless and until it
becomes a Returned Product or Compound.

     3.6 PoC Criteria; PoC Trial Package. Within sixty (60) days after the
designation of the first Candidate Compound within an EPIX Program, GSK will
develop and present to the JSC for review and comment the PoC Criteria for such
Candidate Compound within such EPIX Program. GSK will take the JSC's comments
regarding the PoC Criteria into good faith consideration and, [********] the PoC
Criteria to reflect the JSC's comments. If GSK [********] the PoC Criteria, GSK
will deliver to the JSC a revised PoC Criteria for such EPIX Program within
thirty (30) days after the receipt of comments. As soon as reasonably
practicable, but in no event later than thirty (30) days after the completion of
the first multi-dose Phase I Trial of a Candidate Compound within an EPIX
Program, a subcommittee designated by the JSC will draft and provide to the JSC
a draft design for a PoC Trial for such EPIX Program that is intended to
generate results that will permit evaluation of the tested compound against the
relevant PoC Criteria for the EPIX Program, together with draft designs for such
ancillary preclinical and clinical trials as are required in order to obtain the
Regulatory Approvals and institutional review board approvals necessary to
perform such PoC Trial and together with manufacturing, toxicology studies, or
formulation work required in connection therewith, but excluding such clinical
studies and manufacturing, toxicology studies, or formulation work as was
required to undertake and complete the EPIX Development Plan through to the
completion of the first multi-dose Phase I Trial (together "PoC Trial Package").
For the avoidance of doubt, each PoC Trial Package shall include [********]. The
JSC shall have a period of thirty (30) days after receipt of the draft PoC Trial
Package to review, comment and agree on the PoC Trial Package. If the JSC cannot
reach agreement on the PoC Trial Package, then the matter will be referred to
the Senior Vice President of the CEEDD of GSK and the CEO of EPIX for
resolution. If such matter cannot be so resolved by such executives within
thirty (30) days, then [********] shall have a period of thirty (30) days to
make final changes [********] to such PoC Trial Package so that it will meet the
PoC Criteria for such EPIX Program. The Parties agree that the PoC Trial Package
cannot be materially amended after commencement of the PoC Trial included in the
PoC Trial

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OMISSIONS.

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<PAGE>

Package, except that the PoC Trial may be modified pursuant to agreement of the
Parties, such agreement not to be unreasonably withheld, as needed to address
safety issues, as required by Regulatory Authorities, or to address [********].
Promptly after the Effective Date, GSK will develop and present to the JSC for
review and comment the PoC Criteria for PRX-03140 for the 5-HT4 Partial Agonist
Program.

          3.6.1 Costs of the PoC Trial Package. If the total actual costs
incurred by EPIX to complete the PoC Trial Package for a Candidate Compound
exceed [********], EPIX shall notify GSK, and, [********], [********] of such
costs in excess of [********]. Any amounts paid by GSK to EPIX under this
Section shall be [********] by GSK [********] that may become [********], as and
to the extent provided in [********]. The budget for costs to be incurred by
EPIX in connection with the PoC Trial Package shall not exceed [********] unless
mutually agreed between the Parties. All activities conducted by EPIX with
regard to the PoC Trial Packages will be directed to Developing Candidate
Compounds to which GSK has an Option under Section 4.1.

          3.6.2 PoC Trial Package for the 5-HT4 Partial Agonist Program. The
Parties hereby agree that PRX-03140 is the Candidate Compound for the 5-HT4
Partial Agonist Program. The PoC Trial Package for the 5-HT4 Partial Agonist
Program shall include the following components, as further defined and
incorporated into a PoC Trial Package: (i) a [********] [********] in suitable
form/formulation, (ii) [********] preclinical [********] using suitable
form/formulation, (iii) exploratory study to investigate potential for
[********] specifically involving the [********] (to include [********] of
subjects), and (iv) a [********] clinical study in Alzheimer's patients. Costs
of the PoC Trial Package for the 5-HT4 Partial Agonist Program shall include all
costs as defined in Section 3.6.1, except for such studies for the 5-HT4 Partial
Agonist Program initiated by EPIX prior to the Effective Date.

     3.7 Notice of Proof of Concept to GSK. Once EPIX determines that a
Candidate Compound has completed the PoC Trial Package, within sixty (60) days
of such occurrence, EPIX shall provide a data package to GSK containing the
following information: all analyses, results and raw data from the PoC Trial
Package for such Candidate Compound, as well as all other preclinical data
and/or clinical data generated and any related material correspondence or
information received from or sent to any Regulatory Authority up to the
completion of the PoC Trial Package relating to the Candidate Compounds at issue
and all other EPIX Program Compounds including all Back-up Compounds in the EPIX
Program (the "PoC Trial Report"). Such information shall be used by GSK solely
to make its decision on whether to elect to exercise its Option with respect to
such Candidate Compound and its associated Back-up Compounds. Upon delivery of
the PoC Trial Report, the Candidate Compound and the EPIX Program of which it is
a part shall both become subject to the Option described in Article 4 below.

     3.8 Extensions to the Research Term.

          3.8.1 Candidate Compounds Not Completing PoC Trial Package. Unless
earlier terminated as provided in Article 13, the Research Term shall expire
upon the [********]

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anniversary of the Effective Date; provided, however, that, if at that time, a
Candidate Compound in an EPIX Program has not completed the PoC Trial Package,
such EPIX Program has not been terminated by the JSC, and the Option pertaining
to such EPIX Program has not previously been exercised in accordance with
Section 4.1, then GSK shall have the right to extend the Research Term, in
[********], for such EPIX Program until such time as such PoC Trial Package is
completed or the EPIX Program is terminated by the JSC. In addition, the
Research Term shall automatically be extended by the amount of any delay in an
EPIX Program as provided in Section 3.4.1. In no event will the Research Term be
extended by more than [********]; provided, however, that if, at the conclusion
of the [********] extension of the Research Term a PoC Trial for a Candidate
Compound is then underway (i.e., the first subject has been dosed but the trial
is not yet completed), such EPIX Program has not been terminated by the JSC and
GSK has not exercised an Option for such EPIX Program, then the Research Term
will be [********], and EPIX shall use Commercially Reasonable Efforts to
complete the PoC Trial Package for that EPIX Program during such extension of
the Research Term, and GSK's Option to such EPIX Program shall continue
unaffected during such extension of the Research Term. If a PoC Trial for a
Candidate Compound has not completed by the end of the Research Term, including
the extensions described in this Section 3.8.1, GSK shall have the right to
exercise an Option to such EPIX Program, and the Parties will negotiate, in good
faith, [********]. At the end of the Research Term, including the extensions
described in this Section 3.8.1, all EPIX Program Compounds within all EPIX
Programs for which GSK has not exercised an Option shall be Returned Compounds
and Products, and EPIX will thereafter have all rights, itself or with a Third
Party or through a Third Party sublicensee, to Develop and Commercialize such
Returned Compounds and Products at EPIX's sole expense, subject to the terms of
this Agreement, including the grant of the Transfer License by GSK to EPIX under
Section 13.5.1(c)(ii) and the payment by EPIX of royalties to GSK under Section
8.8. At the end of the Research Term, EPIX can elect at any time, on thirty (30)
days prior notice to GSK, to withdraw from participation in the JSC, or other
committees established under this Agreement, and such committees shall be
disbanded upon such withdrawal. Thereafter, all information that GSK was
required to report to such committees shall be delivered by GSK directly to
EPIX.

          3.8.2 Continuation of Rights and Obligations. Subject to Section
3.5.5, the Parties rights and obligations during the initial Research Term shall
not be modified by virtue of any extension of the Research Term other than that
such rights will continue for the period of such extension. If the initial
Research Term is extended as provided in this Section, GSK shall continue to
participate in the cost of PoC Trial Packages as described herein and shall
continue to pay milestones as provided herein. The Parties agree that during any
extension of the initial Research Term for a particular EPIX Program, EPIX
Development activity will be limited to activities necessary to progress the
most advanced clinical stage Candidate Compound within such EPIX Program towards
the completion of the PoC Trial Package.

     3.9 GSK Internal Program Directed to 5-HT4. EPIX acknowledges that, as of
the Effective Date, GSK has an internal Development program directed to 5-HT4 as
a receptor. Nothing in this Agreement shall obligate GSK to transfer any GSK
Know-How regarding 5-HT4 to EPIX during the Term of the Agreement [********].

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                                    ARTICLE 4

                GSK OPTION; GSK DEVELOPMENT AND COMMERCIALIZATION

     4.1 GSK Option. Subject to the terms and conditions set forth herein,
including without limitation, the payment of amounts to EPIX as and when they
become due hereunder, EPIX hereby grants to GSK the exclusive right, exercisable
at GSK's sole discretion, to elect, on an EPIX Program-by-EPIX Program basis, to
obtain an exclusive worldwide license under Section 5.1 to Develop and
Commercialize all EPIX Program Compounds (including all Back-up Compounds)
within EPIX Programs as Licensed Products under the terms and conditions set
forth in this Agreement (each such right to elect, an "Option"). The Option
shall have a term of [********] from the date of delivery of the PoC Trial
Report for the relevant EPIX Program (the "Option Period"), subject to extension
of the Option Period as provided in Section 4.1.1. During the Option Period, GSK
shall have the right to conduct due diligence on the EPIX Program. The Option
shall only be exercisable during the Option Period; provided that completion of
such exercise shall be subject to the condition set forth in Section 4.1.1, if
applicable. If the Option is not so exercised, then the Option shall expire and
be of no further force or effect at the end of the Option Period. GSK shall
exercise the Option, if at all, by written notice to EPIX, which notice shall
make reference to this Agreement and the relevant EPIX Program and shall include
GSK's decision to exercise the Option with respect to the specific EPIX Program.
Upon exercise of an Option, the relevant EPIX Program shall, for purposes of
this Agreement, be re-designated a GSK Development Program and the relevant EPIX
Program Compounds shall be re-designated as GSK Development Compounds. Such
program shall remain a GSK Development Program unless and until GSK terminates
such GSK Development Program or this Agreement terminates, whether in its
entirety or with respect to the relevant GSK Development Program (alone or with
other GSK Development Programs). Notwithstanding anything herein to the
contrary, GSK, in its discretion, may exercise an Option at any time prior to
completion of the PoC Trial for an EPIX Program Compound and delivery to GSK of
the PoC Trial Report.

          4.1.1 Extension of Option Period. If GSK reasonably determines in good
faith that the exercise of any Option by GSK under this Agreement is required to
be filed with the Federal Trade Commission (the "FTC") under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976 (15 U.S.C. Section 18a)
("HSR") or under any similar premerger notification provision in the European
Union or any other jurisdiction, then, in order to preserve its right to
complete the exercise of the Option, GSK shall provide written notice of
exercise of the Option to EPIX prior to the end of the Option Period as
described in Section 4.1, which notice shall include GSK's binding commitment to
complete the exercise of the Option, subject only to HSR or other governmental
clearance by the FTC or other governmental authority, and the Option Period
automatically shall be extended for [********]. If the exercise of the Option
does not comply with the requirements of Section 4.1 and this Section 4.1.1,
including, for example, because it includes other conditions to the completion
of the exercise of the Option other than the grant of HSR or other governmental
clearance, then the Option exercise shall not be effective, and the Option
Period shall not be extended. If HSR or other governmental clearance is not
granted within [********] from the expiration of the Option Period, or if GSK
receives a "Second

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 Request" from the FTC or similar request for additional information from a
governmental authority in connection with such filing, the Option Period shall
be extended for an additional period of time to permit GSK to obtain FTC or
other governmental clearance or to respond to the Second Request or provide
additional information to the governmental authority. If GSK elects not to
respond to the Second Request or to withdraw its request for HSR or other
governmental clearance, the Option shall terminate. GSK shall have no obligation
to make any [********] to EPIX for [********] until it obtains HSR clearance
from the FTC or similar clearance from any other governmental authority for
which approval is necessary for exercise of an Option.

          4.1.2 GSK Rights on Exercise of Option. Following exercise of its
Option with respect to an EPIX Program, GSK shall have [********] over all
Development and Commercialization of the GSK Development Compounds and shall
make [********] with respect to such Development and Commercialization, subject
to its obligations hereunder, including its obligation to use Commercially
Reasonable Efforts to conduct such activities. In its sole discretion, GSK may
substitute any one of the [********] or any other EPIX Program Compound within
an EPIX Program for the lead Candidate Compound and, in GSK's sole discretion,
GSK may choose to Develop and Commercialize either or both of the Candidate
Compound and a Back-up Compound or any other EPIX Program Compound, subject to
GSK's obligations under this Agreement. GSK shall also have discretion to
terminate Development of any GSK Development Program as provided in Section
13.3.2. All such activities shall be conducted [********]

          4.1.3 No Grant of Rights to Third Parties. Until such time as an
Option granted to GSK pursuant to Section 4.1 on EPIX Program Compounds has
expired or terminated (including, for example, because the JSC terminated the
relevant EPIX Program), EPIX will not grant to any Third Party rights to any
EPIX Patents or EPIX Know-How which are [********] with or which would
[********] with the grant of the licenses resulting from the exercise of such
Option by GSK hereunder. For the avoidance of doubt, the Parties understand and
agree that for so long as a GSK Option is in effect, such Option shall be
exclusive as to the EPIX Program Compounds that are the subject of the relevant
EPIX Program, and, EPIX shall have [********] to offer or negotiate with any
Third Party with respect to the grant to such Third Party of any right or
license, or any other encumbrance of any kind, in or to any of such EPIX Program
Compounds, or any EPIX Patents or EPIX Know-How, which would [********] with the
grant of the licenses resulting from the exercise of such Option to GSK
hereunder. The grant of the Options by EPIX hereunder is [********] except as
provided under Article 13 or at law.

          4.1.4 Returned Compounds. If GSK does not exercise an Option during
the Option Period with respect to a particular EPIX Program, or if the JSC
terminates Development with respect to a particular EPIX Program, then, in
either case, the Option shall expire with respect to such EPIX Program, and all
EPIX Program Compounds within such EPIX Program shall be part of the Returned
Compounds and Products, and EPIX will thereafter have all rights, itself or with
a Third Party or through a Third Party sublicensee, to Develop and Commercialize
such Returned Compounds and Products at EPIX's sole expense, subject to the
terms of this Agreement, including the grant of the Transfer License by GSK to
EPIX under Section 13.5.1(c)(ii) and the payment by EPIX of royalties to GSK
under Section 8.8. GSK shall cease

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any and all Development efforts with respect to all such Returned Compounds and
Products, and GSK shall have no right or license to practice the EPIX Patents,
to use EPIX Know-How, or to use the EPIX Confidential Information relating to
such Returned Compounds and Products for any purpose.

     4.2 GSK Development and Commercialization Efforts. During the Term, after
exercise of an Option, GSK, at its sole cost and expense, will use Commercially
Reasonable Efforts to Develop and Commercialize [********] GSK Development
Compound from each GSK Development Program in [********] in the Territory;
provided, however, that GSK's failure to Commercialize a GSK Development
Compound in a [********] shall not, in and of itself, constitute material breach
of this Agreement under Section 13.2.1. GSK will provide prompt notice to EPIX
if and when GSK determines that the Development or Commercialization of a GSK
Development Compound or a Licensed Product is not commercially reasonable or
technically feasible, or should be terminated or suspended for a period of time,
in each case specifying the reasons for such decision. GSK's decision to
[********] Development or Commercialization of a GSK Development Compound or
Licensed Product, as applicable, shall not [********] by GSK of the GSK
Development Program, so long as GSK is continuing to use Commercially Reasonable
Efforts in Developing and Commercializing at least one GSK Development Compound
or Licensed Product within a GSK Development Program.

     4.3 GSK Development and Commercialization Generally.

          4.3.1 GSK Development Plan; GSK Commercialization Plan. Within
[********] following the exercise of an Option, for each GSK Development
Program, GSK will prepare and provide to the JSC a summary of a [********] plan
for the GSK Development Program that details the plan for conducting Development
of at least [********] specifying significant clinical and non clinical studies
and activities [********], with respect to Development of each GSK Development
Compound (each a "GSK Development Plan"). GSK will take any comments provided by
the JSC or EPIX into [********], but shall have [********] to incorporate them
into GSK's plans for Development. As soon as the information is available, but
no later than [********] prior to the anticipated [********] for the [********]
within a GSK Development Program, GSK will prepare and provide to the JSC a
summary of a plan that is a continuation of the GSK Development Plan for such
GSK Development Compound that details [********] for such GSK Development
Compound, [********] (each a "GSK Commercialization Plan"). GSK will provide the
JSC with any significant updates and revisions to each GSK Development Plan and
GSK Commercialization Plan for the JSC's review.

          4.3.2 Development and Commercialization Reports. On a quarterly basis
at JSC meetings or as otherwise agreed between the Parties, during the Term, GSK
will provide the JSC with presentations regarding the Development activities
performed by GSK, including a summary of [********] generated, and any
[********] to the GSK Development Plans going forward, [********] and updates
regarding [********], regulatory matters, and the status of any Regulatory
Approvals, in each case relating to each GSK Development Compound. GSK shall
provide the JSC, upon request, with a summary of material clinical protocols and
Regulatory Filings with respect to each GSK Development Compound. Once per year
following the

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exercise of the first Option for an EPIX Program, GSK will share with the JSC
its plans for Commercialization of the Licensed Product. In the event that this
update occurs after preparation of the GSK Commercialization Plan for a Licensed
Product, GSK will communicate any significant changes to the Commercialization
Plan to the JSC.

          4.3.3 Records. GSK shall maintain, and require its contractors and
Sublicensees to maintain, complete and accurate records of all work conducted in
furtherance of the Development and Commercialization of GSK Development
Compounds and all results, data and developments made in conducting such
activities. Such records shall be complete and accurate and shall fully and
properly reflect all such work done and results achieved in sufficient detail
and in good scientific manner appropriate for patent and regulatory purposes.

          4.3.4 Development and Commercialization Responsibilities and Costs.
GSK shall have [********] for, and [********] of conducting, all Development and
Commercialization activities with respect to GSK Development Compounds following
exercise of an Option. GSK shall conduct such activities in compliance with all
material applicable legal and regulatory requirements, including, without
limitation, all legal and regulatory requirements pertaining to the design and
conduct of clinical studies and the Commercialization of pharmaceutical
products.

          4.3.5 Regulatory Responsibilities and Costs. Promptly after GSK's
exercise of an Option, EPIX shall assign to GSK any Regulatory Filings for the
relevant EPIX Program. Following exercise of an Option, GSK shall prepare, file,
maintain and own, subject to assignment to EPIX as provided herein, all
Regulatory Filings relating to the relevant GSK Development Program and GSK
Development Compounds. Upon the request of EPIX, GSK will provide EPIX with
copies of material Regulatory Filings and related material correspondence
submitted to Regulatory Authorities or received from Regulatory Authorities with
respect to GSK Development Programs and GSK Development Compounds. GSK shall
have [********] for, and shall [********] preparing, all Regulatory Filings and
related submissions with respect to the GSK Development Programs and the GSK
Development Compounds.

          4.3.6 Subcontracting. Subject to and without limiting Section 5.2, GSK
may perform any activities in support of its Development and Commercialization
of GSK Development Compounds through subcontracting to a Third Party contractor
or contract service organization, provided that: (a) none of the rights of EPIX
hereunder are adversely affected as a result of such subcontracting; (b) any
such Third Party subcontractor to whom GSK discloses Confidential Information
shall enter into an appropriate written agreement obligating such Third Party to
be bound by obligations of confidentiality and restrictions on use of such
Confidential Information that are no less restrictive than the obligations in
this Agreement; (c) GSK will obligate such Third Party to agree in writing to
assign or license (with the right to grant sublicenses) to GSK any inventions
(and patent rights covering such inventions) made by such Third Party in
performing such services for GSK that are necessary to the Development or
Commercialization of GSK Development Compounds or Licensed Products; and (d) GSK
shall at all times be responsible for the performance of such subcontractor.

          4.3.7 Reporting; Confidential Information. Without limiting the
obligations of the Parties under Article 11, all proprietary and confidential
information received or obtained by

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EPIX from GSK (directly or through the JSC) under this Article 4 shall be
treated as GSK Confidential Information hereunder.

     4.4 Licensed Product Approvals. GSK shall use Commercially Reasonable
Efforts to effect the First Commercial Sale of each Licensed Product in
[********] [********].

          4.4.1 Marking. The packaging for each Licensed Product Commercialized
by GSK under this Agreement shall be marked (to the extent not prohibited by
applicable Law): (i) with a notice that such Licensed Product is sold under a
license from EPIX (as applicable) and (ii) with applicable patent and other
intellectual property notices relating to the EPIX Patents in such a manner as
may be required by applicable Law.

          4.4.2 Manufacture and Supply. GSK shall be solely responsible at its
expense for all of its requirements for making or having made all of its
requirements of the Licensed Products following exercise of the relevant Option.
GSK shall manufacture, handle, store and ship the Licensed Products in
compliance with all applicable Laws, with all regulatory filings, and with its
applicable internal specifications and quality control procedures.

     4.5 Pharmacovigilance. Promptly after GSK's exercise of an Option for an
EPIX Program, GSK and EPIX, if necessary, shall execute a safety data exchange
agreement to facilitate transfer and reporting of safety data for any EPIX
Program Compounds within an EPIX Program for which GSK has exercised an Option.

                                    ARTICLE 5

  LICENSE GRANT TO GSK UPON EXERCISE OF AN OPTION; TECHNOLOGY TRANSFER BY EPIX

     5.1 License to GSK for GSK Development and Licensed Products. Subject to
the terms and conditions set forth in this Agreement (including, without
limitation, the reservation of rights in Section 5.7, EPIX's option to
co-promote as described in Article 6, and the payment by GSK of all amounts as
and when they become due and payable hereunder), upon GSK's exercise of an
Option in accordance with the terms of this Agreement, EPIX shall be hereby
deemed to have granted and hereby grants to GSK the exclusive (even as to EPIX
and its Affiliates) license, non-transferable (except as provided in Section
15.4.2) with the right to sublicense solely in accordance with Section 5.2,
under the EPIX Patents and EPIX Know-How, to make, have made, use, sell, offer
to sell, export, import and otherwise exploit or Commercialize Licensed Products
that are the subject of the Option so exercised, during the Term, and throughout
the Field and the Territory.

          5.1.1 Trademarks for Licensed Products. To the extent that EPIX owns
any trademark(s) that pertain specifically to a Licensed Product and that GSK
believes would be necessary or useful for the Commercialization of a Licensed
Product, EPIX shall assign its rights and title to such trademark(s) to GSK
reasonably in advance of GSK's anticipated First

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Commercial Sale of such Licensed Product, upon request by GSK and at no cost to
GSK. Such trademarks shall be treated for all purposes under this Agreement as
part of the EPIX Know-How. Such trademarks shall not include the term "EPIX",
whether alone or in combination with other terms.

     5.2 Sublicenses. GSK shall have the right to grant sublicenses with respect
to the rights licensed to GSK under Section 5.1 solely in accordance with this
Section 5.2.

          (a) GSK shall have the right to grant Sublicenses in a country or on a
regional basis under the EPIX Patents and EPIX Know-How; provided, however, that
GSK shall not, without the prior approval of EPIX (such approval not to be
unreasonably withheld), grant any such Sublicenses that include the right of the
Sublicensee to: (i) perform research or Development of a GSK Development
Compound or Licensed Product prior to the receipt of Regulatory Approval, or
(ii) market or sell a Licensed Product in a Major Market (excluding arrangements
with distributors or wholesalers customary in the industry). For clarification,
an agreement with a contractor, contract research organization, contract
manufacturer or other Third Party performing contracted services related to the
manufacture, research, Development and/or Commercialization of GSK Development
Compound(s) or Licensed Product(s) shall not be a Sublicense thereof, provided
such agreement is a fee-for-service arrangement and does not grant the Third
Party the right to sell or promote such Licensed Product.

          (b) Subject to the foregoing and Section 5.2(a), GSK shall have the
right to enter into a Sublicense with a Third Party, provided that:

          (i) such Sublicense shall refer to this Agreement and shall be
subordinate to and consistent with the terms and conditions of this Agreement,
and shall not limit the ability of GSK (individually or through the activities
of its Sublicensee) to fully perform all of its obligations under this Agreement
or EPIX's rights under this Agreement;

          (ii) in such Sublicense agreement, the Sublicensee shall agree in
writing to be bound to GSK by terms and conditions substantially similar to, or
less favorable to the Sublicensee than, the corresponding terms and conditions
of this Agreement;

          (iii) promptly after execution of the Sublicense agreement, GSK shall
provide a summary of such Sublicense agreement to EPIX. Such summary shall be
treated as GSK Confidential Information hereunder;

          (iv) GSK shall remain responsible for the performance of this
Agreement and the performance of its Sublicensees hereunder, including without
limitation, the payment of all payments due, and making reports and keeping
books and records, and shall cause such Sublicensee to enable GSK to comply with
the terms and conditions of this Agreement;

          (v) each Sublicense shall terminate immediately upon the termination
of this Agreement (in whole or only with respect to the rights that are subject
to such Sublicense), provided that such Sublicense shall not terminate if, as of
the effective date of such termination, the Sublicensee is not in material
breach of its obligations to GSK under its Sublicense

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agreement, and within thirty (30) days of such termination the Sublicensee
agrees in writing to be bound directly to EPIX under a license agreement
substantially similar to this Agreement with respect to the rights sublicensed
hereunder, substituting such Sublicensee (a "Surviving Sublicensee") for GSK,
and provided further that (A) such license agreement shall not prejudice any
remedy EPIX may have against GSK for the circumstances which were the basis for
such termination; (B) the scope of the rights granted to the Surviving
Sublicensee under such license agreement shall be equal to the scope of the
rights that had been sublicensed by GSK to the Surviving Sublicensee pursuant to
the Sublicense agreement; and (C) such license agreement shall obligate the
Surviving Sublicensee to pay directly to EPIX amounts corresponding to those set
forth in Article 8 hereof which are payable based on the activities of such
Surviving Sublicensee, its Affiliates and its Sublicensees; and

          (vi) such Sublicensees shall have the right to grant further
Sublicenses of same or lesser scope as its sublicense from GSK under the grants
contained in Section 5.1 (the other party to such further sublicense also being
a "Sublicensee"), provided that such further sublicenses shall be in accordance
with and subject to all of the terms and conditions of this Section 5.2(b)
(i.e., such Sublicensee shall be subject to this Section 5.2(b) in the same
manner and to the same extent as GSK).

     5.3 Research License to EPIX. During the Research Term and any extension of
such Research Term in accordance with Section 3.8, GSK hereby grants a
royalty-free, non-exclusive, non-sublicensable license to EPIX under GSK Patents
that claim or cover the Program Targets, solely as and to the extent necessary
to enable EPIX to perform activities reflected in the EPIX Development Plans for
each EPIX Program. Nothing in this Section 5.3 shall obligate GSK to transfer
any GSK Know-How to EPIX during the Term of the Agreement, including GSK
Know-How relating to 5-HT4 as a receptor.

     5.4 Transfer License to EPIX. GSK shall grant, and does hereby grant, to
EPIX the Transfer License set forth in Section 13.5.1(c)(ii), subject to the
terms and conditions set forth in this Agreement.

     5.5 Use of Names; Logo. To the extent permitted under applicable laws and
regulations, the packaging and labeling for Licensed Products will bear both GSK
and EPIX names and logos, and such names and logos will be presented with
substantially equivalent prominence in any Product presentations, exhibit
booths, conferences or promotion materials or activities. No right or license,
express or implied, is granted to GSK to use any trademark, trade name, trade
dress or service mark owned or Controlled by EPIX or any of its Affiliates. GSK,
at its sole cost and expense, shall be responsible for the selection,
registration and maintenance of all trademarks which it employs in connection
with its activities conducted pursuant to this Agreement.

     5.6 No Implied Licenses. No license or other right is or shall be created
or granted hereunder by implication, estoppel or otherwise. All such licenses
and rights are or shall be granted only as expressly provided in this Agreement.

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     5.7 Retained Rights. All rights not expressly granted hereunder are
reserved by EPIX and may be used by EPIX for any purpose.

     5.8 Technology Transfer by EPIX after Exercise by GSK of Option.

          5.8.1 Generally. After GSK exercises its Option for an EPIX Program,
EPIX shall promptly deliver to GSK, at no cost to GSK, all EPIX Know-How,
materials and other information in EPIX's possession and Control relating to the
EPIX Program Compounds in such EPIX Program, including, but not limited to all
information regarding the bulk drug substance and methods of manufacturing the
same, which is necessary for the exercise by GSK of the rights granted under
Section 4.1, together with (a) the full disclosure of all information
(including, without limitation, clinical and protocol results, analytical
methodologies, bulk and final product manufacturing processes, batch records,
vendor information, validation documentation, regulatory documentation, patent
information), all regulatory filings, transfer of information related to
regulatory information and filings, all pre-clinical and clinical data, adverse
event data, all regulatory correspondence, analyses, manufacturing data,
applicable reference standards; and (b) all bulk drug substance, or other
materials used to manufacture the applicable Licensed Product. Without limiting
the foregoing, EPIX shall use reasonable efforts with respect to those
activities for which it is responsible to ensure orderly transition and
uninterrupted Development of GSK Development Compounds.

          5.8.2 Continuing Cooperation. After the transfer described in Section
5.8.1 above, and for a [********] period thereafter, EPIX shall use Commercially
Reasonable Efforts, [********], to cooperate fully with GSK to provide GSK with
the EPIX Know-How and information, as it may be developed or identified to which
GSK has a right or license under this Agreement that is necessary or useful for
GSK to further Develop, produce, Commercialize or otherwise exploit the
progression of GSK Development Compounds into Licensed Product(s). After the
transfer of GSK Know-How to EPIX as described in Article 13, if applicable, and
for a [********] period thereafter, GSK shall use Commercially Reasonable
Efforts, [********], to cooperate fully with EPIX to provide EPIX with the GSK
Know-How and information as it may be identified to which EPIX has a right
pursuant to Article 13.

          5.8.3 Additional Services. In the event that GSK requests EPIX to
provide GSK with any materials or services beyond those set forth in Sections
5.8.1 and 5.8.2, such materials and/or services shall be scheduled and provided
by EPIX to GSK on such terms and conditions as may be mutually agreed between
the Parties at the time of any such request, if the Parties mutually desire to
engage in the transfer or provision of such additional materials or services. In
the event that EPIX requests GSK to provide EPIX with any materials or services
beyond those set forth in Article 13 and 5.8.2, such materials and/or services
shall be provided by GSK to EPIX on such terms and conditions as may be mutually
agreed between the Parties at the time of any such request, if the Parties
mutually desire to engage in the transfer or provision of such additional
materials or services.

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                                    ARTICLE 6

                            EPIX OPTION TO CO-PROMOTE

     6.1 EPIX Option to Co-Promote. If GSK exercises the Option for the 5-HT4
Partial Agonist Program, EPIX shall have an option to co-promote any Licensed
Product that incorporates a GSK Development Compound from the 5-HT4 Partial
Agonist Program (the "Co-Promotion Option"). Such Co-Promotion Option shall be
limited to co-promotion activities within the United States only. The
Co-Promotion Option shall be exercisable by EPIX providing written notice to GSK
of its desire to exercise the Co-Promotion Option at any time prior to the NDA
Filing for such Licensed Product in the United States. Upon exercise of the
Co-Promotion Option, the Parties shall negotiate in good faith towards a
definitive written co-promotion agreement specifying the terms of the
co-promotion arrangement, which terms shall be consistent with all of the terms
and conditions in this Article 6 and all other relevant provisions of this
Agreement (the "Co-Promotion Agreement"). [********] GSK and EPIX agree to
cooperate in good faith to agree upon additional terms and conditions for
inclusion in the Co-Promotion Agreement that are intended to balance the right
of EPIX to co-promote Licensed Products as and to the extent set forth herein,
the Parties' desire to ensure that Licensed Products are optimally promoted in a
manner that is consistent with the then-current standards and practices in the
pharmaceutical industry in the U.S., and GSK's Commercialization plans for the
Licensed Product. At least [********] prior to the First Commercial Sale of a
Licensed Product for which EPIX exercised the Co-Promotion Option, EPIX shall
have employed a sufficient number of sales representatives as are required to
enable EPIX to fulfill its obligations under the Co-Promotion Agreement. The
co-promotion agreement will enable EPIX to understand the actual level of
co-promotion activity it will be required to provide and will afford EPIX
adequate time to recruit, evaluate, hire and train its sales force. The
remainder of this Article 6 sets forth terms and conditions pursuant to which
EPIX will provide the co-promotion services. Such terms and conditions are
conditioned on EPIX's timely exercise of the Co-Promotion Option.

     6.2 Level of Co-Promotion. On the effective date of the Co-Promotion
Agreement, GSK will share with EPIX the annual marketing plan for the Licensed
Product for the United States. The US marketing plan for the Licensed Product
will describe in detail EPIX's role in promoting the Licensed Product,
including, without limitation, the [********] for which GSK will pay EPIX during
the period of the marketing plan. Each calendar year, the US marketing plan for
the Licensed Product will be revised to describe the commercial activities for
the following twelve (12) months and will be shared with EPIX in a timely
manner. It is the goal of the Parties that EPIX will be permitted to provide
[********] sales representatives to provide the co-promotion services but in
[********] of the requisite detailing efforts identified in the annual marketing
plan. EPIX shall not provide co-promotion services under the co-promotion
agreement [********]. EPIX's sales representatives will promote the Licensed
Product to [********] only in the United States under the direction of GSK and
for a term not to [********] Licensed Product. GSK will [********] all marketing
and advertising activities for the Licensed Product. EPIX will have no right to
promote any Licensed Products other than those resulting from the 5-HT4 Partial
Agonist Program, and any other participation by EPIX in

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promotional activities relating to Licensed Products shall be subject to the
consent and agreement of the Parties, which may be withheld in their respective
sole discretion.

     6.3 Training; Materials; Compliance. GSK, [********], will supply all
promotional and marketing materials used to promote the relevant Licensed
Product in the United States as well as all product-specific training materials
and trainers for the training of the EPIX sales representatives [********]. EPIX
will use only GSK-approved promotional messages and materials and will comply
with the GSK commercial practices and policies in effect during the co-promotion
period as such are communicated to EPIX. EPIX's co-promotion activities will be
conducted in accordance with all applicable laws and regulations (including,
without limitation, those promulgated by the FDA and the Division of Drug
Marketing and Communications). EPIX shall be responsible for ensuring that its
sales force representatives have comparable levels of knowledge, experience and
skills as other sales representatives employed by GSK. EPIX will ensure that its
sales force representatives shall be trained to the same level and with
consistent materials as GSK's own sales force representatives, and achieve
similar pass rates in sales training exams, at the time of such training. EPIX's
sales force representatives shall attend, as appropriate in view of GSK's
policies and practices, such training seminars as are held for GSK's own sales
force representatives. Any additional training events required by EPIX
[********]. Subject to EPIX's right to provide the level of co-promotion
services specified under Section 6.2, GSK shall not be restricted in its
promotional and selling efforts to any specialist or general practice physician.
At all times, EPIX will be solely responsible for ensuring its sales force
abides by all applicable commercial practice standards, legal regulations and
regulatory rules.

     6.4 Costs; Compensation. Except as set forth above, EPIX shall be
responsible for all costs associated with establishing and training its sales
force. GSK will compensate EPIX for co-promotion activities [********] for
co-promotion activities will be [********]. Nothing in the Co-Promotion
Agreement shall obligate GSK to pay EPIX additional milestones or royalties
other than as set forth in this Agreement.

     6.5 Non-Transferability. In no event shall EPIX's co-promotion right under
Section 6.1 or any resulting definitive co-promotion agreement between the
Parties be assignable, sublicenseable or transferable, in any way, by EPIX. If
EPIX assigns this Agreement to a Third Party, in accordance with Section 15.4,
EPIX's Co-Promotion Option shall immediately terminate. In the event that EPIX
undergoes a Change in Control Event, GSK shall have the right to immediately
terminate EPIX's Co-Promotion Option upon written notice, such termination to be
effective upon the date of receipt by the surviving entity from the Change in
Control Event of such notice.

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                                    ARTICLE 7

                                   EXCLUSIVITY

     7.1 Exclusivity.

          7.1.1 During the Research Term. During the Research Term, as such
Research Term may be extended pursuant to Section 3.8 (the "Research Exclusivity
Period"), EPIX hereby covenants that it shall not, either on its own or with or
for any Third Party: (a) conduct any research or Development or
Commercialization activities, or grant any license or other rights with respect
to the identification or optimization of small molecules whose principal mode of
pharmacological action is to [********] as specified in the [********] to by the
Parties for determining such activity, except pursuant to this Agreement; or (b)
[********] any EPIX Program Compounds for any purpose other than those
contemplated by this Agreement.

          7.1.2 During the Term. During the Term of the Agreement, EPIX hereby
covenants that it shall not, either on its own or with or for a Third Party: (a)
conduct any Development or Commercialization activities or grant any license or
other rights with respect to the identification or optimization of small
molecules [********] as specified in [********] to by the Parties for
determining such activity, except pursuant to this Agreement; or (b) [********]
compounds for use in the Field whose principal mode of pharmacological action is
to [********] specified in [********] to by the Parties for determining such
activity; or (c) [********] any EPIX Program Compounds within an EPIX Program
that were the subject of an Option exercised by GSK.

          7.1.3 Duration of Exclusivity Obligations. EPIX's obligations under
Section 7.1.1 and 7.1.2 shall continue for the Research Exclusivity Period, or
the Term, as provided above, with respect to each EPIX Program, GSK Development
Program, and Licensed Product, unless and until: (i) GSK fails or elects not to
exercise its Option with respect to an EPIX Program, (ii) an EPIX Program is
terminated by the JSC, (iii) an EPIX Program becomes a GSK Development Program
and is subsequently terminated by GSK pursuant to Section 13.3.2, (iv) this
Agreement is terminated, with respect to a particular EPIX Program, GSK
Development Program, or in its entirety, under Article 13 other than under
Section 13.5.2.

     7.2 [********].

          7.2.1 Prior to Exercise of Option; [********] on GSK Development or
Commercialization. Prior to exercise of any Option with respect to each EPIX
Program or in the event GSK elects not to exercise an Option with respect to an
EPIX Program, GSK shall have the right, during the Term, to seek to acquire
rights to, to in-license, and to research, Develop and Commercialize, [********]
provided, however, that GSK shall not use any EPIX Know-How (including any
[********]) or [********], in connection with such activities.

          7.2.2 After Exercise of Option. After GSK exercises an Option with
respect to an EPIX Program, if GSK receives Regulatory Approval of or otherwise
seeks to commercialize [********] as defined herein, GSK shall elect either
[********] is hereby defined as any small

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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<PAGE>
molecule (i) [********] as specified in the Candidate Selection Criteria, as
measured by a [********] agreed to by the Parties for determining such activity;
[********] (ii) which is being Developed or Commercialized [********].
Notwithstanding the foregoing, GSK shall have the right to [********]; provided
that the [********] the Licensed Product in such country is consistent with
Commercially Reasonable Efforts to Commercialize the Licensed Product in such
country (the level of such Commercially Reasonable Efforts to be determined
[********]

          7.2.3 [********] During Development. If, after GSK exercises an Option
(thereby converting an EPIX Program into a GSK Development Program), GSK has
under Development a [********] to that GSK Development Program, then GSK shall,
within [********] after the occurrence of the foregoing circumstances, develop
and provide to EPIX a detailed plan of all Development activities planned for
the GSK Development Program, including the anticipated timing for initiating and
completing all such activities. GSK shall [********] GSK Development Program if
the activities set forth in the plan constitute Commercially Reasonable Efforts
with respect to the Development and Commercialization of such GSK Development
Program [********] and GSK carries out the activities as described in such plan.
GSK shall provide EPIX with copies of such plan as it is amended or
supplemented, and reports of progress GSK makes in the performance of the
activities set forth in such plan, as well as details of Development delays or
setbacks, a description of any deviations from such plan and any other material
information reasonably pertaining to a determination of whether GSK is meeting
its obligations under this Section 7.2.3.

                                    ARTICLE 8

                                 FINANCIAL TERMS

     8.1 Initial Payments.

          8.1.1 Upfront Payment. In consideration for the Option rights granted
to GSK in Article 4 and the Development work to be performed by EPIX under this
Agreement, GSK shall pay to EPIX a one-time-only, nonrefundable, noncreditable
payment of fifteen million Dollars ($15,000,000) no later than ten (10) days
after receipt by GSK of an invoice from EPIX on or after the Effective Date. GSK
shall make such payment by wire transfer of immediately available funds into an
account designated in writing by EPIX.

          8.1.2 Equity Investment. Within ten (10) days after the Effective
Date, GSK shall purchase seventeen million five hundred thousand Dollars
($17,500,000) of common stock of EPIX in accordance with the terms and
conditions of the Stock Purchase Agreement.

          8.1.3 Payments by GSK or Affiliates; Intellectual Property Ownership.
GSK shall determine, in its sole discretion, which of its Affiliates shall hold
legal title to intellectual property and other rights accruing hereunder to GSK,
and which of its Affiliates shall, in the first instance, be obligated to make
payments due hereunder; provided however, that GSK and its

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Affiliates shall take all measures reasonably requested by EPIX to give effect
to the provisions of this Agreement, that any Affiliates which acquires rights
hereunder will be deemed to be bound by the provisions of this Agreement and
that GSK hereby agrees to be jointly and severally liable with any such
Affiliates for amounts that become due and payable hereunder to EPIX.

     8.2 Milestone Payments. Except as otherwise specifically indicated, each
milestone payment set forth below will be payable by GSK to EPIX upon
achievement of the specified milestone event by GSK and within thirty (30) days
of the receipt of an invoice from EPIX, as further set forth in the notes
following the tables below. Such milestone payments shall not be refundable or
returnable in any event, nor shall they be creditable against royalties or other
payments. Each milestone payment shall be payable by wire transfer of
immediately available funds into an account designated in writing by EPIX.

          8.2.1 Milestone Payments Prior to Option Exercise. GSK shall make
milestone payments to EPIX upon achievement of each of the milestone events in
the amounts set forth below.

<TABLE>
<CAPTION>
EVENT                                             MILESTONE PAYMENT
-----                                             -----------------
<S>                                               <C>
[********]                                                US

Upon initiation of [********] for the Candidate       [********]
Compound in the [********],  as described in
[********]

[********]

Identification of a [********] from each              [********]
[********][********]

Identification of the [********] from each            [********]
[********]

Identification of the [********] from each            [********]
[********]

Identification of the [********] from each            [********]
[********])

[********] from each [********] which commences       [********]
[********]

[********] from each [********] which commences       [********]
a [********] PoC [********]

[********](4)                                         $2,500,000

Identification of [********]                          [********]

Identification of the [********]                      [********]
</TABLE>

(1)  Payable for each of the [********] in each [********], up to a total of
     [********] for each [********]

(2)  Payable for the [********] in an [********] that [********]. If the JSC
     determines that it is advisable to [********] with [********], then such
     milestone would be [********] and when such [********]. If, after the
     commencement of [********] with the [********], the JSC terminates

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SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
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OMISSIONS.

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<PAGE>

     [********] of the [********] and GSK agrees to [********] with a
     [********], upon commencement of [********] with the [********], this
     milestone will be [********], but at a [********].

(3)  Payable [********] per [********].

(4)  This milestone is payable within ten (10) days after the date on which EPIX
     notifies GSK of its achievement and upon receipt of an invoice from EPIX.
     The Parties acknowledge that this milestone has been achieved as of the
     Effective Date and that this amount shall be paid no later than ten (10)
     days after receipt by GSK of an invoice from EPIX on or after the Effective
     Date.

          8.2.2 Milestone Payments After Exercise of Option. In consideration
for the grant of licenses by EPIX to GSK, GSK will make the following milestone
payments to EPIX after exercise by GSK of an Option, within [********] of the
achievement of the specified milestone event by GSK, an Affiliate or
Sublicensee, and upon receipt of an invoice from EPIX. GSK shall provide EPIX
with prompt written notice of the achievement of any milestone described below
by GSK, its Affiliates or its Sublicensees.

MILESTONES PAYABLE BY GGL TO EPIX FOLLOWING EXERCISE BY GSK OF OPTION FOR
PRX-03140:

<TABLE>
<CAPTION>
EVENT                                              MILESTONE PAYMENT US$
-----                                              ---------------------
<S>                                                <C>
[********]                                               [********]

Successful completion of [********] by GSK after         [********]
[********] (1, 2, 3)

Initiation of [********] (1)                             [********]

[********]                                               [********]

[********]                                               [********]

Acceptance of [********] Authorization with the          [********]
[********]

[********]                                               [********]

in [********] (which [********] may occur                [********]
in conjunction with or simultaneously
with [********]

[********]                                               [********]
</TABLE>

(1)  Payable for the first Licensed Product from each GSK Development Program to
     achieve the relevant milestone.

(2)  If this milestone payment has not been earned and paid prior to the
     initiation of [********], then the Milestone Payment for the initiation of
     [********] shall be [********], and this milestone payment [********].

(3)  Successful completion of [********] to be determined by GSK (with criteria
     to be provided to JSC prior to start of studies).

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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<PAGE>

MILESTONES PAYABLE BY GSK TO EPIX FOLLOWING EXERCISE BY GSK OF OPTION FOR OTHER
EPIX PROGRAMS:

<TABLE>
<CAPTION>
EVENT                                                MILESTONE PAYMENT US$
-----                                                ---------------------
<S>                                                  <C>
[********]                                                 [********]

Initiation of [********]                                   [********]

[********]                                                 [********]

[********]                                                 [********]

Acceptance of [********] with the [********]               [********]

[********]                                                 [********]

in a [********]                                            [********]

                                                           [********]
</TABLE>

(1)  Payable for the first Licensed Product from each GSK Development Program to
     achieve the relevant milestone.

          8.2.3 Net Sales Threshold Milestones. The following Net Sales
threshold milestone payments will be payable the first time in the first
Calendar Year that the total aggregate Net Sales of all Licensed Products
(including all indications and formulations of such Licensed Products) in a
Calendar Year by GSK, its Affiliates and Sublicensees in the Territory arising
from each GSK Development Program reach the following amounts:

<TABLE>
<CAPTION>
CALENDAR YEAR NET SALES   MILESTONE PAYMENT
-----------------------   -----------------
<S>                       <C>
[********]                    [********]

[********]                    [********]

[********]                    [********]
</TABLE>

The total amount that may become payable by GSK to EPIX under this Section 8.2.3
shall be [********] for each GSK Development Program. For clarification, by way
of example, if the total annual Net Sales of Licensed Products from a single GSK
Development Program for the Calendar Year in which the First Commercial Sale of
such a Licensed Product occurs is [********], then [********] would be payable
in connection with that GSK Development Program by GSK to EPIX under this
Section 8.2.3. Each of the Net Sales threshold milestone payments and the
corresponding Net Sales threshold milestone payments described in this Section
8.2.3 shall be available only one time per GSK Development Program under this
Agreement (for avoidance of doubt, the maximum amount payable under this Section
8.2.3 shall be [********] for the four GSK Development Programs).

          8.2.4 Limitations on Milestone Payments. It is understood that each
milestone shown above in Section 8.2.2 and Section 8.2.3 shall be payable only
once for each EPIX Program Compound, GSK Development Compound, or Licensed
Product to achieve the corresponding milestone event, regardless of the total
number of EPIX Program Compounds, GSK Development Compounds or Licensed
Products, or the number of indications approved for any Licensed Product arising
from such EPIX Program or GSK Development Program. No

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OMISSIONS.

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<PAGE>

Milestone payment shall be owed for any milestone event that is not achieved.
Except as provided in footnote 2 to Section 8.2.1, if one EPIX Program Compound,
GSK Development Compound or Licensed Product is substituted for another EPIX
Program Compound, GSK Development Compound or Licensed Product, then the
milestones payable with respect to the new EPIX Program Compound, GSK
Development Compound or Licensed Product shall be only those that were not
already paid in respect of the first such EPIX Program Compound, GSK Development
Compound or Licensed Product, as applicable. For example, if GSK made a
milestone payment of [********] for [********] Compound in an EPIX Program and
that EPIX Program is later terminated and substituted with another EPIX Program
in accordance with Section 3.3.3, GSK shall not be obligated to make an
additional [********] milestone payment on [********] in the substituted EPIX
Program. Similarly, if GSK made a milestone payment of [********] for [********]
for a GSK Development Compound and GSK later commences another [********] for
another GSK Development Compound within the same GSK Development Program,
[********] to make an additional [********] milestone payment on commencement of
the [********]. In addition, [********] milestone payments are owed on the basis
of any different [********] for the same EPIX Program Compound, GSK Development
Compound or same Licensed Product if such EPIX Program Compound, GSK Development
Compound or Licensed Product has already qualified for a milestone payment.

     8.3 Patent Royalty Payments to EPIX.

          8.3.1 As further consideration to EPIX for the license and other
rights granted to GSK under Article 5 of this Agreement, and subject always to
the provisions of Sections 8.4 and 8.5, GSK shall pay to EPIX royalties as
follows on the total aggregate annual Net Sales in the Territory of all Licensed
Products (including all indications and formulations for such Licensed
Products):

<TABLE>
<CAPTION>
ANNUAL NET SALES OF LICENSED PRODUCTS FROM [********]   ROYALTY RATE
-----------------------------------------------------   -----------
<S>                                                     <C>
For that portion of annual Net Sales from [********]     [********]
For that portion of annual Net Sales from [********]     [********]
For that portion of annual Net Sales from [********]     [********]
</TABLE>

<TABLE>
<CAPTION>
ANNUAL NET SALES OF LICENSED PRODUCTS FROM [********]   ROYALTY RATE
-----------------------------------------------------   ------------
<S>                                                     <C>
For that portion of annual Net Sales of [********]       [********]
For that portion of annual Net Sales of [********]       [********]
For that portion of annual Net Sales of [********]       [********]
</TABLE>

          8.3.2 Royalty Term. Subject to Section 8.4, royalties to EPIX shall be
payable on a Licensed Product-by-Licensed Product and country-by-country basis
on Net Sales of Licensed Products during the Royalty Term.

     8.4 Application of Royalty Rates to EPIX Royalties. All royalties set forth
under Section 8.3 shall be subject always to the provisions of this Section 8.4
and Section 8.5, and shall only be payable as follows:

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       42

<PAGE>

          8.4.1 Valid Claim. For so long as a Valid Claim of an EPIX Patent
covers or claims the manufacture, use, sale or importation of a Licensed Product
(as determined on a Licensed Product-by-Licensed Product and country-by-country
basis), then the royalty rates as set forth in Section 8.3 shall apply, subject
to Section 8.5, if applicable. Only the single highest applicable royalty shall
be due with respect to the same unit of Licensed Product.

          8.4.2 Know-How Royalty; Pending Patent Applications. If Section 8.4.1
does not apply, but (1) EPIX owns or Controls a pending patent application
within the EPIX Patents that covers or claims the manufacture, use, sale or
importation of a Licensed Product (as determined on a Licensed
Product-by-Licensed Product and country-by-country basis) or (2) there is no
pending patent application (as determined on a Licensed Product-by-Licensed
Product and country-by-country basis) then, in either such case, GSK shall pay
to EPIX royalty payments at [********] of the relevant royalty rate that would
otherwise be payable under Section 8.3 for a period of twelve (12) years from
the date of First Commercial Sale of the Licensed Product in such country at
issue, and, if there is such a pending patent application, then GSK shall pay
the [********] of the relevant royalty rate into an escrow account as provided
below, until the [********] (i) such time as a Valid Claim as described in
Section 8.4.1 above issues from such pending patent application, in which case
Section 8.4.1 shall apply; or (ii) the date which is twelve (12) years from the
date of First Commercial Sale of the Licensed Product at issue. The payments
accruing under the [********] of the relevant royalty rate [********] on behalf
of EPIX (with interest from such account being reinvested into such account).
Where there is a pending patent application, upon the occurrence of the grant of
a patent, as set forth in subsection (i) herein, prior to the term of twelve
(12) years from the date of First Commercial Sale of the Licensed Product in
such country at issue, then the [********] of such payments (and interest) in
the escrow account shall be promptly paid by GSK to EPIX. If a Valid Claim does
not issue within such [********], then GSK shall retain all such amounts paid
into escrow, plus all accumulated interest.

          8.4.3 Application of Royalty Thresholds. The royalty rates set forth
in Section 8.3 and Section 8.4 are meant to be applied in turn, with the higher
royalty rate to be applied on incremental Net Sales above the lower threshold.

     8.5 Third Party Royalty and Other Payments.

          8.5.1 By EPIX; Target-Specific Rights. EPIX shall have sole financial
responsibility for all royalty and other payments to any Third Party for Third
Party licenses to which EPIX is a party as of the Effective Date, including
payments due to [********]. EPIX shall also have sole financial responsibility
for satisfying in full all royalties, fees and other payments, and all other
obligations, liabilities or claims of any kind owed to any Third Party in order
to obtain and maintain any licenses or other rights necessary in order for EPIX
[********] however, that to the extent that rights must be obtained from a Third
Party in order for EPIX to perform research, Development and Commercialization
activities with respect to a particular Program Target(s) prior to GSK's
exercise of an Option for an EPIX Program, then GSK shall be responsible for
obtaining such rights and paying all amounts that become due under any
agreements relating to such rights. The decision to obtain and to maintain such
rights shall be solely that of GSK, provided that EPIX shall not be required to
work on any Program Target for

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
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OMISSIONS.

                                       43

<PAGE>

which such rights are not obtained and maintained, and GSK shall have no
obligation to maintain any such rights after GSK elects not or fails to exercise
an Option for an EPIX Program for which the right was obtained. EPIX shall have
sole financial responsibility for all royalty and other payments required to be
paid to any Third Party specifically relating to sales of Returned Compounds and
Products sold by EPIX as permitted hereunder. In addition, EPIX shall have all
responsibility for any right that must be obtained from a Third Party in order
for EPIX to perform research, Development and Commercialization activities for
any EPIX Program to be conducted after GSK elects not or fails to exercise an
Option.

          8.5.2 By GSK. After GSK's exercise of an Option [********] in a
particular country to obtain a license or similar rights under patent rights
controlled by a Third Party in order to [********] then GSK shall be entitled to
[********] of the amounts payable to such Third Party in connection with such
license or similar rights in such country [********] that would otherwise have
been payable under [********] to EPIX upon Net Sales of the applicable Licensed
Product in such country. [********] shall use its [********] to minimize the
amount of any of the foregoing payments owed to Third Parties. In addition to
the foregoing, if GSK reasonably determines that it is necessary in a particular
country to obtain a license or similar rights under patent rights controlled by
a Third Party for [********] Notwithstanding the foregoing, in no event will the
reduction to the royalties described in [********] reduce the royalties payable
under [********] in any country by more than [********]. GSK shall have the
right to carry forward and apply any such unused offset or deduction to which
GSK is entitled in future Calendar Quarters or years in the event that such
[********] threshold would be exceeded, until the full amount of the offset or
deduction to which GSK is entitled is satisfied. Except for payments due from
EPIX to [********] under an existing license agreement with EPIX, which shall
remain the responsibility of EPIX under Section 8.5.1, GSK shall be responsible
for paying any and all royalties or other payments that may be payable to any
Third Party as a result of GSK's manufacture, use or sale of any GSK Development
Compound or Licensed Product, subject to GSK's rights under this Section 8.5.2.

     8.6 Credits by GSK Against Milestones.

          8.6.1 Additional Back-up Discovery Period. If GSK funds any amounts
for the Additional Back-up Discovery Period in accordance with Section 3.5.5,
then GSK shall have the right to credit any amounts paid to EPIX against certain
milestones as and to the extent provided in Section 3.5.5.

          8.6.2 PoC Trial Package. If GSK funds any amount of a PoC Trial
Package for any EPIX Program Compound within an EPIX Program under Section
3.6.1, GSK shall have the [********] such amount paid by GSK to EPIX against any
milestones payable by GSK to EPIX under Section 8.2.2 on exercise by GSK of an
Option for the EPIX Program in which GSK funded the PoC Trial Package,
[********] For instance, if GSK funds a PoC Trial Package in the Second EPIX
Program and exercises an Option for the Second EPIX Program, GSK shall have the
[********] paid by GSK to fund the PoC Trial Package for the Second EPIX Program
[********] for [********] up to a [********]. If GSK funds a PoC Trial Package
in the Second EPIX Program, does not exercise an Option for the Second EPIX
Program and exercises only an

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       44

<PAGE>

Option for the Third EPIX Program, GSK shall have [********] funded by GSK
toward the PoC Trial Package for the Second EPIX Program [********] for the
Third EPIX Program.

     8.7 Compulsory Licenses. Should a compulsory license be granted to a Third
Party under the applicable laws of any country in the Territory under the EPIX
Patents licensed to GSK under Section 5.1, and such Third Party has at least a
[********] market share by value of the relevant Licensed Product in such
country, the [********] under [********] on Net Sales of Licensed Products in
such country will be [********] for such country, with respect to the sales of
such Licensed Product in such country, and provided that during such periods
such Third Parties sell under the compulsory license articles that [********]
Licensed Product then marketed and sold by GSK in that country and such articles
contain the [********] contained in the Licensed Product. GSK shall provide
prompt notice to EPIX in the event GSK receives notice that such a compulsory
license may be demanded.

     8.8 Royalties to GSK. In consideration of GSK's grant of the Transfer
License to EPIX under Section 13.5.1(c)(ii), EPIX shall pay GSK the following
royalties on Net Sales by EPIX of Returned Compounds and Products in the
following situations.

          8.8.1 If GSK elects not to exercise an Option for an EPIX Program as
provided in Section 4.1, a royalty of [********] of Net Sales by EPIX, its
Affiliates or Sublicensees shall be payable on any product that contains or is
comprised of an EPIX Program Compound within such EPIX Program. Maximum
cumulative royalty payments under this Section 8.8.1 shall not exceed [********]
of the milestone payments and PoC funding made by GSK for the specific EPIX
Program under Section 8.2.1 and 3.6.

          8.8.2 If GSK terminates a GSK Development Program (other than the
5-HT4 Partial Agonist Program) during Development, a royalty of [********] of
Net Sales by EPIX, its Affiliates or Sublicensees shall be payable on any
product that contains or is comprised of a GSK Development Compound within such
GSK Development Program.

          8.8.3 If GSK terminates the GSK Development Program arising out of the
5-HT4 Partial Agonist Program during Development, a royalty of [********] of Net
Sales by EPIX, its Affiliates or Sublicensees shall be payable on any product
that contains or is comprised of a GSK Development Compound within such GSK
Development Program (with maximum cumulative royalty payments not to exceed
[********] of the milestone payments and PoC funding made by GSK for the 5-HT4
Partial Agonist Program under Sections 8.2.1, 8.2.2 and 3.6.

          8.8.4 If GSK terminates a GSK Development Program after Regulatory
Approval of a Licensed Product included within such GSK Development Program, a
royalty of [********] of Net Sales by EPIX, its Affiliates or Sublicensees shall
be payable on any product that contains or is comprised of a GSK Development
Compound within such GSK Development Program.

          8.8.5 For all royalties payable to GSK under this Section 8.8, only
the single highest applicable royalty from the above rates shall apply to Net
Sales of any product.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       45

<PAGE>

          8.8.6 EPIX shall pay royalties to GSK under Section 8.8 commencing on
the First Commercial Sale of a particular product Commercialized by EPIX, its
Affiliates or Sublicensees in a country until the later of: (i) twelve (12)
years after the First Commercial Sale of such product in such country, and (ii)
the expiration or termination of the last to expire patent in such country
within the EPIX Patents or GSK Patents with a Valid Claim claiming the
manufacture, use, sale or importation of the product in such country.

     8.9 Manner of Payment. All payments to be made by GSK or EPIX hereunder
shall be made in Dollars by wire transfer of immediately available funds to such
United States bank account as shall be designated by GSK or EPIX. Late payments
shall bear interest at the rate provided in Section 8.15

     8.10 Royalty Payments Reports. After the First Commercial Sale of a
Licensed Product and for the Royalty Term, GSK shall furnish to EPIX a written
report, within forty-five (45) days after the end of each Calendar Quarter (or
portion thereof if this Agreement terminates during a Calendar Quarter), showing
the amount of royalty due for such Calendar Quarter (or portion thereof).
Royalty payments for each Calendar Quarter shall be due at the same time as such
written report for the Calendar Quarter. With each quarterly payment, GSK shall
deliver to EPIX a full and accurate accounting to include at least the following
information:

          (a) the Net Sales for the applicable Licensed Product by GSK, its
Affiliates, and Sublicensees in [********]

          (b) the royalties payable in Dollars which shall have accrued
hereunder in respect of such Net Sales and the basis for calculating those
royalties;

          (c) the exchange rates and other methodology used in converting into
U.S. Dollars, from the currencies in which sales were made;

          (d) dispositions of Licensed Products other than pursuant to sale for
cash; and

          (e) withholding taxes, if any, required by applicable Law to be
deducted in respect of such royalties.

If EPIX Commercializes a product on which royalties are due to GSK under Section
8.8, EPIX shall provide similar royalty payment reports to GSK, commencing with
the First Commercial Sale of such product and continuing for the term set forth
in Section 8.8.6, containing the information set forth above.

     8.11 Records Retention. Commencing with the First Commercial Sale of a
Licensed Product by GSK or a product Commercialized by EPIX, as applicable, GSK
and EPIX each shall keep, and shall cause each of its respective Affiliates, and
Sublicensees, if any, to keep, full and accurate books of accounting in
accordance with IFRS or GAAP, as applicable, containing all particulars that may
be necessary for the purpose of calculating all royalties payable to the other
Party under this Article 8, for a period of [********] after the year in which
such sales occurred, in sufficient detail to permit GSK or EPIX, as applicable,
to confirm the accuracy of royalties

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OMISSIONS.

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paid hereunder. Such books of accounting (including, without limitation, those
of GSK's and EPIX's respective Affiliates, and Sublicensees, if any) shall be
kept at their principal place of business; provided, however, that EPIX
acknowledges that certain of the books of accounting for GSK will be kept
locally at the individual country offices of GSK and its Affiliates.

     8.12 Audits. During the Term of this Agreement and for a period of
[********] thereafter, at the request and expense of a Party receiving royalties
under this Article 8 (the "Payee"), the Party making any payment (the "Payor")
shall permit an independent, certified public accountant of nationally
recognized standing appointed by the Payee, and reasonably acceptable to the
Payor, at reasonable times and upon reasonable notice, but in no case more than
once per calendar year thereafter, to examine such records as may be necessary
for the sole purpose of verifying the calculation and reporting of Net Sales and
the correctness of any royalty payment made under this Agreement for any period
within the preceding [********]. Results of any such examination shall be made
available to both Payor and Payee. The independent, certified public accountant
shall disclose to the Payee only the royalty amounts which the independent
auditor believes to be due and payable hereunder to the Payee, details
concerning any discrepancy from the amount paid and the amount due, and shall
disclose no other information revealed in such audit. Any and all records
examined by such independent accountant shall be deemed the Payor's Confidential
Information which may not be disclosed by said independent, certified public
accountant to any Third Party. If, as a result of any inspection of the books
and records of the Payor, it is shown that a Payee's payments under this
Agreement were less than the amount which should have been paid, then the Payor
shall make all payments required to be made to eliminate any discrepancy
revealed by said inspection within [********]. The Payee shall pay for such
audits, except that in the event that the royalty payments made by the Payor
were less than [********] of the undisputed amounts that should have been paid
during the period in question as per the audit, the Payor shall pay the
reasonable costs of the audit.

     8.13 Currency Exchange. All payments under this Agreement shall be payable,
in full, in U.S. Dollars, regardless of the country(ies) in which sales are
made. For the purposes of computing Net Sales of Licensed Products or products
Commercialized by EPIX that are sold in a currency other than U.S. Dollars, such
currency shall be converted into U.S. Dollars as calculated at the actual
average rates of exchange for the pertinent quarter or year to date, as the case
may be, as used by GSK or EPIX in producing its quarterly and annual accounts,
as confirmed by their respective auditors. [********].

     8.14 Taxes.

          8.14.1 Sales or Other Transfers. The recipient of any transfer under
this Agreement of EPIX Patents, EPIX Know-How, GSK Patents, GSK Know-How, EPIX
Program Compounds or GSK Development Compounds, Licensed Products, or Returned
Compounds and Products, as the case may be, shall be solely responsible for any
sales, use, value added, excise or other taxes applicable to such transfer. All
amounts relating to sales or transfers under this Agreement and any other
documents related to this Agreement, of EPIX Patents, EPIX Know-How, GSK
Patents, GSK Know-How, EPIX Program Compounds or GSK Development Compounds,
Licensed Products or Returned Compounds or Products, as the case may be, are

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stated exclusive of [********]. The Payor is responsible for the payment of all
such appropriately levied taxes to the Payee. The Payee will provide to the
Payor, within 30 days (or alternative territory specific time period as set out
in the local legislation), of the receipt of any consideration under this
Agreement, a valid VAT invoice if appropriate. Should such amounts of VAT be
refunded subsequently by the fiscal authorities to the Payee, the Payee will
refund these monies to the Payor within thirty (30) days of receipt. Where local
laws mean the recipient of services under this Agreement is required to
self-account for VAT, the recipient undertakes to so account. Furthermore, where
local laws require the recipient to pay import VAT and duties to the fiscal
authorities relating to product shipped, the recipient undertakes so to do.

          8.14.2 Tax Withholding. In the event that the Payor is required to
withhold any tax to the tax or revenue authorities in any country regarding any
payment to the Payee due to the laws of such country, such amount shall be
deducted from the payment to be made by the Payor, and the Payor shall promptly
notify the Payee of such withholding and, within a reasonable amount of time
after making such deduction, furnish the Payee with copies of any tax
certificate or other documentation evidencing such withholding. Each of Payor
and Payee agrees to cooperate with the other in claiming exemptions from such
deductions or withholdings under any agreement or treaty from time to time in
effect. However, any such deduction or withholding shall be an expense of and
borne solely by the Payee.

          8.14.3 Completion of Application for Tax Withholding. Promptly after
the Effective Date, EPIX shall complete application found at http://
www.hmrc.gov.uk/cnr/us_company_2002.pdf.

     8.15 Interest Due. Without limiting any other rights or remedies available
to either Party, each Party shall pay the other interest on any payments that
are not paid on or before the date such payments are due under this Agreement at
a rate of [********] per month or the maximum applicable legal rate, if less,
calculated on the total number of days payment is delinquent.

                                    ARTICLE 9

                   REPRESENTATIONS AND WARRANTIES; DISCLAIMER;
                             LIMITATION OF LIABILITY

     9.1 Mutual Representations and Warranties. Each Party represents and
warrants to the other Party as of the Effective Date that:

          9.1.1 such Party is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation and has full
corporate power and authority to enter into this Agreement and to carry out the
provisions hereof.

          9.1.2 execution of this Agreement and the performance by such Party of
its obligations hereunder have been duly authorized.

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          9.1.3 this Agreement has been duly executed and delivered on behalf of
such Party, and constitutes a legal, valid, binding obligation, enforceable
against it in accordance with the terms hereof.

          9.1.4 the performance of this Agreement by it does not create a breach
or default under any other agreement to which it is a Party.

          9.1.5 the execution, delivery and performance of this Agreement by
such Party does not conflict with any agreement, instrument or understanding,
oral or written, to which it is a party or by which it is bound, nor violate any
law or regulation of any court, governmental body or administrative or other
agency having jurisdiction over such Party;

          9.1.6 no government authorization, consent, approval, license,
exemption of or filing or registration with any court or governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, under any applicable laws, rules or regulations currently in effect, is
or will be necessary for, or in connection with, the transaction contemplated by
this Agreement or any other agreement or instrument executed in connection
herewith, or for the performance by it of its obligations under this Agreement
and such other agreements except as may be required under the Stock Purchase
Agreement or to obtain Hart-Scott-Rodino clearance; and

          9.1.7 to the best of its knowledge, has not employed and has not used
a contractor or consultant that has employed, any individual or entity debarred
by the FDA (or subject to a similar sanction of EMEA), or, to the best of its
knowledge, any individual who or entity which is the subject of an FDA debarment
investigation or proceeding (or similar proceeding of EMEA), in the conduct of
its activities prior to the Effective Date of this Agreement.

     9.2 Representations and Warranties of EPIX. EPIX hereby represents and
warrants to GSK, as of the Effective Date, that, to the best of its knowledge:

          9.2.1 EPIX is the owner of, or otherwise has the right to grant all
rights and licenses it purports to grant to GSK with respect to the EPIX Patents
and EPIX Know-How under this Agreement;

          9.2.2 except for the license from [********] EPIX does not require any
licenses or other intellectual property rights from any Third Parties in order
to conduct research and Development activities contemplated in the EPIX
Programs;

          9.2.3 all fees required to be paid by EPIX in order to maintain the
EPIX Patents have been paid to date, and none of such EPIX Patents have been
abandoned or cancelled for failure to prosecute or maintain them;

          9.2.4 there is no pending litigation which alleges, or any written
communication alleging, that EPIX's activities with respect to the EPIX Patents
have infringed or misappropriated any of the intellectual property rights of any
Third Party;

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          9.2.5 EPIX has no present knowledge from which it concludes that any
of the EPIX Patents are invalid or unenforceable;

          9.2.6 there are no additional licenses (beyond those granted to GSK
under Article 5 pursuant to the exercise of a Option) required by GSK under any
intellectual property owned or Controlled by EPIX or its Affiliate as of the
Effective Date which would be required in order for GSK to further Develop and
Commercialize any EPIX Program Compound or Licensed Product as contemplated
under this Agreement pursuant to the exercise by GSK of any of its Options, and
(ii) all such intellectual property owned or Controlled by EPIX as of the
Effective Date and during the Term shall be included within the EPIX Patents and
EPIX Know-How;

          9.2.7 EPIX has not, as of the Effective Date, granted any right or
license to any Third Party relating to any of the EPIX Patents or EPIX Know-How
which would conflict or interfere with any of the rights or licenses granted to
GSK hereunder; and

          9.2.8 EPIX has disclosed to GSK all material data and information, and
all material correspondence to or from any Regulatory Authority regardless of
whether such data, correspondence and information would have a positive,
neutral, or negative impact on the commercial potential of the EPIX Program
Compounds in existence as of the Effective Date, that would in EPIX's reasonable
opinion be material and relevant to a reasonable assessment, of the scientific,
commercial, safety, and regulatory liabilities of such EPIX Program Compounds.

     9.3 Covenants of GSK. GSK covenants that it shall perform it obligations
and exercise it rights hereunder in compliance with all applicable material
legal and regulatory requirements. GSK further covenants that (i) it shall not
knowingly engage in any activities that use the EPIX Patents and/or EPIX
Know-How in a manner that is outside the scope of the license rights granted to
it hereunder or that infringe the intellectual property rights of any Third
Party; and (ii) that it has or will have the financial resources to carry out
its obligations under this Agreement.

     9.4 Covenants of EPIX. EPIX hereby covenants that:

          9.4.1 all employees of EPIX or its Affiliates working under this
Agreement shall be under the obligation to assign all right, title and interest
in and to their inventions and discoveries, whether or not patentable, if any,
to EPIX as the sole owner thereof;

          9.4.2 EPIX shall perform its activities pursuant to this Agreement in
compliance with good laboratory and clinical practices and cGMP, in each case as
applicable under the laws and regulations of the country and the state and local
government wherein such activities are conducted, and with respect to the care,
handling and use in research and Development activities hereunder of any
non-human animals by or on behalf of EPIX, shall at all times comply (and shall
ensure compliance by any of its subcontractors) with all applicable federal,
state and local laws, regulations and ordinances, and also with the [********]
in the industry for the [********] in pharmaceutical and Development activities,
subject to GSK's reasonable right of inspection; and

          9.4.3 EPIX hereby covenants to GSK that it shall disclose to GSK and
provide it

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with [********] and [********] to/from any [********] regardless of whether such
[********] and [********] would have a [********] on the [********] or
[********] of an EPIX Program and EPIX Program Compounds included therein, that
EPIX [********] would be [********] of the scientific, commercial, safety, and
regulatory [********] to be considered by [********] whether or not to
[********] with respect to each EPIX Program.

     9.5 Mutual Covenants.

          9.5.1 Neither Party shall employ (or, to the best of its knowledge,
shall not use any contractor or consultant that employs) any individual or
entity debarred by the FDA (or subject to a similar sanction of EMEA), or, to
the best of its knowledge, any individual who or entity which is the subject of
an FDA debarment investigation or proceeding (or similar proceeding of EMEA), in
the conduct of its activities under this Agreement; and

          9.5.2 Neither Party shall, during the Term, grant any right or license
to any Third Party relating to any of the intellectual property rights it
Controls which would conflict or interfere with any of the rights or licenses
granted to the other Party hereunder.

     9.6 DISCLAIMER. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, EPIX MAKES
NO REPRESENTATIONS OR WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED,
INCLUDING ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE WITH RESPECT TO THE EPIX PATENTS OR EPIX KNOW-HOW OR ANY
LICENSE GRANTED BY EPIX HEREUNDER, OR WITH RESPECT TO ANY EPIX PROGRAM COMPOUNDS
OR LICENSED PRODUCTS. FURTHERMORE, NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED
AS A REPRESENTATION OR WARRANTY THAT ANY PATENT OR OTHER PROPRIETARY RIGHTS
INCLUDED IN THE EPIX PATENTS ARE VALID OR ENFORCEABLE OR THAT USE OF THE EPIX
PATENTS AND EPIX KNOW-HOW CONTEMPLATED HEREUNDER DOES NOT INFRINGE ANY PATENT
RIGHTS OR OTHER INTELLECTUAL PROPERTY RIGHTS OF ANY THIRD PARTY.

     EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, GSK MAKES NO
REPRESENTATIONS OR WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING
ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE WITH RESPECT TO ANY GSK PATENT OR GSK CONFIDENTIAL INFORMATION OR ANY
LICENSE GRANTED BY GSK HEREUNDER, OR WITH RESPECT TO ANY GSK DEVELOPMENT
COMPOUNDS OR LICENSED PRODUCTS. FURTHERMORE, NOTHING IN THIS AGREEMENT SHALL BE
CONSTRUED AS A REPRESENTATION OR WARRANTY THAT ANY PATENT OR OTHER PROPRIETARY
RIGHTS INCLUDED IN THE GSK PATENTS ARE VALID OR ENFORCEABLE OR THAT USE OF THE
GSK PATENTS AND GSK KNOW-HOW CONTEMPLATED HEREUNDER DOES NOT INFRINGE ANY PATENT
RIGHTS OR OTHER INTELLECTUAL PROPERTY RIGHTS OF ANY THIRD PARTY.

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                                   ARTICLE 10

                  PATENT MAINTENANCE; INFRINGEMENT; EXTENSIONS

     10.1 Ownership of Inventions. Inventorship of inventions conceived or
reduced to practice in the course of activities performed under or contemplated
by this Agreement shall be determined by application of United States patent
Laws pertaining to inventorship. If such inventions are jointly invented by one
or more employees, consultants or contractors of each Party, such inventions
shall be jointly owned (each such invention is hereinafter a "Joint Invention"),
and if one or more claims included in an issued patent or pending patent
application which is filed in a patent office in the Territory claim such Joint
Invention, such claims shall be jointly owned (each such patent application or
patent is hereinafter a "Joint Patent"). If such an invention is solely invented
by an employee, consultant or contractor of a Party, such invention shall be
solely owned by such Party, and any patent application filed claiming such
solely owned invention shall also be solely owned by such Party. This Agreement
shall be understood to be a joint research agreement in accordance with 35
U.S.C. Section 103(c)(3) to develop the EPIX Program Compounds, the GSK
Development Compounds and Licensed Products. Each Party shall enter into binding
agreements obligating all employees, consultants and contractors performing
activities under or contemplated by this Agreement, including activities related
to the EPIX Program Compounds, GSK Development Compounds or Licensed Products,
to assign his/her interest in any invention conceived or reduced to practice in
the course of such activities to the Party for which such employee, consultant
or contractor is providing its services.

     10.2 Filing, Prosecution and Maintenance of EPIX Patents. Unless and until
GSK exercises an Option, EPIX shall be responsible, using patent counsel
selected by EPIX (for avoidance of doubt, all references in this Article 10 to
"patent counsel" shall include inside patent counsel as well as outside patent
counsel), for the preparation, prosecution (including, without limitation, any
interferences, reissue proceedings and reexaminations) and maintenance of EPIX
Patents, and the [********]; provided, however, that on an EPIX Program-by-EPIX
Program basis, if GSK exercises an Option with respect to an EPIX Program,
[********] for an EPIX Program and EPIX subsequently licenses or otherwise
Develops or Commercializes an EPIX Program Compound from such EPIX Program with
or through a Third Party or a Third Party sublicensee (not including such
activities conducted by EPIX with or through a Third Party service provider,
such as a contract research organization), [********]. Upon request by GSK, EPIX
shall provide GSK with an update of the filing, prosecution and maintenance
status for each of the EPIX Patents. EPIX shall reasonably consult with GSK, and
shall take any GSK comments into good faith consideration, with respect to the
preparation, prosecution and maintenance of the EPIX Patents. EPIX shall provide
to GSK copies of any papers relating to the filing, prosecution or maintenance
of the EPIX Patents promptly upon their being filed or received. EPIX shall not
knowingly take any action during prosecution and maintenance of the EPIX Patents
that would materially adversely affect them (including any reduction in claim
scope), without GSK's prior consent. Upon the exercise by GSK of an Option and
thereafter during the Term, GSK shall be responsible, using patent counsel
selected by GSK, for the

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preparation, prosecution (including, without limitation, any interferences,
reissue proceedings and reexaminations) and maintenance of the EPIX Patents that
are subject to the license granted upon exercise of the Option. For infringement
under 35 USC 271 (e)(2) where GSK has exercised an Option under Section 4.1 and
where GSK is the holder of the applicable NDA or MAA, GSK has the sole right to
initiate legal action to enforce all EPIX Patents licensed to it pursuant to
Section 5.1, against infringement or misappropriation by Third Parties or defend
any declaratory judgment action relating thereto. Such activities shall be at
[********]. Following the exercise by GSK of an Option, GSK may file a notice
with governmental patent offices of the exclusive license to the EPIX Patents
granted to GSK hereunder. Upon request by EPIX, GSK shall provide EPIX with an
update of the filing, prosecution and maintenance status for such EPIX Patents.
GSK shall reasonably consult with EPIX, and shall take any EPIX comments into
good faith consideration, with respect to the preparation, prosecution and
maintenance of such EPIX Patents. GSK shall provide to EPIX copies of any papers
relating to the filing, prosecution or maintenance of such EPIX Patents promptly
upon their being filed or received. GSK shall not knowingly take any action
during prosecution and maintenance of such EPIX Patents that would materially
adversely affect them (including any reduction in claim scope), without EPIX's
prior consent.

     10.3 Patent Abandonment. In no event will the Party responsible for filing,
prosecution and maintenance of particular EPIX Patents under Section 10.2 (in
each case, the "Responsible Party") permit such patents to be abandoned in any
country in the Territory, or elect not to file a new patent application claiming
priority to a patent application within such EPIX Patents either before such
patent application's issuance or within the time period required for the filing
of an international (i.e., Patent Cooperation Treaty), regional (including
European Patent Office) or national application, without the other Party first
being given an opportunity to assume full responsibility for the continued
prosecution and maintenance of such EPIX Patents, or the filing of such new
patent application. Accordingly, the Responsible Party shall provide the other
Party with notice of the allowance and expected issuance date of any patent
within the EPIX Patents, and any of the aforementioned filing deadlines, and
such Party shall provide the Responsible Party with prompt notice as to whether
it desires the Responsible Party to file such new patent application. In the
event that the Responsible Party decides either (i) not to continue the
prosecution or maintenance of a patent application or patent within EPIX Patents
in any country or (ii) not to file such new patent application requested to be
filed by the other Party, the Responsible Party shall provide such Party with
notice of this decision at least thirty (30) days prior to any pending lapse or
abandonment thereof. In such event, the Responsible Party shall provide the
other Party with an opportunity to assume responsibility for all costs
reasonably associated with the filing and/or further prosecution and maintenance
of such patent application and any patent issuing thereon (such filing to occur
prior to the issuance of the patent to which the application claims priority or
expiration of the applicable filing deadline, as set forth above). In the event
that such other Party assumes such responsibility for such filing, prosecution
and maintenance costs, such other Party shall have the right to transfer the
responsibility for such filing, prosecution and maintenance of such patent
applications and patents to patent counsel selected by it and reasonably
acceptable to the Responsible Party. In such case, Section 10.2 shall apply to
such patent applications and patents except that the role of the Parties shall
be reversed. Such patent applications and patents shall otherwise continue to be
subject to all of the

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terms and conditions of the Agreement in the same manner and to the same extent
as the other EPIX Patents.

     10.4 Enforcement of EPIX Patents Against Infringers.

          10.4.1 Enforcement by GSK. In the event that EPIX or GSK become aware
of a suspected infringement of any EPIX Patent exclusively licensed to GSK under
this Agreement, or any such EPIX Patent is challenged in any action or
proceeding (other than any interferences, reissue proceedings or reexaminations,
which are addressed above), such Party shall notify the other Party promptly,
and following such notification, the Parties shall confer. Upon the exercise by
GSK of an Option and thereafter during the Term, GSK shall have the right, but
shall not be obligated, to defend any such action or proceeding or bring an
infringement action with respect to such infringement at its own expense, in its
own name and entirely under its own direction and control, subject to the
following, or settle any such action, proceeding or dispute by license. EPIX
shall reasonably assist GSK (at GSK's expense) in any action or proceeding being
defended or prosecuted if so requested, and shall lend its name to such actions
or proceedings if reasonably requested by GSK or required by applicable Law.
EPIX shall have the right to participate and be represented in any such suit by
its own counsel at its own expense. No settlement of any such action or
proceeding which restricts the scope, or adversely affects the enforceability,
of an EPIX Patent may be entered into by GSK without the prior written consent
of EPIX, which consent shall not be unreasonably withheld, delayed or
conditioned.

          10.4.2 Enforcement by EPIX. If GSK elects not to timely settle, defend
or bring any action for infringement described in Section 10.4.1, then EPIX may
defend or bring such action at its own expense, in its own name and entirely
under its own direction and control, subject to the following. GSK shall
reasonably assist EPIX (at EPIX's expense) in any action or proceeding being
defended or prosecuted if so requested, and shall lend its name to such actions
or proceedings if requested by EPIX or required by applicable Law. GSK shall
have the right to participate and be represented in any such suit by its own
counsel at its own expense. No settlement of any such action or proceeding which
restricts the scope, or adversely affects the enforceability, of an EPIX Patent
shall be entered into by EPIX without the prior written consent of GSK, which
consent shall not be unreasonably withheld, delayed or conditioned.

          10.4.3 Withdrawal. If either Party brings an action or proceeding
under this Section 10.4 and subsequently ceases to pursue or withdraws from such
action or proceeding, it shall promptly notify the other Party and the other
Party may substitute itself for the withdrawing Party under the terms of this
Section 10.4

          10.4.4 Damages. In the event that either Party exercises the rights
conferred in this Section 10.4 and recovers any damages or other sums in such
action, suit or proceeding or in settlement thereof, such damages or other sums
recovered shall first be applied to all out-of-pocket costs and expenses
incurred by the Parties in connection therewith, including, without limitation,
attorneys fees. If such recovery is insufficient to cover all such costs and
expenses of both Parties, it shall be shared in proportion to the total of such
costs and expenses incurred by each Party. If after such reimbursement any funds
shall remain from such damages or other sums recovered, such funds shall be
retained by the Party that controlled the action or proceeding

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under this Section 10.4; provided, however, that if [********] is the Party that
controlled such action or proceeding, [********] shall receive out of any such
remaining recovery received by [********] an amount as follows: (i) as to
[********] shall receive payment equivalent to payments that would have been due
to [********] under this Agreement had the infringing sales that [********] lost
to the infringer been made by [********] and (ii) as to special or punitive
damages, [********] of such damages shall be retained by [********] and the
remaining [********] shall be paid by [********] to [********].

     10.5 Patent Term Extension. EPIX and GSK shall each cooperate with one
another and shall use Commercially Reasonable Efforts in obtaining patent term
extension (including without limitation, any pediatric exclusivity extensions as
may be available) or supplemental protection certificates or their equivalents
in any country with respect to patent rights covering the Licensed Products, as
applicable. If elections with respect to obtaining such patent term extensions
are to be made, GSK shall have the right to make the election to seek patent
term extension or supplemental protection, provided that such election will be
made so as to maximize the period of marketing exclusivity for the Licensed
Product. For such purpose, for all Regulatory Approvals GSK shall provide EPIX
with written notice of any expected Regulatory Approval at least thirty (30)
days prior to the expected date of Regulatory Approval, as well as notice within
three (3) business days of receiving each Regulatory Approval confirming the
date of such Regulatory Approval.

     10.6 Notification of Patent Certification. GSK shall notify and provide
EPIX with copies of any allegations of alleged patent invalidity,
unenforceability or non-infringement of an EPIX Patent pursuant to a Paragraph
IV Patent Certification by a Third Party filing an Abbreviated New Drug
Application, an application under Section 505(b)(2) or other similar patent
certification by a Third Party, and any foreign equivalent thereof. Such
notification and copies shall be provided to EPIX within thirty (30) days after
GSK receives such certification. In addition, upon request by EPIX, GSK shall
provide reasonable assistance and cooperation (including, without limitation,
making available to EPIX documents possessed by GSK that are reasonably required
by EPIX and making available personnel for interviews and testimony) in any
actions reasonably undertaken by EPIX in accordance with Section 10.4 to contest
any such patent certification.

     10.7 Regulatory Data Protection

          10.7.1 To the extent required by law or permitted by Law, each Party
will use Commercially Reasonable Efforts to promptly, accurately and completely
list, with the applicable Regulatory Authorities during the Term of this
Agreement, all applicable Patents for any EPIX Program Compound or Licensed
Product that such Party intends to, or has begun to Commercialize, and that have
become the subject of a marketing application submitted to FDA, such listings to
include all so called "Orange Book" listings required under the Hatch-Waxman Act
and all so called "Patent Register" listings as required in Canada.

          10.7.2 Prior to such listings, the Parties will meet to evaluate and
identify all applicable Patents. Notwithstanding the preceding sentence, the
Party responsible for marketing

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the applicable EPIX Program Compound or Licensed Product will retain final
decision-making authority as to the listing of all applicable Patents for such
EPIX Program Compound or Licensed Product, regardless of which Party owns such
Patent.

                                   ARTICLE 11

                    NONDISCLOSURE OF CONFIDENTIAL INFORMATION

     11.1 Nondisclosure. Each Party agrees that, for so long as this Agreement
is in effect and for a period of [********] thereafter, a Party (the "Receiving
Party") receiving Confidential Information of the other Party (the "Disclosing
Party") (or that has received any such Confidential Information from the other
Party prior to the Effective Date) shall (i) maintain in confidence such
Confidential Information using not less than the efforts such Receiving Party
uses to maintain in confidence its own proprietary industrial information of
similar kind and value, (ii) not disclose such Confidential Information to any
Third Party without the prior written consent of the Disclosing Party, except
for disclosures expressly permitted below, and (iii) not use such Confidential
Information for any purpose except those permitted by this Agreement (it being
understood that this clause (iii) shall not create or imply any rights or
licenses not expressly granted under Article 5 hereof).

          11.1.1 Exceptions. The obligations in Section 11.1 shall not apply
with respect to any portion of the Confidential Information that the Receiving
Party can show by competent proof:

               (a) is publicly disclosed by the Disclosing Party, either before
or after it is disclosed to the Receiving Party hereunder; or

               (b) was known to the Receiving Party or any of its Affiliates,
without any obligation to keep it confidential or any restriction on its use,
prior to disclosure by the Disclosing Party; or

               (c) is subsequently disclosed to the Receiving Party or any of
its Affiliates by a Third Party lawfully in possession thereof and without any
obligation to keep it confidential or any restriction on its use; or

               (d) is published by a Third Party or otherwise becomes publicly
available or enters the public domain, either before or after it is disclosed to
the Receiving Party.

     11.2 Authorized Disclosure. The Receiving Party may disclose Confidential
Information belonging to the Disclosing Party to the extent (and only to the
extent) such disclosure is reasonably necessary in the following instances:

          (a) filing or prosecuting patents;

          (b) Regulatory Filings and obtaining Regulatory Approvals;

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          (c) prosecuting or defending litigation;

          (d) subject to Section 11.4, complying with applicable Laws
(including, without limitation, the rules and regulations of the Securities and
Exchange Commission or any national securities exchange) and with judicial
process, if in the reasonable opinion of the Receiving Party's counsel, such
disclosure is necessary for such compliance; and

          (e) disclosure, solely on a "need to know basis", to Affiliates,
potential and future collaborators (including Sublicensees), acquirers or
assignees permitted under Section 15.4, research and Development collaborators,
subcontractors, investment bankers, investors, lenders, and their and each of
the Parties' respective directors, employees, contractors and agents, each of
whom prior to disclosure must be bound by written obligations of confidentiality
and non-use no less restrictive than the obligations set forth in this Article
11;

provided, however, that in each of the above situations, the Receiving Party
shall remain responsible for any failure by any Person who receives Confidential
Information pursuant to this Section 11.2(e) to treat such Confidential
Information as required under this Article 11.

     If and whenever any Confidential Information is disclosed in accordance
with this Section 11.2, such disclosure shall not cause any such information to
cease to be Confidential Information except to the extent that such disclosure
results in a public disclosure of such information (otherwise than by breach of
this Agreement). Where reasonably possible and subject to Section 11.4 and other
than pursuant to Section 11.2(e), the Receiving Party shall notify the
Disclosing Party of the Receiving Party's intent to make such disclosure
pursuant to this Section 11.2 sufficiently prior to making such disclosure so as
to allow the Disclosing Party adequate time to take whatever action it may deem
appropriate to protect the confidentiality of the information.

     11.3 Terms of this Agreement. The Parties acknowledge that this Agreement,
the Stock Purchase Agreement and all of the respective terms of this Agreement
and the Stock Purchase Agreement shall be treated as Confidential Information of
both Parties.

     11.4 Securities Filings. In the event either Party proposes to file with
the Securities and Exchange Commission or the securities regulators of any state
or other jurisdiction a registration statement or any other disclosure document
which describes or refers to the terms and conditions of this Agreement under
the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, or any other applicable securities Law, the Party shall notify the
other Party of such intention and shall provide such other Party with a copy of
relevant portions of the proposed filing not less than [********] prior to such
filing (and any revisions to such portions of the proposed filing a reasonable
time prior to the filing thereof), including any exhibits thereto relating to
the terms and conditions of this Agreement, and shall use reasonable efforts to
obtain confidential treatment of the terms and conditions of this Agreement that
such other Party requests be kept confidential, and shall only disclose
Confidential Information which it is advised by counsel is legally required to
be disclosed or required to be disclosed. No such notice shall be required under
this Section 11.4 if the description of or reference to this

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Agreement contained in the proposed filing has been included in any previous
filing made by the either Party hereunder or otherwise approved by the other
Party.

     11.5 Relationship to Confidentiality Agreement. This Agreement supersedes
the Confidential Disclosure Agreement between the Parties executed April 1,
2005, provided that all "Confidential Information" disclosed or received by the
Parties thereunder shall be deemed "Confidential Information" hereunder and
shall be subject to the terms and conditions of this Agreement.

     11.6 Publications.

          11.6.1 Publication by GSK. After exercise of an Option, GSK may
publish or present data and/or results relating to a GSK Development Compound, a
GSK Development Program or Licensed Product in scientific journals and/or at
scientific conferences, subject to the prior review and comment by EPIX as
follows. GSK shall provide EPIX with the opportunity to review any such proposed
abstract, manuscript or presentation by delivering a copy thereof to EPIX no
less than [********] before its intended submission for publication or
presentation. EPIX shall have [********] from its receipt of any such abstract,
manuscript or presentation in which to notify GSK in writing of any specific
objections to the disclosure of Confidential Information of EPIX (including EPIX
Know-How). In the event EPIX objects to the disclosure in writing within such
[********] period, GSK agrees not to submit the publication or abstract or make
the presentation containing the objected-to information until the Parties have
agreed to the content of the proposed disclosure, and GSK shall delete from the
proposed disclosure any EPIX Confidential Information upon the reasonable
request by EPIX. Once any such abstract or manuscript is accepted for
publication, GSK will provide EPIX with a copy of the final version of the
manuscript or abstract.

          11.6.2 Publication by EPIX. EPIX may publish or present data and/or
results relating to an EPIX Program or an EPIX Program Compound in scientific
journals and/or at scientific conferences, subject to the prior review and
comment by GSK as follows. EPIX shall provide GSK with the opportunity to review
any such proposed abstract, manuscript or presentation by delivering a copy
thereof to GSK no less than [********] before its intended submission for
publication or presentation. GSK shall have [********] from its receipt of any
such abstract, manuscript or presentation in which to notify EPIX in writing of
any specific objections to the disclosure of Confidential Information of GSK
(including GSK Know-How). In the event GSK objects to the disclosure in writing
within such [********] period, EPIX agrees not to submit the publication or
abstract or make the presentation containing the objected-to information until
the Parties have agreed to the content of the proposed disclosure, and EPIX
shall delete from the proposed disclosure any GSK Confidential Information upon
the reasonable request of GSK. Once any such abstract or manuscript is accepted
for publication, EPIX will provide GSK with a copy of the final version of the
manuscript or abstract. The Parties acknowledge that publications relating to
EPIX Program Compounds submitted for publication by EPIX prior to the Effective
Date shall not be subject to the above review procedure.

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          11.6.3 Publication of Clinical Trial Results. Notwithstanding Sections
11.6.1 and 11.6.2, GSK shall have no right to publish the results of human
clinical trial data generated by EPIX prior to the exercise by GSK of an Option
without the consent of EPIX. After the exercise of an Option, GSK shall have the
right to publish such data generated by EPIX with respect to the relevant EPIX
Program Compound(s) without obtaining the consent of EPIX. Additionally, GSK
shall have the right to publish the results of human clinical trial data
generated by GSK with respect to a GSK Development Compound without the consent
of EPIX. The Parties shall discuss and reasonably cooperate in order to
facilitate the process to be employed in order to ensure the publication of any
such summaries of human clinical trials data and results as required on the
clinical trial registry of each respective Party, and shall provide the other
Party at least [********] prior notice to review the clinical trials results to
be published for the purposes of preparing any necessary Patent filings.

                                   ARTICLE 12

                                    INDEMNITY

     12.1 GSK Indemnity. GSK shall indemnify, defend and hold harmless EPIX and
its Affiliates, and their respective officers, directors, employees, agents,
licensors, and their respective successors, heirs and assigns and
representatives (the "EPIX Indemnitees"), from and against any and all claims,
threatened claims, damages, losses, suits, proceedings, liabilities, costs
(including, without limitation, reasonable legal expenses, costs of litigation
and reasonable attorney's fees) or judgments, whether for money or equitable
relief, of any kind ("Losses and Claims"), but [********] arising out of or
relating to, directly or indirectly: (i) the negligence, recklessness or
wrongful intentional acts or omissions of GSK and/or its Affiliates and its or
their respective directors, officers, employees and agents, in connection with
GSK's performance of its obligations or exercise of its rights under this
Agreement; (ii) any breach by GSK of any representation or warranty set forth in
Article 9; (iii) the research, Development, Commercialization (including,
without limitation, promotion, advertising, offering for sale, sale or other
disposition), transfer, importation or exportation, manufacture, labeling,
handling or storage, or use of, or exposure to, any GSK Development Compounds or
Licensed Product by or for GSK or any of its Affiliates, Sublicensees, agents
and contractors, including, without limitation, for each of clauses (i), (ii)
and (iii), claims and threatened claims based on (x) product liability, bodily
injury, risk of bodily injury, death or property damage or (y) the failure to
comply with applicable Law; except in any such case for Losses and Claims to the
extent reasonably attributable to any EPIX Indemnitee having committed an act or
acts of gross negligence, recklessness or willful misconduct.

     12.2 EPIX Indemnity. EPIX shall indemnify, defend and hold harmless GSK and
its Affiliates, and their respective officers, directors, employees, agents,
licensors, and their respective successors, heirs and assigns and
representatives (the "GSK Indemnitees"), from and against any and all Losses and
Claims, but [********] arising out of or relating to, directly or indirectly:
(i) the negligence, recklessness or wrongful intentional acts or omissions of
EPIX

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and/or its Affiliates and its or their respective directors, officers, employees
and agents, in connection with EPIX's performance of its obligations or exercise
of its rights under this Agreement; (ii) any breach by EPIX of any
representation or warranty set forth in Article 9; (iii) the research,
Development, Commercialization (including, without limitation, promotion,
advertising, offering for sale, sale or other disposition), transfer,
importation or exportation, manufacture, labeling, handling or storage, or use
of, or exposure to, any EPIX Program Compound, Returned Compounds and Products
by or for EPIX or any of its Affiliates, Sublicensees, agents and contractors,
including, without limitation, for each of clauses (i), (ii) and (iii), claims
and threatened claims based on (x) product liability, bodily injury, risk of
bodily injury, death or property damage and (y) the failure to comply with
applicable Law; except in any such case for Losses and Claims to the extent
reasonably attributable to any GSK Indemnitee having committed an act or acts of
gross negligence, recklessness or willful misconduct.

     12.3 Indemnification Procedure. A claim to which indemnification applies
under Section 12.1 or Section 12.2 shall be referred to herein as an
"Indemnification Claim". If any Person or Persons (collectively, the
"Indemnitee") intends to claim indemnification under this Article 12, the
Indemnitee shall notify the other Party (the "Indemnitor") in writing promptly
upon becoming aware of any claim that may be an Indemnification Claim (it being
understood and agreed, however, that the failure by an Indemnitee to give such
notice shall not relieve the Indemnitor of its indemnification obligation under
this Agreement except and only to the extent that the Indemnitor is actually
prejudiced as a result of such failure to give notice). The Indemnitor shall
have the right to assume and control the defense of the Indemnification Claim at
its own expense with counsel selected by the Indemnitor and reasonably
acceptable to the Indemnitee, provided, however, that an Indemnitee shall have
the right to retain its own counsel, with the fees and expenses to be paid by
the Indemnitee, if representation of such Indemnitee by the counsel retained by
the Indemnitor would be inappropriate due to actual or potential differing
interests between such Indemnitee and any other party represented by such
counsel in such proceedings. If the Indemnitor does not assume the defense of
the Indemnification Claim as aforesaid, the Indemnitee may defend the
Indemnification Claim but shall have no obligation to do so. The Indemnitee
shall not settle or compromise the Indemnification Claim without the prior
written consent of the Indemnitor, and the Indemnitor shall not settle or
compromise the Indemnification Claim in any manner which would have an adverse
effect on the Indemnitee's interests (including without limitation any rights
under this Agreement or the scope or enforceability of the EPIX Patents Rights
or EPIX Know-How, or Confidential Information or patent or other rights licensed
to EPIX by GSK hereunder), without the prior written consent of the Indemnitee,
which consent, in each case, shall not be unreasonably withheld or delayed. The
Indemnitee shall reasonably cooperate with the Indemnitor at the Indemnitor's
expense and shall make available to the Indemnitor all pertinent information
under the control of the Indemnitee, which information shall be subject to
Article 11.

     12.4 Limitation of Liability. EXCEPT FOR A BREACH OF ARTICLE 11 OR FOR
CLAIMS OF A THIRD PARTY WHICH ARE SUBJECT TO INDEMNIFICATION UNDER THIS ARTICLE
12, NEITHER PARTY SHALL BE LIABLE TO THE OTHER WITH RESPECT TO ANY SUBJECT
MATTER OF THIS AGREEMENT, WHETHER UNDER ANY CONTRACT, NEGLIGENCE, STRICT
LIABILITY OR OTHER LEGAL OR

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EQUITABLE THEORY, FOR ANY INCIDENTAL, INDIRECT, SPECIAL, EXEMPLARY, PUNITIVE,
MULTIPLE, OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST PROFITS,
LOSS OF USE, DAMAGE TO GOODWILL, OR LOSS OF BUSINESS).

     12.5 Insurance.

          12.5.1 By GSK. GSK hereby represents and warrants to EPIX that it is
self-insured against liability and other risks associated with its activities
and obligations under this Agreement in [********] for the activities to be
conducted by it under this Agreement. GSK shall [********] upon request.

          12.5.2 By EPIX. EPIX shall, beginning with the initiation of the first
clinical trial for an EPIX Program Compound, maintain at all times thereafter
during the Term of the Agreement, and until the later of (i) three (3) years
after termination or expiration of the Agreement or (ii) the date that all
statutes of limitation covering claims or suits that may be brought for personal
injury based on the sale or use of an EPIX Program Compound by EPIX have expired
in all states in the U.S., commercial general liability insurance from a
recognized, creditworthy insurance company, on an "occurrence basis" which
includes contractual liability coverage and product liability, on a "claims-made
basis" with coverage limits of at least [********] per claim and annual
aggregate, before EPIX enters Phase II Trials with respect to any EPIX Program
Compound and is increased to at least (b) [********] before EPIX initiates the
First Commercial Sale of any product hereunder. EPIX shall furnish to GSK
evidence of such insurance, upon request. The minimum level of insurance set
forth herein shall not be construed to create a limit on EPIX's liability
hereunder. Within ten (10) days following written request from GSK, EPIX shall
furnish to GSK a certificate of insurance evidencing such coverage as of the
date. Each such certificate of insurance, as well as any certificates evidencing
new or modified coverages of EPIX, shall be subject to commercial availability
and include a provision whereby sixty (60) days' written notice must be received
by GSK prior to coverage modification or cancellation by either EPIX or the
insurer and of any new coverage. In the case of a modification or cancellation
of such coverage, EPIX shall promptly provide GSK with a new certificate of
insurance evidencing that EPIX's coverage meets the requirements of this
Section.

                                   ARTICLE 13

                              TERM AND TERMINATION

     13.1 Term; Expiration. This Agreement shall become effective as of the
Effective Date and shall continue in force and effect until expiration as
described in this Section 13.1, unless earlier terminated pursuant to the other
provisions of this Article 13, and shall expire as follows:

          13.1.1 on a product-by-product and country-by-country basis, on the
date of

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expiration of all payment obligations of both GSK and EPIX under this Agreement
with respect to each product in each country, as applicable; and

          13.1.2 in its entirety upon the expiration of all payment obligations
under this Agreement with respect to the last product in the last country in the
Territory; or

          13.1.3 if GSK exercises none of its Options hereunder, this Agreement
will terminate within thirty (30) days of the termination of the Option Period
with respect to the last Option.

          13.1.4 The period from the Effective Date until the date of expiration
or termination of the entire Agreement, or as the case may be, until the date of
expiration or termination of the Agreement in part with respect to a given
program or product, shall be the "Term" of the Agreement in its entirety or with
respect to a given program or product, as applicable.

          13.1.5. Effect of Expiration of the Term.

               (a) As to Licensed Products. Subject to the terms and conditions
of this Agreement (including those which survive termination), upon expiration
of the Term, as determined on a Licensed Product-by-Licensed Product and
country-by-country basis, GSK shall have an exclusive, fully-paid and
royalty-free, right and license, with the right to grant sublicenses, under all
EPIX Patents and EPIX Know-How to make, have made, use, sell, offer to sell and
import Licensed Products in the Field and in the Territory, for so long as GSK
continues to do so.

               (b) As to Returned Compounds and Products. Subject to the terms
and conditions of this Agreement (including those which survive termination),
upon expiration of the Term, as determined on a product-by-product and
country-by-country basis, EPIX shall have an exclusive, fully-paid and
royalty-free, Transfer License (as defined in Section 13.5.1(c)(ii)), with the
right to grant sublicenses, to make, have made, use, sell, offer to sell and
import Returned Compounds and Products in the Field and in the Territory, for so
long as EPIX continues to do so.

     13.2 Termination for Cause.

          13.2.1 Material Breach. Either Party (the "Non-breaching Party") may,
without prejudice to any other remedies available to it at law or in equity,
terminate this Agreement during the Term, on an EPIX Program-by-EPIX Program
basis, GSK Development Program-by-GSK Development Program basis, or in its
entirety, as it shall determine in its sole discretion, in the event the other
Party (the "Breaching Party") shall have materially breached or defaulted in the
performance of any of its material obligations hereunder, and such default shall
have continued for [********] after written notice thereof is provided to the
Breaching Party by the Non-breaching Party, such notice describing the alleged
material breach in sufficient detail to put the Breaching Party on notice.

          13.2.2 Disagreement as to Material Breach; Cure Period. If the Parties

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reasonably and in good faith disagree as to whether there has been a material
breach, the Party which seeks to dispute that there has been a material breach
may contest the allegation in accordance with Section 14.1. Notwithstanding the
above sentence, the cure period for any allegation made in good faith as to a
material breach under this Agreement will run from the date that written notice
was first provided to the Breaching Party by the Non-Breaching Party. Any such
termination of the Agreement under this Section 13.2 shall become effective at
the end of such [********] cure period, unless the Breaching Party has cured any
such breach or default prior to the expiration of such [********] period, or, if
such breach is not susceptible to cure within a [********], then, the
Non-Breaching Party's right to termination shall be suspended only if and for so
long as the Breaching Party has provided to the Non-Breaching Party a written
plan that is reasonably calculated to effect [********], and the Breaching Party
commits to and does carry out such plan as provided to the Non-Breaching Party.
The right of either Party to terminate this Agreement, or a portion of this
Agreement, as provided in this Section 13.2, shall not be affected in any way by
such Party's waiver or failure to take action with respect to any previous
default. It is understood and acknowledged that during the pendency of such a
dispute, all of the terms and conditions of this Agreement shall remain in
effect, and the Parties shall continue to perform all of their respective
obligations hereunder. The Parties further agree that any payments that are made
by one Party to the other Party pursuant to this Agreement pending resolution of
the dispute shall be promptly refunded if the arbitrator determines pursuant to
Section 14.2 that such payments are to be refunded by one Party to the other
Party.

     13.3 GSK Unilateral Termination Rights.

          13.3.1 Termination of Agreement in Its Entirety. GSK may, in its sole
discretion, exercisable at any time during the Term, terminate this Agreement in
its entirety for any reason or no reason at all, upon [********] written notice
to EPIX.

          13.3.2 Termination as to GSK Development Program. GSK may, in its sole
discretion, exercisable at any time during the Term, terminate this Agreement on
a GSK Development Program-by-GSK Development Program basis for any reason or no
reason at all, effective [********] written notice to EPIX. The Agreement shall
continue in full force as to all other EPIX Programs and GSK Development
Programs and Licensed Products, notwithstanding such termination.

          13.3.3 Termination on a Regional Basis. GSK may, in its sole
discretion, exercisable at any time during the Term, terminate this Agreement
with respect to one or more GSK Development Programs, in any [********]
indicated below, for any reason or no reason at all, effective upon [********]
written notice to EPIX. The Agreement shall continue in full force as to such
GSK Development Program in all [********] and as to all other GSK Development
Programs and Licensed Products, notwithstanding such termination. The regions
for purposes of this Section 13.3.3 are the [********]. Upon termination by GSK
pursuant to this Section 13.3.3, the GSK Development Compounds within the GSK
Development Program shall become Returned Compounds and Products [********] and
EPIX will thereafter have all rights, itself or with a Third Party or through a
Third Party sublicensee, to Develop and Commercialize such Returned Compounds
and Products [********] at EPIX's sole expense, subject to the terms of this

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Agreement, including the grant of the Transfer License by GSK to EPIX under
Section 13.5.1(c)(ii) for such Returned Compounds and Products [********] and
the payment by EPIX of royalties to GSK under Section 8.8. In addition, the
provisions in Article 7 applicable to EPIX and GSK shall immediately terminate
and no longer be of any force or effect with respect to the GSK Development
Program [********] and GSK shall cease any and all Development and
Commercialization activities with respect to the GSK Development Program
[********].

     13.4 Termination for Insolvency.

          13.4.1 Either Party may terminate this Agreement, if, at any time, the
other Party shall file in any court or agency pursuant to any statute or
regulation of any state or country, a petition in bankruptcy or insolvency or
for reorganization or for an arrangement or for the appointment of a receiver or
trustee of the Party or of substantially all of its assets, or if the other
Party shall be served with an involuntary petition against it, filed in any
insolvency proceeding, and such petition shall not be dismissed within
[********] after the filing thereof, or if the other Party shall propose or be a
party to any dissolution or liquidation, or if the other Party shall make an
assignment of substantially all of its assets for the benefit of creditors.

          13.4.2 All rights and licenses granted under or pursuant to any
section of this Agreement are and shall otherwise be deemed to be for purposes
of Section 365(n) of Title 11, United States Code (the "Bankruptcy Code")
licenses of rights to "intellectual property" as defined in Section 101(56) of
the Bankruptcy Code. The Parties shall retain and may fully exercise all of
their respective rights and elections under the Bankruptcy Code. Upon the
bankruptcy of any Party, the non-bankrupt Party shall further be entitled to a
complete duplicate of, or complete access to, any such intellectual property,
and such, if not already in its possession, shall be promptly delivered to the
non-bankrupt Party, unless the bankrupt Party elects to continue, and continues,
to perform all of its obligations under this Agreement.

     13.5 Effect of Termination. All of the following effects of termination are
in addition to the other rights and remedies that may be available to the
Parties at law or in equity.

          13.5.1 Upon Termination by GSK Without Cause or by EPIX for Cause.

               (a) In the event of a unilateral termination of this Agreement in
its entirety by GSK pursuant to Section 13.3.1 or a termination of this
Agreement in its entirety by EPIX pursuant to Section 13.2.1(for cause) or
Section 13.4.1(insolvency):

                    (i) Notwithstanding anything contained herein to the
contrary, all rights (including without limitation, all Options) and licenses
granted herein to GSK with respect to EPIX Program Compounds and GSK Development
Compounds and Licensed Products (if GSK has exercised any Options) shall
terminate, and GSK shall cease any and all Development and Commercialization
activities with respect thereto;

                    (ii) all payment obligations hereunder shall terminate,
other than those which are accrued and unpaid as of the effective date of
termination and those payment obligations which survive termination as expressly
provided herein;

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SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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                    (iii) all compounds within EPIX Programs (including rejected
compounds as described in Section 3.5.6), all GSK Development Compounds and
Licensed Products shall be deemed to be part of the Returned Compounds and
Products and EPIX will thereafter have all rights, itself or with a Third Party
or through a Third Party sublicensee, to Develop and Commercialize such Returned
Compounds and Products at EPIX's sole expense, subject to the terms of this
Agreement, including the grant of the Transfer License by GSK to EPIX under
Section 13.5.1(c)(ii) and the payment by EPIX of royalties to GSK under Section
8.8. GSK shall cease any and all Development efforts with respect to all such
Returned Compounds and Products, and GSK shall have no right or license to
practice the EPIX Patents, to use EPIX Know-How, or to use the EPIX Confidential
Information relating to such Returned Compounds and Products for any purpose;
and

                    (iv) the provisions in Article 7 applicable to EPIX and GSK
shall terminate in their entirety.

               (b) In the event of: (1) a termination by GSK pursuant to Section
13.3.2 with respect to a GSK Development Program, (2) a termination by EPIX with
respect to a GSK Development Program pursuant to Section 13.2.1(for cause), or
(3) a termination by the JSC of an EPIX Program or a failure of GSK to exercise
the Option with respect to an EPIX Program, in both cases as described in
Section 4.1.4:

                    (i) Notwithstanding anything contained herein to the
contrary, all rights (including without limitation, all Options) and licenses
granted herein to GSK with respect to: (A) such GSK Development Programs, the
GSK Development Compounds and Licensed Products included within such GSK
Development Program or (B) such EPIX Programs and the EPIX Program Compounds
included within such EPIX Programs shall terminate, and GSK shall cease any and
all Development and Commercialization activities with respect thereto;

                    (ii) any Options (other than for such terminated program)
that are in effect as of the date of termination shall remain in full force and
effect, in accordance with their terms;

                    (iii) all of GSK's payment obligations under Article 8 shall
terminate with respect to such GSK Development Program or Licensed Product or
EPIX Program, other than those which are accrued and unpaid as of the effective
date of termination and those payment obligations which survive termination as
expressly provided herein;

                    (iv) all Licensed Products and GSK Development Compounds
pertaining to such terminated GSK Development Program and EPIX Program Compounds
(including rejected compounds as described in Section 3.5.6) pertaining to such
terminated EPIX Program shall be part of the Returned Compounds and Products,
and EPIX will thereafter have all rights, itself or with a Third Party or
through a Third Party sublicensee, to Develop and Commercialize such Returned
Compounds and Products at EPIX's sole expense, subject to the terms of this
Agreement, including the grant of the Transfer License by GSK to EPIX under
Section 13.5.1(c)(ii) and the payment by EPIX of royalties to GSK under Section
8.8; and

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
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                    (v) the provisions in Article 7 applicable to EPIX and GSK
shall immediately terminate and no longer be of any force or effect with respect
to the Program Target, EPIX Program and GSK Development Program and Licensed
Product being terminated and the EPIX Program Compounds, GSK Development
Compounds and Licensed Products included within such terminated programs.

               (c) When compounds and products become Returned Compounds and
Products under Section 13.5.1(a)(iii) and Section 13.5.1(b)(iv), the following
shall occur with respect to each such Returned Compound and Product:

                    (i) GSK shall promptly return to EPIX all data and materials
transferred by EPIX to GSK with regard to each such Returned Compound and
Product;

                    (ii) Transfer License. GSK shall grant, and does hereby
grant, a non-exclusive license to EPIX in the Territory, with the right to grant
sublicenses, under GSK's right, title and interest in and to any [********] in
existence at the time of termination of Development or Commercialization of the
relevant EPIX Program Compound, GSK Development Compound or Licensed Product, as
applicable, but only to the extent such [********] were [********] of such EPIX
Program Compound, GSK Development Compound or Licensed Product, and [********]
by EPIX to continue the Development, Commercialization, manufacture, use, sale
or importation of such EPIX Program Compound, GSK Development Compound or
Licensed Product [********] the EPIX Development Plans and GSK Development Plans
in effect at the time each EPIX Program Compound, GSK Development Compound or
Licensed Product became a Returned Compound and Product. Such license shall be
for use by EPIX (and its sublicensees) solely in connection with the
Development, manufacture, use, sale, offer for sale and import of such Returned
Compounds and Products (the "Transfer License"); provided, however, that to the
extent equivalent technology that is not Controlled by GSK is available to EPIX
(and its Sublicensees) for use in the Development, manufacture, use, sale, offer
for sale and import of such Returned Compounds and Products throughout the
Territory, without significant additional expense or delay, then EPIX and its
Sublicensees shall use Commercially Reasonable Efforts to obtain access to such
alternative technology. Notwithstanding the foregoing, the Transfer License
shall not include, and GSK shall have no obligation to grant, and does not
hereby grant, any license to EPIX under [********]; provided, however, that the
Parties may enter into good faith discussions for the grant by GSK of a license
to EPIX [********] on terms agreeable to each Party.

                    (iii) GSK shall transfer to EPIX, at EPIX's request,
[********] pertaining to the applicable Returned Compounds and Products in its
possession and other related materials, and [********];

                    (iv) GSK shall provide EPIX with copies of all clinical
study data and results, and all other information, and the like developed by or
for the benefit of GSK relating to such Returned Compounds and Products;

                    (v) GSK shall assign to EPIX [********] related to such
Returned Compounds and Products;

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
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                    (vi) GSK shall provide to EPIX other documents to the extent
directly and solely related to the Returned Compounds and Products that are
necessary in the continued Development and Commercialization of such Returned
Compounds and Products (including without limitation, material documents and
agreements relating to the sourcing, manufacture, promotion, distribution, sale
or use of a product) throughout the Territory; and

                    (vii) subject to the obligation to pay to GSK the applicable
royalty set forth in Section 8.8, EPIX shall be free to Develop and
Commercialize any and all such Returned Compounds and Products, alone or with
any Third Party or through any Third Party sublicensee. In the event EPIX
decides to further Develop and/or Commercialize such Returned Compounds and
Products, EPIX shall be solely responsible for satisfying any and all
obligations to Third Parties with respect to the Development, manufacture or
Commercialization of such Returned Compounds and Products including, but not
limited to, any ongoing obligations of GSK under any Third Party manufacturing
or licensing agreements to the extent such obligations are contained in
agreements which GSK may assign to EPIX, in accordance with the terms of such
agreements, and as such agreements may be assumed by EPIX at its request
hereunder.

When compounds and products become Returned Compounds and Products under Section
13.3.3, all of the above provisions (other than subsection (v)) shall apply, but
only to the extent necessary to permit EPIX to Develop and Commercialize the
Returned Compound and Product in the region terminated by GSK, and GSK shall
permit EPIX to cross-reference in such region any Regulatory Filings for such
Returned Compounds and Products.

          13.5.2 Upon Termination by GSK for Cause or Insolvency of EPIX.

               (a) In the event of termination by GSK of the Agreement in its
entirety or with respect to an EPIX Program or GSK Development Program pursuant
to Section 13.2.1 upon the breach of EPIX; or (2) pursuant to Section 13.4 upon
the insolvency of EPIX:

                    (i) all licenses granted to GSK with respect to GSK
Development Programs and Licensed Products within such GSK Development Programs
for which GSK previously exercised its Option in accordance with Section 4.1
shall continue in full force, in accordance with the terms and conditions of
this Agreement (other than for licenses for those GSK Development Programs which
GSK elects to terminate under Section 13.2.1); provided, [********]

                    (ii) all Options that are pending as of the effective date
of such termination by GSK shall continue under their terms, and GSK shall have
the right immediately on such termination to exercise any Options that are so
pending. If GSK exercises such Options, all licenses granted to GSK with respect
to GSK Development Programs and Licensed Products within such GSK Development
Programs for which GSK exercises its Option shall continue in full force, in
accordance with the terms and conditions of this Agreement; provided, however,
that [********] with respect to any EPIX Programs for which GSK exercises an
Option after the effective date of termination, including, without limitation,
[********];

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
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OMISSIONS.

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                    (iii) the provisions of Section 7.2 applicable to GSK shall
terminate in their entirety, but the provisions of Section 7.1 applicable to
EPIX shall continue in full force and effect;

                    (iv) EPIX shall promptly return to GSK all data and
materials transferred by GSK to EPIX, including all GSK Know-How, and EPIX shall
have no right or license to practice the GSK Patents, to use GSK Know-How or GSK
Confidential Information for any purpose;

                    (v) GSK shall have no obligation to grant EPIX the Transfer
License set forth in Section 13.5.1(c)(ii); and

                    (vi) GSK shall use Commercially Reasonable Efforts to
Develop and Commercialize a Licensed Product in the Territory under each license
described in the foregoing Section 13.5.2(a)(i) or 13.5.2(a)(ii), or such
license shall terminate.

          13.5.3 Upon Termination by EPIX for Cause or Insolvency of GSK. In the
event of a termination of this Agreement in its entirety by EPIX, or a
termination by EPIX with respect to an EPIX Program or a GSK Development
Program, either pursuant to Section 13.2.1 upon a breach of GSK or pursuant to
Section 13.4 upon the insolvency of GSK, this Agreement or such program shall
terminate with the same effects as are indicated under Section 13.5.1(a)(as to
termination of the Agreement in its entirety) and Section 13.5.1(b)(as to
termination of an EPIX Program or GSK Development Program); provided however,
[********] shall continue but such obligation shall be modified such that
[********] that shall become [********].

     13.6 Survival. The following provisions shall survive termination or
expiration of this Agreement in its entirety, as well as any other provision
which by its terms or by the context thereof, is intended to survive such
termination: Article 1 (as applicable), Articles 11, 12, 13, 14 and 15 and
Section 5.4 (except in the event of termination by GSK of the Agreement in its
entirety or with respect to a GSK Development Program pursuant to Section 13.2
or Section 13.4) and Section 10.2 (solely with respect to EPIX's obligation to
reimburse GSK for certain expenses under the circumstances described within such
section, even if such circumstances do not arise until after the effective date
of termination). In addition to the foregoing, and in addition to the provisions
identified in Section 13.5.2 as surviving (in some cases in a modified form) in
the event that GSK shall terminate the Agreement under 13.2.1 (for cause) or
13.4 (insolvency), with the effect set forth in Section 13.5.2, then the terms
and conditions set forth in Section 4.1 (applicable to Options eligible for
exercise by GSK under Section 13.5.2(a)(ii) and granting GSK full rights to
Develop and Commercialize GSK Development Compounds on exercise of an Option,
but excluding Section 4.1.4), Sections 5.8 (except with respect to GSK's
obligation in Section 5.8.2 to transfer GSK Know-How to EPIX for Returned
Compounds and Products), Article 8 (as modified in Section 13.5.2), Article 10
(except with respect to EPIX Patents that do not claim or cover any compounds or
products to which GSK retained rights hereunder) and Section 9.3 shall also
survive such termination as and to the extent applicable to those GSK
Development Candidates and Licensed Products for which GSK obtains and maintains
its license rights under Section 5.1 as of and after the effective date of
termination of this Agreement. In addition to the surviving terms and conditions
set forth in the first sentence

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of this Section 13.6, upon any termination of the Agreement or GSK Development
Program, the following Sections shall survive and shall be applicable to EPIX
with respect to its Development and Commercialization of Returned Compounds and
Products: Sections 5.4, 5.8 (except with respect to EPIX's obligation in Section
5.8.2 to transfer EPIX Know-How to GSK), 8.8 through 8.15 (inclusive), and
Section 9.4.2. Termination or expiration of this Agreement shall not relieve the
Parties of any liability or obligation which accrued hereunder prior to the
effective date of such termination or expiration nor preclude either Party from
pursuing all rights and remedies it may have hereunder or at law or in equity,
subject to Sections 14.1 and 14.2, with respect to any breach of this Agreement
nor prejudice either Party's right to obtain performance of any obligation. All
other rights, licenses and obligations shall terminate upon expiration of this
Agreement.

                                   ARTICLE 14

                               DISPUTE RESOLUTION

     14.1 Resolution by Senior Executives. Except as provided in Section 3.5.2,
in the event of any dispute between the Parties in connection with this
Agreement, the construction hereof, or the rights, duties or liabilities of
either Party hereunder, the Parties shall first attempt in good faith to resolve
such dispute by negotiation and consultation between themselves. In the event
that such dispute is not resolved on an informal basis within ten (10) Business
Days, either Party may, by written notice to the other Party, refer the dispute
to the other Party for attempted resolution by good faith negotiation within
thirty (30) days after such notice is received. Any disputes relating to EPIX
Programs prior to GSK's exercise of an Option shall be referred to the Senior
Vice President of the CEEDD of GSK and the CEO of EPIX for attempted resolution.
After GSK's exercise of an Option, any disputes relating to a GSK Development
Program or Licensed Product shall be referred to the Chairman of Research and
Development of GSK (or his designated representative) and the CEO of EPIX for
attempted resolution.

     14.2 Arbitration. Except as provided in Section 3.5.2, any dispute between
the Parties relating to or arising out of this Agreement that cannot be resolved
in accordance with Section 14.1 will be resolved through binding arbitration in
New York, New York as follows:

          (a) A Party shall submit such dispute to arbitration by notifying the
other Party, in writing, of such dispute. Within thirty (30) days after receipt
of such notice, the Parties shall designate in writing a single arbitrator to
resolve the dispute; provided, however, that if the Parties cannot agree on an
arbitrator within such thirty (30) day period, the arbitrator shall be selected
by the office of the American Arbitration Association (the "AAA") in New York,
New York. The arbitrator shall be a lawyer knowledgeable and experienced in the
applicable Law concerning the subject matter of the dispute, and shall not be an
Affiliate, employee, consultant, officer, director or stockholder of either
Party, or otherwise have any current or previous relationship with either Party
or their respective Affiliates. The governing law in Section 15.7 shall govern
any such proceedings. The language of the arbitration shall be English. All time

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frames herein are subject to extension by the arbitrator upon showing of good
cause by either Party.

          (b) Within thirty (30) days after the designation of the arbitrator,
the arbitrator and the Parties shall meet, and each Party shall provide to the
arbitrator a written summary of all disputed issues, such Party's position on
such disputed issues and such Party's proposed ruling on the merits of each such
issue.

          (c) The arbitrator shall set a date for a hearing, which shall be no
later than thirty (30) days after the submission of written proposals pursuant
to Section 14.2(b), for the presentation of evidence and legal argument
concerning each of the issues identified by the Parties. The Parties shall have
the right to be represented by counsel. Except as provided herein, the
arbitration shall be governed by the Commercial Arbitration Rules of the AAA
applicable at the time of the notice of arbitration pursuant to Section 14.2(a).

          (d) The arbitrator shall use his best efforts to rule on each disputed
issue within thirty (30) days after completion of the hearing described in
Section 14.2(c). The determination of the arbitrator as to the resolution of any
dispute shall be binding and conclusive upon all Parties. All rulings of the
arbitrator shall be in writing and shall be delivered to the Parties except to
the extent that the Commercial Arbitration Rules of the AAA provide otherwise.
Nothing contained herein shall be construed to permit the arbitrator to award
punitive, exemplary or any similar damages.

          (e) The fees of the arbitrator and the costs and expenses of the
arbitration proceedings shall be borne by the Parties in equal proportion.

          (f) Any arbitration pursuant to this Section 14.2 shall be conducted
in New York, New York. Any arbitration award may be entered in and enforced by a
court in accordance with Section 15.8.

          (g) Notwithstanding anything in this Article 14, each Party shall have
the right to seek injunctive or other equitable relief from a court of competent
jurisdiction pursuant to Section 15.8 that may be necessary to avoid irreparable
harm, including any breach or threatened breach of Section 11.1.

                                   ARTICLE 15

                                  MISCELLANEOUS

     15.1 Severability. If any one or more of the provisions of this Agreement
is held to be invalid or unenforceable, the provision shall be considered
severed from this Agreement and shall not serve to invalidate any remaining
provisions hereof. The Parties shall make a good faith effort to replace any
invalid or unenforceable provision with a valid and enforceable one

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
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such that the objectives contemplated by the Parties when entering this
Agreement may be realized.

     15.2 Notices. Any notice required or permitted to be given by this
Agreement shall be in writing and shall be delivered by hand or overnight
courier with tracking capabilities or mailed postage prepaid by first class,
registered or certified mail addressed as set forth below unless changed by
notice so given:

          If to GSK:

                          Attention: Vice President, Business Development
                          Center of Excellence for External Drug Discovery
                          GlaxoSmithKline
                          2301 Renaissance Boulevard
                          Mail Code RN0210
                          King of Prussia, PA 19406
                          Telephone: 610-787-4093
                          Facsimile: 610-787-4105

                          and

                          Attention: Vice President, Transactions,
                          Worldwide Business Development
                          GlaxoSmithKline
                          Greenford Road
                          Greenford, Middlesex
                          UB6 OHE
                          Telephone: +44 208 966 5655
                          Facsimile: +44 208 966 5371

          With a copy to:

                          Attention: Vice President and Associate General
                          Counsel
                          R&D Legal Operations
                          GlaxoSmithKline
                          2301 Renaissance Boulevard
                          Mail Code RN0220
                          King of Prussia, PA 19406
                          Telephone: 610-787-3626
                          Facsimile: 610-787-7084

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

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          If to EPIX:

                          EPIX Pharmaceuticals, Inc.
                          4 Maguire Road
                          Lexington, MA
                          Attention: Chief Business Officer
                          Telephone: 781-372-3260
                          Facsimile: 781-372-0822

          With a copy to:

                          Goodwin Procter LLP
                          Exchange Place
                          Boston, Massachusetts 02109
                          Attention: Christopher Denn, Esq.
                          Telephone: 617-570-1000
                          Facsimile: 617-523-1231

     Any such notice shall be deemed given on the date received. A Party may
add, delete, or change the person or address to whom notices should be sent at
any time upon written notice delivered to the Party's notices in accordance with
this Section 15.2.

     15.3 Force Majeure. Neither Party shall be liable for delay or failure in
the performance of any of its obligations hereunder if such delay or failure is
due to causes beyond its reasonable control, including, without limitation, acts
of God, fires, earthquakes, acts of war, terrorism, or civil unrest ("Force
Majeure"); provided, however, that the affected Party promptly notifies the
other Party and further provided that the affected Party shall use its
Commercially Reasonable Efforts to avoid or remove such causes of
non-performance and to mitigate the effect of such occurrence, and shall
continue performance with the utmost dispatch whenever such causes are removed.
When such circumstances arise, the Parties shall negotiate in good faith any
modifications of the terms of this Agreement that may be necessary or
appropriate in order to arrive at an equitable solution.

     15.4 Assignment. Neither Party shall assign or transfer any of its rights
or obligations hereunder except as provided herein or as consented to in writing
by the other Party.

          15.4.1 Assignment by EPIX; Change in Control Event of EPIX.

               (a) EPIX may, without the consent of GSK, assign or transfer all
of its rights and obligations hereunder to an Affiliate or to a successor in
interest by reason of merger or consolidation or sale of all or substantially
all of the assets of EPIX; provided however, that (i) EPIX's rights and
obligations under this Agreement [********] and [********] from all or
substantially all of its other [********], including those [********] that are
subject to this Agreement, (ii) such assignment includes, without limitation,
[********] and all rights and obligations under this Agreement, (iii) such
successor in interest or Affiliate shall have agreed as

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of such assignment or transfer to be bound by the terms of this Agreement in
writing as provided to GSK, and (iv) where this Agreement is assigned or
transferred to an Affiliate, EPIX remains responsible for the performance of
this Agreement.

               (b) In addition, where assignment is in connection with a Change
in Control Event of EPIX: (1) EPIX's [********] or if previously exercised, it
shall terminate; (2) the JSC shall continue only with respect to EPIX
Development activities; (3) the [********] of GSK provided for herein for any
GSK Development Program (other than under [********] shall end; (4) [********]
obligations under [********] shall terminate; (5) [********] obligations and
restrictions under [********] shall survive except that the acquiring party and
its Affiliates (together, the "Acquiror") shall have the right to seek to
acquire rights, to in-license and to research, Develop or Commercialize any
compound(s) or products(s) that modulate any Program Target for which [********]
is obligated to exclusivity according to [********] as long as the Acquiror does
not [********] (and [********] does not [********] on behalf of or for the
benefit of the Acquiror) any of [********] and (6) if the Acquiror is Developing
or Commercializing a compound or product directed to a [********] for an
[********],[********] shall ensure and take all reasonable steps (including the
creation of a firewall) to ensure that [********] in any [********] to which GSK
has [********] is provided to or used by the Acquiror with respect to such
compound or product.

               (c) Breach of any of the provisions set forth in this Section
15.4.1 shall constitute material breach of the Agreement. Upon the consummation
of such Change in Control Event, if both Parties so desire, the Parties may
negotiate in good faith an early termination of the Agreement taking into
consideration the stage of Development of each EPIX Program and the payments
made hereunder by GSK prior to such termination.

          15.4.2 Assignment by GSK. GSK may, without the consent of EPIX, assign
or transfer all of its rights and obligations hereunder to an Affiliate of GSK
or to a successor in interest by reason of merger or consolidation or sale of
all or substantially all of the assets of GSK; provided however, that (i) GSK's
rights and obligations under this Agreement [********] and [********] from all
or substantially all of its other [********] including those [********] that are
subject to this Agreement, (ii) such assignment includes, without limitation,
all [********] and all rights and obligations under this Agreement, (iii) such
successor in interest or Affiliate shall have agreed as of such assignment or
transfer to be bound by the terms of this Agreement in a writing provided to
EPIX, and (iv) where this Agreement is assigned or transferred to an Affiliate,
GSK remains responsible for the performance of this Agreement.

          15.4.3 Subject to the foregoing, this Agreement shall inure to the
benefit of and be binding on the Parties' successors and assigns. Any assignment
or transfer in violation of the foregoing shall be null and void and wholly
invalid, the assignee or transferee in any such assignment or transfer shall
acquire no rights whatsoever, and the non-assigning non-transferring Party shall
not recognize, nor shall it be required to recognize, such assignment or
transfer.

     15.5 Further Assurances. Each Party agrees to do and perform all such
further acts and things and shall execute and deliver such other agreements,
certificates, instruments and documents necessary or that the other Party may
deem advisable in order to carry out the intent

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and accomplish the purposes of this Agreement and to evidence, perfect or
otherwise confirm its rights hereunder.

     15.6 Waivers and Modifications. The failure of any Party to insist on the
performance of any obligation hereunder shall not be deemed to be a waiver of
such obligation. Waiver of any breach of any provision hereof shall not be
deemed to be a waiver of any other breach of such provision or any other
provision on such occasion or any succeeding occasion. No waiver, modification,
release or amendment of any obligation under or provision of this Agreement
shall be valid or effective unless in writing and signed by all Parties hereto.

     15.7 Choice of Law. This Agreement shall be governed by, enforced, and
shall be construed in accordance with the laws of the State of New York without
regard to its conflicts of law provisions.

     15.8 Jurisdiction. Unless the Parties otherwise agree in writing, each
Party, for the purpose of enforcing an award under Section 14.2 or for seeking
injunctive or other equitable relief as permitted under Section 14.2(g), hereby
irrevocably submits to the exclusive jurisdiction of (i) the courts of the State
of New York (each a "State Court"), and (ii) the United States District Court
for the District of New York (the "District Court"), for the purposes of any
suit, action or other proceeding arising out of this Agreement or out of any
transaction contemplated hereby. Each party agrees to commence any such action,
suit or proceeding either in the District Court or if such suit, action or other
proceeding may not be brought in such court for jurisdictional reasons, in a
State Court. Each party further agrees that service of any process, summons,
notice or document by personal delivery, by registered mail, or by a recognized
international express delivery service to such Party's respective address set
forth above shall be effective service of process for any action, suit or
proceeding in the District Court or State Court with respect to any matters to
which it has submitted to jurisdiction in this Section. Each party irrevocably
and unconditionally waives any objection to the laying of venue of any action,
suit or proceeding arising out of this Agreement or the transactions
contemplated hereby in the District Court or State Court, and hereby and thereby
further irrevocably and unconditionally waives and agrees not to plead or claim
in any such court that any such action, suit or proceeding brought in any such
court has been brought in an inconvenient forum.

     15.9 Publicity. Upon execution of this Agreement, the Parties shall issue
the press release announcing the existence of this Agreement in the form and
substance as set forth in Appendix B, attached hereto and incorporated herein.
Each Party agrees not to issue any other press release or other public statement
disclosing other information relating to this Agreement or the transactions
contemplated hereby without the prior written consent of the other Party, other
than with respect to the terms and conditions of this Agreement in accordance
with Section 11.4; provided, however, that any disclosure which is required by
applicable Law (including the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended), or the rules of a securities
exchange or the Securities and Exchange Commission or the securities regulators
of any state or other jurisdiction, as reasonably advised by the disclosing
Party's counsel, may be made subject to the following. The Parties agree that
any such required disclosure will not contain confidential business or technical
information, including Confidential

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       74

<PAGE>

Information, and, if disclosure of such information is required by applicable
Law or such rules or regulators, the Parties will use appropriate diligent
efforts to minimize such disclosure and obtain confidential treatment for any
such information which is disclosed to a governmental agency. Each Party agrees
to provide to the other Party a copy of any public announcement regarding this
Agreement or the subject matter thereof as soon as reasonably practicable under
the circumstances prior to its scheduled release. Except under extraordinary
circumstances, each Party shall provide the other with an advance copy of any
such announcement at least three (3) Business Days prior to its scheduled
release. Each Party shall have the right to expeditiously review and recommend
changes to any such announcement and, except as otherwise required by applicable
Law or such rules or regulators, the Party whose announcement has been reviewed
shall remove any Confidential Information of the reviewing Party that the
reviewing Party reasonably deems to be inappropriate for disclosure. The
contents of any announcement or similar publicity which has been reviewed and
approved by the reviewing Party (including the press release set forth in
Appendix B) can be re-released by either Party without a requirement for
re-approval. Nothing in this Section 15.9 shall be construed to prohibit GSK,
EPIX or their respective Affiliates or Sublicensees from making a public
announcement or disclosure regarding the stage of development of EPIX Program
Compounds, GSK Development Compounds and Licensed Products or disclosing
clinical trial results with respect thereto, as may be required by applicable
Law or such rules or regulators, as reasonably advised by GSK's (or its
Affiliates' or Sublicensees') or EPIX's counsel.

     15.10 Relationship of the Parties. Each Party is an independent contractor
under this Agreement. Nothing contained herein is intended or is to be construed
so as to constitute EPIX and GSK as partners, agents or joint venturers. Neither
Party shall have any express or implied right or authority to assume or create
any obligations on behalf of or in the name of the other Party or to bind the
other Party to any contract, agreement or undertaking with any Third Party.
There are no express or implied third party beneficiaries hereunder.

     15.11 Headings. Headings and captions are for convenience only and are not
be used in the interpretation of this Agreement.

     15.12 Entire Agreement. This Agreement and the attached Appendices
constitutes the entire agreement between the Parties as to the subject matter of
this Agreement, and supersedes and merges all prior negotiations,
representations, agreements and understandings regarding the same.

     15.13 Counterparts. This Agreement may be executed in counter-parts with
the same effect as if both Parties had signed the same document. All such
counterparts shall be deemed an original, shall be construed together and shall
constitute one and the same instrument.

     15.14 Exports. Each Party agrees not to export or re-export, directly or
indirectly, any information, technical data, the direct product of such data,
samples or equipment received or generated under this Agreement in violation of
any applicable export control Laws.

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       75

<PAGE>

     15.15 Interpretation.

          15.15.1 Each of the Parties acknowledges and agrees that this
Agreement has been diligently reviewed by and negotiated by and between them,
that in such negotiations each of them has been represented by competent counsel
and that the final agreement contained herein, including the language whereby it
has been expressed, represents the joint efforts of the Parties hereto and their
counsel. Accordingly, in interpreting this Agreement or any provision hereof, no
presumption shall apply against any Party hereto as being responsible for the
wording or drafting of this Agreement or any such provision, and ambiguities, if
any, in this Agreement shall not be construed against any Party, irrespective of
which Party may be deemed to have authored the ambiguous provision.

          15.15.2 The definitions of the terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". The word
"any" shall mean "any and all" unless otherwise clearly indicated by context.

          15.15.3 Unless the context requires otherwise, (a) any definition of
or reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein
or therein), (b) any reference to any Laws herein shall be construed as
referring to such Laws as from time to time enacted, repealed or amended, (c)
any reference herein to any Person shall be construed to include the Person's
successors and assigns, (d) the words "herein", "hereof" and "hereunder", and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, and (e) all references
herein to Articles, Sections or Appendices, unless otherwise specifically
provided, shall be construed to refer to Articles, Sections and Appendices of
this Agreement.

                                      * * *

                            [signature page follows]

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       76
<PAGE>

     IN WITNESS WHEREOF, the Parties have caused this Development and License
Agreement to be executed by their respective duly authorized officers.

                                        SMITHKLINE BEECHAM CORPORATION,
                                        DOING BUSINESS AS GLAXOSMITHKLINE

                                        By: /s/ Donald F. Parman
                                            ------------------------------------
                                            (Signature)
                                        Name: Donald F. Parman
                                        Title: Vice President and Secretary
                                        Date: 12/11/06

                                        GLAXO GROUP LIMITED

                                        By: /s/ Paul Williamson
                                            ------------------------------------
                                            (Signature)
                                        Name: Paul Williamson
                                        Title: For and on behalf of Edinbugh
                                               Pharmaceutical Industries Limited
                                               Corporate Director
                                        Date: 12/11/06

                                        EPIX PHARMACEUTICALS, INC.

                                        By: /s/ Michael G. Kauffman
                                            ------------------------------------
                                            (Signature)
                                        Name: Michael G. Kauffman
                                        Title: CEO
                                        Date: 12/11/06

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       77

<PAGE>

                                   APPENDIX A

                                  EPIX PATENTS

<TABLE>
<CAPTION>
  Case ID    Country      Title     Inventor(s)   Application No.   Filing Date
  -------    -------   ----------   -----------   ---------------   -----------
<S>          <C>       <C>          <C>           <C>               <C>
[********]     US      [********]    [********]      [********]      [********]
[********]     PCT     [********]    [********]      [********]      [********]
[********]     AU      [********]    [********]          --(1)       [********]
[********]     BR      [********]    [********]          --          [********]
[********]     CN      [********]    [********]          --          [********]
[********]     EG      [********]    [********]          --          [********]
[********]     JP      [********]    [********]          --          [********]
[********]     KR      [********]    [********]          --          [********]
[********]     RU      [********]    [********]          --          [********]
[********]     EG      [********]    [********]          --              --
[********]     IN      [********]    [********]          --          [********]
[********]     ID      [********]    [********]          --          [********]
[********]     IL      [********]    [********]          --          [********]
[********]     MA      [********]    [********]          --          [********]
[********]     NO      [********]    [********]          --          [********]
[********]     PH      [********]    [********]          --          [********]
[********]     EP      [********]    [********]          --          [********]
[********]     NZ      [********]    [********]          --              --
[********]     ZA      [********]    [********]          --          [********]
[********]     UK      [********]    [********]          --          [********]
[********]     US      [********]    [********]      [********]      [********]
[********]     US      [********]    [********]      [********]      [********]
[********]     US      [********]    [********]      [********]      [********]
[********]    CP/PC    [********]    [********]          --              --
[********]    CP/AR    [********]    [********]          --              --
</TABLE>

----------
(1)  Information not yet received

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       78

<PAGE>

<TABLE>
<CAPTION>
  Case ID    Country      Title     Inventor(s)   Application No.   Filing Date
  -------    -------   ----------   -----------   ---------------   -----------
<S>          <C>       <C>          <C>           <C>               <C>
[********]    CP/CL    [********]    [********]          --              --
[********]    CP/TH    [********]    [********]          --              --
[********]    CP/TW    [********]    [********]          --              --
[********]     US      [********]    [********]      [********]      [********]
[********]     PCT     [********]    [********]      [********]      [********]
[********]     AR      [********]    [********]      [********]      [********]
[********]     CL      [********]    [********]      [********]      [********]
[********]     TH      [********]    [********]      [********]      [********]
[********]     TW      [********]    [********]      [********]      [********]
</TABLE>

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       79

<PAGE>

                                   APPENDIX B

                                  PRESS RELEASE

PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE EXCHANGE ACT; [*] DENOTES
OMISSIONS.

                                       80
<PAGE>

(GLAXOSMITHKLINE LOGO)                               (EPIX PHARMACEUTICALS LOGO)

FOR IMMEDIATE RELEASE

CONTACT:
EPIX PHARMACEUTICALS                    PURE COMMUNICATIONS
Kim Drapkin                             Andrea L. Johnston
Chief Financial Officer                 (910) 616-5858
(781) 761-7600

GLAXOSMITHKLINE
US MEDIA QUERIES
Nancy Pekarek
(215) 751-7709
Patricia Seif
(215) 751-7709

US ANALYST/INVESTOR QUERIES
Frank Murdolo
(215) 751-7002
Frank Curry
(215) 751-5419

                    GLAXOSMITHKLINE AND EPIX PHARMACEUTICALS
                  ENTER DRUG DISCOVERY AND DEVELOPMENT ALLIANCE

     COLLABORATION INCLUDES DISCOVERY AND DEVELOPMENT OF FOUR GPCR PROGRAMS

London, U.K., Philadelphia, PA and Lexington, MA; December 12, 2006 -
GlaxoSmithKline (NYSE:GSK) and EPIX Pharmaceuticals (NASDAQ:EPIX) today
announced a worldwide multi-target strategic collaboration to discover, develop
and market novel medicines targeting four G-protein coupled receptors (GPCRs)
for the treatment of a variety of diseases, including EPIX's novel 5-HT4 partial
agonist program, PRX-03140, in early-stage clinical development for the
treatment of Alzheimer's disease. The alliance with GSK will be conducted
through its Center of Excellence for External Drug Discovery (CEEDD).

EPIX will receive total initial payments of $35 million, including $17.5 million
through the purchase of 3,009,027 shares of common stock. In addition, EPIX will
be eligible to earn potential milestones of up to $1.2 billion based on the
achievement of certain discovery, development, regulatory and commercial
milestones across the four GPCR programs. EPIX will also receive tiered
double-digit royalties on sales by GSK of all collaboration-developed product
sales.

<PAGE>

EPIX will be responsible for the discovery and development of small molecule
drug candidates targeting four GPCRs, including PRX-03140 for the treatment of
Alzheimer's disease, through to clinical proof of concept, at which point GSK
will have an exclusive option to license each product for further development
and commercialization on a worldwide basis. In addition to the upfront payment,
EPIX has the opportunity to earn milestone payments upon the achievement of
specified development and regulatory milestones in each of the programs. If GSK
exercises the option to license EPIX's 5-HT4 partial agonist program, EPIX will
retain the right to co-promote any products from that program in the United
States.

"We are very pleased to enter into this collaboration with GSK, a world-class
pharmaceutical company," stated Michael G. Kauffman, M.D., Ph.D., chief
executive officer of EPIX. "This alliance will provide us with access to
significant capital in the near and long term to support the ongoing development
of PRX-03140 and three additional programs, as well as the ability to continue
to move forward our existing programs. Furthermore, the co-promotion option in
this collaboration provides further opportunity for EPIX to build a sales force
in the future."

Chen Schor, chief business officer of EPIX added, "We were looking for a partner
that would appreciate our proprietary drug discovery expertise. GSK's vast
experience in clinical development and commercialization, especially in diseases
of the central nervous system, make them the ideal partner for the continued
development of our 5-HT4 Alzheimer's program, as well as the other GPCR targets
that will be the focus of this alliance."

Maxine Gowen, Ph.D. Senior Vice President and head of GSK's CEEDD stated, "This
alliance with Epix again demonstrates the CEEDD's and GSK's commitment to
accessing leading-edge innovation. We are very excited to be working with the
Epix team both on the existing 5HT4 program in Alzheimer's disease, a key
disease area for GSK, and on other GPCR programs which will be initiated as part
of this collaboration."

ABOUT GPCRS

GPCRs are the largest known class of molecular targets with proven therapeutic
value. Of the top 50 selling drug worldwide, as identified by IMS, it is
estimated that nearly 40 percent interact with GPCRs as their target proteins.
GPCRs convert signals received from outside the cell into biological processes
inside the cell. A variety of well-known biological molecules, including
neurotransmitters and hormones, can bind to GPCRs and trigger cellular processes
involved in diseases such as obesity, cognition, depression and pain. EPIX has a
proprietary drug discovery technology and approach which has enabled the company
to advance four novel GPCR drug candidates from discovery to clinical
development in less than four years.

ABOUT EPIX

EPIX Pharmaceuticals is a biopharmaceutical company focused on discovering,
developing and commercializing novel pharmaceutical products through the use of
proprietary technology to better diagnose, treat and manage patients. The
company has a

<PAGE>

blood-pool imaging agent approved and marketed in Europe (Vasovist(TM)), and
five internally-discovered therapeutic and imaging drug candidates currently in
clinical trials targeting conditions such as depression, Alzheimer's disease,
cardiovascular disease and obesity. These drug candidates include EP-2104R, a
novel thrombus imaging agent which has completed a Phase 2a trial, PRX-08066 in
Phase 2 clinical development for pulmonary hypertension associated with chronic
obstructive pulmonary disease, and PRX-03140, which has completed a Phase 1b
clinical trial in Alzheimer's patients. EPIX also has collaborations with other
leading organizations, including Amgen, Cystic Fibrosis Foundation Therapeutics,
and Schering AG (Germany). For more information about EPIX, please visit the
company's website at www.epixpharma.com.

ABOUT THE CEEDD

GlaxoSmithKline is enhancing the way it discovers and develops drugs by creating
a small dedicated team who will feed the GSK pipeline solely through the efforts
of its external alliances. The CEEDD (Center of Excellence for External Drug
Discovery) was formed as a further validation of GSK's strategy to create small,
independent and accountable R&D teams (Centers of Excellence for Drug Discovery
or CEDDs). In essence, the CEEDD will "virtualize" a portion of the GSK
pipeline; namely, from target to clinical proof of concept, by forming multiple
risk-sharing/reward-sharing alliances. Capitalizing on the speed and efficiency
of its collaborators will allow GSK to deliver pharmaceutical products faster to
patients. For information about the CEEDD, visit the group's website at
www.CEEDD.com

ABOUT GSK

GlaxoSmithKline, one of the world's leading research-based pharmaceutical and
healthcare companies, is committed to improving the quality of human life by
enabling people to do more, feel better and live longer. For information about
GSK visit the company website at www.GSK.com

FORWARD-LOOKING STATEMENTS

Any statements in this press release about Epix's expectations, beliefs, plans,
objectives, assumptions or future events or performance are not historical facts
and are forward-looking statements. These statements are often but not always,
made through the use of words or phrases such as believe, will, expect,
anticipate, estimate, intend, plan and would. Forward-looking statements are not
guarantees of performance. They involve known and unknown risks, uncertainties
and assumptions that may cause actual results, levels of activity, performance
or achievements to differ materially from any results, levels of activity,
performance or achievements expressed or implied by any forward-looking
statement. Some of the risks, uncertainties and assumptions that could cause
actual results to differ materially from estimates or projections contained in
the forward looking statements include but are not limited to (i) the timing,
success and cost of preclinical research activities and clinical studies, (ii)
the timing, acceptability and review periods for regulatory filings, (iii) the
availability of corporate partners, (iv)uncertainties relating to patent
protection and intellectual property rights of third parties, (v) the impact of
competitive products and technological changes, (vi) the availability of capital
and the cost of capital (vii) other vagaries in the biotechnology

<PAGE>

industry and (viii) other risks. Epix undertakes no obligation to update or
revise any forward looking statements.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Under the safe harbor provisions of the US Private Securities Litigation Reform
Act of 1995, GlaxoSmithKline cautions investors that any forward-looking
statements or projections made by the company, including those made in this
Announcement, are subject to risks and uncertainties that may cause actual
results to differ materially from those projected. Factors that may affect the
Group's operations are described under 'Risk Factors' in the 'Operating and
Financial Review and Prospects' in the company's Annual Report 2005.<PAGE>

                                                                    EXHIBIT 10.2

                            STOCK PURCHASE AGREEMENT

                                 BY AND BETWEEN

                           EPIX PHARMACEUTICALS, INC.

                                       AND

                               GLAXO GROUP LIMITED

                                       AND

        SMITHKLINE BEECHAM CORPORATION, DOING BUSINESS AS GLAXOSMITHKLINE

                          DATED AS OF DECEMBER 11, 2006

                                        i

<PAGE>

                            STOCK PURCHASE AGREEMENT

     THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made as of December 11,
2006, by and between EPIX Pharmaceuticals, Inc., a Delaware corporation (the
"Company") and Glaxo Group Limited, a company organized under the laws of
England ("GGL") and SmithKline Beecham Corporation, doing business as
GlaxoSmithKline, a Pennsylvania corporation ("SBC") (GGL and SBC together are
referred to herein as "GSK").

     WHEREAS, the Company has agreed to sell, and GSK has agreed to purchase, an
aggregate of shares of the Company's common stock as determined in Section 1.2
herein, par value $.01 per share (the "Common Stock") for an aggregate purchase
price of $17,500,000 in accordance with the terms and provisions hereof.

     WHEREAS, the Company and GSK are entering into a Development and License
Agreement, dated as of the same date herewith, to develop and commercialize a
compound designated as PRX-03140 and certain other compounds developed by the
Company and which may be licensed by GSK (the "Development and License
Agreement").

     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

                     SECTION I - PURCHASE AND SALE OF SHARES

     1.1. PURCHASE AND SALE OF COMMON STOCK. Subject to the terms and conditions
of this Agreement and in reliance on the representations, warranties and
covenants herein set forth, the Company shall issue and sell to GSK, and GSK
agrees to purchase from the Company the total number of shares of Common Stock
as determined in Section 1.2 for an aggregate purchase price of $17,500,000. The
shares of Common Stock purchased pursuant to this Section 1.1 are hereinafter
referred to as the "Shares."

     1.2. DETERMINATION OF NUMBER OF SHARES. The number of Shares shall be the
quotient, rounded to the nearest whole number, obtained by dividing $17,500,000
by 125% of the average of the closing sale prices of the Common Stock on the
Nasdaq Global Market for the 15-day trading period ending on the Effective Date
of the Development and License Agreement (as defined therein).

     1.3. CLOSING. Subject to the satisfaction or waiver of the conditions set
forth herein, the purchase of the Shares shall be made at a closing to be held
at the offices of Goodwin Procter LLP, 53 State Street, Boston, Massachusetts
02109 (by means of facsimile or overnight mail) on a December 11, 2006 (the
"Closing").

     1.4. CLOSING DELIVERY. Within five (5) days of the Closing, subject to the
terms and conditions of this Agreement: (i) GSK shall pay the Purchase Price by
wire transfer of $17,500,000 in immediately available funds in accordance with
the wire transfer instructions previously provided to GSK; (ii) the parties
hereto shall have entered into the Development and License Agreement; and (iii)
the Company shall deliver stock certificates representing the

<PAGE>

Shares. The Shares shall be registered 54.16% in the name of GGL and 45.84% in
the name of SBC, in each case rounded to the nearest full share.

     1.5. EXEMPTION FROM REGISTRATION. The certificate or certificates for the
Shares (and any securities issued in respect of or exchange for the Shares)
shall be subject to a legend or legends restricting transfer under the
Securities Act of 1933, as amended, (the "Securities Act") and referring to
restrictions on transfer herein, such legend to be substantially as follows:

     THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR APPLICABLE STATE SECURITIES
LAWS AND NO INTEREST THEREIN MAY BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER
THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR THE ISSUER OF THESE
SECURITIES RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES
SATISFACTORY TO THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER THE ACT OR
ANY APPLICABLE STATE SECURITIES LAWS.

     THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS ALSO
SUBJECT TO THE RESTRICTIONS CONTAINED IN THAT CERTAIN STOCK PURCHASE AGREEMENT
DATED AS OF DECEMBER 11, 2006, BY AND BETWEEN EPIX PHARMACEUTICALS, INC. AND
GLAXO GROUP LIMITED AND SMITHKLINE BEECHAM CORPORATION.

           SECTION II - REPRESENTATIONS AND WARRANTIES OF THE COMPANY

     The Company hereby represents, warrants and covenants to GSK, as of the
date hereof, as follows:

     2.1. ORGANIZATION AND CORPORATE POWER. The Company and each of its
Subsidiaries (as defined in Rule 405 of the Securities Act) is duly organized
and validly existing in good standing under the laws of the jurisdiction of its
organization. Each of the Company and its Subsidiaries has all requisite
corporate power and authority to own its properties and to carry on its business
as presently conducted and as described in the prospectus contained in its
Registration Statement on Form S-3 (No. 333-117925). Each of the Company and its
subsidiaries is qualified to do business as a foreign corporation in each
jurisdiction wherein the character of its property, or the nature of the
activities presently conducted by it, makes such qualification necessary, except
where the failure to be so licensed or qualified would not have a Material
Adverse Effect. The Company is not in violation of any term or provision of its
charter or by-laws, each as in effect as of this date. "Material Adverse Effect"
shall mean any events, occurrences or circumstances which give rise to or would
reasonably be expected to give rise to, individually or in the aggregate, a
material adverse effect on the assets, liabilities, condition (financial or
other), business, results of operations of the Company and its Subsidiaries,
considered as one enterprise.

                                        2

<PAGE>

     2.2. AUTHORIZATION AND NON-CONTRAVENTION. This Agreement is a valid and
binding obligation of the Company, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). The execution, delivery and performance of
this Agreement, and the sale and delivery of the Shares in accordance with this
Agreement have been duly authorized by all necessary corporate or other action
of the Company. The execution, delivery and performance of this Agreement,
including, without limitation, the sale and delivery of the Shares in accordance
with this Agreement and the performance of any transactions contemplated by this
Agreement will not violate, conflict with or result in a default (whether after
the giving of notice, lapse of time or both) under (i) any bond, debenture, note
or any other evidence of indebtedness in any indenture, mortgage deed of trust
or any other material agreement or instrument which would be reasonably likely
to have a Material Adverse Effect, or to cause the creation of any lien or
encumbrance upon any of the assets of the Company or any of its Subsidiaries,
except for those which would not have a Material Adverse Effect, (ii) any
provision of the Company's charter or by-laws, or (iii) any provision of any
law, regulation or rule, or any order of, or any restriction imposed by any
court or other governmental agency applicable to the Company, except for those
which would not have a Material Adverse Effect.

     2.3. APPROVALS. Except as set forth on Schedule 2.3, no permit,
authorization, consent, approval, or order of or by, or any, notification of or
filing with, any person or entity (governmental or otherwise) is required in
connection with the execution, delivery or performance of this Agreement
(including the issuance and sale of the Shares) by the Company.

     2.4. AUTHORIZED AND OUTSTANDING STOCK. As of November 1, 2006, the
authorized capital stock of the Company consists of (i) 100,000,000 shares of
Common Stock, of which 29,157,147 shares are issued and outstanding, and (ii)
1,000,000 shares of Preferred Stock, none of which are issued and outstanding.
The Company has not issued any capital stock since that date other than pursuant
to (i) employee benefit plans disclosed in the SEC Documents (as defined in
Section 2.5 below), or (ii) outstanding warrants, options or other securities
disclosed in the SEC Documents. The Shares, when issued against payment
therefore in accordance with this Agreement, will be validly issued, fully paid
and non-assessable. There are no preemptive rights, rights of first refusal, put
or call rights or obligations or anti-dilution rights with respect to the
issuance or sale of the Shares. The Company owns the entire equity interest in
each of its Subsidiaries, free and clear of any pledge, lien, security interest,
encumbrance, claim or equitable interest, other than as described in the SEC
Documents. Except as disclosed in the SEC Documents, there are no stockholders
agreements, voting agreements or other similar agreements with respect to the
Common Stock to which the Company is a party.

     2.5. SEC DOCUMENTS; FINANCIAL STATEMENTS. Since December 31, 2005, the
Company has filed all documents required to be filed with the SEC pursuant to
the reporting requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") (such filings since such date, the "SEC Documents"). As of
their respective filing dates, each of the SEC Documents complied in all
material respects with the requirements of the Exchange Act, and the rules and
regulations of the SEC promulgated thereunder applicable to such SEC

                                        3

<PAGE>

Documents, and no SEC Document when filed contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The financial
statements of the Company and the related notes contained in the SEC Documents
present fairly, in accordance with generally accepted accounting principles, the
financial position of the Company and its Subsidiaries as of the dates
indicated, and the results of its operations and cash flows for the periods
therein specified except that the unaudited interim financial statements were or
are subject to normal and recurring year-end adjustments which will not be
material in amount. Such financial statements (including the related notes) have
been prepared in compliance in all material respects with the published rules
and regulations of the SEC and in accordance with generally accepted accounting
principles applied on a consistent basis throughout the periods therein
specified, except as may be disclosed in the notes to such financial statements,
or in the case of unaudited statements, as may be permitted by the SEC on Form
10-Q under the Exchange Act and except as disclosed in the SEC Documents.

     2.6. NO VIOLATIONS. Neither the Company nor any of its Subsidiaries is (i)
in violation of its charter, bylaws, or other organizational document, or (ii)
in violation of any law, administrative regulation, ordinance or order of any
court or governmental agency, arbitration panel or authority applicable to the
Company or any Subsidiary, which violation, individually or in the aggregate,
would be reasonably likely to have a Material Adverse Effect, or (iii) in
default (and there exists no condition which, with the passage of time or
otherwise, would constitute a default) in the performance of any bond,
debenture, note or any other evidence of indebtedness in any indenture,
mortgage, deed of trust or any other material agreement or instrument which is
filed as an exhibit to the SEC Documents and which would be reasonably likely to
have a Material Adverse Effect.

     2.7. NASDAQ COMPLIANCE. The Company's Common Stock is listed on The NASDAQ
Global Market and the Company has taken no action designed to, or likely to have
the effect of, de-listing the Common Stock from the NASDAQ Global Market, nor
has the Company received any notification that the Securities Exchange
Commission (the "SEC") or the National Association of Securities Dealers, Inc.
(the "NASD") is contemplating terminating such registration or listing. The
Company shall comply with all requirements of the NASD and the SEC with respect
to the issuance of the Shares and the listing of the Shares on the NASDAQ Global
Market.

     2.8. COMPANY NOT AN "INVESTMENT COMPANY". The Company has been advised of
the rules and requirements under the Investment Company Act of 1940, as amended
(the "Investment Company Act"). To the best knowledge of the Company, the
Company is not, and immediately after receipt of payment for the Shares will not
be, an "investment company" or an entity "controlled" by an "investment company"
within the meaning of the Investment Company Act and shall conduct its business
in a manner so that it will not become subject to the Investment Company Act.

     2.9. PRIVATE OFFERING. Assuming the correctness of the representations and
warranties of GSK set forth in Section 3 hereof, the offer and sale of the
Shares hereunder is exempt from registration under the Securities Act.

                                        4

<PAGE>

     2.10. NO BROKERS OR FINDERS. No person has or will have, as a result of the
transactions contemplated by this Agreement, any right, interest or claim
against or upon the Company for any commission, fee or other compensation as a
finder or broker because of any act or omission by the Company or its
stockholders or its affiliates.

     2.11. VALID ISSUANCE OF SHARES. When issued, sold and delivered in
accordance with the terms hereof for the consideration provided herein, the
Shares shall be duly authorized, validly issued, fully paid and nonassessable,
free from any encumbrances or restrictions on transfer other than restrictions
on transfer under this Agreement and under federal and state securities laws.

               SECTION III - REPRESENTATIONS AND WARRANTIES OF GSK

     GGL and SBC hereby jointly and severally represent, warrant and covenant to
the Company, as of the date hereof, as follows:

     3.1. INVESTMENT REPRESENTATIONS. (i) (A) Each of GGL and SBC is an
"accredited investor" as defined in Regulation D under the Securities Act and is
knowledgeable, sophisticated and experienced in making, and is qualified to make
decisions with respect to investments in shares presenting an investment
decision like that involved in the purchase of the Shares, including investments
in securities issued by the Company and investments in comparable companies, and
has requested, received, reviewed and considered all information it deemed
relevant in making an informed decision to purchase the Shares and (B) the
Company has made available to GSK, prior to the date hereof, the opportunity to
ask questions of and receive complete and correct answers from representatives
of the Company concerning the terms and conditions of the Shares and to obtain
any additional information relating to the financial condition and business of
the Company and GSK has such knowledge and experience in financial and business
matters that GSK is capable of evaluating the merits and risks of the investment
in the Shares; (ii) each of GGL and SBC is acquiring the Shares for its own
account for investment only and with no present intention of distributing any of
the Shares or any arrangement or understanding with any other persons regarding
the distribution of the Shares; (iii) each of GGL and SBC will not, directly or
indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit
any offers to buy, purchase or otherwise acquire or take a pledge of) any of the
Shares except in compliance with Section 4.2 of this Agreement, the Securities
Act, applicable state securities laws and the respective rules and regulations
promulgated thereunder, and acknowledges that certificates evidencing the Shares
will be imprinted with a legend that prohibits their transfer except in
accordance therewith; and (iv) each of GGL and SBC has, in connection with its
decision to purchase the Shares relied only upon the SEC Documents and the
representations and warranties of the Company contained herein. Each of GGL and
SBC understands that its acquisition of the Shares has not been registered under
the Securities Act or registered or qualified under any state securities law in
reliance on specific exemptions therefrom, which exemptions may depend upon,
among other things, the bona fide nature of each investor's investment intent as
expressed herein.

     3.2. COMPLIANCE WITH FOREIGN SECURITIES LAWS. No action has been or will be
taken in any jurisdiction outside the United States by the Company that would
permit an offering of the

                                        5

<PAGE>

Shares, or possession or distribution of offering materials in connection with
the issue of the Shares, in any jurisdiction outside the United States where
legal action by the Company for that purpose is required. Each of GGL and SBC
will comply with all applicable laws and regulations in each foreign
jurisdiction in which it purchases, offers, sells or delivers the Shares, or has
in its possession or distributes any offering material, in all cases at its own
expense.

     3.3. AUTHORITY. (i) Each of GGL and SBC has full right, power, authority
and capacity to enter into this Agreement and to consummate the transactions
contemplated hereby and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement, and (ii) this Agreement
constitutes a valid and binding obligation of each of GGL and SBC enforceable
against each of them in accordance with its terms, except as enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).

     3.4. INVESTMENT BANKING; BROKERAGE FEES. GSK has not incurred or taken any
action so that the Company is liable for or may become liable for any investment
banking fees, brokerage commissions, broker's or finder's fees or similar
compensation (exclusive of professional fees to lawyers and accountants) in
connection with the transactions contemplated by this Agreement.

                      SECTION IV - COVENANTS OF THE PARTIES

     4.1. RULE 144. The Company covenants that it will timely file the reports
required to be filed by it under the Securities Act and the Exchange Act and the
rules and regulations adopted by the SEC thereunder (or, if the Company is not
required to file such reports, it will, upon the request of GSK holding the
Shares purchased hereunder, made after the first anniversary of the Closing,
make publicly available such information as necessary to permit sales pursuant
to Rule 144 under the Securities Act), and it will take such further action as
GSK may reasonably request, all to the extent required from time to time to
enable GSK to sell such Shares without registration under the Securities Act
within the limitation of the exemptions provided by (i) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (ii) any
similar rule or regulation hereafter adopted by the SEC. Upon the request of
GSK, the Company will deliver to such holder a written statement as to whether
it has complied with such information and requirements.

     4.2. SALE OF SHARES. Except as set forth in this Section 4.2, GSK agrees
that it shall not sell, transfer, pledge, hypothecate or otherwise dispose of
(each a "Transfer") (i) any of the Shares purchased at the Closing prior to the
first anniversary following the Closing and (ii) not more than fifty percent
(50%) of the Shares purchased at the Closing prior to the second anniversary
following the Closing. The restrictions on Transfer set forth in this Section
4.2 shall not apply to Transfers to a subsidiary or parent of GSK, or
"affiliates" (as defined in Rule 405 of the Securities Act) or stockholders of
GSK, provided that each transferee agrees in writing as a condition precedent to
such Transfer to be bound by the terms of this Agreement. For as long as GGL or
SBC together own more than five percent (5%) of the outstanding shares of Common

                                        6

<PAGE>

Stock, GSK shall give the Company at least five (5) days prior written notice of
any intended Transfer of any of the Shares purchased pursuant to this Agreement.
GSK also agrees and consents to the entry of stop transfer instructions with the
Company's transfer agent and registrar against the transfer of the Shares except
in compliance with this Section 4.2.

     4.3. CONFIDENTIALITY; NON-DISCLOSURE. Each party represents to the other
that, at all times during the Company's offering of the Shares to GSK, it has
maintained in confidence all non-public information regarding the other, and
covenants that it will continue to maintain in confidence such information until
such information pursuant to Article 11 of the Development and License
Agreement, except as follows: (i) at Closing, the Company may issue a press
release disclosing information regarding its transaction with GSK that the
Company believes constitutes material and non-public information and (ii) the
Company shall, within four (4) business days of the Closing, file with the SEC a
Form 8-K disclosing the material terms of the transactions contemplated hereby
and by the Development and License Agreement. For the avoidance of doubt, the
parties agree that the information to be disclosed by the Company hereto shall
be deemed authorized disclosure under Section 11.2 of the Development and
License Agreement.

                            SECTION V - MISCELLANEOUS

     5.1. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company and GSK contained herein shall survive the execution
of this Agreement, the delivery to GSK of the Shares being purchased and the
payment therefore until 12 months from and after the date hereof.

     5.2. AMENDMENTS, WAIVERS AND CONSENTS. For the purposes of this Agreement,
except as otherwise specifically set forth herein, no course of dealing between
the Company on the one hand and GSK on the other and no delay on the part of any
party hereto in exercising any rights hereunder or thereunder shall operate as a
waiver of the rights hereof and thereof. Any term or provision hereof may be
amended, terminated or waived (either generally or in a particular instance and
either retroactively or prospectively) with the written consent of the Company
and GSK.

     5.3. NOTICES AND DEMANDS. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if faxed (with transmission acknowledgment received), delivered
personally or mailed by certified or registered mail (return receipt requested)
as follows:

                                        7

<PAGE>

     To the Company:   EPIX Pharmaceuticals, Inc.
                       4 Maguire Road
                       Lexington, Massachusetts 02421
                       Attention: Kimberlee C. Drapkin, Chief Financial Officer
                       Facsimile: (781) 761-7632

     With a copy to:   Goodwin Procter LLP
                       Exchange Place
                       Boston, MA 02109
                       Attn: Christopher Denn
                       Facsimile Number (617) 570-1231

     To GGL:                          With a copy to:
     Glaxo Group Limited              GlaxoSmithKline
     GSK House                        2301 Renaissance Blvd.
     980 Great West Road,             Mail Stop (RN0220)
     Brentford, Middlesex             King of Prussia, PA 19101
     TW8 9GS
     United Kingdom

     Attn: Corporate Secretariat      Attn: Vice President &
     Facsimile: 44 20 8047 6904       Associate General Counsel
                                      Facsimile: 610-787-7084

     To SBC:                          With a copy to:
     SmithKline Beecham Corporation   GlaxoSmithKline
     One Franklin Plaza (FP2355)      One Franklin Plaza (FP2355)
     200 N. 16th Street               200 N. 16th Street
     Philadelphia, PA 19102           Philadelphia, PA 19102

     Attn: Corporate Secretariat      Attn: VP & Associate General
     Facsimile: 215-751-5349          Counsel, Corporate Functions- US
                                      Facsimile: 215-751-5349

     or to such other address or fax number of which any party may notify the
other parties as provided above. Notices shall be effective as of the date of
such delivery, mailing or fax.

     5.4. SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such a manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be deemed
prohibited or invalid under such applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, and such
prohibition or invalidity shall not invalidate the remainder of such provision
or the other provisions of this Agreement.

                                        8

<PAGE>

     5.5. EXPENSES. Each of the parties shall be responsible for its own costs
and expenses incurred in connection with the transactions contemplated hereby
and all agreements, documents and instruments executed pursuant hereto.

     5.6. COUNTERPARTS. This Agreement may be executed in multiple counterparts,
each of which shall constitute an original but all of which shall constitute but
one and the same instrument. One or more counterparts of this Agreement may be
delivered via telecopier, with the intention that they shall have the same
effect as an original counterpart hereof.

     5.7. EFFECT OF HEADINGS; CONSTRUCTION. The descriptive headings in this
Agreement have been inserted for convenience only and shall not be deemed to
limit or otherwise affect the construction of any provision thereof or hereof.
The parties have participated jointly in the negotiation and drafting of this
Agreement with counsel sophisticated in investment transactions. In the event an
ambiguity or question of intent or interpretation arises, this Agreement and the
agreements, documents and instruments executed and delivered in connection
herewith shall be construed as if drafted jointly by the parties and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Agreement and the agreements,
documents and instruments executed and delivered in connection herewith..

     5.8. GOVERNING LAW. This Agreement shall be deemed a contract made under
the laws of New York and all disputes, claims or controversies arising out of
this Agreement, or the negotiation, validity or performance hereof or the
transactions contemplated herein, shall be construed under and governed by the
laws of such state, without giving effect to its conflicts of laws principles.

     5.9. DISPUTE RESOLUTION. All disputes, claims, or controversies arising out
of or relating to this Agreement, or the negotiation, validity or performance
hereof or the transactions contemplated hereby, that are not resolved by mutual
agreement shall be resolved in accordance with Article 14 of the Development and
License Agreement.

     5.10. ENTIRE AGREEMENT. This Agreement (and the provisions of the
Development and License Agreement incorporated herein) constitutes the full and
entire understanding and agreement among the parties hereto with respect to the
subject matters hereof and thereof, and any and all other written or oral
agreements existing prior to or contemporaneously herewith are expressly
superseded and canceled.

                            [SIGNATURE PAGE FOLLOWS]

                                        9

<PAGE>

     IN WITNESS WHEREOF, the undersigned have executed this Stock Purchase
Agreement as of the day and year first above written.

                                        COMPANY:

                                        EPIX PHARMACEUTICALS, INC.

                                        By: /s/ Michael G. Kauffman
                                            ------------------------------------
                                        Name: Michael G. Kauffman
                                        Title: CEO

                                        GSK:

                                        GLAXO GROUP LIMITED

                                        By: /s/ Paul Williamson
                                            ------------------------------------
                                        Name: Paul Williamson
                                        Title: For and on behalf of Edinburgh
                                               Pharmaceutical Industries Limited
                                               Corporate Director

                                        SMITHKLINE BEECHAM CORPORATION,
                                        doing business as GLAXOSMITHKLINE

                                        By: /s/ Donald F. Parman
                                            ------------------------------------
                                        Name: Donald F. Parman
                                        Title: Vice President and Secretary

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